Dana Point is working towards a solution to deal with an over 10% drop in General Fund revenue. Dana Point is being hit hard in the downturn because over one-third of the General Fund revenue comes from the Transient Occupancy Tax (TOT). During the first eight months of FY 2009 (July 2008 - February 2009), TOT declined over 14% from FY 2008's near record levels. The collection of a $3/night surcharge on selected hotel rooms starting in 2010 will not be used to close the budget gap.
Tourism in Dana Point is unique because of the emphasis on upscale, overnight resort-type destinations rather than a mix of properties which appeal to locals or more moderate budgets. Approximately 70% of the hotel rooms are contained in the Ritz Carlton,
St. Regis, Laguna Cliffs Marriott and Doubletree Guest Suites. These hotels draw guests from around the country and overseas and also host corporate events. Reduced corporate conference bookings and cuts in individual corporate travel costs hit this class of property particularly hard.
Dana Point is working to raise money to enhance the brand of the city as an upscale coastal resort. Starting in 2010, a $3/night surcharge on rooms in the Ritz Carlton, St. Regis, Laguna Cliffs Marriott and Doubletree Guest Suites will be collected and used by the Dana Point Business Improvement District (DPBIA). These funds won't go into the General Fund to help close the budget gap, but the actions of the DPBIA may be able to generate more business for the area once the economy turns around.
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