The 3-Percent Question
The Albany County Legislature holds off on tax legislation that would help fund convention center
Published on 3/13/2008 by Metroland written by David King
This week Albany County legislators tabled a bill that would renew a 3-percent hotel tax, part of which would be used to secure bonds for the proposed Albany Convention Center. Some legislators said they feel as though they did not have enough information about the wording of the bill or the future of funding of the convention center to approve the tax. The bill has been sent to the Audit and Finance Committee. The room tax will be discontinued by the end of the year if the county Legislature does not reauthorize it. The state Legislature also has to approve the bill.
Confusion arose over the fact that the phrase “hotel project fund” was added to the bill, which had some legislators concerned the county could be allocating taxes on other hotel rooms in the county to fund the Sheraton Hotel in the convention center.
Albany Convention Center Authority executive director Duncan Stewart told the Times Union that the funds would go to repay construction costs and not go to the operators of the hotel.
Legislators also were concerned with the fact that a sunset provision has been eliminated, meaning that they will never again be able to vote on the renewal of the tax. Albany County Legislator Chris Higgins (D-District 6) said it concerns him that the tax could be allocated to the ACCA even if the convention center does not come to fruition.
Furthermore, Higgins said he is concerned that there is no representative from the county Legislature on the ACCA board.
Legislators reportedly are working on arranging a meeting with the larger players in the authority so that they can have a better understanding of the bill they are voting on.
Higgins said he and a number of his colleagues are concerned about where the rest of the funding for the convention center will come from, as it is fairly clear that there is no room in the state budget to provide funding.
“Given the increase in costs and uncertainty of this project, it is absolutely necessary to take a step back and evaluate whether continued county funding of this project is in the best interests of the taxpayers of Albany County,” said Higgins.
Albany Common Councilman Dominick Calsolaro (D-Ward 1) said he has talked to legislators about adding wording to the legislation that would state that the county is liable only for the 1-percent bed tax. “I thought maybe we need to put in to the legislation that the county would only be liable up to whatever amount the bed tax brings in and nothing more,” said Calsolaro.
Meanwhile, Calsolaro said he thinks it is important that the ACCA takes into account rising interest rates on the bond market when considering how much debt service is going to be attached to the building of the center. Calsolaro said he would like to see more information about the kinds of bonds the ACCA is considering.
“I think we need an estimate from Duncan Stewart about what it would cost if they do those bonds,” said Calsolaro. “We really need to have the info. Right now there is no sunset for the bed tax. I suggest maybe we want to have a sunset clause put in for when the bonds are finished. So if we have 20-year bonds it will sunset in 20 years. There is no reason to keep the tax indefinitely.”