I've got a new post up at the Urban One blog, this one addressing the controversial subsidies intended to attract more hotel development to the area around Downtown LA's convention center.
Click here to see the full post.
A lot of the arguments in favor of the subsidies have focused on the need for more hotel rooms in a downtown that is relatively hotel-poor — it has fewer than half as many rooms within walking distance of its convention center as competitive cities like San Diego, San Francisco, and Las Vegas.
My interest, in comparison, was with the direct financial benefits, focusing on an often-overlooked (and huge) source of revenue known as the "transient occupancy tax," colloquially known as the hotel tax or bed tax. What I found is that, in lieu of public assistance, a hotel development that recently began construction is expected to produce more than five times as much city revenue over a 25-year period as a comparable condo project. Even after the subsidies used to encourage the developer to build a hotel instead of more residential, the city comes out ahead by about $70 million compared to the condo building.
See below for a few charts from the post, and be sure to follow the link to Urban One's blog to get the full story.
