Convention center board delays vote on new lodging tax

The Montgomery County Convention Facilities Authority, a A new tax authority formed last year to take ownership of the convention center, has been meeting since May to map a future for the facility. FILE, CHUCK HAMLIN / STAFF
Caption
The Montgomery County Convention Facilities Authority, a A new tax authority formed last year to take ownership of the convention center, has been meeting since May to map a future for the facility. FILE, CHUCK HAMLIN / STAFF

Credit: Chuck Hamlin

Credit: Chuck Hamlin

A new tax board formed to take over ownership of the struggling Dayton Convention Center formally hired its first executive director on Thursday but put off voting on a new lodging tax of 3%, an increase which remains controversial in some quarters of the county.

Some members of the 11-member Montgomery County Convention Facilities Authority said they needed more time to study the issue and questioned the timing of a new tax during a pandemic that’s slowed the hospitality industry.

“I fully appreciate that 3% is definitely … necessary for some of the things previous studies have shown need to be done with the convention center,” said Jacquelyn Powell, president and CEO of the Dayton Convention & Visitors Bureau and CFA Board member. “(But) we’re in a different world right now when it comes to the hotels.”

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Although hotels are struggling and lodging tax revenues have slumped during the pandemic, an upgraded convention center will help hotels once travel and tourism rebounds, said Joe Parlette, deputy Dayton city manager.

“Let’s be careful and not take a short sighted view on this,” he said. “If we have a new convention center that has $20 million reinvested in it, what does that do to rates the hotels within Montgomery County can charge?”

Board members Tom Whelley and Mike Stevens asked for more time and proposed the board hold off on a vote until its December meeting.

CFA Chairman Walter Reynolds, noting that he also had further questions about the draft resolution, tabled the item until Dec. 3.

“I don’t want to rush anybody on this to vote. I want everybody to be comfortable before we move forward,” Reynolds said.

Shannon Martin, a Dayton attorney advising the CFA, reminded the board that due to the wording of a state law, the ability for the authority to levy the tax goes away unless approved by Dec. 31.

“My concern would be let’s make sure we get a quorum at that next meeting so that you know everyone’s there and you can conduct the appropriate business,” she told the board Thursday.

If the board passes the resolution, the tax levied on hotel-motel stays of fewer than 30 days will climb from 6% to 9% in most Montgomery County jurisdictions.

Raising the lodging tax is a misstep, said Donald Culp, a trustee in Miami Twp. where more than a quarter of the county’s hotel rooms are located.

“I am absolutely still against it,” he said. “Tax increases for our hotels and the townships — Miami Twp. and Butler Twp., in particular — shouldn’t be expected to bear the brunt of refurbishing and supporting a convention center in downtown Dayton.”

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Culp said the new tax might hurt continued development around Austin Landing, handing Warren County a competitive advantage.

“If a hotel’s looking at an opportunity on one side of the line or the other side of the line and there’s a substantial difference in the combined tax rate, I think that plays a role in where they would locate,” he said.

The new excise tax could generate $3 million or more annually to revive the convention center, which needs expensive repairs and has struggled financially for years even before the coronavirus pandemic.

Government leaders in Butler Twp., where about 25% of the county’s hotels are located, are also not in favor of raising the hotel-motel tax, but acknowledge a revived convention center could be a draw for increased business once the pandemic is under control.

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“Future progress with the convention center could actually help the whole region and bring new business and travel to our area and our hotels as well,” said Erika Vogel, Butler Twp. administrator. “Our hope is that the CFA is successful in making decisions that can boost our region as a whole and is able to attract new businesses and travelers to Butler Twp. and surrounding communities.”

The CFA was formed last November through an agreement between Montgomery County and the city of Dayton. It has been meeting since May, working toward the transfer of ownership of the convention center from the city to the CFA.

First director

Board members on Thursday formally hired Pam Plageman as the new executive director to manage daily operations and oversee future planning and improvements to the convention center.

Plageman said she’s excited about being involved in a “rebirth” of the facility.

“There’s a lot of work to be done but I’m ready to roll up my sleeves,” she told the Dayton Daily News.

Plageman, with 30 years of hospitality industry experience, said she is no stranger to Dayton and its convention center. Formerly a regional vice president with a supplier, Plageman oversaw the company’s food and beverage contract with the Dayton Convention Center for a decade.

“I’m very familiar with the venue and a lot of the folks there,” she said. “I’m very comfortable. It’s almost like coming back home.”

Plageman, who lives in Hebron, Ky., will be leaving a facilities management position at Cincinnati Children’s Hospital. She has also operated her own consulting business, PLP Hospitality Solutions.

Plageman signed an offer letter with the CFA on Oct. 27 which indicates she will be paid $140,000 annually and be eligible for an annual performance bonus up to 10% of her base pay.

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The Dayton Convention Center, built in 1973 at a cost of $6 million, has 150,000 square feet of floor space and 77,000 square feet of exhibit space. It has operated at a loss since 2012.

Studies by a consultant and a local task force in recent years concluded the convention center’s last hope for revival was for the city to turn it over to a CFA that could put more lodging tax revenue toward building improvements. The reports indicated the facility required $15.2 million to $28 million in upgrades.

Generally in Ohio, jurisdictions levy a 3% hotel/motel tax while the county collects another 3% for a maximum 6%. But language added to a 2019 state budget bill allowed county commissioners to pass a resolution to create the convention facilities authority — but only if done between July and December of 2019 — that allows the collection of an additional 3%.

The 3% countywide lodging tax collected by Montgomery County averaged about $3.25 million annually over the previous five years before the pandemic, according to county’s Office of Management and Budget.

Last month, Montgomery County provided the CFA $600,000. Dayton has pledged all its lodging tax revenue to the authority through 2060. Lodging tax revenue for Dayton averaged about $805,000 for 2018 and 2019, but receipts are down more than half through September, city records show.