Tennessee Supreme Court Refuses to Hear County’s Raft Tax Appeal
The Supreme Court for the State of Tennessee recently refused to hear Polk County’s appeal of a State Court of Appeals ruling that a tax on rafting customers on the Ocoee River was illegal under the Maritime Transportation Security Act of 2002. Therefore, outfitters have won for now.
However, an effort was made in the last session of Congress to reverse the prohibition on non federal taxes and fees on navigable waters. Fees are legal if a service is provided or safety and security is enhanced. That rescission language was included in the Coast Guard Authorization bill which passed the House but died in the Senate. AOA is working to keep the measure out of the House bill this year.
New taxes on struggling, small business in this economic environment is the worst idea possible! Nonetheless, several state and local governments are trying to raise fees on recreation services, which are illegal under existing law on navigable waters except fees for regulation. Under current law, taxes on river trips have been rescinded in Idaho, Pennsylvania and Tennessee and the rescission has withstood legal challenges by local governments. The legal costs for outfitters in Tennessee were staggering since the County used every trick in the book to attempt to collect the tax, including confiscating outfitters' property.
The language in the current law states:
"No taxes, tolls, operating charges, fees, or any other impositions whatever shall be levied upon or collected from any vessel or other water craft, or from its passengers or crew, by any non-Federal interest, if the vessel or water craft is operating on any navigable waters subject to the authority of the United States, or under the right to freedom of navigation on those waters, except for--
`(1) fees charged under section 208 of the Water Resources Development Act of 1986 (33 U.S.C. 2236); or
`(2) reasonable fees charged on a fair and equitable basis that--
`(A) are used solely to pay the cost of a service to the vessel or water craft;
`(B) enhance the safety and efficiency of interstate and foreign commerce; and
`(C) do not impose more than a small burden on interstate or foreign commerce.'"
Thanks for Completing the Spring Business Outlook Survey. It Isn’t Too Late to Respond.
If you have responded to the Spring survey, thanks. You can only respond once. However, if you have not responded please go to SURVEY. Help us gauge the industry’s economic condition. Over 150 companies responded to the winter survey and more than 60 have responded to the Spring edition. You can see the results at RESULTS
What we are hearing about the market:
• Low end day trips near metro markets are doing well
• Some adventure resorts with lodging offering 3 and 4 days stays are doing well
• Multi-day trips, especially those that require air travel are weakest, especially if they are higher priced trips.
One outfitter running day trips in northern California who has rental cabins said their business is doing well because their community tourism board focused marketing efforts on the Bay area and those efforts seem to be paying off. You can read the comments at the end of the survey.
AOA Pushing for Waiver on Forest Service Use Requirements
The Forest Service permit states that failure to use authorized privileges is a permit violation. Some Forests collect fees up front and require outfitters to pay for all authorized use. Earlier this year, AOA wrote the Secretary of Agriculture asking that the agency waive these requirements. The response said the agency will review the situation at the end of the season. Unfortunately, that will be too late for some companies whose business is off 30% to 40%. AOA is pushing once more to have the Forest Service waive the permit utilization requirement and only charge for actual use, not all of it. Some ranger districts are already allowing these changes, but we are asking for a letter from the Washington Office so that outfitters who need to shut down will not be cited for violating their permits.
Forest Service and BLM Stimulus Projects Can Be Found on Line.
Department of Interior Stimulus Projects can be found online at http://recovery.doi.gov/
Forest Service projects by state are available through the AOA site under Member Resources. Don’t look for many trails projects. Most of the projects are for thinning, hazardous fuels reduction, environmental restoration, and road maintenance, some which will benefit recreation.
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