Pennsylvania counties are raising the hotel tax rate following a move to allow an increase from the current 3 percent room tax to 5 percent.
Six counties so far have made the move, and the Potter County Visitors Association (PCVA) is hoping to include Potter County among those numbers. The increase would help fund PCVA’s tourism promotion efforts.
The hotel tax is paid by visitors staying at hotels, motels, bed and breakfast establishments, vacation homes and cabins. Potter County has about 45 lodging facilities with approximately 500 rooms.
“The more resources we have, the more we can do to bring people into the county. It’s that simple. We have some tremendous assets here and we need the capacity to share all that Potter County has to offer with the world,” said PCVA Director David Brooks. “Tourism is vital to the economic well-being of our communities. The more people we bring into the county, the more revenue we generate.”
At the current 3 percent, the hotel tax generates approximately $65,000 per year for tourism promotion. The increase is expected to generate an additional $40,000 annually.
Act 18 was signed into law in April by Gov. Tom Wolf. More than a dozen counties are already pursuing an increase; a handful more have already approved it. Brooks believes that over time all the counties will adopt an increase.
“I have never spoken with a tourist who chose one destination over another because of the rate of the hotel tax. As long as the experience matches the expectations that are set, people will still choose Potter County,” Brooks said. “Ten counties in Pennsylvania already have a higher hotel tax.”
Philadelphia County visitors pay 8.5 percent for the hotel tax. In Erie County, the rate is 7 percent.
The increase to Potter County hotel room costs was not immediately known, but Brooks believes the average cost is $70 or $80 per night. The 2 percent increase would add less than $2 to the price of a night’s stay.
Since adopted in 2004, the room tax has generated nearly $850,000 for Potter County tourism promotion. The tourism industry supports more than 1,000 Potter County jobs, according to Brooks. Visitors spend more than $35 million annually in Potter County, according to the Pennsylvania Office of Travel & Tourism.
Additional funds generated through an increase would be used to expand the PCVA website, enhance marketing and public relations efforts and attract more tourists and travel writers.
Nearly 40 local business owners attended the annual PCVA meeting held earlier this month, wherein it was announced that PCVA would lobby the commissioners to increase the hotel tax.
The commissioners spoke on the passage of the act that allows for the increase at a regular meeting several months ago, but did not express an inclination toward either side of the argument.
Commissioner Paul Heimel said the commissioners have had one meeting with PCVA officials in which they presented their position on the matter and options. Since the PCVA announcement, the commissioners have received only one communication in response to the move. A lodging owner stated his concerns over an increase, saying the move would bring taxes on rooms up to 11 percent total — 6 percent from the state sales tax and 5 percent due to the room tax.
The commissioners have not yet made a decision on the issue, and expect to have another meeting with PCVA officials and lodging owners in the future.
PCVA is the designated tourism promotion agency for Potter County, producing a visitors’ guide, calendar of events and road map, visiting travel shows and local events, and organizing three annual fundraisers — the God’s Country Marathon, Austin Dam Show and the Conquer the Grill BBQ Competition. The agency has also supported efforts to restore old attractions and create new recreational opportunities within the county, working with the Austin Dam Association, Denton Hill and Cherry Springs State Park, among others.
