HAVERHILL — City Council easily passed a proposal to increase the local tax on hotel stays last night.
The measure to raise the rate by 2 percent will add $4 to a $200 hotel bill and an estimated $78,000 to city coffers over the next year.
A state law enacted by the Legislature several years ago gives cities and towns the option of increasing the local hotel tax from 4 percent to 6 percent. Fiorentini pitched it for the first time in 2010, but the council defeated it then by a single vote.
Last night’s vote was 7 to 2, with Councilors William Ryan and John Michitson opposed.
“All these fees and assessments keep piling on to make the city unaffordable,” Ryan said. “The Legislature just jacked up the tax on gas and cigarettes. We are taxing people out of Massachusetts.”
The local hotel tax is on the top of the 5.7 percent state tax on lodging.
Mayor James Fiorentini, who proposed the increase, said the change won’t impact the city’s two motels — the 110-room Best Western and the 126-room Hampton Inn — from a competitive standpoint because most of Haverhill’s neighbors have already increased their local hotel tax.
Nearby communities already at 6 percent, the mayor said, include Andover, Lawrence, Methuen, Amesbury, Tewksbury, Billerica, Chelmsford and Lowell.
Councilor Michael McGonagle said the Best Western and Hampton Inn in Haverhill are already among the most expensive hotels in the area.
Prior to the meeting, McGonagle said he he checked the rates for hotels in the area for this coming Friday. He said Best Western and Hampton Inn were both offering standard rooms for $189 per day.
Similar hotels in Andover and Lawrence, he said, were offering rooms for between $114 and $119 per night, while a hotel in Tewksbury wanted $179 per night.
“Everyone around us is already cheaper and they already have the higher tax rate,” McGonagle said. “I don’t believe increasing the rate by 2 percent will cause our hotels to lose business.”
Councilor Mary Ellen Daly O’Brien voiced a similar view.
“Our hotels charge $60 to $70 more than their competitors,” she said. “But if they choose to have high rates, that’s their business.”
No one from Haverhill’s Best Western or Hampton Inn attended the meeting to speak against the tax hike, unlike two years ago when representatives from both those hotels spoke against the measure prior to the council defeating it then.
Councilor William Macek voted against the tax hike two years ago, but for it last night.
“I intend to vote for it because the money stays local,” Macek said. “It doesn’t go to the state and it’s paid by transients,” he said of the local tax paid by hotel guests.
Haverhill generated $153,000 in the fiscal year that ended June 30 at the 4 percent tax rate.
Projections show raising the rate by 2 percent will increase the take to $231,000 in the new fiscal year.