Town Meeting begins, raises hotel tax

Apr 26, 2011

Town Meeting got off to a slow start on Monday after some confusion about which financial articles would be held while officials work to resolve a $919,000 discrepancy in the town's books.

“I strongly believe that the independent auditor ... has given us a road map to address material weaknesses relative to our financial system,” Town Administrator Mark Andrews assured voters. He noted that the Finance Committee approved the use of $40,000 to continue using the services of auditor Powers & Sullivan to straighten out the books. The problem was discovered earlier this month.

The financial articles will be addressed on May 23 at 7 p.m. in the Wareham High School auditorium.

More than an hour into the meeting, voters began acting on articles drawn from a lottery, a new process approved at Town Meeting in October. Voters approved a 2% increase in the tax paid by renters of hotel rooms and turned down a proposal to use Affordable Housing Trust Fund dollars to help the town foreclose on several properties.

Hotel/motel tax increase:

A tax increase on the rental of rooms in hotels, motels, lodging houses, and bed and breakfast establishments was approved during Town Meeting Monday night.

Town officials said the increase will bring much-needed revenue into the town. The town's tax will be raised from 4% to 6%, which proponents pointed out would add an extra $1 to a $50 bill.

Under the current bylaw, a 9.7% tax is paid as a part of the total bill at checkout. The state receives 5.7% of the tax. The remaining revenue goes to the town. Patrons will now pay an 11.7% tax.

“It’s very difficult to come up with additional funding,” said Finance Committee chair Donna Bronk. “Nobody wants to see new taxes, but we have to come up with something.”

Town Administrator Mark Andrews told voters the 2% increase will provide the town with an extra $25,000 in revenue each year.

“This is one of the only recurring revenue sources left for towns and cities to take advantage of,” Andrews said.

Residents in support of the article pointed out the tax hike will affect patrons, not Wareham residents.

“This is to be collected from people who come and stay in our community,” former Board of Selectmen chairwoman Jane Donahue stated. She noted most Cape Cod towns have similar hotel/motel tax rates without a negative impact on tourism.

Board of Selectmen member Steve Holmes questioned the idea of collecting money on the backs of tourists.

“We need to find a stream of revenue to attract visitors,” he said.

The article passed by a majority vote. Of the revenue generated by the tax, 60% will be used to fund community events. The remaining money will be deposited into the town's general fund.

Affordable Housing Trust:

Town Meeting defeated a proposal to use Affordable Housing Trust Fund dollars to pay for legal expenses to help the town foreclose on several properties.

Affordable Housing Trust Fund money is used to acquire low-income housing for the town. If Town Meeting approved the proposal, the funds would be used to get the foreclosure process started on several pieces of land off of Charge Pond Road, which Town Meeting could then vote to turn over to the trust.

By law, the town can seize properties for non-payment of taxes. The property owner has not paid taxes for several years, said proponent and former-Selectman Brenda Eckstrom, who served on the trust in her role as a Selectman.

An approval would have told the trust that "if we used our money to go forward with foreclosing on these properties, that this body going forward in the future would consider giving some part or all of this property to the Affordable Housing Trust," Eckstrom said. The trust could then look for a developer to build homes on the properties.

Opponents of the article said more information about the properties was needed.

“I had the opportunity to look at a map of all of these properties and there's a lot more involved than what you're seeing here," said Finance Committee chair Donna Bronk. "I would urge people to look at a map, have a professional come in here and show us this area and show us who owns what [so] we could have a clear, concise picture."

After much discussion, the proposal failed.

In other Town Meeting business:

Voters heard annual reports regarding the status of School Department buildings and finances as well as town capital planning efforts.