REPORT TO COUNCIL
SUBJECT
Title
Action on the Adoption of Ordinance No. 2033 Amending Section 3.25.030 of the Santa Clara City Code to Reflect the Increase in the Transient Occupancy Tax Rate to 11.5%
Report
COUNCIL PILLAR
Enhance Community Engagement and Transparency
BACKGROUND
At the September 28, 2021 Council meeting, proposed Ordinance No. 2033 was introduced and passed for the purpose of publication. Pursuant to City Charter Sections 808 and 812, proposed Ordinance No. 2033 was published on October 6, 2021, and copies were posted in three public places. The Ordinance now comes to Council for final adoption.
DISCUSSION
The City's current Transient Occupancy Tax (TOT) rate is 9.5%, which is one of the lowest in the County. On November 3, 2020, Santa Clara voters approved the following ballot measure that allows for an increase of up to four percentage points in the City's TOT. This 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 the current rate of 9.5% to up to 13.5%.
As part of the adoption of the operating budget on June 22, 2021, staff was directed to bring forward a separate resolution to increase the TOT rate by two percentage points (of the maximum of four percentage points) effective January 1, 2022. The FY 2021/22 and FY 2022/23 Adopted Operating Budget assumes this increase. On September 28, 2021, the City Council approved a Resolution increasing the TOT rate from 9.5% to 11.5%. 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 CEQA Guidelines section 15378(a)(4) 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.
FISC...
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