County to boost hotel tax today for arena project

1/17/2007

Lucas County commissioners said they will approve a 2 percentage-point increase in the local hotel-motel tax today, putting in place the funding mechanism necessary to build a new arena downtown.

The commissioners have scheduled a 10 a.m. special meeting in One Government Center to declare the arena project "in the best interest of the county" and to increase the hotel-motel tax from 8 percent to 10 percent, effective March 1.

Once the tax is approved, the county can move forward with hiring an architectural firm and a construction manager and operator for the arena project. The new arena, projected to cost $80 million, is expected to be built by 2009 at a site near the downtown SeaGate Centre.

The favored location would close Superior Street at Jefferson Avenue and be connected to the SeaGate Centre via a pedestrian bridge across Jefferson. The arena would stretch from roughly St. Clair Street north to Huron Street, then extend east to include the Subway restaurant, Club Bijou building and the Golden Lily Chinese Restaurant, and parking lots across the street along Superior Street.

While recognizing concerns from county hotel operators that the so-called "bed tax" increase could drive business outside the county to hotels in neighboring Wood County, the commissioners said they intend to approve the increase for the economic vitality of the community at large.

"When you break it down, it's $2 for every $100," Commissioner Pete Gerken said of the new tax. "If you were paying $100 for a hotel room, now you're paying $102. People outside our community are paying $2," he added, noting that visitors would help finance the arena "without reaching into [county] taxpayers' pockets."

During hearings at the state level - before the county was given permission to raise the tax - Toledo and Lucas County hotel-motel operators pointed out that the county's bed tax - which includes state and local sales taxes - is already among the highest in the nation at 16.75 percent. The bed tax in Monclova Township, which has a local lodging tax of 3 percent, is even higher at 19.75 percent.

Chad Bortle, vice president of operations for SJB Management Inc., owner of the AmeriHost Inn & Suites, 6425 Kit Lane, in Monclova, said he supports the principle behind funding for the project, but is still opposed to the tax.

Despite assurances by county officials that it will not affect business, Mr. Bortle said that conventioneers and businesses will certainly look at taxes when considering where to book rooms.

"Quite honestly, it makes us reconsider building more property in this area," the AmeriHost representative said. "We're always looking to build. We like the market in some ways, but this makes it difficult."

County commissioners defended the tax, noting that a percentage - 2 cents of every dollar of the bed tax - is dedicated to marketing all of the hotels and motels in the county.

The marketing plan of the Greater Toledo Convention and Visitors Bureau became an issue when officials in Sylvania expressed interest in recouping some of the money brought in through the hotel-motel tax.

Mr. Gerken said he has met with Sylvania officials and explained that the goal is to market all of the hotels and motels in the county, including the Wingate Inn & Suites at 5480 South Main St. in Sylvania.

"Our interests are aligned. If they don't do well, we don't generate the money we need," he said of the hotel industry. "Some of this money will be to market them."

Jim Donnelly, who heads both the SeaGate Centre and the visitors' bureau, said that the success of both the arena and the hotel-motel industry are dependent on each other.

"Our main goal is putting heads in beds. The arena will help us do that," he said. "Once we know that the arena is on its way, we can start marketing it."

State lawmakers did not give carte blanche when allowing for the bed-tax hike. The enabling legislation gives citizens the ability to initiate an effort to repeal the tax.

Commissioner Ben Konop said that, while not a perfect project, the arena represents an opportunity to bring vitality to the community without burdening county taxpayers.

"I think a state-of-the-art, thriving arena sends a message to the rest of the country that Lucas County is ready to be an active player in the 21st century," he said.

Mr. Gerken said that the commissioners would make decisions on who to bring on as construction managers and architects in the next 14 days because they already requested proposals from interested firms last fall. He added that the county would then negotiate contracts, complete agreements for property and construction, and then begin construction sometime later this year.

Contact Erica Blake at:

eblake@theblade.com

or 419-724-6076.