Bill would allow local $2/night fee on lodgings

CONCORD — A bill currently being considered in the state legislature would give towns and cities the opportunity to raise revenue through a modest fee placed on the rental of hotel rooms. The idea is unpopular among the people who make those rooms available for rent.

The bill, HB 641, would give municipalities the option to place a fee of up to $2 on each room rented per night. The wording of the bill states that money collected would be placed in “a capital reserve fund, tourism support fund, revolving fund or other special revenue fund as may be authorized. Such funds shall be used to augment funding for the cost of municipal services associated with the increase in tourism and transient traffic.”

Scott Myers, Laconia’s city manager, said that he supports the measure, which is being promoted by the New Hampshire Municipal Association. “I like that it’s enabling legislation,” Myers said. The bill would give cities and towns the option of assessing a fee if the select board or city council approved the levy. In Laconia, the fee would give the city revenue that wouldn’t be restricted by the tax cap, which limits how much can be raised by property taxes.

“Enabling legislation that doesn’t mandate anything is a good approach,” Myers said.

In Meredith, Jeanie Forrester was more reserved. “In the past, when I was in the legislature, when something like that came in front of me, I wouldn’t support it. I wasn’t in support of new taxes,” she said. Now that she is on the town’s selectboard, she said she might consider the option of the fee, should it become available.

“It’s a conversation I would like to have with the other selectmen and our town manager,” Forrester said, but added, “I think we do a good job of running our town with the funds that we have now.”

When it comes to hoteliers, though, the proposal is about as popular as a bedbug infestation.

Mike Somers, CEO and president of the New Hampshire Lodging and Restaurant Association, said his organization was “strongly opposed” to HB 641. “Let’s face it, New Hampshire, at nine percent, is one of the highest tax rates for lodging in the New England Area,” he said. The rooms and meals tax generates $330 million for the state already, he noted.

“Frankly, we just don’t think it’s necessary at this time,” Somers said.

At the Wolfeboro Inn, general manager Shelley Burch said the people who rent her 44 rooms would likely find the added fee to be an annoyance that might detract from their experience.

“If you look at major urban areas, they have all sorts of fees and taxes and people expect that,” she said. They expect relief from those fees when they vacation somewhere rural, she added. “I think people traveling to New Hampshire might be disappointed by it.”

Between Steele Hill in Sanbornton, Summit Resorts in Laconia and the Center Harbor Inn, parent company Path Resorts has 268 rooms, said Justin Cutillo, vice president. He said the proposal feels unfair to his industry.

Hotels are already taxed, he said. On top of that, hospitality companies generally pay high property tax bills to the state and town, due to their higher assessments, while they don’t require as much in terms of municipal services as residential developments likely would.

“It seems like, in a state like New Hampshire that has such high respect to balance in applying taxes, this doesn’t feel very prudent to me,” Cutillo said.

The bill has already passed the House once, and was referred to the Ways and Means Committee, which has recommended its passage with an amendment when it comes to the floor for a vote on Thursday.