Hosts balk at zero-threshold assessment plan
By Christian Kallen
Sonoma County Tourism, the county agency that promotes visitation to support the local economy, is asking for a bigger budget. The agency went to the Sonoma County Board of Supervisors on Oct. 18 to request that its primary source of funding be expanded.
The Business Improvement Area (BIA), a funding source for the tourism agency, currently gets a 2 percent assessment on all lodging businesses that report revenue of $350,000 or more annually. The current expected revenue from the BIA is over $6 million. The district includes the entirety of Sonoma County and every incorporated city except Sonoma and Healdsburg.
Businesses that fall beneath that financial threshold, including the numerous vacation rentals in the county and its jurisdictions, pay no such assessment. As a result, the messaging of the SCT is supportive of larger hotels, and not so much of B& Bs and many vacation rentals.
Sonoma County Tourism would like to see the threshold disappear and all overnight rental businesses contribute to its funding, which would mean a significant increase in funds to cover operating expenses.
The proposed removal of the minimum revenue threshold would result in an estimated $2.1 to $2.5 million increase in assessments collected annually from approximately 3,800 operators with revenue less than $350,000, according to a press release from the Board of Supervisors.
“In arguing for the expanded [assessment], SCT believes that now is the time to eliminate the revenue threshold so that short-term rentals can enjoy greater visibility across SCT’s marketing channels and benefit from the robust marketing programs,” says Claudia Vecchio, president and CEO of Sonoma County Tourism. “This proposed amendment is called the Responsible Tourism Assessment because it helps to fund programs designed to shape consumer behavior and ultimately protect and preserve Sonoma County’s cultural and natural resources.”
It’s not difficult to break down the math: If $350,000 is the annual revenue floor, that means any such business would need to gross about $1,000 a day to qualify for the assessment ($959 to be more precise). That leaves a lot of hosts falling below that level of income, but whether or not all of them can afford a 2 percent levy is another question.
Carl Jaeger, a member of a grassroots organization called the Sonoma County Coalition of Hosts, said members are skeptical of the proposal, though not necessarily opposed to expanding the income set.
“To protect the lower-income families among us who might be impacted by this, we are wondering if there is a better threshold between $0 and $350K. For those people in Sonoma County earning less than $100,000 from their home-sharing, this might be too burdensome,” he said.
Jaeger cited an untold number of hosts who supplement their income with home-sharing and “often use this as a way to afford staying in Sonoma County, aging in home, making much-needed repairs, and other expenses. Have you seen the cost of a new roof lately?”
The board of supervisors was reluctant to adopt Sonoma County Tourism’s new funding schedule without getting input from the wider community, and even then, such increases in assessment can be voided if more than 50 percent of the affected businesses object.
The board will have a public meeting on Nov. 1 to discuss the issue, although the SCT held two meetings, on Oct. 25 and Oct. 27, to discuss the process and answer questions. Not to be left out, the Coalition of Hosts will hold its own meeting on Oct. 30 to evaluate its options in light of the SCT discussions.
“Our meeting of hosts, scheduled for Oct. 30, is a closed meeting to discuss what we learn from the tourism board sessions and other sources,” said Jaeger. “This should help all hosts form their own opinion.”
The final public hearing will come before the Board of Supervisors at its regular Dec. 23 meeting.