Buffalo hotel occupancy tax gets frosty reception in Albany

But it seems the idea isn’t going anywhere.

A hotel occupancy tax included in Mayor Byron Brown’s 2024-25 budget to raise $4,230,000 in municipal revenue required state approval in the form of a law – a law that appears to lack support in the Senate.

As of Monday, the bill sponsored by Rep. Crystal Peoples-Stokes, D-Buffalo, had no sponsor in the Senate. And Sen. Sean Ryan, D-Buffalo, a potential sponsor of the legislation, warned that it would not serve Buffalo’s interests to add a new tax as the city’s tourism industry continues to recover from Covid- 19. The bill, he noted, was introduced just four days into this year’s legislative session.

The tax would include occupants of Buffalo hotels, motels and other lodging establishments.

Ryan told the Buffalo News that Erie County already levies a tourist tax, which he said primarily funds the Buffalo Convention and Visitors Bureau and is intended to promote tourism in Western New York. This tax, which dates from 1974, is charged to establishments who, in turn, pass the costs on to customers. In December, county lawmakers passed a 3% resort tax on vacation rentals such as Airbnb and Vrbo.

The new tax, he said, would be the third-highest bed tax in the country. Ryan estimated the tax would add $10 to a $200-a-night hotel room, on top of the county tax.

Stakeholders, including hotels, the convention center, visitors bureau and restaurants, have all expressed concerns that the tax could deter tourists from visiting Buffalo, making it less competitive, he said. -he declares.

“I think the city needs to go back to the drawing board, engage with stakeholders and see if we can come to a consensus on this,” Ryan said. “But for now, stakeholders are opposed to it.”

Ryan said the legislation was unclear on how the money would be spent.

Brown proposed the tax in his executive budget, arguing it would provide the city with additional revenue to fund cultural institutions, infrastructure improvements and safety measures downtown.

The tax could not exceed 5% of the daily rental rate of each room. It would be collected in any night establishment offering rental accommodation, including guest rooms and tourist sites, according to a text of legislation.

“This bill would provide the City of Buffalo with the revenue needed to continue providing quality services to its residents,” states a rationale memo included in the bill text.

After being informed that the proposal appeared unlikely to pass this year, a city spokesperson said via email: “If the New York State Legislature does not approve the occupancy tax hotels before the start of the 2024-2025 fiscal year, the City of Buffalo is prepared to make changes to its budget to continue providing services to its taxpayers and constituents.

Some members of the Buffalo Common Council have expressed concern that Brown’s proposed budget and the one they approved May 22 rely on revenue that may go uncollected, including the hotel bed tax and $11 million from a Seneca Indian Nation gaming compact that the government entered into. Kathy Hochul is still negotiating.

The state Legislature is scheduled to sit for four days this week to wrap up lawmakers’ annual session. All state legislators will be up for re-election in November.