The city council is now convinced that the formation of a convention center facilities district to tax hotel property owners and pay for the phase III expansion of the convention center on Harbor Drive is justified. By the time the afternoon public hearing was done and the councilmembers voted on Tuesday, January 24, the special district and the bond funding needed to finance the construction were approved.
Property owners and hotel operators had their opportunity to speak in favor, or against, the district tax financing plan. All the testimony was heard by the council and considered.
The district formation will go to a vote among the owners that own hotel property in one of the three zones in the district. Mail-in ballots start to go out to the voters on March 25th. By April 13th, each owner will have had a ballot sent to them.
Votes are not equal among the voting owners. An owner gets one vote for each dollar in special taxes they would have spent during 12 months.
Hoteliers that earn profit from the Hilton Bayfront nextdoor, the Doubletree Hotel in Mission Valley, and the Ramada in San Ysidro earned their votes by adding up room requests and room prices.
Money that comes from the hotel receipts, just like the TOT dollars, the city will use to pay off the bond debt. The councilmembers set the limit for bond funding at $575 million dollars.
A phase III expansion will take land acquisitions and real estate improvements on public owned property, and the purchase of the construction materials. All the project's bond funded costs, including the price of construction work and consultant services, will get paid off when the tax payments come in.
District special taxes are expected to bring in $35.7 million a year by 2017.
This is a Center Line Policy Alert.
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