May 11, 2007 By Steve Ferris 4 min read

Fayette County Commissioner Joseph A. Hardy III is opposed to a 3 percent hotel room tax, but would abstain from voting on it if the commissioners consider imposing the levy, a spokesman said Thursday. Jeff Nobers, vice president of corporate communications for Nemacolin Woodlands Resort & Spa, which Hardy founded and is now run by his daughter Maggie Hardy Magerko, and Trey Matheu, the resort’s director of operations, discussed the tax issue with the Herald-Standard editorial board.

The Fayette County Tourism Alliance is supporting the tax, which they said could generate more than a half-million dollars annually, and would relieve the county from making a $20,000 annual contribution to the Laurel Highlands Visitors Bureau.

Fayette, Somerset and Westmoreland counties make annual payments to the LHBV to promote tourism in the counties.

Nobers and Mathew said they believe the tax would cut into the hotel’s group sales and possibly result in job layoffs or cutbacks.

Matheu, who is also a member of LHVB board of director, explained that the resort classifies its customers into two categories ‘- transients and groups.

Transients rent individual rooms during the prime season from May to October and groups rent a number of rooms for corporate events and meetings during the off-peak season from November to March.

Matheu said all hotels and resorts compete for transient business, but Nemacolin competes with more regional resorts and facilities for the group business.

He said transients for the most part won’t mind paying the tax, but he said groups are often looking for the best price and the tax could hinder efforts to draw them to the resort.

This is crucial for the resort because the group business has grown from 50 percent of its total business two years ago to 60 percent today, Matheu said.

Because of an upsurge in group business, he said, the resort’s compliment of year-around employees has grown to 800 from 500 to 600 a few years ago.

During the May-October peak time period, the addition of seasonal workers drives the number of employees up to 1,200, said Nobers.

Matheu said the number of year-around employees could be affected if the tax was imposed.

He said the resort also promotes the region to attract visitors, but might “pull back” from those efforts if the tax is adopted and the resort starts losing business.

Nobers said the resort directs it guests to county attractions such as Fallingwater, white water rafting at Ohiopyle State Park, Woodlands Zoo and the Christian W. Clay Winery.

He said it is a misconception that Nemacolin hoards the tourists it draws. “We aren’t this vacuum,” Nobers said.

In addition to using hotel tax revenues for tourism promotion through the LHVB, Somerset and Westmoreland counties established separate tourism grant programs.

The grant programs provide money to tourism-related groups or businesses that have to use it for marketing or capital improvement projects.

“That, to us, is sort of illogical,” Nobers said. “The grant side of the tax is our biggest objection.”

Nobers said that giving revenue from taxes to private businesses to help compete against other local businesses is not a good idea.

Limiting the use of the tax revenue for marketing and promoting regional tourism makes sense, Nobers said.

Another problem with distributing grants from the tax revenue, Nobers said, is that a board would be created to select grant winners and that could lead to political problems with who gets the money.

“The grant program opens the door to a lot of problems, Nobers said.

Matheu said he believes as much as 42 percent of Nemacolin’s group business would be at risk if the tax would be adopted.

If the hotel tax had been in place last year when 80,000 room nights were rented at the resort, Nemacolin would have had to pay about $580,000 making it the largest contributor to the $700,000 to $800,000 the LHVB would have collected from all county motels and hotels, Nobers said.

The tax probably wouldn’t deter individual guests from staying at the resort nor would it be likely to hurt hotels and motels with room rates that are less expensive than Nemacolin’s rates, he said

Nemacolin currently charges guests the state’s 6 percent sales tax and pays $280,000 a year in amusement taxes to the Uniontown Area School District and Wharton Township in addition to real estate taxes, Nobers said.