Bed tax hike to rescue Civic Center unlikely; Mayor: ‘That ship has sailed’

By Gordon Woodworth & Mark Frost
Chronicle News Editor & Chronicle Publisher/Editor

A renewed late push to fund the Glens Falls Civic Center with a 1% hike in the occupancy “bed” tax is apparently going nowhere, and Mayor Jack Diamond says the Aug. 18 auction of the Glens Falls Civic Center will proceed.

“If the County asks me to consider canceling the sale of the Civic Center and has a memorandum of understanding agreeing to buy it for $1.5-million, I’d stop the sale,” the mayor told The Chronicle Tuesday.

Otherwise, he said, “My plan is to sell the building in 2014. It’s pretty clear that the supervisors don’t know what they want to do, and our only option is to sell the building. That ship has sailed. I don’t have time to wait around for a county board that has a $15.5-million fund balance.”

Mr. Diamond said eight groups have picked up auction packets “and I feel confident the building will be sold. The only question is for how much.”

Asked what he will do if no one meets the $1.5-million minimum, the mayor said, “I will continue to pursue selling the building. My intentions are to sell the building and get it off the City’s books for 2015.”

The Post-Star, local outlet plaza entrepreneurs Ed Moore and Dave Kenny and retired athletic director Doug Kenyon have spearheaded a renewed, late push for Warren County to raise the bed tax to help pay for the Civic Center.
But County Board chairman Kevin Geraghty of Warrensburg told The Chronicle Tuesday, “I just don’t think anything will happen using a bed tax increase.”

Even if support for the bed tax hike lined up, Mr. Geraghty said, “I don’t see it happening in time,” noting the next full Board of Supervisors meeting is Friday, Aug. 15, three days before the scheduled auction.

And he said that any tax increase needs approval from the state legislature, which he said would take up to a year.

Bill Kenny, county Supervisor from Glens Falls Ward 5, chairs the Occupancy Tax Committee and led the push for a bed tax hike to fund the Civic Center. Asked if he expects anything to emerge from his committee before the auction, Mr. Kenny said, “No. I don’t see that happening. To me, it’s a no-brainer. To others, it is not. And I respect the others who don’t agree with me.”
His initial proposal died in committee. “There wasn’t support for it, so I didn’t bring it to a vote,” Mr. Kenny said. “The clock is ticking.”

If the bed tax hike were to survive the Occupancy Tax committee, would it have a chance of passing the full Board of Supervisors? Mr. Kenny said he has counted votes and thinks “it would be close.”

As for the committee, Mr. Kenny said, “There are three of us in favor of doing something — me, [Queensbury Supervisor] John Strough and [Lake Luzerne Supervisor] Gene Merlino.”

But committee members Ron Conover (Bolton), Dennis Dickinson (Lake George), Matt Simpson (Horicon) and Edna Frasier (Hague) opposed the bed tax hike.

“I am not in favor of a 1% tax increase,” Horicon’s Mr. Simpson told The Chronicle. “The underlying problems of the Civic Center are not going to be mitigated by the County becoming a funding source. I think the City should sell it. I don’t think the answer is raising taxes. Every time we fund these things with the lure of how it will help everyone out, we get further and further from what we should be doing.”

Mr. Dickinson said of the possible bed tax hike, “Motel owners in Lake George would storm my office…We need another plan, and I don’t know what that plan is. We are reviewing the whole occupancy tax program…to see if we are getting bang for our buck or if we need to restructure.”

Mr. Conover said he is working on a countywide approach to look at reallocating bed tax money, but he said “the prudent thing to do is to see what interest is expressed at the auction, because that will help clarify things.”

Mr. Strough said he has favored “from the get-go” the bed tax hike to help the City pay for the Civic Center. “Two benefits would come out of that additional 1% of bed tax money,” he said. “One, it would help the City pay for a regional resource without any burden on the local taxpayer. And two, we could use some of the money to help manage invasive species.

“Lake George is a regional resource just like the Civic Center. Both add to the quality of life here, and bring in outsiders.”
Mr. Strough said “sooner or later, a 1% bed tax increase will come up again.”

Mr. Dickinson said that 90% of bed tax revenue is generated in Bolton, Lake George and Queensbury, “because that’s where the hotels are. And that money is specifically earmarked for the promotion of more occupancy. We have to be careful where we spend that money.”

Mr. Conover said in terms of bed tax revenue, “our first priority is the enhancement and protection of Lake George, which drives the occupancy tax.”

Mr. Merlino said “I support doing something, and I support helping the Civic Center. We have got to come up with a solution that covers all of the bases.”

Mr. Merlino has proposed changing the way sales tax revenue is allocated, and giving $400,000 a year to Glens Falls for the Civic Center. He said he will give another presentation on his proposal next week.

Mr. Kenny has made two proposals to help pay for Civic Center operations. The first proposed adding 1% to the existing 4% bed tax, with the $800,000-plus in additional revenue going to the City.

His second proposal, to reduce annual bed tax awards from $350,000 to $175,000, and take an additional $125,000 from bed tax reserves, would have provided $300,000 annually for the Civic Center.