Disagreement over San Francisco hotel tax hike


With the city facing cuts to vital services, some residents are backing a ballot measure to make visitors pay a bit more, but the mayor and industry leaders are fighting the proposal.

San Francisco's Convention and Visitors Bureau was created to lure visitors back after the '06 quake. Now, the organization is celebrating its centennial.

"We've had some challenges like everybody else has in the country. It's been tough economic times for pretty much every destination in America. But, having said that, its trending the positive direction right now," Leonard Hoops told ABC7.

Tom Sweeney at the Sir Francisco Drake Hotel, the world's most famous hotel doorman, has noticed a rebound. He said if things are picking up for the industry that meant they were picking up for him too.

Last year, 15.4 million tourists visited San Francisco, spending $7.8 billion and generating $426 million in taxes and fees for the city's general fund. Now, when they leave their hearts in San Francisco, they might also have to leave more money.

On Tuesday afternoon, community activists turned in thousands of signatures to place what they call the "Hotel Fairness Initiative" on the November ballot. It would raise the room tax 2 percent to about $3 a night, charge on-line booking sites, and close the loophole for airline crews who stay in city hotels.

Backers say the measure will bring in at least $35 million a year for vital city services including programs for children.

"I'm the one that a lot of the parents come to, that want after school programs, summer programs, and as you know there has been budget cuts," said supporter Mritza Di Cicco.

The current hotel tax is 14 percent plus a 1.5 percent fee. The additional hike would make San Francisco's the highest in the nation.

Mayor Gavin Newsom said Tuesday, "This is not the time to be raising taxes in this city. This is a city that is working through this recession."

The Chamber of Commerce labels the tax proposal a "job killer" and estimates that more than 2,000 jobs would be lost each year.

"A vote yes means a vote to kill someone's job," says Steven Falk with the chamber.

But, the city's labor council believes the tax will save jobs.

"The public sector workers, the gardeners and the nursing assistants, and the firefighters will not be laid off if we can start generating some revenue," says councilmember Tim Paulson.

If the measure passes in November, it will take effect in January and end in four years.

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