Sparks flew briefly Tuesday evening when the Board of Selectmen (BOS) voted 3-2 to remove an article from the Annual Town Meeting (ATM) warrant that would have authorized Harvard to tax hotels by as much as 6 percent. By the same 3-2 margin, however, the BOS voted to keep the article that would impose a .75 percent local meals tax on local food services, and therein lay the debate.
The article to enact the room tax was added March 16 at the request of BOS Chairman Ron Ricci, who, though he opposes any new taxes as a matter of principal, said it was only fair to give voters a say in the matter. A similar argument had been used by Selectwoman Lucy Wallace in support of the article to enact a meals tax. The Harvard Press had also editorialized earlier this year in favor of both taxes. Both local option taxes were approved by the state legislature in 2009 as a way for towns to make up for cuts in local aid, which the state said recently it will reduce by an additional 4 percent this coming fiscal year.
The controversy erupted as the selectmen reviewed the final list of 50 articles set to be printed in the Annual Town Meeting warrant this week. When the BOS reached the two tax-related articles, which are among the last in the warrant, Wallace reported she had learned from Town Counsel Mark Lanza, through Town Administrator Tim Bragan, that Harvard would be unable to tax restaurants and hotels at Devens because “Mass Development [the governing authority for Devens] has snatched [them both].”
“Given that we couldn’t tax … hotels on Devens,” she said, “I would recommend we pull [the article],” because it would apply only to the Friendly Crossways conference center on Old Littleton County Road.
“I would agree,” said Selectman Peter Warren,” if you’d agree to withdraw [the meals tax article].”
“The problem,” said Selectwoman Marie Sobalvarro, “is that we have no idea how much money this is going to raise for us,” since the state Department of Revenue will not estimate tax receipts when there is only one business in town, a fact confirmed by Bragan. “I can figure out that the meals tax is a number I don’t want to leave on the table,” she said, but with the room tax “I have no clue.”
“I think it’s perfectly horrible,” Ricci said to Wallace, “that you’re singling out one business you happen to be friends with.”
“I think you’re misrepresenting me and I resent that,” said Wallace, who said no favoritism was involved.
Following the vote to pull the room tax article from the warrant, which Ricci and Warren opposed, Warren moved to pull the meals tax article as well.
“You’re voting to remove it because it only raises $7,000?” asked Sobalvarro, referring to the 2009 DOR estimate of revenues Harvard would have received last fiscal year.
“I’m voting to remove it because you’re affecting seven small businesses [in town] who don’t do a whole lot of business compared to the Devens Grill or the Holiday Inn in Boxborough. I think you’re putting a burden on these people,” he responded.
The motion was defeated 3-2. Once again Ricci and Warren were outvoted, but not without a parting shot from Ricci. “You wanted to put the meals tax on the warrant to give voters a choice,” he said. “Chapter 498 [the portion of state law that spells out who can tax Devens businesses] is clear to anyone who can read. You didn’t have to ask Mark Lanza.”
Statewide, 73 towns have approved a local meals tax, and 72 have voted for a room tax of 4 to 6 percent. Of the towns that abut Harvard, none have adopted a meals tax, and only one, Boxborough, has voted for the room tax.