MAHONING COUNTY Officials' decision to reallocate bed-tax funding sinks bureau

Commissioners will use 2 percent of the bed tax for funding a local airport.
By BOB JACKSON
VINDICATOR COURTHOUSE REPORTER
YOUNGSTOWN -- Mahoning County commissioners have changed their minds about taking two-thirds of the county's bed-tax revenue away from the Youngstown-Mahoning County Convention and Visitors Bureau.
They've decided to take all of it away, effectively putting the bureau out of business.
Commissioners say it's all part of establishing accountability for the way public money is spent, but a hotel industry spokesman said it leaves no one to promote local travel and tourism.
"By cutting off their funding, you are all but eliminating the bureau from the community," said Barton Hacker of the Ohio Hotel & amp; Lodging Association.
Since 1987, commissioners have assessed a 3-percent tax on all hotel and motel room rentals in the county. The revenue is given to the bureau, which uses it to promote tourism.
The bed tax, which is applied in addition to state and local sales taxes, brings in about $450,000 a year and is the bureau's primary source of revenue.
Commissioners said this summer that they intended to realign the way the bed-tax revenue is distributed, setting aside 2 percent for the Western Reserve Port Authority and 1 percent for the CVB.
Commissioners have long wanted to find a stable source of funding for the port authority, which operates the Youngstown-Warren Regional Airport.
Lawsuit expected
Atty. Lawrence Richards, CVB chairman, said he's not sure the law that allows bed-tax revenue to be used for port authorities is constitutional, and he expects a lawsuit to be filed.
"There are several legal issues that are going to have to be addressed here," he said. "There's a high degree of probability that we are going to end up in litigation."
Richards said he's disappointed in the commissioners' decision because he'd been told the bureau would still get 1 percent of the revenue.
New panel
At their meeting today, commissioners were to eliminate the Youngstown-Mahoning County CVB as the designated recipient of bed-tax revenue and establish a new Mahoning County CVB that will instead get the money.
The new panel initially will consist of the commissioners' chairman, county administrator and county special projects director. Others could be added later, said Gary Kubick, county administrator.
He said the new panel now will receive the 1 percent of bed-tax revenue, leaving the original bureau without a regular funding source. The remaining 2 percent will go to the port authority.
Commissioners Vicki Allen Sherlock and Ed Reese said they think it's necessary to ensure that public officials are responsible for spending the bed-tax money, which is public revenue. The current board became a private, self-appointing body several years ago, leaving commissioners with no control over how the money is spent.
"This is not an indictment of their performance," Sherlock said. "It's just that in tight times like these, we think there needs to be some accountability."
Reese said the new bureau will probably use its 1-percent share of the revenue to hire someone to promote local tourism.
Commissioners had at one time considered increasing the bed tax to 5 percent and using the additional 2 percent for funding the airport. But after strenuous opposition from local hotel and motel owners, they scrapped that plan and decided instead to realign the current revenue.
"The bottom line is that we will still be providing those services, and we did not raise the tax," Sherlock said.
End of the line
Hacker said it's doubtful the current bureau will be able to come up with enough revenue from other sources to stay in business.
"Needless to say, we disagree to what the commissioners are doing," he said.
He said the bureau could operate for a short time on a $600,000 rainy-day fund it has accumulated, but Sherlock hopes it won't.
"I would hope that since that bureau will be defunct, it will turn that money over to the new bureau," Sherlock said.
bjackson@vindy.com