Why did Pat Scully paint his hotel light blue?

Because it helped him make money

Explanation:

These two lines from the story make the reader believe that he painted it blue for money reasons

"it was not to be thought that any traveler could pass the Palace Hotel without looking at it." "Pat Scully, the owner, had proved himself a master of strategy when he chose his paints. It is true that on clear days, when the great express trains swept through Fort Romper, passengers were overcome at the sight."