Friday, February 25, 2000
Hotel-tax increase advances
Help for Cincinnati center
BY PATRICK CROWLEY
The Cincinnati Enquirer
FRANKFORT — A contentious measure that would use Kentucky tax dollars to promote Cincinnati's convention center expansion received a boost Thursday when it passed a legislative committee by a large margin.
The House Local Government Committee OK'd allowing local fiscal courts to raise Northern Kentucky's hotel tax by a penny on the dollar. The vote was 15-1, with one lawmaker not voting. The measure now goes to the full House for a vote next week.
Some Northern Kentucky lawmakers have questioned the need for the increase and have said they may not support it.
The estimated $1 million a year the increase would raise would be spent on marketing and bringing business to Cincinnati's convention center, which that city's leaders are hoping to enlarge with a $400 million expansion.
Northern Kentucky tourism officials, hotel owners and business leaders are touting the bill by saying more convention business in Cincinnati will benefit Northern Kentucky hotels, restaurants and retailers.
Dan Fay, president of Covington-based Commonwealth Hotels, the owner and opera tor of four Northern Kentucky hotels, released a study by the accounting firm PricewaterhouseCoopers that shows the hotel room tax increase would result in nearly $13 million in new spending.
The study indicates that new money would be spent annually on hotels ($4.1 million), restaurants ($1.7 million), retail ($510,000), local transportation ($360,000), amusements ($30,000), auto rental ($940,000) and business services ($5 million).
“This is a good bill because it's going to benefit Northern Kentucky businesses,” Mr. Fay said Thursday after testifying before the House committee.
Tom Caradonio, president and chief executive officer of the Northern Kentucky Con vention and Visitors Bureau, said Kentucky businesses will clearly benefit by the Cincinnati Reds' signing of baseball superstar Ken Griffey Jr.
“He'll bring people to town, and a lot of those people will stay in Northern Kentucky,” Mr. Caradonio said.
“Griffey is this year's aquarium,” he said, referring to the Newport Oceanic Adventures Aquarium, a project that helped fill Northern Kentucky hotel rooms when it opened last year.
“And when people come to town for a ballgame or to go to a convention, many of them stay in and visit Northern Kentucky,” Mr. Fay said.
Mr. Fay said some of the opposition to the bill may be fueled by misunderstandings about the legislation.
The provision that allows the hotel tax to be raised from 4 percent to 5 percent is actually an amendment to a bill filed by Rep. Charlie Geveden, D-Wickliffe, that would allow several cities around the state to raise or implement a hotel tax. The amendment is sponsored by two Northern Kentucky lawmakers, House Majority Caucus Chairman Jim Callahan, D-Wilder, and Rep. Jon Draud, R-Crestview Hills.
Neither the bill nor the amendment actually raises taxes, Mr. Callahan said.
“All the bill does is allow local governments to raise the tax,” he said. “In Northern Kentucky, actually raising the tax will be left to the fiscal courts in Boone, Kenton and Campbell counties.””
Some lawmakers have ex pressed concern about raising taxes in Kentucky to help a Cincinnati project.
But Mr. Fay said the money raised by the increase will would go toward marketing and promoting the entire region.
“We do a lot of that now with some of our Kentucky money,” he said. “This tax won't be going toward brick and mortar. It will be used to increase the marketing for the expanded convention center, and that will help bring more people into the area and into Northern Kentucky.”
Twenty hotels and three of Northern Kentucky's largest cities — Covington, Newport and Fort Thomas — support the increase.
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