The state capital of Texas is benefiting quite well from its hotel tax, which is used to fund many of the improvements for Austin itself. It's interesting how although the tax makes hotel stays slightly more expensive for visitors, the fund helps beautify the city to the point that vacationers are more likely to make return visits.

Scott Burroughs, like many of the thousands who visited Austin the past two weeks, enjoyed his stay in the Red River District.

“You get to really get a sense of Austin, have some fun, listen to some music, eat some breakfast tacos,” said Burroughs, who flew in from California for the music portion of South by Southwest.

It’s good visitors are enjoying the improved downtown neighborhood – because they’re paying for it.

Austin hotel taxes increased close to 7 percent from 2011 to 2012, as more people flock to the city to do business and to have fun.

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