Tuesday, March 12, 2002
Hotel tax bill hits snag
Defeat could endanger convention center plan
By Dan Klepal, dklepal@enquirer.com
The Cincinnati Enquirer
Paying for the expansion and renovation of Cincinnati's convention center has turned into a game of political hardball.
Scheduled testimony in an Ohio House committee today over a bill written expressly for Hamilton County to help pay for the $198 million expansion of the Albert B. Sabin Cincinnati Convention Center was abruptly canceled Monday.
The reason: Rep. Bill Seitz, R-Green Township, has said he will vote against the proposal unless it is changed in significant ways.
Mr. Seitz gave Cincinnati Mayor Charlie Luken a list of six issues he wants resolved before the bill moves forward. The Republican chairman of the State Government Committee has said nothing will happen with the bill until local state lawmakers are behind it.
The bill was pulled in an effort to save it, by providing the city and county time to answer our questions without (the bill) getting blasted for the better part of the day, Mr. Seitz said.
Mr. Luken called Mr. Seitz's involvement destructive.
The bill would give Hamilton County permission to raise its hotel-motel tax from 3 percent to 7.5 percent. That would generate $7.8 million a year and allow the issuance of $141 million in bonds to pay for the project.
Although county commissioners agreed in principle to raise the tax starting Jan. 1, they cannot legally do so unless the bill passes.
Mr. Seitz's issues:
The bill should allow Cincinnati to raise its hotel-motel tax from 3 percent to 4.5 percent. As part of the financing plan, Cincinnati City Council doubled its tax from 1.5 percent to 3 percent, the maximum allowed. A higher city tax could mean a lower county increase. Many suburban hotels think the tax increase will put them out of business.
The bill needs to specify how hotel tax revenue is split between convention and visitors bureaus when more than one exists in a county. A new convention and visitors bureau is being considered in the suburbs.
The bill needs to clarify how the $141 million debt will be guaranteed.
Cincinnati needs to clarify its financial commitment to the project. The city has said it will spend $20 million over 20 years; County Commissioner John Dowlin wants $30 million over 30 years.
A water contract between Cincinnati, the county and other municipalities, scheduled to expire in 2017, should be extended 30 years.
Discussion between the city and county over transferring operations of the Metropolitan Sewer District from Cincinnati to the county.
I'd like to see the expansion get done, but these are legitimate points, Mr. Seitz said.
Mr. Luken said the water contract will be extended and that if more money comes in for the project than needed, it can be rebated to hotels and motels throughout the county.
Other than that, there's not much we can do to respond to those demands, Mr. Luken said. And that's what they are demands. "Do this or we won't pass the bill.'
This is an attempt to accomplish things through the back door that couldn't be accomplished through the front door.
Mr. Seitz's opinion is important. Republicans control both the House and the Senate, and Mr. Seitz is a Republican lawmaker from the county the law has been written for.
Other area lawmakers State Rep. Tom Brinkman Jr., R-Mount Lookout, and State Rep. Wayne Coates, D-Forest Park have also voiced opposition to the bill.
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