DATE: May 21, 2025
TO: Council Budget and Finance Committee
FROM: Director of Finance
SUBJECT
Transient Occupancy Tax (TOT) Review
RECOMMENDATION
That the Committee provides feedback on this analysis and provides a recommendation to present to City Council to adjust the City’s Transient Occupancy Tax (TOT) rate that the Hayward voters approved with the passing of Measure NN in November 2020 for a rate up to 14 percent.
SUMMARY
This report provides a review of the City’s current TOT rate, and consideration for increasing the TOT rate in accordance with Measure NN, a voter approved ballot measure, which authorized Council to adjust the TOT rate from 8.5 percent up to 14 percent. In November 2020, the City continued to balance the impacts related to the economic uncertainties around the pandemic. At that time, Council directed staff to keep the TOT rate at its current rate of 8.5 percent to allow hoteliers time to recover from the pandemic. Council requested that an adjustment to the TOT rate be reviewed and considered when the economy has recovered from the impacts of the pandemic.
The report provides an overview of the TOT rate, and consideration for adjusting the TOT rate from 8.5 percent to 12 percent in FY 2025-26 and to review raising TOT from 12% to 14% effective FY 2027-28 should the current 2% Excise Tax terminate December 31, 2027.
ATTACHMENTS
Attachment I Staff Report