Op-Ed: Transient Occupancy Tax

     Hello James DeHaven:

     I read your article of June 8, 2012 "Campaign for lodging tax shapes up". I find it interesting that once again comments regarding this tax emphasize the positive and omit and/or misrepresent the negative.

     And please don't get me wrong. Every one of the recipients of the proposed tax increase is a worthy cause deserving of "everyone's" support.

     I'm not suggesting that you purposely omitted one side of the argument; however I suspect that no one has presented it to you.

     for EXAMPLE, Pat McGreevy states that"  He doesn't undertand the opposition. That it's just a matter of explaining a "win-win" situation.

     I suggest that Pat McGreevy, like many others who support this tax increase either haven't taken the time to research both sides of this issue or have simply  "elected" not to understand the opposition as it detracts from a self serving interest.

     The opposition is simple:

         1)  Why is "ONLY" the Lodging industry being charged with collecting a tax that isn't tied to the Lodging industry and /or benefits the  lodging industry any more than anyone else?

      The theory is that lodging facicilities simply "collect" the tax and thus will simply "PASS ON" the cost to their customers.

     But that theory is full of flaws.

     Perhaps the lodging facilities in the popular tourist destination locations such as Murphys and other nearby attractions can simply pass on this cost as a tot, perhaps most of their customers are tourists with discretionary income.

     However many lodging facilities further removed from tourist attractions (i.e. San Andreas, Valley Springs) rely primarily on the type of customer looking for lower rates.

     State employees (limited to $84 to $85/a night)

     Hospital Temp Employees (looking for extended stay rates)

     Visiting family

      Visiting hospital patients (hardship stays)

      Simply passing through (sleep and nothing more)

   

     And these people are generally looking for the lowest rates possible.

     Additionally, before the economy crashed the destination areas would fill up and would then refer their overflow to the non-destination areas. In our case this once represented 25% of our business.

     Unfortunately, the bad economy has virtually eliminated the overflow.  Lodging facilities in the destination areas are claiming that they're down 5 – 15%.

     Consequently their 5% – 15% drop translates to ZERO overflow which translates to a drop of 25% for us and similar for many other non-destination facilities.

     In other words, the non-destination areas are down a whole lot more than the destination areas.

     Which all boils down to the fact that many of us CANNOT raise our room rates and thereby pass the increased tax on to our customers.

     We will be forced to either:  lose business, or pay for the tax from our bottom line.

     Many lodging facilities in the non-destination areas, including us, are already in the red and this additional tax could be the proverbial final straw that puts us out of business.

     Perhaps this might explain to Mr. McGreevy and others who support this controversial tax increase that while it might look like a Win-Win situation for those RECEIVING related tax revenue, since it doesn't cost them anything in terms of effort or monry, it's NOT a Win-Win for many of the lodging facilities that are already struggling to stay afloat.

     And than again, perhaps those of us that will be affected negatively can be considered acceptable casualties of a greater good?

        William and Karen Konietzny

        The Robin's Nest Bed & Breakfast

        San Andreas