Disneyland and Honda Center face 2% gate tax under Anaheim ballot proposal

Anaheim City Council will consider Tuesday asking voters to levy a 2% border tax on visitors to Disneyland and the Honda Center to generate additional income to pay for additional staff and new city amenities. city.

If the council agrees to put the measure to a vote on November 8 and a majority of voters approve it, the border tax could generate $55 million to $82 million per year deposited into the general fund account. of the city, according to a city report.

The proposal was made last month by City Councilor Jose Moreno, who said he hoped the border tax money would support a city budget that he said was stretched. Moreno, who is serving his final year on the board, has been a vocal critic of the tax breaks for Disneyland.

“Because of how much we have struggled… just to help our seniors, we really need the revenue,” he said when proposing the border tax last month. For a city of our size, we need more revenue.”

A spokesperson for Disneyland declined to comment on the proposal. A representative for Honda Center, home of the Anaheim Ducks, could not be reached for comment Monday.

The proposal was written to also levy a border tax on Angel Stadium visitors, but under the city’s rental agreement with the Angels, the city would be required to credit the Angels against the contract for rental for any “collection or evaluation of any ticket, admission, parking or other tax or fee based on revenue derived from the operation of the Baseball Stadium or Parking Area, or business Team revenue. In short, the lease will ensure that the gate tax will not promote city assets.

Getting the panel to agree to put the measure on the ballot can be a challenge. According to city regulations, the measure requires the support of five of the seven council members to pass. But council membership fell from seven to six in May when Mayor Harry Sidhu resigned after being accused of bribery, fraud, obstruction of justice and witness tampering. That means the measure needs five of the remaining six council members.

Pro Tem Mayor Trevor O’Neil has voiced opposition to the proposal. “Increasing the already high tax burden on visitors risks negatively impacting tourism and resulting in an economic impact for our city,” he said in a statement Monday. “And, this proposal will apply not only to visitors but also to our residents and to those who enjoy the many entertainment options in our city.”

Daily tickets to Disneyland range from $104 to $164, depending on the day of the week, with a 2% border tax plus $2.08 to $3.28 per ticket.

The proposal comes as the city’s main sources of revenue – sales and accommodation taxes levied on hotel guests – have rebounded significantly since the pandemic hit in 2020 and forced Disneyland Resort closed for more than a year and pushed hotel occupancy to record lows. levels.

The city is expected to collect $167 million in hotel use taxes in the current fiscal year, surpassing the previous record high of $163 million for 2018-19, according to budget filings. city ​​book. Ten of the city’s largest hotels, including three at Disneyland Resort, generate about 50% of the city’s total hotel room revenue.

Anaheim’s 15% hotel rental tax rate is among the highest among Southern California’s most popular tourist destinations, including Los Angeles (14%), Long Beach (13%) and Pasadena (12%). ).

Anaheim is also expected to collect $97 million in sales tax revenue in the current fiscal year, beating the previous record high of $85 million in 2018-19, its successful budget record. street shows.

In the last few years, the city’s once-supportive relationship with Disneyland Resort has become difficult.

For 19 years, Anaheim took the little-known measure of exempting Disneyland Resort from any entertainment or border taxes imposed by the city until 2015. The city renewed the agreement in 30 years as long as Disney agrees to invest at least $1 billion in the Resort. Disneyland has met its obligation by building Star Wars: Galaxy’s Edge, a 14-acre expansion that will open in 2019.

The agreement and goodwill between Anaheim and Disney fell apart when the city canceled a $267 million tax refund plan offered to Disneyland in exchange for the construction of a luxury four-diamond hotel on the resort. . Frustrated Disney executives responded in 2018 by asking Anaheim to cancel all of their previous financial arrangements, including 30-year cuts to entertainment and taxes. gate. That move opened the door to the proposed border tax measure.

https://www.latimes.com/business/story/2022-07-18/disneyland-honda-center-anaheim-tax Disneyland and Honda Center face 2% gate tax under Anaheim ballot proposal

Edmund DeMarche

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