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Motel, Hotel Tax Vital To Government Agencies On Central, South Coasts Hit Hard By Coronavirus

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There’s yet another sign of how the coronavirus crisis has put a huge dent in the tourism industry on the Central and South Coasts.  Santa Barbara’s hotel room tax is down by about 20% for the just completed fiscal year, which is a reflection of rooms left empty by the situation.

The Transient Occupancy Tax is the tax you pay when you rent a hotel room.  For many communities, it’s an important financial supplement which in effect brings in tax dollars from visitors.

Santa Barbara had projected $19 million dollars in motel and hotel tax revenue for the fiscal year which ended in June.  Thanks to shutdowns, and then reduced tourism due to coronavirus, the total ended up nearly four million dollars short.

In April, revenue from the tax was down a whopping 93%, from $1.6 million dollars in 2019 to just over $100,000 this year.  In June, there was major improvement, but revenue was still down by nearly 56%, from $1.9 million in 2019 to around $850,000 this year. 

Similar shortfalls through the region are forcing government agencies to make big budget adjustments, with the hope federal aid will help fill some of the holes.

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