Powerful interest groups want to do different things with the taxes guests pay to stay in San Diego’s hotels. This intensifying interest in visitor taxes turned an incremental step in a long process into an hour-long City Council meeting Tuesday.

In much of that hour, council heard from the people who directly benefit from tourism promotion, mainly the city’s hoteliers. They’re pushing to extend a 2 percent charge on visitor’s hotel-room bills for four decades, a more than $1 billion pot of tax revenue. Hoteliers decide whether to impose the charge, but City Council has the final say on the extension.

The council expressed its overwhelming support.

“We need you,” City Councilman Kevin Faulconer said. “We need this industry very healthy and this city should stand behind you.”

But even the whisper of a challenge drew dozens of hoteliers and other supporters into council chambers. The city’s hotel-workers union has argued that the extension isn’t legal without a public vote, and reiterated that point on Tuesday. In November, Californians passed a ballot measure that tightened the definition of what’s a tax and, therefore, what needs voter approval, throwing the extension into question.

Up to the microphone came hoteliers from Mission Bay and Mission Valley, red-coated promoters of the city’s college football bowl games and the head of San Diego Beer Week. They argued that the tax revenue, managed by a hotelier-run board called the Tourism Marketing District, helps support hotel worker jobs and expand the city’s visitor tax base. They also wore yellow stickers saying, “TMD Works For Me.”

“The TMD benefits me,” Scott Hermes, the general manager at the Sheraton Hotel on Harbor Island, told the council. “I’ve got the sticker. But it also benefits the 170,000 associates who call the tourism industry their employer.”

The council voted 7-1 to move the extension forward. That’s the small victory for backers of the charge. Assistant City Attorney Mary Jo Lanzafame dismissed the hotel-workers’ legal concerns for now. But she warned that a lack of court cases since the November ballot measure meant the extension’s ultimate implementation remains legally complicated.

Even the Chargers, who recently have discussed tapping visitors to help pay for a new stadium, got a mention at the hearing’s end. The Chargers have suggested that voters could redirect city and hotelier-approved tax revenue to a stadium. Councilman David Alvarez asked Lanzafame if that was possible. She didn’t know. She said city attorneys needed more time to study the concept.

Liam Dillon is a news reporter for voiceofsandiego.org. He covers San Diego City Hall, the 2012 mayor’s race and big building projects. What should he write about next?

Please contact him directly at liam.dillon@voiceofsandiego.org or 619.550.5663.

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Liam Dillon was formerly a senior reporter and assistant editor for Voice of San Diego. He led VOSD’s investigations and wrote about how regular people...

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