As another summer dawns in Santa Cruz and the boardwalk begins to swell with tourists, the hotel industry is hoping this year will be better than last. It may soon get a leg up from local politicians. On Tuesday, June 15, the Board of Supervisors will make its final vote on the proposed Tourism Marketing District—a separate lodging fee that would be used exclusively by and for the tourism industry to promote tourism in Santa Cruz County. The proposed fee would add an additional $1-1.50 to hotel stays and provide an estimated $1.1 million to the Convention and Visitor’s Council. The idea has already received the thumbs-up from city councils in Santa Cruz, Scotts Valley, Capitola and Watsonville. The supes’ approval would make it official countywide.
Hotel representatives who spoke at the Board of Supervisor’s meeting weeks ago expressed concerns over what they say is a 25 percent drop in business from last year.
“Market share in Santa Cruz County is dwindling as compared to other counties,” says Jim Maggio, general manager at Seascape Resort. Maggio, who has had to lay off 17 employees since last season, says Santa Cruz must do more to compete with Monterey and Tahoe for tourists.
District 1 Supervisor John Leopold supports the intentions of the proposed TMD but remains concerned about job quality and wages of hotel workers, which would not be affected or addressed by the new fee.
“Labor representation in communities assures decent wages and benefits,” says Leopold. “In Santa Cruz County, we don’t have that.”
Leopold also expressed concern that the TMD would stay on task in the future and not be allowed to lobby or become an entity that would influence local government decisions down the road. Although he supports the TMD, his vote is contingent on the language of the ordinance plan.
The proposed TMD would be on top of the current Transient Occupancy Tax, or bed tax, which charges guests a fee equal to 10 percent of each lodging stay. In the city of Santa Cruz that valuable TOT revenue funds police, fire and public works and currently faces a $4 million shortfall. Critics of the TMD, like Ron Pomeranz of Santa Cruzans for Responsible Planning, question whether an increase in promotion guarantees an increase in tourism and advocates a 2-3 percent TOT increase instead.
