Harrison Town Supervisor Ronald Belmont wasn”™t surprised when his town”™s bid to impose a hotel occupancy tax died a quiet death in the state Senate chambers.
The town had asked for authority to charge a 3 percent tax on hotel visitors four times since 2007 and each time the proposal went nowhere.
This year, a bill granting the Harrison hotel tax made it through the state Assembly, but was never voted on by the Senate. Harrison has been rejected so often, Belmont said, that asking for state approval has become mostly a ceremonial process. The town will request the tax again a sixth time in 2014.
“It gets a lot easier now,” he said. “All you have to do is change the date on the paperwork.”
The hotel tax has been a mouthwatering option for revenue-hungry local governments, which see the potential of adding a non-property tax revenue line that is charged not to residents, but to outsiders visiting their communities. The amount of the tax has also been touted as being relatively small for those who use the hotels while adding up to big bucks for the communities.
Harrison has three properties that would be taxed if a law were to pass: dwellings at Westchester Country Club, the Renaissance Westchester and the extended stay Hyatt House on Corporate Park Drive.
Belmont said the town could generate as much as half a million dollars in annual revenue through the tax, but he”™d be happy with much less. “If I get 100,000 or 200,000, I”™d be ecstatic,” Belmont, a Republican, said. “Every little bit counts.”
But for those in the hospitality industry, that little bit means the loss of a competitive edge.
Dan Conte, president of the 31-member Westchester Hotel Association, said most hotel business comes from corporate clients. Even a minor room tax can mean the difference in a choice of hotels, he said.
“Every penny does count when it comes to the decision makers,” he said. “The misnomer is that it”™s a victimless crime.”
Conte, the general manager of the Westchester Marriott in Tarrytown, said hotels like his must compete with hotels in White Plains or other urban centers closer to public transportation and with a broader range of dining options. He noted that the county already charges its own 3 percent tax on hotels in addition to the sales tax. All of Westchester”™s hotels are also competing with locations in Fairfield County, Conn., and Northern New Jersey, he said.
“We don”™t understand, again, why they continue to single us out as an industry,” Conte said. “The economy has gotten a little bit better, but it”™s not better.”
A dozen Westchester communities wanted their own hotel tax this year, despite ongoing opposition from the hospitality industry. Although state government has previously approved the tax for a number of communities in Westchester and elsewhere, it has taken a strict “no new hotel taxes” stance the last three years.
Local government leaders such as Greenburgh Town Supervisor Paul Feiner take issue with that approach.
“The state should treat every community equally,” Feiner, a Democrat, said. “It”™s not fair that some communities in Westchester are allowed to have a hotel tax and some are not.”
Feiner, who has been in office for two decades, said the hotel tax and other non-property tax revenues are becoming more vital as New York communities contend with a 2 percent cap on annual tax levy increases.
“I think that”™s it”™s getting tougher for communities to stay in the tax cap without the state providing some of the relief so that we can keep taxes as low as possible,” he said.
Greenburgh and its six villages teamed with Sleepy Hollow and jointly sought an occupancy tax this year in a bill sponsored by Assemblyman Thomas J. Abinanti, a Greenburgh Democrat. Abinanti”™s proposal was unique in that he introduced a second bill that would have set up a Rivertowns Tourism Fund.
If the fund had been approved, a portion of the hotel tax would be collected by the town and distributed to the members of the consortium to promote visiting the communities along the Hudson River. Hotel owners heard the proposal, but some said that the county already had its own tourism board.
Abinanti disagreed with the notion that the tax put suburban hotels at a disadvantage.
“What we”™re talking about here are hotels that have the advantage of ease of access (to highways), free parking and a beautiful environment,” he said. “It seems to me that that”™s a great edge.”
The assemblyman said he didn”™t believe the taxes targeted the hotel industry. “We believe it”™s a fair tax,” he said. “While the communities like and welcome the hospitality industry, there is a burden on the communities. There”™s traffic, there are other types of services specific to the hotels that aren”™t covered by the property taxes.”
State Sen. George Latimer, a Rye Democrat, sponsored bills for hotel taxes in Yonkers, North Castle, Mamaroneck and Harrison. Latimer, who spent 20 years working in the hotel industry, downplayed the impact on hotels”™ bottom lines. He said that simplifying the occupancy tax as “just another tax” was failing to see the greater benefit. “Any non-property tax revenue that forestalls laying off of cops (or other layoffs) is an intelligent decision,” he said.
Prior to being elected to the Senate in 2012, Latimer served in the Assembly. There he successfully sponsored a number of hotel tax bills including one for the village of Rye Brook, which in 2010 became the first government to get a hotel tax in the state that wasn”™t a county or city. Gov. David Paterson was in office at the time and signed the bill after it made its way through both houses.
Rye Brook, a community of roughly 10,000 residents, receives 3 percent of its entire annual revenue from occupancy taxes from the Hilton Westchester (formerly The Rye Town Hilton) and Doral Arrowwood. The community, which has an operating budget of $17.1 million, expects to collect $630,000 from the tax in its 2012-13 fiscal year.
New Rochelle, the city of Rye and White Plains also have the tax and its impact varies depending on the size of the community, the number of hotels within its borders and the number of rooms within the hotels.
Rye, with a $44.9 million total budget, expects to take in $155,000 in hotel tax revenue in its 2013 budget. New Rochelle projected $300,000 in hotel tax revenue this year, after receiving an estimated $289,000 in 2012, according to city budget figures. New Rochelle”™s total adopted budget for the year is $153.5 million. White Plains expects to collect $1.05 million during the 2013-14 fiscal year, according to its $172.1 million adopted budget. Westchester brings in roughly $5 million annually from the tax.
In 2011, Harrison”™s former Assemblyman Robert Castelli, a Republican, refused to sponsor the hotel tax bill for the town. Latimer, then serving a nearby district, crossed the boundaries and sponsored the legislation for Harrison in the Assembly. He did so he said because it made sense. Now, as a freshman member of the Senate, he said he”™ll look to convince his colleagues of that.
“We have to go back each and every time until we get it right,” he said, adding he”™ll sponsor hotel tax bills in the Senate again in 2014. “The Chinese have a saying, ”˜If we don”™t convince you in 1,000 years, then we”™ll convince you in 1,001.”
