Tax provides funding after state budget cuts
A 2012 study conducted by The Center for Rural Pennsylvania shows that organizations that promote tourism such as the Lycoming County Visitors Bureau heavily depend on hotel tax revenues to support their operating budgets, especially after state funding for programs was eliminated.
The study, which surveyed 45 tourist promotion agencies in rural, urban and mixed markets, showed that the Marcellus Shale natural gas industry has increased hotel room tax revenues in Lycoming County.
But it also points out that the county was prepared to bring in more activity, as Lycoming County has more than twice the number of accommodations and food services than Wayne County, where gas drilling takes place.
Legislation passed in 2000 allows 4th through 8th Class counties to levy and collect a hotel room tax of up to 3 percent to be used solely for tourism and convention development and promotion.
In fact, Lycoming County ranks ninth out of 49 of 4th through 8th class counties in a five-year average of room tax collection, bringing in $508,361.
In Adams County, special legislation is in place that directs 75 percent of hotel tax funds to the TPA and the remainder for such purposes as local economic development, historic preservation and grants to police departments.
The study also details advantages of multi-county TPAs that pool resources and benefits that may be provided to member organizations.
“While the TPAs promote their county or region as a whole, special benefits accrue to paid members such as reduced advertising rates or inclusion in large-scale advertising projects such as the TPA website, calendars or … advertising,” the report stated.
Of the 45 TPAs surveyed in the study, most are incorporated nonprofit organizations that maintain a degree of independence.
“While Pennsylvania’s TPAs may receive county funding and room tax dollars, as a result of their nonprofit status, they are independent organizations with their own board of directors and hired staff,” the report states. “Their budgets are separate from any county funds and are therefore not subject to any government regulation.”
However, they are required to submit audited financial reports directly to county commissioners.
According to the report, only 20 percent of TPAs said they presented reports “specifically on the uses of the room tax money.”
The Lycoming County Visitors Bureau does submit yearly reports to the county commissioners, said Jason Fink, executive director of the bureau.
Legislation on the room tax is unclear as to exactly what information should be reported to county commissioners, but overall, 90 percent of TPAs surveyed said they provided at least some reporting to commissioners, according to the study.
The board of directors for the Center for Rural Pennsylvania is comprised of state university professors, legislators and those appointed by the governor. State Sen. E. Eugene Yaw-R, Loyalsock Township, chairs the board. State Reps. Garth Everett, R-Muncy, and Rick Mirabito, D-Williamsport, also serve on the board.