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Dana Point council starts process to renew tourism Business Improvement District, proposes percentage-based assessment
Summary
Council voted to begin the renewal process for the Dana Point Tourism Business Improvement District for July 1, 2025to June 30, 2030. Staff and Visit Dana Point proposed shifting from a flat per-room fee to a tiered percentage of gross room revenue, with an initial year budget projected at about $2.5 million.
The Dana Point City Council on March 18 approved a resolution of intent to renew the Dana Point Tourism Business Improvement District (TBID) and begin the 45-day protest period for lodging businesses that would be assessed under the plan.
City staffer Jamie To told the council the proposed management district plan would cover lodging businesses with 20 rooms or more and that the initial annual budget for the first year of the renewed five-year district is anticipated to be approximately $2,500,000. The renewal would change the assessment structure from a flat $3 or $5 per room to a percentage of gross room rental revenue with two tiers: 1% for 20to 189-room properties (Tier 1) and 1.5% for properties with 190 rooms or more (Tier 2) during the first two years; the plan allows a potential increase beginning year three with a majority vote by both the city council and Visit Dana Point's board.
Visit Dana Point and local hotel managers spoke in support. Kelly Stewart, general manager of the Ritz-Carlton Laguna Niguel, said the TBID renewal is "about visibility" and exposure for the city's hotels, restaurants and attractions. Heather Johnston, executive director of Visit Dana Point, said moving to a percentage-based assessment helps the organization keep pace with rising average daily rates and would keep promotion efforts funded as the destination grows.
Staff said five lodging businesses representing about 94.41% of the proposed assessment signed petitions favoring the renewal. If the council proceeds, staff will mail written notice to assessed businesses and schedule a public meeting and a final public hearing, with council staff aiming for a final hearing on May 6.
Why it matters: Transient occupancy tax and the TBID revenues are a substantial portion of the city's revenue base; Visit Dana Point uses TBID funds for marketing and visitor promotion aimed at increasing room nights and related local spending. The council's action starts the formal renewal process but does not finalize the TBID; assessed businesses will be able to protest during the statutory period.
Council action: Council member Federico moved the resolution of intent; the motion passed on the council floor. The council will consider final renewal after the protest period and a public hearing.
