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Push for local tourism districts advance in Pa. House

Some Pennsylvania legislators want to give tourism activity a boost, adding a formal process for municipalities to develop specific areas.

The idea is that formalizing tourism improvement districts could give towns a way to levy a hotel tax to fund marketing and brand development.

House Bill 1891, introduced by Rep. Johanny Cepeda-Freytiz, D-Wyomissing, would give counties and municipalities the option to create a tourism improvement district and establish a tax to support it. No two districts could overlap. If businesses that comprise 40% of “the total room inventory within the proposed TID file objections,” according to the bill, the district could not be created.

In Wednesday committee hearing, Cepeda-Freytiz said the bill could spur tourism – for out-of-state visitors and Pennsylvania residents alike.

“I have a new sense of pride in being Pennsylvanian and representing parts of the commonwealth,” Cepeda-Freytiz said. “Tourism improvement districts provide an opportunity for the lodging industry for marketing purposes so we can attract more people to the commonwealth – and we can attract current Pennsylvanians because there’s so many here who don’t realize the treasures and the beautiful spaces that we have to offer.”

The bill passed its committee vote 20-5, but some issues remain.

Though Rep. Donna Oberlander, R-Clarion, the minority chairwoman, voted for the bill, she warned that some Republicans had concerns and encouraged Cepeda-Freytiz to work on ensuring that small business owners are protected.

“When we did the last room tax, it was a big deal in my county, there was a lot of fighting,” said Rep. Jack Rader, R-Effort. “You’re not giving anything to the county, you’re not doing anything for the school districts, it’s all going to the vacation bureau.”

The appeal of a hotel tax is that revenues come from non-locals, he noted.

“It’s easier to do a tax when you’re taxing somebody else,” Rader said. “In the long run, I think it hurts the industry if the taxes get too high. I’m just concerned because of the ease about taxing somebody else, that that’s the direction it will go in Pennsylvania.”

Similar legislation has been proposed in the commonwealth in recent years, with similar concerns about extra taxes undermining business growth. The interest follows more emphasis on Pennsylvania’s tourism sector, with Gov. Josh Shapiro promoting a new tourism campaign with a family RV trip.

State officials have also talked up outdoor recreation as a major tourism opportunity across Pennsylvania.

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