Hotel owners in Los Angeles are pushing a plan to add a new fee to hotel bills that would generate more money to promote the city as a worldwide tourist destination.
While the city already spends $11.4 million a year to attract tourists, proponents of the new fee say Los Angeles spends far less to promote itself than other top tourism towns such as Las Vegas, San Diego and Orlando, Fla.
The city already levies a 14% transient occupancy tax, or bed tax, on hotel guests. The new proposed fee of an additional 1.5% would be levied only on guests at the 192 hotels in Los Angeles with more than 50 guest rooms. It would generate an estimated $10 million to $11 million annually. The charge must be approved by the Los Angeles City Council and the hotel owners. The proposal is scheduled for a vote of a City Council committee later this month
A specific marketing campaign using money generated by the new assessment has yet to be drafted, but hotel officials said a committee of marketing and tourism experts — headed by Universal Studios Hollywood President Larry Kurzweil — has been formed to devise a plan.
While individual businesses such as Universal Studios Hollywood and the city’s large hotels spend heavily to promote themselves, the backers of the proposed L.A. marketing district say a well-funded united campaign is needed for the whole city.
Under the proposal, the City Council must approve the creation of a citywide tourism marketing district. Hotels with 50 rooms or more would then vote to adopt a 1.5% fee added to the daily hotel room rate.
The 1.5% assessment would be added only to the room rate, not to the cost of meals or other services offered at the hotels.
Hotel and tourism leaders say creating a tourism district would be an easier way to raise money than increasing the bed tax, which would require approval of city voters.
The money raised by the assessment would be collected by a nonprofit group called the Los Angeles Tourism Marketing District Management Corp., which would handle the funds.
A committee of the council is expected to vote on the proposal in two weeks, followed by a vote of the city’s 192 large hotels in late August or early September. Tourism leaders hope to begin collecting the fee as early as this fall.