Sunday, November 23, 2014

Bed, Breakfast, and a Lodging Tax

It's no secret that the Common Council is looking for new sources of revenue to keep the City solvent and functioning and to give residents some relief from the increasingly heavy burden of property taxes. One of the favorite ideas, first suggested in a public meeting by Alderman John Friedman (Third Ward) back in September, is a lodging tax--a 2 to 8 percent tax applied to room rates at hotels and B&Bs in Hudson. When the idea was first presented, Friedman said a part of the revenue from the tax would be "plowed back into the industry that created it" in the form of a "cohesive marketing program for the city."

Mayor William Hallenbeck questioned the wisdom of the proposal, maintaining that it would discourage tourism. In a press release, Hallenbeck announced his intention to "arrange a meeting with the owners/operators of our city-wide B&Bs." He explained the goal of the meeting in this way: "First, it will help me identify further who they are and who runs them, and secondly and most importantly get their advice on this and any other issue that they have concerns about pertaining to the B&B business." So far, there has been no word that such a meeting has occurred.

B&B proprietors Gossips has spoken with have expressed concern about the possible inequity of the tax. If the tax is only levied on rooms in recognized hotels and B&Bs, the increase in price from the tax could drive patrons to the guest rooms and houses marketed on Airbnb, which might offer lower prices because they are not collecting the lodging tax. 

There are many such accommodations available in Hudson. A search for the destination "Hudson, NY" on Airbnb yields 891 rentals. Not all of them are actually in Hudson. In fact, fewer than a hundred of them are. The others are located elsewhere in Columbia County and the Hudson Valley, as well as across the river in Athens and Catskill and across the border in Massachusetts. Browsing the list though reveals that there are tourist accommodations in homes and buildings where you wouldn't necessarily imagine them to be.

Even though the mayor and some hotel and B&B owners have reservations (no pun intended) about a lodging tax, Alderman Tiffany Garriga (Second Ward) has taken on the task of researching the experience of five cities in New York that have lodging taxes: Niagara Falls, Peekskill, Rye, Lockport, and Geneva. To gather information, she is posing nine questions:

  1. What year was your tax first initiated?
  2. What is the current percentage rate? Is that the original rate or has it been raised?
  3. How much revenue is raised annually from the tax?
  4. How many beds do you currently have subject to the tax?
  5. What was the purpose of the tax as first proposed--to raise funds generally or to raise funds for a specific purpose, for example, for the promotion of tourism? 
  6. Is the revenue now collected added to the general fund or is money reserved in separate accounts for the promotion of tourism or other purposes?
  7. Has the implementation of the tax offset property taxes either by reducing the need to raise taxes or by increased revenue from tourism?
  8. If money is reserved for tourism, has it been successful in terms of increasing activity and revenue from tourists?
  9. Is the municipality satisfied with the tax as it is, or do you feel it needs adjustment for improvement--for example, does the rate need to be increased, or should the application of funds raised from the tax be redirected?
So far, Garriga has received information from two of the five cities. In Niagara Falls, a 4 percent lodging tax was initiated in 1991. In 2006, it was increased 1 percent to finance a trolley to transport tourists to hotels and B&Bs. In Peekskill, where there is only a Holiday Inn Express with 76 rooms, a 3 percent lodging tax was introduced in 2013. So far in 2014, the revenue from the lodging is $64,000, which has not helped to offset any general taxes.


  1. the common council refuses to do the right thing and put a very large number of salable lots and buildings back on the tax rolls.

    these are held by the HDC and the HCDPA for "affordable housing" that the City of Hudson and its residents can ill afford. in fact there is a limited amount of money to operate the city the way it is.

    the SIMPLE solution is to get rid of the HUD act from 1985 that the City operates under and to sell the properties to private people so they can invest in Hudson and pay real property taxes.

    the common council says they want to change but they dont. the 1970s concept of affordable housing is a dead issue. its not affordable.

    for poorer people, the county has hundreds of 1960s ranches that are going begging. these really are affordable. why not try to get people real houses that they can live in ? is that too simple ?

    let those private citizens that want to invest in hudson have a chance to do so.

    the city and its agencies are blocking the real solution. its promises promises but they refuse to do the right thing we need a new council.

  2. My 2 cents: dumb & greedy idea.

  3. 1. Why the dramatic language: "to keep the city solvent and functioning"? Suddenly, it seems, the city is seeking new ways to raise taxes (vis the 30-acre boondogle behind the high school). What have I missed?
    2. If you're going to tax B&Bs why not Airbnbs too? They seem easy enough to find?
    3. And thank you, city council, for at least doing some research. You don't hear that word very often in government deliberations.

    peter m.

  4. p.s. the idea proposed by 6b15.... above is certainly worth considering. The city ought to do what we did on the school board and convene multiple public hearings on the budget. It's really past time to engage the community in a substantive discussion of its finances.... peter m.

  5. bed tax, great idea. Air BnBz required to be licensed transient rental units, another great tax, but this one also gives the city power to protect residents from drunken wedding parties every other weekend at the house next door. trouble comes when the city has to figure out how to spend the money. other cities use the money to pay for events that attract more guests and generate more tax and everyone benefits. the big question right now , do we want to become a real tourist town or remain as we are now, hip joint of the week whose lustre will fade unless we can create really good events and real attractions. it amazes me that the clock at 4th and Warren doesn't collect four dollars a head to look at the machinery and take a peek out the window for example. not all tax is bad tax, there is only bad spending. heads in beds make money, do we want them to be tourists or recently released convicts from NY prisons.

  6. The Monroe County

    Commission on Wednesday

    unanimously approved increasing

    the county’s lodging tax by

    one penny. It represents the

    first increase in the countywide

    lodging tax in more than 20


    The added tax, which could

    generate as much as $4 million

    a year for the Monroe County

    Tourist Development Council,

    will be used for additional

    advertising and marketing

    efforts, according to Director

    Harold Wheeler.

    The additional penny brings

    the total tax paid on hotel rooms

    in the county to 12.5 percent.

  7. The web address below is to a story worth reading. San Francisco has induced Air B and B to start collecting the bed tax for the city, and apparently the company will play ball with other cities who adopt laws and regulations requiring such an arrangement, and a license to operate. All of this has happened just recently. So maybe the concerns of the B and B hotels can be alleviated. The internet is a wonderful tool for find out what is going on out there isn't it? All it takes is a good word search - and voila!

  8. Is this additional tax need the result of dropping the assessment on the Holcim Cement waterfront by $1m ?

  9. Also: