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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />JUNE 7, 2016 <br />TITLE; <br />ADOPT A RESOLUTION TO <br />ESTABLISH A HOTEL DEVELOPMENT <br />INCENTIVE PROGRAM <br />{STRATEGIC PLAN NO. 3,3C) <br /><__i:;� e5��_K <br />CITY MANAC R <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />❑ As Recommended <br />❑ As Amended <br />Ordinance on IIt Reading <br />❑ Ordinance on 2"d Reading <br />❑ Implementing Resolutlon <br />❑ Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />Adopt a resolution authorizing the establishment of a Hotel Development Incentive Program to <br />provide economic incentives for the development of four to five -stars or AAA -rated four Diamond <br />and above quality hotels in the City of Santa Ana. <br />DISCUSSION <br />According to the Anaheim /Orange County Visitors & Convention Bureau, 46.1 million people <br />visited Orange County in 2014. Visits increased by 3.9 percent in 2013 and is expected to <br />continue to increase more in 2016. Tourism in Orange County is booming and Santa Ana has <br />the opportunity to take advantage of its centralized location in the heart of this industry. Santa <br />Ana's proximity to the Anaheim resort district, the John Wayne Airport, and local amenities such <br />as, the Discovery Cube Orange County and the Bowers Museum makes it a desireable location <br />to attract incoming tourists and visitors to Orange County. According to a study by PKF <br />Hospitality Research consultant, the average occupancy rate for Orange County hotels is 78.3 <br />percent and is indicative that additional capacity exists for the development of new hotels in this <br />area. <br />To capitalize on this growth, Santa Ana will need to strategically position itself to accommodate <br />new hotel development. By doing so, Santa Ana will have the potential to create new jobs, spur <br />economic development, and enhance the City's revenue base. Currently, Santa Ana does not <br />have any four -star rated or AAA (American Automobile Association) four Diamond and above <br />hotels. However, nine three -star rated hotels are located within city limits. All other hotels and <br />motels within the city are rated from one to two - stars. A uniform rating system for star quality <br />hotels in the United States does not exist. Several websites and travel guides use the star rating <br />when ranking hotels. AAA has an independent rating system that many hotels have been rated <br />by (Exhibit 1). Staff recommends the use of both star and AAA Diamond ratings for this incentive <br />program. <br />55E -1 <br />