REPORT TO COUNCIL
SUBJECT
Title
Action to Waive Second Reading and Adopt Ordinance No. 2073 Amending Section 3.25.030 of the Santa Clara City Code to Reflect a 1% Increase in the Transient Occupancy Tax Rate.
Report
BACKGROUND
At the October 22, 2024 City Council meeting, proposed Ordinance No. 2073 was passed for the purpose of publication. Pursuant to City Charter Sections 808 and 812, a summary of proposed Ordinance No. 2073 was published in the Santa Clara Weekly on November 6, 2024 and copies were posted in three public places.
DISCUSSION
On November 3, 2020, Santa Clara voters approved a ballot measure that allows for an increase of up to four percentage points in the City’s Transient Occupancy Tax (TOT). The ballot measure, approved by 73.57% of Santa Clara voters, supports essential City services, paid by guests staying in hotels. With this measure, the TOT can be increased from 9.5% to up to 13.5% by resolution.
On October 22, 2024, the City Council approved a Resolution increasing the TOT rate from 12.5% to 13.5%. This Ordinance brings the City Code into conformance with that Resolution.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environment Quality Act (“CEQA”) pursuant to section 15378(a)(4) of Title 14 of the California Code of Regulations in that it is a fiscal activity that does not involve any commitment to any specific project which may result in a potential significant impact on the environment.
FISCAL IMPACT
The FY 2024/25 Adopted Budget factors in additional revenue from a one percentage point increase in the TOT rate effective January 1, 2025. This additional revenue is estimated at $1.7 million annually.
COORDINATION
This report has been coordinated with the City Attorney’s Office
PUBLIC CONTACT
A summary of proposed Ordinance No. 2073 was published to the Santa Clara Weekly on November 6, 2024 and copies were posted in three public places and made available for public inspection at the City Clerk’s Office.
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Waive second reading and adopt Ordinance No. 2073 amending section 3.25.030 of the Santa Clara City Code to reflect the increase in the Transient Occupancy Tax rate.
Staff
Reviewed by: Glen R. Googins, City Attorney
Approved by: Jovan D. Grogan, City Manager
ATTACHMENTS
1. Ordinance No. 2073 (Intro)