OSWEGO, NY – At its meeting this week, the Common Council approved decreasing the city’s tentative bed tax rate from 5% to 1%.
Councilors reconsidered Resolution No. 220 of 2013, which authorized the mayor to execute all documents necessary to state legislators and other state agencies to request authorization for and empower the Port City to adopt a local law for the purpose of imposing a city of Oswego room occupancy tax law.
In May, Councilor Ron Kaplewicz, council president, had proposed a bed tax that “shall not exceed 5% of the per diem rental rate for each room” and that the proceeds be designated equally for promotion and tourism and for the general obligations of the city.
The council passed Resolution 220 at its May 28 meeting by a vote of 4-2-1.
Voting yes were councilors Fran Enwright, Mike Myers, Erik VanBuren and Kaplewicz. Mike Todd and Dan Donovan voted no and Shawn Walker was absent.
“Officially, it passed. It now goes to the State Legislature for consideration,” Kaplewicz said following the meeting. “The legislation says ‘may not exceed 5%.’ We will, as a council, set that rate. Our goal is to fill every hotel room in the city but we need a dedicated revenue stream to accomplish that goal.”
“There are several counties and cities across New York State that have a bed tax,” he said this week, adding that there is a city that has a bed tax “on top of what the county charges.
Citing the potential for future declines in revenue, he said, “We need to start looking and turning over every stone as a city. Or, some day, our property taxpayers … won’t like the outcome.”
In 2012, the county collected $368,000 in bed tax revenue, he said. The city of Oswego contributed about $219,000 to that figure, he added.
“That is 61 percent at the three percent level. That is what we could expect if we went to a three percent bed tax surcharge on behalf of the city,” he explained.
A bed tax would be “a small part of the price you pay to visit our city,” he said.
To save the city money, the (council) president and vice president shouldn’t have taken a raise this year,” Councilor Walker said referring to the salary adjustment approved in January for Kaplewicz and Myers.
“And, another thing, we got people coming, families, they’re going to pay that rate. That’s my family; they’re coming in for different events … why should they pay a lot more to come to Oswego, NY, when they can stay in Syracuse somewhere and it’d be a lot cheaper,” he continued.
Councilor Todd added that “It’s just wrong” that the county takes so much from the city.
To increase revenues, he suggested the city increase its fine structure.
For example, he pointed to those who don’t shovel their sidewalks after it snows.
“If we fine them every single time after the first (warning) letter, we could be having some substantial fines, generating all that revenue, it wouldn’t take long,” he said. “I don’t see where raising (bed tax) 5% is going to solve anything. We just can’t keep putting taxes on top of taxes.”
He said he wouldn’t support 5% but would consider 1%.
Councilor VanBuren said he found it “hard to believe that someone would stay (in Onondaga County) and then spend all that money on gas to come to Oswego for an event.”
Enwright pointed out this is just to authorization help from the state, not actually impose a new tax.
“By voting yes on this, we’re taking the opportunity to be proactive on our current financial situation that the city faces,” he said. “We have to explore every avenue.”
“We’re trying very hard to grow our economy here. This isn’t some political game,” Mayor Tom Gillen added.
“We will forward our request for a 1% bed tax to Senator Patty Ritchie and Assemblyman Will Barclay. State legislation must be passed to allow us to establish the tax,” the council president noted. “There is still lots of work left to do.”
The city’s bed tax, if implemented, would “sunset” in three years and the council would then have to seek re-authorization to continue it.
That way, Kaplewicz explained, the council could evaluate the pros and cons on whether to continue it as is, amend the rate or discontinue it all together.