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Sleeping on the bed tax

Published: Sun, April 8, 2012 @ 12:00 a.m.

By Todd Franko (Contact)

The Mahoning County commissioners are sleeping on the debate over whether to increase the county bed tax by 2 percent, or about $500,000 per year, to raise economic-development funds for the Western Reserve Port Authority.

Sleeping on this is about the most prudent decision a local government entity has made in years — especially when staring into such taxpayer riches and not having to go before voters with the request.

And hopefully when they awake from sleeping on this issue, their next decision will be to walk away from this foolish and poorly conceived idea.

We asked last week in a Sunday editorial for the hotel owners to show proof that the tax increase would hurt business. That’s a fair point. I believe many of the concerns of the hotel owners, but not all, including that it would hurt business.

I’m part of the billion-dollar market that is youth-sports travel. We stay in hotels month after month, seven months a year; our group includes parents who do the same for dance, baseball, volleyball, etc. When we do talk about hotel stays, it’s mainly on the best ways to have parent parties and tailgates.

But when talk does turn to hotel prices, it is always about the room rate. I can say with certainty that a parent has never picked a hotel based on the tax rates in five years, after 20-plus cities and states, hundreds of family stays and thousands of dollars.

In fact, the biggest gripe about hotels is not the taxes or the room rates, but the mandatory stays the hotels and the event hosts agree on so as to prevent families from choice. That — not the fees and taxes — is the biggest gripe from our segment of their industry.

But I digress ...

With the bed-tax debate, where the burden of proof also is needed (and I would say more so) is with the economic-development industry, i.e. proof it’s really having an impact.

The message boarders on Vindy.com are having a field day with the port authority’s list of accomplishments being headed by the move of B.J. Alan fireworks from Mahoning County to Trumbull County. Moving $5 from my left pocket to my right pocket hardly makes my life more fruitful. And if my left pocket could talk, it probably would have preferred to hold on to the $5.

I did a bit of research on the paper trail of that move, and best I could tell, that move happened with port folks politely at the table but hardly leading the way.

That’s where the need for proof comes in. Actually, we sought such proof two years ago.

Go to Vindy.com and search “Denen economic” and find the story from Aug. 8, 2010. That was our simple effort to answer this: “We have a lot of agencies and millions of dollars spent in the Valley in the name of economic development. Are we getting the best bang for our buck?”

Read the story, and tell me if you get more comfortable — or less — in creating an additional $500,000 in taxes in the name of economic development.

The consistent message from the agencies that would talk to us is that no accurate records are kept on true job gains — despite the numbers they all throw out in press releases and annual statements.

One state office official even said that their 2009 claim of 2,143 jobs created included projected future jobs that might be created. Really?

The best testament to the trouble with proof is the amount of unanswered calls and requests incurred in that story process. When the story finally was published, officials came out of the woodwork decrying the story — including some who would not make themselves available as the story was being developed.

When you finish that story, then search “Franko Clebone” and read that March 2009 story. That is about the regional eco-nomic-development office of former Gov. Ted Strickland that was vital to our area’s economic development. Amid the governor regime change last year, that office was eliminated. Ironically — Mahoning and Trumbull counties had record sales-tax years without the office.

Those from that flock instantly could argue, “Well, 2011 was good because of our work in 2010 and 2009 — before we were eliminated.” That would hold more stock if the present bed-tax arguments would have included “... and we need to buffer the loss from that office’s elimination.”

Instead, the office is a lost memory like trolley cars, blimp factories and indoor racetracks.

We already spend millions of taxpayer dollars annually in the Valley on salaries and related expenses for government and nonprofit agency posts in the name of economic development. They exist amid myriad alphabet soup titles such as the chamber, YDEC, MVEDC, CIC, Team NEO, CASTLO, TCPCED, LTR, SBA, etc. ....

These groups employ specialists who head, front, advise, consult and lobby for elected officials in townships, cities, counties, legislatures, senates and congresses — who in turn cost millions of local taxpayer dollars.

I hope that when commissioners revisit the bed-tax issue, they’ve slept enough on all of the taxes already spent on economic development and resist the pressure thrust on them by the Valley’s political muscle.

Approving this would be only political, not profitable.

Todd Franko is editor of The Vindicator. He likes emails about stories and our newspaper. Email him at tfranko@vindy.com. He blogs, too, on vindy.com.

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