CHRISTIANSBURG -- Town council voted unanimously Monday night to impose a cap on tourism funding it gives to the Montgomery County Chamber of Commerce.

The town will now cap the contributions given to chamber at 85 percent, keeping the additional 15 percent to promote its own initiatives.

In 2004, Christiansburg, Blacksburg and Montgomery County agreed to increase their transient occupancy taxes -- a tax paid by visitors to hotels -- and dedicate half the increase for tourism and marketing services provided by the chamber. As a result, Christiansburg increased its tax from 5 percent to 7 percent.

Each spring, the town assesses how much revenue is available for the tourism initiative and sets monthly installments to be paid to the chamber. Town Manager Lance Terpenny said the town has been allocating $125,000 to $150,000 to the chamber a year.

The money serves three purposes: 55 percent is for marketing the town, 25 percent is for research and development and the remaining 20 percent is for administrative costs.

If allocations remain the same, the cap would decrease the tourism payments to between $106,000 and $128,000 a year. Terpenny said the cap would take at least six months to go into effect after formal notice is given. If the chamber is notified this month, the earliest the cap could go into effect is May 1.

Town officials have had mixed feelings about the agreement for nearly two years and began to consider the cap this past May.

Councilman Michael Barber, who brought forth the motion to implement the cap, said the chamber has been doing its job, but the town would like to have money to promote its interests.

"It's not so much that we do not support the initiative, we just want to have availability of some of the money to have for our own things," Barber said.

He cited the 2010 Dixie Youth World Series, sponsored by Christiansburg, and the new aquatics center as items he would like to use money to fund and promote.

David Smith, general manager of the Quality Inn in Christiansburg, was vehemently opposed to the cap as he addressed council during the public comment portion of the meeting. "You're going to be hurting yourself in the long run," Smith warned council.

He said council would going back on its agreement with the chamber and local hotels and that the chamber's initiative has increased tourism in the area.

Chamber President Shane Adams said the chamber's Tourism Development Council was already underfunded but has consistently produced a profit.

"We certainly feel that Christiansburg should self-promote, but they have multiple other sources of funding they could pull from. We're kind of flabbergasted that they want to mess with success," Adams said.

Adams also said the chamber is the only organization actively promoting the town.

For the cap to be implemented, he said the town and the chamber would have to renegotiate their current tourism contract, which will decrease money used in some portion of the tourism initiative.