Before adjourning for the summer recess, the PA General Assembly considered the following issues of interest to the tourism industry:
2007-2008 State Budget
On July 16, Governor Rendell signed the State budget bill. The $27.5 billion spending bill became law 17 days after the start of the 2007-08 Fiscal Year despite a $650 million surplus at the end of the previous fiscal year. There are no new taxes or tax increases in the budget.
Overall, the budget was good news for the tourism industry. The tourism promotion line item was increased and the appropriations for Regional Marketing Partnerships at $5 million and Tourist Product Development at $2 million were the same level of funding as last year. Funding for the TPA Matching Grant Program was reduced by $412,000.
Amusement Tax Bill Introduced
On June 30, Senator Robert Regola (R-Westmoreland) introduced legislation, Senate Bill 1012, that would prohibit the imposition of amusement taxes on amusement parks, effective January 1, 2008. The bill has been referred to the Senate Finance Committee.
The following Senators co-sponsored the bill: John Eichelberger (R-Blair); Mike Folmer (R-Lebanon); Chuck McIlhinney (R-Bucks); Jane Orie (R-Allegheny); Bob Robbins (R-Mercer); Mike Waugh (R-York); and John Wozniak (D-Cambria).
Smoking Ban
The State House and Senate couldn't agree on a smoking ban to send the Governor before recessing for the summer. Instead, they will leave it to a House-Senate conference committee to reach a compromise, which likely will come in the fall at the earliest.
Last month, The State Senate approved Senate Bill 246 by a 33-17 vote that would have provided exemptions for casinos, certain restaurants and bars, firehouses, and cigar bars, in addition to private clubs. It would not have allowed municipalities to impose stricter bans.
The House amended and approved Senate Bill 246 on June 16 by a 141-62 vote. The House version would have outlawed indoor smoking in restaurants, taverns and casinos. It would allow exceptions only for private clubs, private homes, tobacco-related businesses, cigar exhibitions, a quarter of the rooms in hotels, and private living quarters in nursing homes or assisted living facilities. It also would have allowed municipalities to enact stricter smoking bans.
The Senate, shortly after the House vote, rejected that plan by a 13-36 vote.
Governor Rendell said he would have vetoed the Senate-passed plan had it reached his desk, but suggested the House version provides a framework of a smoking ban that he could sign.
PTLA is a member of a coalition that is advocating for passage of a comprehensive smoking ban.
Transportation Funding/Room Tax/Drink Tax
The General Assembly approved House Bill 1590, which would provide funding for highways and mass transit. Initially, lawmakers considered a plan proposed by House Democrats that would allow counties and municipalities state-wide to levy several local taxes to gradually boost their share of mass transit funding from 13 to 20 percent to be eligible for state money. Under that plan, counties were authorized to impose a room rental tax of up to 1.5 percent.
PTLA lobbied against this plan when the House considered the bill on June 25. House Bill 1590 was approved by a party-line vote of 102-101 (Democrats voting for it and Republicans against).
HB 1590 was then referred to the Senate Transportation Committee. On July 28, we contacted key senators and expressed opposition to the room tax language. That afternoon, both republican and democratic senators assured us the room tax provisions would be stricken from the bill.
The Senate Transportation Committee met the evening of June 29. HB 1590 was amended and approved. All of the local tax options, including the room tax provisions, were removed.
In addition, a provision calling for a 10% drink tax to fund mass transit in Allegheny County was added to the bill. A coalition of hospitality groups, including PTLA, the Greater Pittsburgh Hotel Association, and the PA Restaurant Association, expressed opposition to this tax.
The Senate and House then passed the Senate version of bill. Governor Rendell signed HB 1590 into law as Act No. 44 on July 18.
The hospitality industry in Allegheny County will lobby against the imposition of the drink tax if and when county council decides to address the issue.
PA Gaming Economic Development & Tourism Fund/2007 - 2008 Capital Budget
Lawmakers approved legislation, House Bill 1631, authorizing certain economic development projects around the State, including funding for the PA Convention Center and the new hockey arena in Pittsburgh.
