Local Law Modifications Under Review for Hotel Occupancy Tax and Short Term Rentals

On July 16, 2025, the Tompkins County Housing and Economic Development Committee convened to discuss critical issues surrounding the county's budget and proposed modifications to the hotel occupancy tax law. The meeting highlighted concerns about declining tourism revenue and the implications of new regulations on short-term rentals.

A significant topic of discussion was the anticipated decrease in room tax and occupancy rates for 2026. Committee members noted several factors contributing to this trend, including a decline in international visitors, particularly from Canada, and the impact of geopolitical tensions and tariffs on discretionary travel spending. The committee acknowledged that academic-related business, such as conferences and meetings, has already been affected, with many events being postponed or canceled. These factors raise concerns about the county's economic outlook, prompting discussions about potential budget adjustments if revenue projections prove inaccurate.

In addition to budgetary concerns, the committee addressed a proposed local law aimed at modifying the existing hotel occupancy tax to include short-term rentals. This amendment is in response to recent changes in state law that require counties to regulate short-term rentals as taxable lodging. The committee emphasized the importance of clearly defining short-term rentals and ensuring compliance with registration requirements. This move is seen as a necessary step to align local laws with state regulations and to enhance the county's ability to collect taxes from this growing sector.

Members also raised questions about how the new regulations would affect institutions of higher learning, such as Cornell University and Ithaca College, which may operate short-term rentals for non-academic purposes. While the current proposal does not specifically address these institutions, committee members expressed a willingness to revisit and amend the law to ensure comprehensive coverage of all rental operators.

The meeting concluded with a resolution to authorize a public hearing on the proposed local law, allowing for further community input and discussion. As Tompkins County navigates these challenges, the outcomes of these discussions will play a crucial role in shaping the region's economic landscape and housing policies moving forward.