County supervisors Tuesday considered whether to place a transient occupancy tax – or “hotel tax” – on the November 2014 general election ballot.
The current tax is 8 percent and was established by ordinance in 1986, according to Janelle Cox, a management analyst. The rate under consideration is between 10 percent and 12 percent. Communities customarily use the tax on visitors to hotels and motels for economic development or tourism promotion, officials noted.
“An increase to the TOT rate requires voter approval,” Cox said to the board.
The total revenue to the county from the current tax is $84,000 a year, she said. If the tax is increased, another $20,000 could be generated, she said.
“As the county grows, the additional lodging from visitors could increase revenue,” she said.
Supervisors raised questions about how specific they would need to be – regarding where the money gets spent – and whether the measure would need voter approval.
“Some counties use TOT tax exclusively for economic development,” said Supervisor Jerry Muenzer, who initially raised the possibility of increasing the rate.
Any vote by the residents on how the funds could be used would merely be “advisory” to the board and not necessarily binding, said County Counsel Matthew Granger.
“I think we should just put the item on the ballot and hope future boards” provide direction on how to spend it, said Supervisor Jaime De La Cruz.
In order to put it on the ballot, the county would have to draft language and set the proposed increase. There would be a period for public comment, while the final resolution would be submitted to the public by August 2014, Cox said.
“I think this would be successful if we say what the money could be used for,” said Supervisor Margie Barrios.
Another issue that might come up is that adding the measure to the 2014 ballot could increase election costs, said Joe Paul Gonzalez, the clerk-auditor-recorder. Additional language would cost extra in printing and postage.
“We have a lot of mailed postage precincts,” he said.
