Local Hotel Tax and PPT Reimbursement Bills See Action

Posted on October 6, 2023 by John LaMacchia

This week, the House Local Government and Municipal Finance Committee took testimony on legislation that would allow for the creation of a local hotel tax. House Bill 5048, sponsored by Representative John Fitzgerald, would allow the governing body of any city or township to enact an ordinance to levy, assess, and collect a separate excise tax of up to 2.0% of the total charges for accommodations. The tax would then have to be approved by a majority of the city or township’s voters.

Revenue from a local excise tax could be spent on the financing of the acquisition, construction, improvement, enlargement, repair, or maintenance of convention and entertainment facilities. The bill defines convention and entertainment facilities as all, or any part, or any combination of convention halls, auditoriums, stadiums, music halls, arenas, aquariums, meeting rooms, exhibit areas, and related public areas.

The bill was reported by the committee, and it awaits action by the full House. The League is supportive of this legislation and did testify in committee this week. We are hopeful this legislation will receive support in both the House and Senate and be placed on the Governor’s in the coming weeks.

In other good news, Senate Bill 331, House Bills 4553, and 4554  address the direct reimbursement to local governments for lost revenue associated with the expansion of the small tax payer exemption. These bills received bipartisan support in both chambers this week. This legislation will permanently set aside $75M annually to cover any lost revenue. We anticipate this legislation will be on the Governor’s desk for signature before the end of the month and would represent a huge win for local government.

John LaMacchia is the League’s director of state & federal affairs. He can be reached at [email protected] or 517-908-0303.

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