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Santa Barbara’s Bed Tax Giveaway to Rick Caruso

Ladies and Gentlemen:

I would suggest that all of you read a letter in Thursday’s Santa Barbara News-Press written by Mr. Jim Patterson concerning the Bed Tax giveaway to Caruso.

He correctly states that the 10% Bed Tax rebate that the county proposes to give to Caruso’s Miramar project, will for the most part come from the Bed Tax revenues that would have been generated by other area hotels.  I suggest the that the Biltmore and Bacara would be among  the losers, along with some other hotels located in both the city and county of Santa Barbara.

The plan subsidizes Caruso by robbing Peter to pay Paul with millions in bed taxes that would have been collected by existing hotels, while stealing income from these existing hotels in the bargain, were the Miramar not in existence.

As I also said in my recent piece in the News-Press, the 10% Bed Tax charged on the Miramar Hotel’s bills for guests will not only be a hidden 10% extra profit for the Miramar in the guise of a tax, but it will allow the Miramar to lower its prices 10% for ten years without really lowering its normal return rate on rooms.

Were I a local hotel owner, such as Ty Warner and this tax giveaway came into being, I would sue the county for not only using tax funds to subsidize a competitor, but for using tax funds to facilitate a competing hotel’s ability to steal my guests.  I would use the same reasoning if I were the Santa Barbara City Council as it pertains to hotels in the city limits. Let the games begin!

Warmest regards,
Ernest Salomon

3 Responses to “Santa Barbara’s Bed Tax Giveaway to Rick Caruso”

  1. Right on, Mr. Salomon: it’s inconceivable how anyone can see fairness in subsidizing one landowner, one would-be hotelier, over another. The only valid argument that I can see for subsidies and special breaks is an economic justice one, but that does not apply to this multi-millionaire LA developer, known for his high end outdoor shopping malls.