CHARLESTON, W.Va. - Charleston Mayor Danny Jones sees the Civic Center as a major economic engine for the city, and he is hoping a new city sales tax -- half a penny on the dollar -- will help pay for its overhaul.
Jones unveiled a proposal Tuesday that also would eliminate and reduce some business and occupation taxes.
The sales tax plan is to add a half-cent city tax onto the 6 percent levied by the state.
Car dealerships and businesses selling non-prepared food, such as grocery stores, would be exempt from the new city sales tax, Jones said.
The tax changes would net about $3.57 million a year, and the money would be used to finance $45 million to $60 million in renovations to the aging Civic Center, Jones said.
"We desperately need to rehab the Civic Center," the mayor said.
City Manager David Molgaard said the Civic Center's exterior would be redone. He said the facility currently looks like a "state prison."
The renovations also would include 25,000 square feet of new ballroom and meeting space, upgrades to the kitchen facilities and new bathrooms. The heating and cooling system also would be upgraded.
As for the B&O changes, the mayor wants to eliminate that tax on manufacturing in city limits.
"That's something we should have done a long time ago," he said.
Jones also hopes to reduce the B&O rate on retail businesses from 0.5 percent to 0.35 percent, he said.
Such businesses now pay 50 cents on every $100 of gross proceeds. Under the new proposal, they would pay 35 cents on every $100.
City leaders would like to reduce the B&O rate even more, but that is not currently feasible, Jones said.
"We're not reducing it as much as we want to, but it's something," he said.
The elimination of the B&O tax on manufacturing is projected to reduce city revenue by $350,000 a year. The retail rate reduction would result in a loss of $2.25 million.
However, the new city sales tax is projected to generate around $6.17 million annually.
So the city would net about $3.5 million a year to service bond debt undertaken to renovate the Civic Center.
Charleston's plan comes about a year after the imposition of a 1-cent city sales tax in Huntington, Jones said.
Huntington's tax went into effect on Jan. 1, 2012, said Deron Runyon, that city's finance director. Huntington leaders expect the city sales tax to generate about $6.1 million this fiscal year, which ends June 30.
Anecdotal evidence, and figures garnered from the city's B&O tax on retail, indicates the new sales tax has not adversely affected businesses in the city, Runyon said.
Jones believes renovating the aging Charleston Civic Center, which hasn't seen a significant expansion since 1980, will help attract larger conventions and major events to the city.
This will generate more revenue for hotels, restaurants and retail establishments in the city and beyond, he said.
"We need to renovate the Civic Center to make Charleston the convention city it can be," he said.
Jones pointed out that Charleston competes with many other cities for conventions and large events, which can bring millions of dollars to the area. However, these cities have an advantage because their convention centers are more modern.
The Civic Center must be expanded to accommodate larger conventions and events, Jones said.
The redo would include a new 20,000-square-foot, adaptable ballroom and 5,000 square feet of new, state-of-the-art meeting space.
The ballroom would be built over the parking lot on the Lee Street side of the Civic Center, Molgaard said. However, the parking space would remain.
Renovations also could include sound and lighting upgrades in the Coliseum, Civic Center General Manager John Robertson said.
Construction of additional bathrooms would address a major problem in the complex, he said.
"We're very excited about this," he said.