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Facebook Twitter WhatsApp SMS Email Print Copy article link Save OCEAN CITY — The cost of a short stay in the city could go up under an ordinance introduced by City Council creating a 3% fee on stays in hotels, motels or other lodgings booked online. A public hearing must take place before a final vote, planned for 10 a.m. Dec. 5 on the third floor of City Hall, 861 Asbury Ave. The original ordinance was written only for accommodations booked online through third-party services like Vrbo or Airbnb, what the ordinance describes as the “transient space marketplace.” There are currently no local taxes on those rentals, which have become a significant part of the summer rental market. Council President Pete Madden suggested moving the ordinance forward as proposed, and revisiting the potential addition of hotel and motel rooms at a later date. As city attorney Dottie McCrosson described it, there had been discussion of including hotel and motel rooms, but those visitors already pay a 5% state occupancy tax and a 6.625% sales tax, adding 11.625% to the total bill. Jersey Shore restaurants shift gears to survive in offseason Friday’s New Jersey high school football playoff scores Not too late! Voting closes at noon for The Press Football Player of the Week Galloway Township gymnastics center co-owner charged with sexually assaulting minor Offshore wind company to buy vacant 1.5-acre Atlantic City lot for $1 million Atlantic City International Airport's 1 carrier, Spirit Airlines, files for bankruptcy Which players did the Cape-Atlantic League coaches pick as the best of the best in fall sports? 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Council member Terry Crowley recommended against the move, at least without more research. The city hopes to have the new tax in place before Jan. 1. “I would encourage you to really research that,” Crowley said. “There’s a downside there as well. I don’t think we’re considering everything.” A red sticker on a Glenn Cove bulkhead indicates work has come to a halt on boat slips in Ocean City’s smallest lagoon, at least for now. He said the city could approve the ordinance as written and then bring the local room tax up later. “This version is kind of the cleanest way to kickstart the process, to look to bring in additional revenue to the town. It’s been done in many other towns,” Crowley said. “By doing it this way, we're really not incurring any administrative costs. We’re not going to have to hire the anyone else.” At one time, it was difficult and cumbersome to tax third-party rental systems. Now, Vrbo, Airbnb and others are set up to include local fees and taxes, and McCrosson said the state has recently empowered towns to add the additional taxes. Mayor Jay Gillian said the idea has been talked about for some time and was previously raised by former Council member Bob Barr, who is now on the Cape May County Board of Commissioners. McCrosson said she did not intend to single out Airbnb and Vrbo, but those are the two largest online rental marketplaces by a significant margin. As originally proposed, the ordinance would not have applied to rentals through Realtors or directly from the owner, or for hotel stays booked through the hotel’s own website or through the front desk. Some hotel owners have requested some sort of local fee. “There was a perception among hotel (and) motel owners in town that there was not a level playing field,” McCrosson told council. “That Ocean City should somehow tax them or put license fees on them. At that time it was not an easy thing to do.” With the current state law in place and systems created for the third-party rental systems, it is now relatively simple to impose and collect an additional tax on the rentals. Barnes presented the issue as a matter of fairness. Ocean City officials announced Thursday that a 3rd Ward meeting to be led by City Council member Jody Levchuk will be moved from council chambers in City Hall to the larger Chris Maloney Lecture Hall at the Ocean City Free Public Library, 1735 Simpson Ave. Plans for the former Gillian's Wonderland are expected to be part of the discussion. “I don’t want to see anybody pay more taxes than their competitor, but I want to make sure that they’re all paying the same,” he said. He also questioned where the additional fees paid by hotel visitors end up. “It leaves Ocean City,” McCrosson said. “It’s various fees, but it leaves Ocean City.” McCrosson told council the ordinance was their decision, and that a majority of members could amend the ordinance prior to introduction or introduce a new ordinance at a later meeting. “The concern of the administration is, if you’re going to do it, lets get it in place by January,” she said. Barnes, Hartzell, Winslow and Council member Tony Polcini voted to amend the ordinance prior to introduction to include hotel and motel rooms, with votes against from Crowley, Madden and Council member Jody Levchuk. The same 4-3 majority voted to introduce the ordinance, the first step toward a potential final adoption in December. Other communities have imposed local taxes on hotel and motel rooms. In Cape May, the charge is 3%, while in Atlantic City, a $2 surcharge per day in casino rooms, in addition to the 9% Atlantic City luxury tax familiar to any Monopoly player, joins sales and occupancy taxes and other fees. In Ocean City, many hotels also charge additional fees beyond the room rate, such as resort fees covering the use of the pool or other offerings. Ocean City also charges a license fee for rental properties. At the Thursday meeting, McCrosson emphasized the distinction that it was a fee rather than a tax. Contact Bill Barlow: 609-272-7290 bbarlow@pressofac.com Twitter @jerseynews_bill Get Government & Politics updates in your inbox! Stay up-to-date on the latest in local and national government and political topics with our newsletter. Author email {{description}} Email notifications are only sent once a day, and only if there are new matching items.