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Politics & Government

Council Approves Hotel Tax Measure

Foster City voters on Nov. 8 will decide whether to increase the transient occupancy tax by 1.5 percent.

The City Council on Monday approved putting a measure on the November ballot that would raise the hotel tax rate to 9.5 percent.

If voters approve the measure on Nov. 8, the city’s transient occupancy tax would rise from 8 percent to 9.5 percent.

Councilwoman Pam Frisella said she supported increasing the TOT to help close the city’s , adding that the council already voted to raise fees.

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“It seems like we should spread the pain any place that we can to close this deficit,” Frisella said. “We are voting to bring it to the residents and let them decide.”

City staff prepared reports that called for but the vote required a 4/5 majority and council members Charlie Bronitsky and Rick Wykoff voted against the motion.

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Bronitsky said he would support a 9.5 percent tax rate, while Wykoff said the council should look to reduce spending before increasing taxes.

“I don’t think we’ve been aggressive as we should be in looking at budget reductions,” Wykoff said.

According to the staff report, Foster City has the lowest transient occupancy tax in San Mateo County; other cities have a 10 percent or 12 percent rate. The city’s TOT hasn’t been increased since it was established in 1981, and even if voters pass the tax, the city’s rate would still be the lowest in the county.

The originally proposed 2 percent tax increase would generate an additional $325,000 a year for the city, or the equivalent of two police officers or three and half parks maintenance workers, the report says.

City officials have discussed the TOT increase with owners of the city’s two hotels, Crowne Plaza and Marriot Courtyard, said Mayor Linda Koelling.

“Both individuals from Crowne Plaza and Marriot were both supportive and understanding,” Koelling said. “Would there be some impact? Yes.”

She said the owners had some concern that an increased tax rate could impact lodging contracts with airliners.

With Monday’s approvals, the council on Aug. 1 will be scheduled to officially adopt an ordinance changing the hotel tax rate and submit a ballot argument signed by the four assenting council members, said City Manager Jim Hardy.

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