County works out details of "bed tax"

9/9/2009

By David Avitabile

Schoharie County Supervisors have begun the last step of instituting a “bed tax” by the end of this year.
Supervisors opened a public hearing on a four percent occupancy tax charged on rooms at motels, hotels and other lodging in the county possibly starting October 1.
After discussing the issue for almost 90 minutes at a hearing Thursday evening, board members agreed to hold the hearing open until the board’s September 18 meeting.
The state senate and assembly have already agreed to allow Schoharie County to impose the tax and it has been signed by the governor, said planning director Alicia Terry. The last step is for the board to hold a public hearing and enact a local law.
Ms. Terry said that $106,696 could be generated by the new tax in the first year.
She said that was a conservative figure based upon 45 percent occupancy and an average room cost of $80 a night. There are about 200 rooms in the county with facilities of 20 or more rooms.
Though the county board will make the final determination of where the revenue is placed, according to the local law, the spending of the revenue is “weighted toward promotional activity that will increase the number of travelers staying overnight in all lodging establishments.”
Much of the discussion among the board members was on how the revenue should be spent.
Bob Mann of Blenheim said he thought the intent of the tax was to reduce property taxes and was disappointed that that language was not in the local law.
Tony VanGlad of Gilboa said the board could set the way the revenue is spent in January, splitting the funds between promotion, to the general budget and to the treasurer’s office for the administration of the tax program.
Seward Supervisor Larry Phillips said it is “frowned upon” in the state to use “bed tax” revenue for anything other than promotion.
The intent, he said, is to promote tourism and therefore fuel economic development.
Because of the new tax, local taxpayers will not have to pay for promotion in the county budget, he said.
The money can also be used for the $60,000 in matching “I Love New York” funds needed for advertising throughout the state.
Carle Kopecky, the director of the Old Stone Fort, said the county needs to put the funds toward promotion which will lead to more people lodging in the county, more tourism and therefore more sales tax revenue.
“It’s really an investment of these funds for more funds,” he said.
Using the revenue to promote activity in the county will translate to more business, he said.
According to the law, a nine-member occupancy tax board will meet and give recommendations on how to spend the revenue with an eye toward advertising, publicizing and promoting tourist attractions and facilities in the county.
The collected tax will be paid by motels, hotels, bed and breakfasts and other lodging facilities on a quarterly basis, similar to the state sales tax. The taxes are due to the treasurer’s office 20 days after the last day of February, May, August and November.
The law has a number of exemptions including members of the state and federal officials and not-for-profit organizations on business as well as permanent county residents.
Permanent county residents are defined as any occupant of a room in a lodging facility for at least 15 consecutive days or anyone that has a permanent county address. A certificate of permanent address may have to come from the treasurer’s office.
The treasurer’s office will be in charge of administering the program and supervisors agreed that 10 percent of the revenue go to that office. Treasurer Bill Cherry said he is not sure whether another person would be needed in his office to help with the program.
After official approval, the law has to be filed with the secretary of state. Within 30 days after the law becomes effective, motels, hotels and other lodging facilities have to file with the treasurer’s office for a certificate to charge the tax.