Merrimack Gets $1.1M in Meals/Rooms Taxes

The state's projected Meals & Rooms tax revenue for fiscal year 2013 is $249.7 million. As the Legislature dives into Gov. Maggie Hassan's budget recommendation for fiscal years 2014-15, here is a snapshot of the Meals & Rooms tax distribution to Merrimack ($1,138,772) and a dozen other communities.

Is it proportional to the amount of meals and rooms taxes generated in respective towns and cities? It's a tough question, as state law does not make the tax revenue generated from each town or city readily available.

Some Seacoast legislators want to change that. 

State Sen. Nancy Stiles (R-Hampton) is one of them. When she was first elected in 2010, she made a beeline to the Legislative Budget Assistant office. She was determined to find out: How much meals & rooms tax revenue did her tourist-busy Seacoast District generate for the state–and how much did the communities get in return.

• What's the distribution formula, and is it fair?
• Or are some towns and cities, in the vernacular of past state property tax debates, "donor towns" when it comes to meals & rooms taxes?

Portsmouth, for example, has 158 restaurants and 17 hotels, but receives the same amount as a community with the same population with no restaurants or hotels, according to one of the city's budget presentations last year.

Stiles continues to hunt for answers. This week, Stiles takes another step toward possibly finding out.

Stiles and fellow Seacoast legislators have a public hearing for their bill that would make available the meals & rooms tax revenue generated in each municipality. The other sponsors are: Sen. Martha Fuller Clark, D-Portsmouth, Rep. Chris Muns, D-Hampton, Rep. Renny Cushing, D-Hampton, and Rep. Susan Ford, D-Easton.

The state Department of Revenue Administration notes that the bill is currently at odds with state law that "confidentiality of department records prohibiting disclosure of aggregate numbers that could identify, or permit identification of tax information." 

Another hurdle, the DRA says, is that even if the tax data were made available, it would be inaccurate due to consolidated tax filings (for example, if an operator had several businesses in different towns and cities but files a consolidated return).

*M&R revenue distribution, except where noted, is from the most recent financial report or budget on municipal website. In some cases it's fiscal year '13, '12 or '11, but the distribution has remained flat in recent years. ** Population estimates from U.S. Census, NH OEP, or municipal website.

• The state's meals & rooms tax is 9 percent. Licensed operators collect the taxes and pay them over to the state.
• Per law (RSA 78-A), M&R revenue from the state is based on a community's population as a percentage of the state's population.

The House Ways and Means Committee holds a public hearing on House Bill 662 on Feb. 21 at 10 a.m. in Room 202 of the Legislative Office Building in Concord.