Thursday, December 14, 2006

Legislative language for funding the arena

The state legislature is considering the bill which grants permissive authority to the Board of County Commissioners - in eligible counties only - to increase the hotel/motel tax to fund an arena. (Link to the summary is here starting on page 66.)

There are several things which I believe are important for people to know.

1) Only Lucas County qualifies as an 'eligible' county.

2) It allows the County to establish ticket charges or surcharges for admission to events.

3) It allows the County to increase the lodging tax by 2 percentage points which can be used to make contributions to a convention and visitors bureau, to promote/advertise/market the region, and to pay for an arena.

4) A resolution to increase the lodging tax can only be passed by the Commissioners between January 15, 2007 and January 15, 2008.

5) The resolution takes effect upon adoption, unless they specify that the tax is to go to a vote of the people.

6) If the tax does not go to a vote of the people and is, instead, adopted by the Commissioners, the people can petition to have it submitted to a referendum.

7) The lodging tax remains in effect at the rate at which it was imposed for the duration of any lease or other agreement entered into by the board with respect to the arena; the duration during which any securities issued by the board are outstanding; or the duration of the period during which the board owns the arena, whichever period of time is longest.

8) The bill prohibits the Commissioners from repealing, rescinding or reducing any or all of the lodging taxes pledged to pay debt on any outstanding securities issued for the arena. Further, once lodging taxes are pledged to pay debt on the securities, they are not subject to repeal, rescission or reduction by the county voters.

People should know that there is nothing to require the tax to expire once the arena construction is paid for - and that if the taxes are passed and securities are issued, they are not subject to repeal.

I think this raises two critical questions: One - is this written so that the Commissioners can pass the tax, issue bonds and then eliminate the option of the people to petition for referendum because the tax would be pledged to debt payment on those bonds? In other words, is it likely they can get this done BEFORE the petitions for referendum can be filed? Two - will the Commissioners pledge to collect the tax only until the construction bonds are paid off?

Just some questions that I think need to be answered PRIOR to any votes...


Unknown said...

It was troubling that the House passed this without discussion.

Maggie said...

Lisa - I'm not sure they even had time to read the whole thing before the vote. It took a really long time to put the language together.

I just got the language myself - and came across some of these issues. I don't know if any of the hotel/motel managers are aware of these details - I know that they were going to concentrate on the Senate...

we'll see...

Unknown said...

First, thanks again for your link because it is easier to read than the one I was using is.

My original belief that this would end up on the ballot is now not so certain with the questions you have raised.

What's ironic is I had read parts of this bill before on a different topic and didn't even realize that this was included. You are very correct in this bill is huge and it is very doubtful that all of the General Assembly members have spent the necessary time on this before voting.

All we can hope for at this point is that the Senate has more common sense than the House did. From my understanding many people are calling and not all are in favor so time will tell.

Hooda Thunkit (Dave Zawodny) said...

Such a carefully "crafted" bill with such perfectly formed "loopholed," what's to discuss. . .

Sad, isn't it?

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