§ 17507 — Hotel room rental tax in third through eighth class counties

(a) Imposition.--A county may, by ordinance, impose a tax which shall be known as the hotel room rental tax on the consideration received by each operator of a hotel within the county from each transaction of renting a room or rooms to accommodate transients. The tax shall be collected by the operator from the patron of the room and paid over to the county where the hotel is located as provided under this section.

(b) Limitation on tax rate.--The rate of tax imposed under this section shall not exceed 5%.

(c) Collection, deposit and distribution.--The treasurer of each county electing to impose the tax authorized under this section shall collect the tax and deposit the revenues received from the tax in a special fund established for that purpose. Subsequent to the deduction for administrative costs established in subsection (i), the county shall distribute to the recognized tourist promotion agency all revenues received from the tax not later than 60 days after receipt of the tax revenues.

(d) Use of tax revenue.--The revenues from the special fund shall be used by the recognized tourist promotion agency for any of the following purposes:

(1) Marketing the area served by the agency as a leisure travel destination.

(2) Marketing the area served by the agency as a business, convention or meeting travel destination.

(3) Using all appropriate marketing tools to accomplish these purposes, including, but not limited to, advertising, publicity, publications, direct marketing, sales, technology and participation in industry trade shows that attract tourists or travelers to the area served by the agency.

(4) Programs, expenditures or grants that are directly and substantially related to tourism or a business, convention or meeting travel destination within the county, augment and do not compete with private sector tourism or travel efforts and improve and expand the county as a destination market as deemed necessary by the recognized tourist promotion agency. The following shall apply to grants awarded under this paragraph:

(i) Grants require a cash or in-kind local match of at least 25%.

(ii) Grants may not be used for signage that promotes a specific private entity on the situs of that entity, except where the signage also carries the logo of a recognized tourist promotion agency.

(5) Any other tourism or travel marketing or promotion program, expenditure or project that does not compete with private sector tourism or travel efforts as deemed necessary by the recognized tourist promotion agency.

(e) Concurrent tax years.--Each taxable year for any tax imposed under this section shall run concurrently with the county's fiscal year.

(f) Audit.--An audited report or financial statement, as determined by the county in consultation with the recognized tourist promotion agency, on the income and expenditures incurred by a recognized tourist promotion agency receiving any revenues from the tax authorized under this section shall be submitted annually by the recognized tourist promotion agency to the county commissioners.

(g) Sanction.--The following shall apply:

(1) If a recognized tourist promotion agency fails to submit an annual audit report or financial statement required under subsection (f) within 90 days of the end of the recognized tourist promotion agency's fiscal year, the corresponding county may withhold tax revenues collected and deposited in a special fund under this section until the required annual audit report or financial statement is submitted to the county.

(2) In the event the county does not take action under paragraph (1) within 120 days of the end of the recognized tourist promotion agency's fiscal year, the Secretary of Community and Economic Development may require the county to withhold tax revenues collected and deposited in a special fund under this section until the required annual audit report or financial statement is submitted to the county and the Department of Community and Economic Development.

(h) Conflict of interest.--Any board member, director, officer or employee of a recognized tourist promotion agency shall disclose to the recognized tourist promotion agency the nature of any conflict of interest or financial interest and recuse himself or herself from any action taken on behalf of the recognized tourist promotion agency which may result in a private pecuniary benefit to the individual, a member of the individual's immediate family or a business with which the individual or a member of the individual's immediate family is associated.

(i) Administrative costs.--For the purposes of defraying the costs associated with the collection of the tax imposed under this section and otherwise performing its obligations under this section, the county may deduct and retain an administrative fee from the taxes collected under this section. The administrative fee shall be established by the county but shall not exceed 4% of the taxes collected in any taxable year.

(j) Penalty.--A penalty of 1.5% per month shall be imposed upon the operator of a hotel for failure to timely collect and remit the tax authorized by this section. In addition to other remedies available for collection of debts, the county may file a lien upon the hotel in the name of the county and for the use of the county as provided by law.

(k) Definitions.--The following words and phrases when used in this section shall have the meanings given to them in this subsection unless the context clearly indicates otherwise:

"Bed and breakfast"or"homestead."A public accommodation consisting of a private residence, which contains 10 or fewer bedrooms, used for providing overnight accommodations to the public and in which breakfast is the only meal served and is included in the charge for the room.

"Cabin."A permanent structure with beds and running water that is located on a campground on State land or private property and is available to provide overnight lodging for consideration to persons seeking temporary accommodations. The term does not include a yurt or walled tent.

"Conflict of interest."Use by a board member, director, officer or employee of a recognized tourist promotion agency of the authority of his or her office or employment or any confidential information received through his or her capacity in relation to a recognized tourist promotion agency for the private pecuniary benefit of himself or herself, a member of his or her immediate family or a business with which he or she or a member of his or her immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes a board member, director, officer or employee, a member of his or her immediate family or business with which he or she or a member of his or her immediate family is associated.

"Consideration."Receipts, fees, charges, rentals, leases, cash, credits, property of any kind or nature or other payment received by operators in exchange for or in consideration of the use or occupancy by a transient of a room or rooms in a hotel for a temporary period.

"County."Any county of the third through eighth class that was authorized to levy a hotel occupancy or room rental tax under former sections 1770.2 or 1770.6 of the County Code.

"Hotel."A hotel, motel, inn, guest house, rooming house, bed and breakfast, homestead or other structure which holds itself out by any means, including advertising, license, registration with an innkeepers' group, convention listing association, travel publication or similar association or with a government agency, as being available to provide overnight lodging for consideration to persons seeking temporary accommodation; any place which advertises to the public at large or any segment thereof that it will provide beds, sanitary facilities or other space for a temporary period to members of the public at large; any place recognized as a hostelry or any cabin. The term does not include any of the following:

(1) A charitable institution.

(2) A portion of a facility that is devoted to persons who have an established permanent residence.

(3) A college or university student residence hall currently occupied by students enrolled in a degree program.

(4) An educational or religious institution camp for children, including a camp registered under the act of November 10, 1959 (P.L.1400, No.497), entitled "An act providing for the annual registration of organized camps for children, youth and adults; defining the duties of the Department of Health of the Commonwealth of Pennsylvania; and prescribing penalties."

(5) A hospital.

(6) A nursing home.

(7) Part of a campground that is not a cabin.

"Immediate family."A spouse, parent, brother, sister or child.

"Marketing."An action by a recognized tourism promotion agency that includes, but is not limited to, promoting and encouraging visitors to visit a specific county, counties or geographic region.

"Occupancy."The use or possession or the right to the use or possession by any person other than a permanent resident of any room in a hotel for any purpose or the right to the use or possession of the furnishings or to the services accompanying the use and possession of the room.

"Operator."Any individual, partnership, nonprofit or profit-making association or corporation or other person or group of persons who maintain, operate, manage, own, have custody of or otherwise possess the right to rent or lease overnight accommodations in a building to the public for consideration.

"Patron."Any person who pays the consideration for the occupancy of a room or rooms in a hotel.

"Permanent resident."A person who has occupied or has the right to occupancy of a room or rooms in a hotel as a patron or otherwise for a period exceeding 30 consecutive days.

"Recognized tourist promotion agency."The nonprofit corporation, organization, association or agency which is engaged in planning and promoting programs designed to stimulate and increase the volume of tourist, visitor and vacation business within a county and certified by the county as of April 20, 2016, or under section 17508 (relating to certification of recognized tourist promotion agencies).

"Room."A space in a building set aside for use and occupancy by patrons or otherwise, for consideration, having at least one bed or other sleeping accommodations provided.

"Transaction."The activity involving the obtaining by a transient or patron of the use or occupancy of a hotel room from which consideration emanates to the operator under an express or implied contract.

"Transient."An individual who obtains accommodation in a hotel by means of registering at the facility for the temporary occupancy of a room for the personal use of the individual by paying a fee to the operator.