Long Beach may offer tax incentives for new hotels

Long Beach’s city govement may soon offer tax incentives in a bid to encourage new hotel construction.

The City Council has not yet taken any concrete action to create such a program, but assistant city manager Tom Modica delivered a brief presentation on the prospect of doing so during Tuesday’s City Council meeting. Modica informed the council that city staffers plan to conduct an extensive study of the subject, and results may be ready in about two months.

The incentive program may mirror the city’s existing policy that allows some businesses to keep up to half of the sales tax revenue generated by their activity. As described in a staff report, the program may allow the operators of future hotels with at least 100 rooms to keep up to half of the taxes that would be paid by future visitors.

Los Angeles, Anaheim and San Diego already have similar incentive programs in place, according to that report.

Long Beach voters will have an opportunity to vote June 7 on a measure to raise sales taxes for 10 years, which Mayor Robert Garcia has said is necessary to finance infrastructure projects and reverse recent cuts to the city’s police and fire departments. A companion measure would require 1 percent of new tax revenues to be placed in a rainy-day fund.

Advertisement