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Tax Repeal Helps New Hampshire Park Industry

August 4, 2010 by   - () Leave a Comment

They say it’s been a perfect season for camping: lots of sun, warm weather — and no 9% tax on campsites.

Campers and campground owners across southern New Hampshire are heralding a summer of exceptional weather and the state’s repeal of the controversial tax, the Eagle Tribune reported.

The Legislature eliminated the tax in April, only nine months after it was enacted to help plug a growing state budget gap.

While supporters praised it as a means of generating revenue, opponents argued the levy — an extension of the rooms and meals tax — would severely harm the tourism industry. It would drive campers away and put campground owners out of business, they said.

Now, a year after it took effect, no one at local campgrounds is bemoaning the tax’s demise.

“I think it was stupid,” said Arthur Colby of Keene, who was vacationing with his family at Hidden Family RV and Golf Park in Derry. “I think it scared a lot of people off.”

Even months after its repeal, Colby is still unhappy with the tax.

“I didn’t like the idea of it,” he said. “You bring your own room; you shouldn’t be paying a rooms tax,”

Colby, who camps at various locations around southern New Hampshire, said he has seen a substantial decrease in the number of vacationers at campsites since the tax was enacted in July 2009.

“Once they get hit with that tax, they’re gone,” he said. “That 9% was crazy.”

Earlier this year, lawmakers sought a repeal of the tax, a move backed by Gov. John Lynch. The governor concluded the tax would not have raised enough money to make it worthwhile because businesses were avoiding payment.

The tax was expected to generate $2.5 million in revenue, but fell far short of that goal, according to Gregg Pitman, executive director of the New Hampshire Campground Owners Association.

“The state collected less than they thought,” he said. “By the time we hit spring, it brought in less than a million (dollars).”

Pitman said news of the repeal brought back many campers who otherwise might have stayed away from New Hampshire’s campsites.

“That’s definitely had a positive effect in terms of campers coming back into the state,” he said. “The word is spreading.”

While many New Hampshire residents knew of the tax’s repeal when booking their reservations earlier in the year, many out-of-staters did not, Pitman said.

There were many out-of-state residents who didn’t know it was eliminated and many others who did not know it had even existed.

“They were surprised that we had it,” Pitman said. “It was the New Hampshire people who weren’t really happy.”

Several Massachusetts campers fishing or relaxing in other ways at Hidden Valley said they weren’t familiar with the 9% tax — never mind that it had been repealed.

“I thought I was getting a discount,” said Tina Fontes of Lowell, chatting with family members as they sat outside their tent.

Repeal boosts business

Campground owners said they are seeing a significant increase in business this season, with some saying the tax’s repeal has made a big difference.

“Well, it seems like it’s been going excellent,” said Diane Durbin, owner of Mill Brook RV Park in Kingston. “It seems like it has a lot to do with the tax. The weather has helped, too. We did have a lot of cancellations last year because of the tax.”

This year, many of those same customers are coming back, she said, adding they seemed to know there was no longer a tax when booking reservations.

Although seasonal campground users were exempt from the tax, other campers weren’t. They had to pay at least a few dollars more a night, Durbin said. Though it may not seem like much to some, it can certainly add up, she said.

“We have a lot of people who stay monthly and that’s $63,” Durbin said. “That’s a big expense.”

At Hidden Valley in Derry, manager Cathy Kierstad said there definitely has been an increase in business over last year, but she wasn’t sure how much of that was due to the tax’s repeal as opposed to an improving economy.

“I think we are a bit more filled up than last year,” she said. “We are doing good.”

At Sunset Park in Hampstead, the 9% tax didn’t have much of an impact, according to office manager Kendra Neville. That’s because about 98% of the park’s customers camped there for the season and were exempt from the tax, she said.

The campground still had to carefully track who had to pay the tax and who did not, a burdensome task, Neville said.

“For us, it was more of a hassle with the paperwork,” she said.

While most Sunset customers were exempt from the 9% fee, they still had to pay another tax that affects seasonal campers.

Hampstead charges its campers a personal property tax of roughly $21 per $1,000, which averages about $200 per season, Neville said.

The town initiated the tax last year and campers weren’t happy because they did not think they were receiving their fair share of services for the money they were paying, Neville said.

“They were very upset,” she added.

Neville said the weak economy also has had an impact on the number of campers in the past few years. But one disturbing trend she has noticed is the large number of people living in recreational vehicles because they can no longer afford their homes.

“It’s gotten bad enough where people are trying to live on a campsite for a season,” she said.

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