Commissioners Amend Hotel Tax Ordinance

by Jonathan Weaver

An increased hotel tax implemented by Armstrong County commissioners earlier this month will be delayed until the beginning of 2017 rather than take effect before the Fourth of July holiday.

On June 2, Commissioners Pat Fabian, Jason Renshaw and George Skamai each voted in favor of Ordinance 2016-10, increasing the hotel room tax from three percent to five percent.

But, portions of that ordinance changed effective yesterday morning.

Executive Director of Administration Dan Lucovich explained the amended ordinance.

“The amendment in this ordinance from the last one is that the hotel tax will start January 1, 2017 versus July 1, 2016,” Lucovich said. “The only other change in the ordinance is that the penalty that is imposed went to one-and-a-half percent in late fees.”

Tourism Bureau Director Kevin Andrews and Commissioner Chair Pat Fabian said commissioners decided to amend the ordinance after learning a hotel called with concerns over guests that already booked rooms next month.

“(After the ordinance was initially passed), We had a meeting with the commissioners, we talked to (County Treasurer Amanda Slagle-Hiles), reached out to all the hotels to let them know that we were looking into it, and (commissioners) decided to push it back until January 1, Andrews said.

“The increase is still happening, but they’re pushing it back to start January 1 instead of July 1 so it gives them the rest of the year to get prepared for the tax increase.”

Tourist Bureau Director Kevin Andrews explained that the increased revenue in 2017 will help his team further promoting local tourism.

Andrews explained that next year, Hiles will collect the tax revenue and some dollars will be kept by the County as administration fees while the rest is given to the Tourist Bureau to help with further promotion and marketing.

There are nearly 20 hotels in Armstrong County, of which include hotels, motels or bed and breakfasts.
“Basically, it’s another way of securing funding for the Tourist Bureau that (isn’t) County taxpayer dollars, one step closer to alleviating some stress on the county and helping the Tourist Bureau continue its mission of promoting the county,” Andrews said.

The County Commissioners Association of Pennsylvania and the Pennsylvania Restaurant and Lodging Association have collaborated since at least May 2015 on an effort to allow third-through eighth-class counties to raise the hotel room tax. HB 794 was officially signed by Governor Tom Wolf April 20 after being signed in both the state House and the Senate.

Armstrong County state Representative Donna Oberlander voted in favor of HB 794, while Reps. Eli Evankovich and Joseph Petrarca voted against the measure.

State Rep. Jeff Pyle was absent for the vote.

State Senator Don White also voted for the bill to ensure the final passage.

Because of similar ordinance adoption in counties across the state, Andrews does not foresee a negative impact on local tourism. Neighboring counties such as Westmoreland, Indiana and Butler are also eligible to increase the tax, but not Allegheny.

But, Fabian said the tax might not be effective long term.

“If the Tourist Bureau continues to sit on a surplus of money and not use it for marketing the County, I’m not opposed to at the end of the year roll it back to three percent,” Fabian said. “There’s no sense putting a tax on people coming in to Armstrong County if we’re not utilizing those dollars.”

Renshaw was glad the amended ordinance will alleviate some tax dollars from local residents.

According to the state Department of Revenue, the hotel occupancy tax, imposed at the same rate as sales tax, applies to room rental charges for periods of less than 30 days by the same person.

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