Burnside may tax parked houseboats
April 8, 2012 Share

Burnside may tax parked houseboats

At the April meeting of the Burnside City Council this past week, mayor Ron Jones asked the council to consider a tax on documented boats — specifically referring to houseboats, rather than smaller, speedier vessels — which are being stored at marinas within the city.

The potential legislation was not passed, put up to a vote, or even discussed in great depth at the meeting, but rather was presented to the councilors as something they might consider enacting at an upcoming meeting.

Jones told those at the meeting that there was no such tax — similar to a tangible property tax — currently being taken on these boats, and that they would be subject to tax wherever they’re stored.

“There’s not any taxation being assessed on the boats that are down here in our marinas,” said Jones.

He also provided a list of other water-adjacent cities in Kentucky that currently do have such a tax, including Paducah, Kuttawa, Covington, Hindman, Paintsville, and Maysville.  “We’re probably the only one that doesn’t do it,” said Jones.

Primarily, those boats in two marinas would be affected — Burnside Marina, visible around the majestic turn of Lakeshore Drive, and Lee’s Ford Marina, which is considered part of Burnside following its annexation in 2005.

Burnside City Clerk Crissa Morris said that it was hard to estimate exactly how many houseboats would be affected. However, Dic Gaskin, dockmaster of Burnside Marina, told the Commonwealth Journal that there were likely “75 to 80” houseboats at his place of business, and J.D. Hamilton, owner of Lee’s Ford Marina, claimed anywhere from 300 to 350 in slips.

The tax — if implemented — would likely be the same as the tangible property tax, according to Jones. Currently, Burnside’s tax rate is 17.1 cents per hundred.

That tax would be based on the worth of the boat — divide whatever dollar amount that is by 100, said Morris, then multiply times 17.1 to get the tax amount. With a potential for more than 400 boat owners paying that tax, the revenue amounts for Burnside could prove substantial.

“It’s not just there’s a lot of revenue there, it’s that everybody else is paying a tax on their boat wherever they keep it, except in Burnside,” said Jones. “I think that’s something we need to give some serious (thought to). … This is food for thought on what we need to do.”

To the Commonwealth Journal, Jones stated that Burnside’s lack of a tax has been “good for the boat owner and we don’t want to run them off,” but “it’s a loophole I feel we need to close up.”

He added, “They charge us on our cars, our trucks, our paper airplanes and everything else. … It doesn’t have to be an exorbitant amount, whatever is customary.”

As someone whose business depends largely on the presence of houseboats, however, Hamilton isn’t sure a tax is such a good idea, especially with the industry already in a crunch.

“We have a lake that still has an economic disaster declared, the houseboat industry is decimated,” said Hamilton. “We pay a ton of taxes.

“It’s already happening on other lakes; it’s a big deal in the marina industry,” he added. “No surrounding state charges this. They’re just going to tax business out of here.”

Hamilton, a member of the Lake Cumberland Association, stated that “there’s legislation saying you can tax documents on vessels but nobody’s been doing it — now people say they’re going to start doing it. Some local governments are saying no, others are saying we’re going to charge. … I think it’s a terrible time to start taxing houseboats, especially when it’s not being uniformly applied.”

Hamilton noted that the tax could end up costing as much as the boat slip itself — close to $4,000 annually at his marina — and also said that as he understood it, houseboat owners in Pulaski might have already been paying a tax already to the county.

To clarify, the Commonwealth Journal contacted county clerk Ralph Troxtell, who noted that owners of documented houseboats — the ones Jones specifically pointed out for tax eligibility Monday — were not paying any taxes, but those with undocumented vessels were paying a “fee.” When asked if it was similar to the property tax paid on vehicles like cars and bass boats — paid to the county before money is paid back to Burnside — Troxtell replied that it was.

Jones reminded the Commonwealth Journal that this is not a done deal, but merely an avenue for revenue that could benefit his city.

“This may never come about,” he said. “I just wanted the rest of the council to give some thought to it, look at everything, and make sure we’re doing what’s best.

By CHRIS HARRIS, Staff Writer
Commonwealth Journal