A Civil
District Court Judge ruled on Aug. 5 that the New Orleans Regional Transit
Authority can begin collecting its one percent sales tax on hotel and motel
rooms but just one day later an appeal was filed. The RTA last month asked
permission to overturn a provision of the sales tax law that exempted hotel
and motels, claiming it is illegal under the state constitution. The estimated
$6 million in annual revenue will fund the city’s 20 percent share of
construction costs on the proposed $153 million Canal streetcar line and pay
for other capital projects. The judge said the tax could go into effect on
Aug. 15. But the local hospitality industry wasted no time in launching a
fight in the state Court of Appeal, which froze collection of the tax pending
further arguments in the case. The Executive Vice President of the Greater New
Orleans Hotel-Motel Association said he intends to take the case all the way
to the state Supreme Court if necessary. The hotels claim the sales tax, on
top of an 11 percent occupancy tax and a surcharge of up to $3 per room, could
drive visitors away. But the RTA found that other popular U.S. tourist
destinations have hotel taxes ranging up to 17 percent. In addition, said the
agency, the return of streetcars to Canal Street will provide an added tourist
attraction.
A Streetcar Named Desire (Almost)
A
consultant report on a proposed streetcar line in New Orleans’ Desire Street
corridor has been released. The project would cost about $82 million and run
approximately three miles from Canal Street along North Rampart Street and St.
Claude Avenue. There would be a stop at Desire Street but the study indicated
the route would be named the St. Claude line. On North Rampart, the tracks would
be laid in the left traffic lane. Passengers would board and alight from the
neutral ground on both Rampart and St. Claude, although the latter right-of-way
may have to be widened. The year-long study was prepared by Parsons Brinckerhoff,
who also recommended substantial changes in bus service. The consultants looked
at two proposed extensions of the Riverfront streetcar line along the river and
then inland, creating a rail loop around the French Quarter. But these were
rejected, primarily due to their high cost. RTA officials said they will request
funding from the Federal Transit Administration for preliminary engineering and
an environmental impact study for the St. Claude line even though no
construction money has been identified and the agency is faced with a
substantial deficit. The earliest that work on the line could begin is 2002.
