One of the cornerstones of the Bahamian development strategy for resort developments has been the Hotel Encouragement Act. With the downturn in the Bahamian economy, politicians are calling for changes to impact smaller resorts and the real estate market for the Bahamas.
Nassau Guardian
By ROGAN M. SMITH,NG Senior Reporter,
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Progressive Liberal Party (PLP) Senator Allyson Maynard-Gibson is calling on the government to immediately amend the Hotel Encouragement Act so that small hotels and self-catering facilities in New Providence with five or more bedrooms can be given the same exemptions for renovations and refurbishment as properties on the Family Islands.
Maynard-Gibson said the Act also needs to be amended so that hotels won't have to compete with outside restaurants. She said the Act, as it is currently written, encourages competition.
Maynard-Gibson was giving her contribution in the upper chamber yesterday to debate on a bill to grant certain import concessions on construction materials for airports.
"The Hotel Encouragement Act should be amended to allow properties with rooms only, minimum of say 10 rooms and an appropriate lobby, to qualify under the Act provided that the property is within a reasonable distance of restaurants serving breakfast, lunch and dinner outside the facility," she said.
"The government ought to lead by encouraging spending outside hotels and resorts.
"There is a greater chance the small hotels can earn higher profits and thereby maintain their properties better. Similarly, the revenues of outside restaurants can increase and they can also improve the maintenance of their facilities."
Maynard-Gibson said the government also needs to expand incentives to tourism projects beyond hotels, amend the Time Share Act and Stamp Tax Act and create a Tourism Development Fund.
She said because tourism is the country's main economic engine, now is not the time to take a "piecemeal approach" to the industry, especially in the current world economic recession.
The PLP Senator said time share facilities are the "wave of the future" and provide incredible opportunities for growth. However, she said studies have shown that time shares in The Bahamas are regarded as the most poorly maintained time share units in the region.
"Thought needs to be given to how to [provide incentives to] time share owners to pay the costs for refurbishing and construction material. They might be given less than the duty-free allowances for hotels and resorts," she said.
"Consideration might also be given to relief from property tax for a specified period. This provision will also allow the licensing authorities to be much tougher on the owners of those facilities in need of refurbishment. It will also address those hotel properties that are hybrids in that a number of their rooms are sold as time share units yet they enjoy the full benefits of the Hotel Encouragement Act."
In order to accelerate the participation of Bahamians in the tourism sector beyond hotels, Maynard-Gibson is suggesting that the government provide incentives and change policies in a number of areas, including Bahamian nightclubs, golf courses and preserving historic sites and attractions.
"Bahamian nightclubs are vital to the continued development of Bahamian music, to the expansion of Bahamian artistic expression and they provide a principal vehicle for increasing visitor satisfaction and increasing visitor spending beyond hotels," she said.
"Either discourage hotels and resorts from building Bahamian nightclubs and showrooms within their facility, or encourage them to have Bahamian investors operate those facilities within those resorts. While it is possible to achieve this through the licensing process for new properties, it would be more desirable to achieve the result through persuasion."
Maynard-Gibson said this move would reinforce the policy that all Bahamian nightclubs or showrooms must be owned and operated by Bahamian investors. She also recommends reviewing the current policy prohibiting non-Bahamian investment in nightclubs and allowing joint ventures between Bahamian and non-Bahamian investors.
There has been much criticism about the maintenance of the country's historic sites, many of which are badly deteriorated from years of neglect. Maynard-Gibson said designated historic sites must be preserved and said the owners and developers of the sites must be allowed to import material for construction and refurbishing duty free.
She said property taxes should also be waived on approved sites for a specified period.
"They must work with Antiquities and Monuments Commission and [The Ministry of] Tourism," she said.
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