Con game
The good news: Some hoteliers in San Diego have banded together to commit a $500,000 inducement over five years to keep the Comic Con in San Diego.
The bad news: The money is going to come from people who stay in those hotel rooms, in the form of a 2% tax on top of the 10.5% hotel tax.
In other words, about 7,000 of us who stay in Comic-Con block hotel rooms will be paying 2% more to keep 126,000 people who come to the Con and spend their money in hotels and restaurants and on cabs and so forth.
That doesn’t sound like much of a contribution from the city — and, technically, it isn’t any contribution from the city. Moreover, it sounds suspiciously like a regressive tax.
April 28th, 2010 at 6:04 pm
The money comes from a 2% tax already implemented to fund a Tourism Marketing District in San Diego.
“The latest overture comes from a coalition of hoteliers who formed a marketing district three years ago to boost tourism through a 2 percent surcharge on city hotel rooms.” – San Diego Union Tribute
Las Vegas has had a fee added to hotel rooms to fund the Las Vegas Convention Center for many years.
The San Diego Union Tribute article can be found here:
http://www.signonsandiego.com/news/2010/apr/28/comic-con-lure-gets-500000-sweetener/
April 29th, 2010 at 7:55 am
I had already linked to the same article. Check out my post again and you’ll see it. I reference the 2% on top of the 10.5% hotel tax, as you do, but I conclude that therefore 7,000 people staying overnight are thereby partly financing the vacation of 119,000 others. The math still holds, and the tax is still regressive.
My further point is this: The people who are most benefiting from this — the City, in increased sales tax revenue, and the restaurateurs and vendors — aren’t kicking in in any way. And neither are the hoteliers. The only people kicking in are those paying for rooms.
To put this in perspective, over the past three years, the City of Burbank has seen its share of sales tax revenue decline by $6 million. (Which means that in 2008-2010, we’ve lost $600 million in retail sales.) Now figure it the other way: What is the City of San Diego’s share of sales tax revenue from the Comic Con? Note this, from the news article we both linked to:
“Next year’s revenue from the surcharge is expected to exceed $23 million, which will go toward attracting more visitors and conventioneers to the city. About half the money is allocated to San Diego’s main tourism agency, the San Diego Convention & Visitors Bureau, which was formerly funded by the city.
“Well aware of the tens of millions of dollars in spending Comic-Con brings to the city each year, local hoteliers say they would be hard-pressed to find any other event that would fill rooms throughout the city, especially during a prolonged economic slump.”
If the Comic Con brings, say, $30 million in spending to the City, that’s $3 million annually into City coffers. Also note that the “revenue from the surcharge” is expected to exceed $23 million next year alone. And yet the offer to the Con is only $100,00 a year — and you and I are paying that.
Does it seem fair now?
April 29th, 2010 at 2:17 pm
I agree that we should not be paying for a service that is being resold as a “benefit” from the city. When I read your blog it seemed that the charge was something new to act as a way to “help” intice the Con to stay in San Diego. I was trying to point out additionally that this type of fee is not unique to Sa Diego. Many areas have a “tourism marketing fee” that’s used to buy advertising and other items to get people to visit.
Just like a municipality adding a fee to car rentals to raise revenue San Diego is imposing a fee on hotel users. The residents don’t complain about such fees because they don’t pay them. The people who do don’t vote in the city that imposes the fee so it’s considered a safe tax.
Sorry if my post seemed like I was supporting the tax.
April 29th, 2010 at 3:07 pm
I’m often in favor of these fees. A TOT (tax on transient occupancy) usually benefits the city providing services and the local businesses who benefit from tourism marketing. In this particular case, it’s being levied on 5% of us to subsidize the other 95%. And the city itself has kicked in nothing.
April 29th, 2010 at 3:08 pm
And please, you’re free to disagree. In this particular case, I continue to think the city of San Diego doesn’t do enough for the convention. Attending the Con talkback a few years ago was an eye-opener.
April 29th, 2010 at 5:53 pm
At some places in San Diego I get the feeling that Con goers are more welcome than at others. Last year I went to a restaurant for lunch and the waitress said that the owner had simplified the menu because of the Con. They had a special menu of the items most ordered by Con goers because they could prepare an order quicker and the attendees could get back to the convention center quicker. At some of the higher end places Con goers are seen as clogging the sidewalks and not letting “real” customers in.
For all the money the Con goers will dump in the city you would think more would be done. I still don’t want the Con to end up elsewhere.