Hotel tax revenue holds steady

Posted on January 27, 2011 by Sonoma Valley Sun

Revenues from the Transient Occupancy Tax collected in Sonoma in the first half of 2010 were flat compared to the same period the year before, according to the latest figures compiled by the Sonoma County Economic Development Board.

The $783,000 collected from January through June was 1.5 percent less than the same period in 2009. The numbers pale to the banner visitor year of 2008, when the 10 percent surcharge on Sonoma hotel rooms totaled $1,142,000.

That 30 percent drop is due in part to lower room rates. In response to the ailing economy, hoteliers have been forced to drop rates to boost occupancy rates.
The County’s unincorporated areas, including Sonoma Valley, fared much better in the first half of the year, gaining about eight percent over the same period in 2009.

Historically, the third quarter of each year is the busiest for the hospitality industry, followed by the second, fourth and first quarters.

In Sonoma the room tax goes directly into the city’s general fund, where it accounts for about 17% of city revenue.

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