Cash-Strapped City of Orange Raises Bed Tax by 25% : Revenue: It is estimated that increasing from 8% to 10% the surcharge on hotel guests will yield an additional $400,000 in the 1993-94 fiscal year.
ORANGE — As expected, the City Council on Tuesday increased by 25% the tax imposed on visitors staying in city hotels and motels.
It is estimated that raising the so-called bed tax from 8% to 10% will bring the cash-strapped city an additional $400,000 in revenue during the 1993-94 fiscal year. The tax increase will begin in mid-June.
Although several hotel owners have voiced their opposition to the increased tax to council members and the city’s Chamber of Commerce, only one hotelier spoke at Tuesday’s meeting.
“This tax does affect business in Orange,†said Michelle Manire, general manager of the 451-unit Doubletree Hotel at the City. “Approximately 50% of our business comes from such businesses in Orange as TRW and UCI, and it will impact them. (The tax) is not something that only people from out of town or out of state will be paying.â€
Manire said she thinks the increased transient occupancy tax will cause hotels in Orange to lose potential business to neighboring cities.
“It’s going to cause us to lose our competitive edge,†Manire said.
In Orange County, 26 cities impose bed taxes on travelers staying in city hotels and motels. Anaheim’s bed tax is the highest, at 13%, and Tustin’s and Costa Mesa’s are the lowest, at 6%.
Several members of the council, which voted 4 to 0 for the increase, have said that they would like to devote some of the additional tax revenue to marketing and promoting the city’s hotels in an effort to offset any loss of business.
“I look favorably on that idea,†said Mayor Gene Beyer.
Orange’s transient occupancy tax was last increased in July, 1983, from 5% to 8%.
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