About the TPDF

The mission of the Buncombe County Tourism Development Authority is to be a leader in the economic development of Buncombe County by attracting and serving visitors, generating income, jobs and tax revenues that make the community a better place to live and visit.

The Tourism Product Development Fund (TPDF) is funded through Buncombe County occupancy tax (or room tax). The room tax rate in Buncombe County was increased from three cents to four cents in August 2001 with the original three cent tax continues to be dedicated to out-of-market advertising of the Asheville area. In 2015, the occupancy tax was increased from four to six percent with one and a half percent dedicated to funding the Tourism Product Development Fund. The purpose of the TPDF is to provide financial assistance for major tourism projects to substantially increase patronage of lodging facilities in Buncombe County.  To date, $44 million has been awarded to 39 community projects.

TPDF funds can be awarded to non-profit entities as a grant, pledge of debt service or loan guaranty. The legislation establishing the TPDF states that the funds are to be used for tourism capital projects, such as construction costs for a new tourism project. The legislation also states that to be a qualified project, it must demonstrate that it will generate new and incremental room nights in Buncombe County.

The TPDF Committee, a nine-person review committee, reviews all funding applications.  Each project must pass a two-stage approval process prior to receiving TPDF funding.  First, the TPDF Committee thoroughly reviews all applications and interviews applicants who make it to the second phase of the process.  The committee then makes funding recommendations to the Buncombe County Tourism Development Authority (BCTDA). Final grant awards are approved by the BCTDA.

Frequently Asked Questions

1. What is the TPDF?
The creation of the Tourism Product Development Fund (TPDF) is the outgrowth of a business decision by the tourism industry to find a way to drive more room nights to the area. It is a fund that is under the auspices of the Buncombe County Tourism Development Authority which designates review and vetting of applications to the Tourism Product Development Committee as called for in the legislation.

2. Why was the TPDF developed?
When the industry realized the Asheville area was at risk over time of losing visitors to competitive destinations, leaders devised a mechanism that could serve as an incentive for significant tourism product that would drive overnight visitation.

Just as they had in the early 1980s, the lodging industry in Buncombe County turned inward to find a solution. The TPDF is the result of lodging properties choosing to earmark a portion of the existing self-imposed tax on their lodging facilities for funding tourism product that will serve to generate significant additional room nights, thereby impacting the local economy. The fund is not intended to be a project’s primary source of funding.

3. Who pays the tax?
The room tax is paid by visitors to the area who are staying overnight in lodging properties. In addition to the 6 percent room tax, visitors also pay a sales tax of 7 percent resulting in visitors paying a total of 13 percent on their accommodations.

4. Is it true that both non-profit and for-profit businesses can apply for funds?
When first created, the tourism industry purposefully crafted the legislation without consideration of tax status of the applicant. The aim was to create an incentive pool to help projects that would serve as a destination driver or provide a reason for an extended stay or repeat visit. Projects are judged based on their ability to create substantial new and incremental overnight stays in Buncombe County thus creating a significant overall economic impact on the community. In June 2015, the General Assembly passed HB347 which includes modifications to the Buncombe County Tourism Product Development Fund. Under these changes, for-profit entities are no longer eligible for TPDF funding.

5. Who decides what project(s) receives TPDF dollars?
The enabling legislation mandates that a TPDF committee review all funding applications. Each project must pass a two-stage approval process prior to receiving funding. The TPDF committee first thoroughly reviews all applications and conducts interviews as needed. The committee then makes funding recommendations to the Buncombe County Tourism Development Authority (BCTDA). Before a project is recommended to the BCTDA board, eight of the nine member TPDF committee must affirm the decision to fund, or all voting committee members minus one in case of absentees or abstentions. A majority of BCTDA voting board members (four) must affirm the funding recommendations made by the committee.

6. How are projects chosen for funding?
Each project is reviewed on its own merit and much scrutiny is given to the methodology and assessments of room nights. Projects are judged on their ability to generate new room nights as well as to impact the overall economy, similar to the way that businesses are assessed for potential economic development incentives. The TPDF committee also requests information on financials from each project to ensure the financial viability of a project as best it can.

In most cases, a hotel in and of itself is not the primary reason people come to visit. Therefore, a builder of a new hotel would have a more difficult time demonstrating that the project would generate incremental rooms versus displacing visitors from other lodging.

7. How many projects have received funding thus far?
Since the fund’s inception in 2001, a total of $44 million has been awarded to 39 projects that are not only generating room nights, but are also great assets to the community. More than half of the funds disbursed have gone to City of Asheville owned or affiliated projects, including the John B. Lewis Soccer Fields, Pack Square Park, a portion of the Wayfinding program, the U.S. Cellular Center and Riverfront Redevelopment. Review the list of funded projects here.

8. How are funds disbursed once a project is awarded funding?
Disbursement of the monies takes place after various steps in the construction process have occurred. Contractual language in the specific grant agreements outlines a series of provisions and covenants tied to disbursement of the funds as well as remedies in the event of a breach. When it becomes clear a project won’t move forward, under certain contracts, the award can be rescinded.

9. Where do the funds sit before disbursement?
Funds stay in escrow in a BCTDA account until disbursement.

10. How can I learn more about applying for a TPDF award?
To learn more about the application process, criteria for funding, funding schedule, and to download application materials, contact Pat Kappes, Director of Public Affairs, at 828-210-2724 or pkappes@ExploreAsheville.com