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Room tax approved in county

December 27, 2001

Room tax approved in county



By STACEY DANZUSO
chbbureau@innernet.net


CHAMBERSBURG, Pa. - Visitors to Franklin County will pay a 3 percent local tax on hotel room rentals beginning Jan. 1.

The tax is expected to generate about $400,000 to promote tourism in the region. The county will use 2 percent of the revenues for administrative costs. The rest will be split between the county and the Capital Region's Vacation Bureau, Norma Bigham, president of the vacation bureau, said.

The county will get 60 percent to support local nonprofit tourism efforts and the bureau will use the remaining 40 percent to push regional tourism for southcentral Pennsylvania.

With about 1,400 hotel rooms in Franklin County renting for an average of $50 a night, the 3 percent tax would add $1.50 to the average hotel room cost.

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That will bring in $386,000 annually if 50 percent of rooms are occupied and a maximum of $772,000 with 100 percent occupancy, according to county figures.

The actual revenue probably will fall somewhere in the middle since average occupancy rates are between 70 percent and 80 percent, Bigham said.

The Franklin County Board of Commissioners approved the hotel room tax ordinance Thursday. They had been considering it since earlier this year when the state approved legislation to allow counties as small as Franklin to levy a local tax.

The 3 percent tax is in addition to the 6 percent tax the state collects on hotel rooms.

Bigham said tourists would be the ones shouldering the tax.

She said Franklin County could use its returns to establish nonprofit tourism grants to help local arts councils, museums or special projects that would attract tourists.

Once a year, beginning in 2003, the commissioners will hear funding requests from local groups.

Both Bigham and David Sciamanna, president of the Greater Chambersburg Chamber of Commerce, said they have spoken with hotel operators in Franklin County and have not had any negative feedback.

"The residents are not paying. It's tourists paying for our own tourism economic development," Bigham said.

Greg Ohler, general manager of the Fairfield Inn in Chambersburg, said the room tax was a good idea.

"Professionally, I think it is really great Franklin County is trying to develop more efforts toward the promotion of our unique history, and this is a great way to implement it," he said.

The transition should be smooth, Ohler said, since travelers pay similar taxes in most surrounding counties, including Washington County.

Lei Ann Reihart, manager of the EconoLodge in Greencastle, Pa., said she opposes the tax and expects to hear a lot of questions.

"We already charge enough money and pay enough taxes," she said. "(Guests) are already putting money in the economy by stopping here."

She said most of the hotel's guests are older people on fixed incomes traveling Interstate 81 or workers paying their own bill.

"They won't be happy. I think there will be a lot of complaining," she said.

Officials said they don't expect the tax to affect business.

"I don't think anyone will go somewhere else because of $1.50. I don't think we are putting any of our hotel operators or bed and breakfasts at a disadvantage," Commissioner G. Warren Elliott said.

People who occupy a hotel room for more than 30 consecutive days are exempt from the tax.

The only other exceptions are ambassadors, ministers and consular officers of foreign governments, and federal, state or local government employees renting a hotel room for official business purposes.

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