A 3% occupancy tax on Cortland hotel and motel rooms recently signed into law by Gov. Andrew Cuomo won’t be enacted by the city government any time soon, but concerns over its effect have been raised by local leaders.
The law, signed Dec. 23, enables the Cortland Common Council to enact its own local version of the law, which it has not done, said Meghan Lawton, the executive director of the Cortland County Convention and Visitors Bureau.
This would add on to the 5% occupancy tax already charged by Cortland County along with the 8% state sales tax.
Cortland Mayor Brian Tobin said the Common Council won’t enact the tax any time soon because the coronavirus pandemic continues to hurt businesses.
“We completely recognize that now is not a good time to be instituting additional fees or taxes on businesses and hotels,” he said.
Once the pandemic comes under control, Tobin said the council will start to look at implementing the tax and using the money generated from it to support tourism and community events in Cortland.
Mack Cook, Cortland’s director of administration and finance, said in January 2020 the city had anticipated generating between $150,000 and $176,000 a year from the tax.
“This is going to allow us to more aggressively market Cortland as being a destination for people to come stay and enjoy themselves,” Tobin said said.
However, Lawton said she and the bureau have opposed the tax since it was introduced about 10 years ago.
“The tourism industry has been one of the hardest hit industries by the pandemic — here in Cortland County, across New York State, and across the entire United States,” she said. “Billions of dollars in economic activity have been lost and according to US Travel, 75% of tourism-industry jobs across the US have been cut.”
Sam Ferro, the general manager of the Hampton Inn on River Street in Cortland, said that if the tax is enacted eventually, he could see both sides: either helping or hurting the city’s hospitality industry.
It could help by providing extra funding in ways that could support hotels and motels, but it could also lead people to look for cheaper places to stay elsewhere — such as hotels in Cortlandville or Virgil.
“If other places didn’t have the tax and we did, that would definitely drive people outside the city,” he said.
No timeframe has been set to enact the tax, but it could cause problems for the city’s — and county’s — tourism, Lawton said. “Tourism, when it can safely happen again, will be one of the biggest drivers of the economic recovery and we need to do all we can to support and encourage the industry as we move forward and eventually out of the pandemic.”
The tax had previously failed in the state legislature, including a veto by Cuomo in 2019.