A proposal to find new funding for a campaign promoting Sonoma tourism failed to win over the Sonoma City Council last week.
The idea is to raise the Transient Occupancy Tax, or room tax, from the current 10 percent rate to 12 percent. The resulting gain, approximately $440,000 annually, would be used specifically to market Sonoma and generate tourist dollars.
The mechanism for the increase is called a Tourism Improvement District. A city staff report explained that “hotel representatives have indicated that their motivation to form a TID is to provide a mechanism for a strong and sustainable marketing program for tourism promotion… and potentially alleviate the need for the city to continue to provide the current general fund marketing subsidy to the Visitors Bureau.”
The money generated under the TID would be administered by a new entity overseen by as yet unnamed board of directors. Currently, the Visitors Bureau handles the marketing program, with funding and input from hotel partners.
The city also contributes to that fund, with redevelopment dollars. That option may disappear give the state’s budget crunch.
Still, council members took a wait and see approach to the TID proposal. “Until we know what the landscape is going to look like, I just can’t get there,” said Ken Brown.
Steve Barbose said he was unwilling to give up a two percent TOT increase that might otherwise go directly to the city’s general fund. That move would require a public vote, whereas the formation of the TID is strictly a council decision. I
A staff report estimated that to generate an amount of TOT equal to the amount the city could garner with a two percent TOT increase, hotel room sales would need to increase by $4,660,000.
Mayor Laurie Gallian left the door open to further study. “Stay tuned,” she said.
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