Travel group presses town to consider 1% lodging tax hike
Citing empty pockets and frustration over unpaid taxes, Travel Berkeley Springs officials pushed the Town of Bath council to hear public opinion about raising the municipal hotel/motel tax from 3% to 4%.
The tax is paid by guests at local hotels as part of their room rate. Lodging businesses collect the money, then must turn it over to the town or county government monthly.
Travel Berkeley Springs (TBS) receives the majority of its operating budget from the tax. The group, by law, receives 50% of the tax revenue to promote tourism. The other half goes to cultural, recreation and beautification groups.
“Shortfalls in hotel/motel tax have left TBS in a horrendous situation.
Besides our website, we’re doing no paid advertising. We’re concerned about the effect on tourism,” said TBS President Stephanie Rebant.
“Even if The Country Inn had paid up, money would still be tight,” Rebant said, referring to the $30,000 in outstanding hotel taxes owed by the inn.
“I don’t want to raise taxes on anyone. You guys were here before asking that we not raise the tax,” Mayor Susan Webster replied during the March 1 council meeting.
Rebant said a 1% increase in the hotel tax on town
and county lodging businesses would generate $20,000
in additional funds each year.
Tourism board member Jeanne Mozier said the hike would raise the price of a hotel room by $1 or $1.25.
Mozier called TBS one of the “most effective economic development tools in the county,” noting that its tourism promotion efforts came at no cost to local taxpayers.
In a recent meeting of TBS member businesses, support for the increase was strong, said Mozier. Supporters included some of the lodging businesses most affected by the tax hike.
“My own feeling is if the people who are primarily involved are supporting it, I’m for it,” said Councilman David Crosby.
Crosby made a motion to hold a joint public hearing with the Morgan County Commission about the proposed increase.
TBS had previously approached the county about the tax hike.
Bath council members agreed to join in the hearing on Wednesday, March 16 at 7 p.m. at the Morgan County Courthouse, Commission meeting room.
Once the public weighs in on the tax increase on local lodging guests, the Town of Bath and the Morgan County Commission will separately consider amending their Hotel/Motel Tax laws to change the tax rate.
Civil negotiations with Inn
After a 20-minute closed session with their attorney Richard Gay on Tuesday, March 1, the Bath Town Council discussed their options for collecting more than $30,000 in outstanding lodging tax from The Country Inn, dating back to 2009.
“Our goal is to collect all the tax and interest, while keeping the economic situation of the community intact,” Webster said.
“It would not be in anyone’s interest to shut down the business,” said Finance Chairman David Crosby.
Crosby proposed putting the finance committee in charge of negotiating a payment plan with the hotel. The plan would include both the full amount of taxes and penalties on the tax.
Any plan would come back to the full council for approval, Webster said.
Crosby’s proposal got approval from the council, as did his other motion -- for Gay to pursue a civil lawsuit if payment negotiations fail.
Collections a sore spot
Mayor Webster clashed with TBS representatives over their questions about the town’s trouble collecting the lodging tax from some businesses.
“There is money being collected every day from guests and I want to know if the money is being paid to the town,” Mozier said.
Crosby said that will be part of the town’s negotiations.
“One of the most important parts of an agreement will be keeping the payments current,” Webster said.
Webster heatedly denied that town officials were “complicit” in businesses’ failure to pay the tax.
“The concern is the system that let that go on for 19 or 20 months,” said Rebant.