Consider Raising the Rate of the Hotel Tax (Transient Occupancy Tax).  (Councilmember Daysog)  [Continued from March 19, 2019 to April 16, 2019]
Thank you, Mr. Levitt. And do we have any oral communications? Not agenda? No. So then we move on to council referrals. Item nine, a couple more days. Well, great. Well, thank you very much. Laura, do you, by any chance have this, um. Oh, yes. Actually setting it up. Just to get to the punchline. The punchline is, I think the city of Alameda should officially seek to increase the current hotel tax rate, which is basically 10%. The hotel tax rate is also referred to as a transient occupancy tax. And so that's basically the punchline and that's one recommendation. And the second recommendation, but these are separate is begin thinking about setting aside some of the increase in revenue generated by the increase in the rate for having an Alameda visiting serving campaign. It could be run, for example, money generated from the increased incremental revenues perhaps could be funded through an RFP process to an outfit like the Chamber of Commerce who might serve as as the visiting center. So what I put together, I don't do this well that I put together is just a bunch of data. And this is actually from this actually from 2015. So this is I know how we talked earlier this evening about the wheels of kind of moving slowly. But, you know, we're almost four years ago. So I so I think one of the points in putting this slide together, which is 2014 data, but I think the rates still hold is to show how low our hotel tax rate is relative to nearby areas like Emeryville, Berkeley and Oakland, which are really within our market area. The point of which is to say even if we increased the hotel tax rate, we wouldn't be putting ourselves at a competitive disadvantage. And while San Leandro is a neighbor to us at 10%, if you look at the gross revenues generated by a their what, clearly the $402,000 of San Leandro versus the $1.6 million generated by Alameda to me suggests that San Leandro is a different market. So that's why I believe in increasing the hotel tax rate. Somewhere north of 10% right now would not put our our motels and hotels at a competitive disadvantage. This is the hotel tax rate for the Union City. And the reason why I included this is because Union City created an interesting mechanism where when they when the voters adopted the increased hotel tax rate, they did it in a way that allows the city to kind of calibrated up or calibrated down depending on market conditions. So that's something to think about. This is the hotel tax rate for the city of Oakland. They're at 14% and they were previously at 13%. And you can see you can see how much they're generating. Clearly, we're not going to generate that much because we're at a different scale. So I just want to make sure to clearly see that. And one of the reasons why I think we should think about not only increasing our hotel tax rate, but doing it in a strategic manner is because I do believe that we have a variety of assets that nationally renowned entities are beginning to to recognize assets that we can market to new visitors within the region, as well as market to daytime visitors. People, for example, who are working, coming to our harbor Bay Isle on short contract jobs or whatever, so that they can come to Alameda. And here's an example, something that was in the Architectural Digest where Alameda is antiques by the Fair Bay was was noted in July 25. And then in in Sunset Magazine, again, Alameda, a spirits alley was given some recognition. So my hope is to increase the hotel tax rate. I don't think it will put us at a competitive disadvantage. It does require a vote of the people. And the second thing is to. Target some of that towards a visitor surfing campaign. So I would hope to have staff come back with some more thoughts on this and some recommendations and suggestions. If if the council so looks at this. I think you remind me, colleagues, did did this come up at our priority setting? Okay. I guess we've discussed it somewhat in context of needing to do something about an a Airbnb ordinance and then making sure that our total is competitive with other cities. Those days are old. San Leandro is now past is there but what's the what's the the pleasure of the council and vice mayor? So in general, I support the general idea of talking about this tax at some point in time. I think we just continue to talk to things. I am concerned that a lot of times when referrals come, the way to not address them is to say, hey, let's just put them on a list to get addressed earlier, and then they just become a part of a long list and is difficult to do. I think we have infrastructure bonds, we have a whole bunch of things that we're going to be talking about going to the voters of. And I am happy to have that commerce, this conversation as a part of what are the things we are going to ask the voters for. But quite honestly, I don't disagree with you that this is probably one that we should talk about, but I don't want to jump one to the top of the queue and then find out that we you know, there were other things we wish we were going in asking for funding. Funding. Okay. So you're saying I'm for this into a discussion of of ballot measures for the general election. Okay. A future conversation with Councilmember Vela. So I actually think it's a bit premature. I would say let's wait until we actually have some of these hotels built that are coming in, are we? I know we have hotels currently, but in terms of the impact that something like a total increase is going to have, it's, uh, I would rather focus on the infrastructure. We've talked about the storm drain tonight. I just think we have a lot of other things that we're focused on. So I'm not saying no. I'm just saying no for right now. And if it's no for right now, I don't want to put it on the list for staff to to be focused on. And I would like our polling to be very specific and strategic to the few measures that have already been put forward by staff and discussed by council. And I'll just throw in that. I think the authority is probably an easier measure to pass because residents are generally speaking not going to be paying it. But I, I do have some concerns about that money not going to the general fund because that's what pains me to know that we are getting less in our Toti than our neighboring communities and that's just money that's not going into our general fund. So but that's a that's a discussion that could be had at the same time. Councilman Brody. Sure. I'll chime in. I mean, I think it's a good idea to think about this. Like you said, Mayor, this is not something that Alameda residents are going to pay. I'd like to I mean, I don't know whether it's put it on a list or, you know, at some point we're going to have a discussion on revenue measures. And this needs to we need to make sure this is their. Good. Time. I mean, instead of like just pushing it off and, you know, you know, this is something that was proposed four years ago. And I thought it was something that maybe should have been done already. Again, not to keep beating that horse, but I am concerned about one small thing and that's, you know, dedicating any of of it, because I think that changes the characterization. And, you know, what the what the threshold is to get it passed. But, you know, I think this is something this is kind of a no brainer to me. You know, it's a quick and easy way to increase revenue that doesn't really come out of the pockets of Alameda. Well. Let me if I quickly saying I'm I'm happy to have introduced this. I look forward to having further conversations on this. I do want to make sure to say that I project that if we increase it by one percentage point, that we would generate $160,000 in incremental revenues. And if we increased it by two percentage points to 12%, we could generate roughly $250,000. And I think that would be good money that that that could go towards a visitor surfing campaign. So but I look forward to including this as part of a more robust discussion with other measures. I'm fine with that. I can live with it. Okay. Well, I'll find a note if it does come to a vote. I don't think it will be competitive with another vote for the reasons that we said. All right. Okay. And have staff discretion, direction. Okay. The next item is number ten Council Communications. I'm wondering if we could take item ten a first to make sure we get that covered hearing no objection. Go ahead, Vice Mayor.