Establishing the extended stay housing program and exempting participating businesses from the tax on meals and rooms.
Impact
The primary impact of SB434 is the exemption of qualified lodging businesses from the M&R tax, which, while providing financial relief to those businesses, is expected to lead to a decrease in state revenue. The bill specifies that the impact of this tax exemption could begin to affect revenue collections as early as August 2024, with ongoing impacts through fiscal year 2027. As such, local governments may face budgetary challenges due to anticipated decreases in M&R revenue transfers, which fund municipalities.
Summary
Senate Bill 434 (SB434) establishes an Extended Stay Housing Program aimed at exempting participating lodging businesses from the Meals and Rooms (M&R) tax in New Hampshire. The bill creates specific eligibility criteria for businesses, requiring them to apply to the Department of Revenue Administration and adhere to stipulations such as capping the monthly rental fee and ensuring that not more than 25% of their available rooms participate in the program. This initiative is designed to provide relief to businesses while helping to address accommodation shortages for those in need of extended stays.
Sentiment
Sentiment surrounding SB434 appears to be mixed. Proponents of the bill argue that it supports businesses by lowering their tax burden, ultimately fostering economic growth and addressing housing shortages. Critics, however, express concerns regarding the lack of tenant rights for individuals participating in the extended stay program, given that the bill does not guarantee any rights for occupants, potentially leaving vulnerable individuals at risk of eviction without recourse. This aspect of the bill may lead to ethical discussions about tenant protections in the context of economic incentives.
Contention
A notable point of contention is the provision within SB434 that allows lodging businesses to remove occupants from their premises without any guaranteed rights for the tenants, which raises concerns among advocacy groups and lawmakers who prioritize tenant protections. Moreover, there is potential tension around the bill's impact on local tax revenue; while state legislators may support the economic rationale behind tax exemptions, local governments depend on these revenues for essential services. The debate reflects broader discussions about balancing economic development with social equity and community needs.
Establishing a scholarship fund for certain small businesses applying for loans from the capital access program administered by the New Hampshire business finance authority.
Removing fees and charges for governmental records under the right-to-know law and reinstating potential liability for disclosure of information exempt from disclosure.