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To my surprise, voiceofsandiego.org is not only repeating — but headlining — the canard that “taxes” are proposed to finance the Convention Center expansion.
That’s not true. No taxes are being proposed. Unlike the hotel tax (TOT) which goes into the city general fund for broad purposes, proposed fees on hotel visitors, downtown restaurants and taxis could only be used for the exclusive purpose of financing the Convention Center expansion.
For confirmation that an assessment on hotels and their guests is a fee, not a tax, you may want to refer to the California State Constitution or review the explanations contained in the City of San Diego Independent Budget Analyst “Report 10-29 Revenue Options for the City of San Diego.” You will find this very clear summary on page two:
“Tax vs. Fees. A tax is purposed for revenue generation, while the purpose of a fee is to recover the cost of providing a particular service. Per California Law, a fee cannot be set above the reasonable cost of providing a service.Full cost recovery through fees effectively frees up general tax revenue to support other general services.”
As in fire stations, cops on the beat, and libraries.
In the case of financing the Convention Center expansion, the majority of new fees will be levied only on visitors. The new fee revenue can only be used for debt service and other capital costs (not operations).
The city of San Diego will be very careful to ensure that money is only spent this way, especially after the expensive spanking it got from courts when it used business license fees improperly. That won’t happen again.
Economists project that expansion will add $17 million in annual city tax revenue from visitors, nearly 6,000 permanent jobs, and overall annual economic impact for our region of almost $700 million per year.
In this case “walks like a duck, etc.” does not apply. It is a golden goose (fee), not a duck (see previous reference regarding “canard.”)
Finally, my comments here are based on my service as chair of the Citizens Revenue Review and Economic Competitiveness Commission, and does not reflect the views of any organization, including my present position as a Port Commissioner.
PS: For the less cynical among us, see Wikipedia definition: “Canard, duck (in French) An unfounded or false, deliberately misleading fabrication, a false report, rumour or hoax.”
Bob Nelson is an advertising and public relations executive who dedicates much of his time as a volunteer in community and civic organizations. He formerly served on the board of the San Diego Convention Center Corporation.