Levy of up to 5% includes short-term rentals
Beacon is now part of a growing list of Hudson Valley municipalities authorized to impose their own tax of up to 5 percent on overnight stays at hotels, bed-and-breakfasts and Airbnbs.
Gov. Kathy Hochul on Wednesday (Aug. 23) enacted a bill sponsored by Beacon’s two representatives — Assembly Member Jonathan Jacobson, a Democrat, and state Sen. Rob Rolison, a Republican. Their legislation passed the Assembly, 95-52, on June 6 and the state Senate, 36-16, two days later.
With Hochul’s signature, Beacon now needs to pass a local law to implement the tax, which would have to be renewed after three years. The city’s charge would be in addition to a 4 percent tax Dutchess County collects from hotels, motels and, since 2017, Airbnb, which in 2022 sent the county $785,502.
Mayor Lee Kyriacou estimated that Beacon’s tax would generate revenue equal to 1 percent of the city’s property tax levy (a room tax based on this year’s tax levy, $12.5 million, would yield $125,000 in taxes). The tax would not be a “huge revenue source, but it will help,” he said, adding that he would like to see a local law passed by the end of the year.
“You don’t want it to be too high, because you don’t want to deter visitors from coming,” said Kyriacou. “On the other hand, we do a lot of services for our tourists, and this is one way of collecting a little bit from them as opposed to our property-tax payers.”
In addition to boutique hotels like the Dutchess Inn & Spa and the Roundhouse, Beacon has bed-and-breakfasts like Chrystie House and the Swann Inn.
Two additional lodgings are in the works. At the Tioronda Estate on Route 9D, the Mirbeau Inn & Spa is expected to open in 2025. The company charges more than $400 per night at its Rhinebeck hotel.
A development group has also received Planning Board approval to convert the former Reformed Church of Beacon into Prophecy Hall, an event space with an adjacent 30-room hotel.
There are about 110 short-term rentals in Beacon, the bulk of them illegal because they have not been licensed by the city. Graham Lawlor, an organizer of the group Beacon Hosts, said in April that he was in favor of a Beacon hotel tax “in principle,” but felt that Rolison and Jacobson’s proposal would be excessive when combined with the room tax that Dutchess County charges.
Cold Spring received the same authority last year, under a law enacted by Hochul on July 22, 2022, that lets the village collect up to 5 percent on room stays. The village’s 2023-24 budget estimates revenues of $24,200 from a tax on hotels. Short-term rentals are not yet being taxed because the village is rewriting regulations governing them.
As with Cold Spring, Hochul also enacted legislation last year that lets the City of Newburgh tax lodging facilities. This year, Jacobson and Rolison authored legislation allowing the City of Poughkeepsie to tax overnight stays. Hochul signed that bill on Wednesday.
In March, members of the Putnam Legislature’s Economic Development and Energy Committee discussed a room tax for the county.
The Legislature had passed, in 2012, a 4 percent tax but newly elected County Executive MaryEllen Odell vetoed it, arguing that it would inhibit future development projects that included a hotel, motel or conference center.
In 2019, after short-term rentals became widespread, she told The Current she felt taxes on STRs should be levied and collected by towns and villages.
Jeff Simms contributed reporting.