Solana Beach voters reject business tax

Solana Beach voters on Tuesday rejected a business tax that would have helped the city make up for a roughly $600,000 loss in sales tax revenue from two fiscal years ago.

Proposition L, which failed by a margin of 14 percentage points, called for a six-tier business tax model based upon gross earnings made within the city of Solana Beach. Businesses would have had the option of paying a flat rate based on their earnings, or a multiplier of their gross receipts.

There were 2,451 Solana Beach residents who voted, with 1,407, or 57.41 percent, opposed to the proposition and 1,044, or 42.59 percent, in favor.

The tax was ultimately expected to generate roughly $500,000 annually for Solana Beach, but the city council decided to impose it at 50 percent in at least its first year as a way to help businesses cope with the recession.

Businesses would have had until Oct. 15 to pay their portion of the tax for this fiscal year, which will cost anywhere from $25 to $837.50 based on the phased-in rate. Solana Beach remains one of only three cities in San Diego County not to imposing this type of tax.

In Del Mar, voters on Tuesday rejected a measure to extend the city’s 11.5 percent transient occupancy tax to short-term vacation rentals.

Proposition J, which failed by a margin of 16 points, would have allowed Del Mar to join the neighboring cities of San Diego, Solana Beach, Encinitas, Carlsbad and Oceanside, among others, as those who tax homes being rented to tourists the same way they do hotels.

There were 981 Del Mar voters who cast their ballots with 572 voting against the proposition and 409 for it, or 58.31 percent opposed versus 41.69 percent in favor.
City staff conservatively estimated an annual revenue stream of $181,000, based on 75 short-term rentals going for a rate of $2,500 per week in the peak travel season had the proposition passed. Critics of the measure said it would cost the city too much to enforce, and also discourage tourists from patronizing area restaurants and businesses.

Related posts:

  1. Del Mar voters reject TOT extension on short-term rentals
  2. Solana Beach Business tax nears ballot
  3. Prop. L makes Solana Beach stronger
  4. Proposed biz tax to be up to voters
  5. Solana Beach letters to the editor

Short URL: http://www.delmartimes.net/?p=6910

Posted by on Jun 9, 2010. Filed under Archives. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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