Why The Tax Increase?Ulster County Legislature Targets Hospitality/Tourism with 4% Bed Tax Increase

A new resolution has been presented by the UC Legislature’s Economic Development, Planning, Education, Employment, Arts & Agriculture Committee to increase the Bed Tax from 2% to 4%, to potentially take effect later this year.

Ulster County’s tourism and hospitality industry has been the driving force behind our county’s economic growth over the last decade. Visitors come to hike on our trails, fish in our streams, camp in our forests, paddle on our creeks and rivers, or immerse themselves in our history and spend on average of $200/per day per person in our restaurants, shops, and small businesses. Tourism and hospitality has grown to become the largest industry in Ulster. And quite a few people have come to love our natural and cultural resources so much as to dig deep in their pockets and purchase new homes in our communities and become tax paying residents of the county. The lifeblood of this unprecedented economic trend, our most critical assets that have allowed this growth to continue, are our hotels, resorts, BNBs and short-term rental properties. Without affordable and interesting places to stay locally, our tourism industry and the economic benefits that it bestows would wither on the vine.

It is because of this understanding, the need to protect and support our hospitality industry, that we were surprised to learn of an effort by the Ulster County Legislature to impose an additional 4% tax on hotels, resorts and short-term rental properties in Ulster County. Even more shocking is that our government leaders seem willing to place this unnecessary financial burden on this critically important part of our county’s economy on the heels of the COVID-19 pandemic that saw many of our hospitality businesses come to the brink of extinction. And we use the word unnecessary with intention. Is there some financial crisis facing Ulster County today that we are not aware that would justify such a money grab? The last we heard, Ulster County was awash in cash with an unprecedented $20 million surplus in sales tax revenue (generated by the visitors staying in the same businesses the Legislature is targeting for a fiscal shakedown.)

What we have not heard from the Legislature is any justification for this tax increase. No plan for how to spend the additional revenue – which is mandated by law – nor any reassurance that this dubious action would not sink our tourism industry and our broader economy into a tailspin. As such, it is our opinion that before any action is taken on this matter by the Legislature, a comprehensive study on the impacts of the tax increase be undertaken and a discussion with the public occur about why the money is necessary to the operation of our county government. Proceeding without such understanding would be reckless and irresponsible.