Item 07 - Public Meeting Regarding Renewing the Santa Ana Tourism Marketing District

Home Browse Search

SATMD Management District Plan 12 May 14, 2025 3. Reasonable Cost SATMD services will be implemented carefully to ensure they do not exceed the reasonable cost of such services. The full amount assessed will be used to provide the services described herein. Funds will be managed by the TSA, and reports submitted on an annual basis to the City. Only assessed lodging businesses will be featured in marketing materials, receive sales leads generated from SATMD- funded activities, be featured in advertising campaigns, and benefit from other SATMD-funded services. The assessed lodging business list was compiled from records provided by the jurisdiction and complies with the requirements of the 94 Law. Pursuant to Streets and Highways Code Section 36615, the City Council’s determination of ownership is final and conclusive, with no obligation to obtain other information. Non-assessed lodging businesses will not receive these, nor any other, SATMD-funded services and benefits. D. Assessment The annual assessment rate is two percent (2%) of gross short term room rental revenue. Every two (2) years during the operation of the SATMD, the assessment rate may be increased by the TSA Board to a maximum rate of four percent (4%) of gross short-term sleeping room rental revenue. If the assessment rate is increased, it may subsequently be decreased but shall not be decreased below a minimum of two percent (2%) of gross short-term sleeping room rental revenue. The maximum increase or decrease in any two-year period shall be one-half of one percent (0.5%). Based on the benefit received, assessments will not be collected on: stays of more than thirty (30) consecutive days; stays by any person as to whom, or any occupancy as to which, it is beyond the power of the City to impose the assessment herein provided; stays by any officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty; and stays by any federal or state officer or employee while on official business only and when payment for such occupancy is made directly to the operator by duly authorized voucher payment from a governmental accounting office. This exemption does not exempt a transient who is employed by the United States government or the state or their respective instrumentalities from payment of the assessment when the payment is later to be reimbursed by the United States government or the state or their respective instrumentalities. The assessment was calculated based on the total cost of the activities to be provided for the benefit of the businesses within the SATMD, with costs allocated based on the proportional benefit conferred to each business. Activities funded by the SATMD, are specifically targeted to increase room nights at assessed businesses. All room night sales do not represent the same benefit to the payors. For example, a higher priced room night is of greater benefit than a lower priced room night because the assessee derives greater revenue. To account for this benefit differential and to make sure the benefits are proportional, an assessment formula based on a percentage of revenue has been selected. The proposed formula accurately reflects greater benefit to assessed businesses with higher priced room nights. The term “gross short-term sleeping room rental revenue” as used herein means: the total consideration charged to transients as shown on the guest receipt for the occupancy of space in a hotel, including charges for equipment (such as rollaway beds, cribs and television set, etc.), and in - room services (such as movies and other services not subject to state taxes), valued in money. The costs of additional goods and services, which are not "rent," but which may be sold as a package with the room (such as meals, excursions, and recreational services), must be accounted for in accordance with the rules and regulations promulgated by the City.