Kerr County leaders debunk misinformation, clarify proposed 7% HOT fee

Recently, Kerr County commissioners unanimously supported a 7% county Hotel Occupancy Tax (HOT) for short-term rentals in the unincorporated areas of the county, and now the matter is in the hands of Texas Senator (District 24) Pete Flores who will take it to the Texas Legislature.

“What we want our local community to understand is that this proposed fee would not be on any rentals more than 30 days and it would not impact children’s camps,” explained Kerr County Commissioner Pct. 2 Rich Paces. “It also will not affect RV parks, except for those who offer short-term stays in fixed cabin facilities,” he added.

“What it WILL do,” he continued, “is greatly help in funding the planned $2.5 million in improvements needed at our Hill Country Youth Event Center (HCYEC). Certain repairs and improvements are needed at the HCYEC, starting with the indoor arena, but an $8.1 million bond issue that would have covered these needs failed. The current, reduced scope of improvements need to be made to keep the indoor arena operational, so Kerr County Tax Assessor-Collector Bob Reeves had the idea that we could look into implementing a 7% fee on out-of-town guests’ stays.”

According to Reeves, initial estimates are that this initiative could generate an estimated $350,000 in revenue each year, and it would not add to the burden already faced by our local taxpayers.

Commissioner Paces further clarified some misinformation on the topic. “I have heard from some people who are upset because they believe we’re going to impose a 20% HOT fee. That is not correct. The truth is, the county would only implement a 7% tax.”

“Where did people get the 20%? They added the county’s proposed fee to the existing 7% city and 6% state HOT fees at places inside city limits. This would be incorrect and inaccurate, because that is a scenario that does not exist,” Paces said.

“Our efforts to pass legislation would allow for a county 7% HOT fee to be charged to short-term guests on properties only in the rural areas of Kerr County,” Kerr County Commissioner Pct. 4 Don Harris further explained.

“The county fee would be added to the existing 6% state fee in those places. So, that would make the add-on fees charged to those staying in accommodations outside the city limits 13% -- the same as the fees paid for those staying inside city limits (where there already is a 7% city fee and a 6% state fee.) Again, a county fee will not be placed on any overnight establishments inside the city limits of Ingram or Kerrville, and the incremental fee is only 7%.”

Misinformation has caused some other negative feedback. “Before the issue goes any further, I want people to understand the facts. We took a reasonable approach to this issue. It will not impact our camps or our RV parks (except cabin rentals), and it will not impact long-term rental properties. It is merely evening out the fees on places in the unincorporated areas with those inside city limits,” Paces said.

“In return, I hope that Kerr County property taxpayers will be glad that our out-of-town guests will be helping to pay for repairs and improvements to facilities that benefit us all,” Harris added.

“Undoubtedly, the improved facilities will help draw more events to the HCYEC, which will help attract more visitors,” Harris added. “In fact, the funds derived from a HOT can only be used for facilities or improvements that will help put more ‘heads in beds’ in Kerr County. The money may not be used for any other purposes,” he said.

The next session of the Texas Legislature – the 89th session of the Texas Senate and the Texas House of Representatives – will run Jan. 14- June 2, 2025.