Santa Barbara County voters will decide in November whether to increase transient-occupancy taxes in unincorporated areas to 12 percent from 10 percent.
It would be the first such increase since 1990.
The county Board of Supervisors voted 4-1 Tuesday in favor of adding a general tax measure to the ballot, with a condition that draft ballot language add “county” into the phrase “for general government purposes.”
If approved, out-of-area visitors renting hotel rooms or other lodging for 30 days or less would pay more transient-occupancy taxes, also commonly called TOT or bed taxes.
TOT is already up to 12 percent in Santa Barbara, Goleta, Carpinteria, Solvang and Buellton.
Fourth District Supervisor Peter Adam opposed the action because voters would be asked to approve new taxes for the county’s general fund with unspecified use.
He guessed residents would vote the measure down as they did in 2014 to Measure O, which proposed an increase to 12.5 percent.
“I’m on record as opposing any general tax,” Adam said. “It sends the message we’ve spent all our money. I would support any special tax for any reason.”
TOT is the third largest source of revenue for the county general fund after property and retail-sales taxes. In the 2015-16 fiscal year, the county expects TOT to generate $8.98 million.
If voters approve the measure, the county could see an additional $1.98 million in revenue for 2017-18.
The supervisors pointed out that figure doesn’t include Montecito’s Rosewood Miramar Beach resort and at least two other hotels going up in the Goleta and Los Olivos areas.
Fifth District Supervisor Steve Lavagnino estimated Miramar alone could bring in another $300,000 annually.
At least four supervisors had to approve putting the measure on the ballot, and a majority of voters must approve the tax for it to take effect.
Lavagnino worried some residents might not understand that ballot language means the tax would stay local, possibly funding road repairs or law enforcement.
Aging infrastructure and $324.5 million in deferred maintenance were specifically mentioned in a county staff report as needy funding areas.
County Counsel Michael Ghizzoni warned that listing potential uses could constitute a special tax, which must instead be approved by two-thirds of voters under California law.
“It gets murky when you just say ‘general government purposes,’” Lavagnino said. “I’m not sure they would know exactly what they’re voting on.”
Second District Supervisor Janet Wolf, who called the tax measure a no-brainer, suggested adding “county” to draft ballot language, which supervisors will approve next month.
Santa Barbara Chamber of Commerce President and CEO Ken Oplinger said South Coast businesses were generally supportive of the tax measure, but he tempered support with whether part of that increase would be invested back into economic development and tourism.
The area sees 6.1 million visitors a year, Oplinger said, generating nearly $46 million in tax revenues to South Coast cities.
“Frankly, I think it’s a pretty decent debate to find out if the private sector can spend that money better than the public sector,” said Santa Barbara County Taxpayers Association President Joe Armendariz, an opponent of the increase.
Taxing visitors for using roads might make sense, he said, but for public safety, not so much.
“Visitors do cost us money for roads,” Lavagnino said. “I think it’s an issue of fairness.”
With a presidential election in November, he said the ballot will have a better chance of reaching voters to let them decide.
Lavagnino and Wolf will write arguments in support of voters passing the ballot measure, which would go into effect Jan. 1, 2017.
— Noozhawk staff writer Gina Potthoff can be reached at gpotthoff@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.