Mayor Faulconer Pushes For Hotel Tax To Fund Convention Center Expansion
Mayor Kevin Faulconer touted a proposed ballot measure on Monday that he said would raise hotel room taxes to pay for an expansion of the San Diego Convention Center and produce funding streams for road repairs and homelessness programs.
The plan, which needs voter approval because of the tax hike, is scheduled to be submitted to the City Council's Rules Committee on Wednesday. The full City Council will later have to decide whether to call a special election, likely for November.
"This ballot measure will create jobs, fix streets and help reduce homelessness in our city," Faulconer told reporters.
"Our convention center must be modernized and expanded to keep up with other cities that are taking away from our tourism business," Faulconer said. "I'm not asking San Diego taxpayers, who are being taxed enough already, to shoulder this burden."
The levy — known officially as the Transient Occupancy Tax — is paid by hotel guests. The Chargers attempted a similar funding mechanism in their stadium measure last November, but it failed to gain the support of even a majority of voters. Two-thirds voter support is required to raise taxes.
Tourism boosters contend the bayside convention center is losing out on the biggest trade shows because other cities can offer facilities with more room. Competing convention centers have for years been trying to lure away Comic-Con International, the annual celebration of the popular arts that began in San Diego and is the area's largest annual event.
The mayor's office said expansion would add 400,000 square feet of convention space, which could attract an additional 50 events to downtown. Supporters projected that would generate an additional $15 million annually in room tax revenue for the city from more than 380,000 new hotel room nights.
The extra dollars would help pay for municipal services such as public safety, parks and libraries, according to the mayor's office.
The proposal also estimates an additional $10 million each for programs for the homeless and road repairs every year, with the income growing as tourism increases. That money can back bonds that would bring in additional funding for projects.
"Homelessness in San Diego is a problem not just for those of us that are most vulnerable and on the streets and in the shelters, but it’s a problem affecting the entire fabric of the community, including the business world and in particular the tourism industry that’s part of that business world," said Rick Gentry, president and CEO of the San Diego Housing Commission.
A TOT increase has been tried and rejected by voters multiple times in year's past, but Faulconer said this time will be different.
"The only people who will have to pay this very modest increase are the tourists," Faulconer said. "And meanwhile, San Diegans will receive the benefits."
"It’s never easy to get two-thirds. But I’m confident as we work together as a city, we have a real opportunity to get this across the finish line," he added.
If approved by voters, the hotel room tax increase would take effect in 2018. Construction on the convention center expansion would begin in summer 2019 and take 44 months.