A swing vote from Chula Vista City Councilman Rudy Ramirez sealed the fate of Chula Vista’s tourism and marketing district to disestablishment during its regular City Council meeting Tuesday.
Chula Vista Chamber of Commerce CEO Lisa Cohen was disappointed in the outcome.
“It’s a sad day for Chula Vista,” Cohen said without elaborating.
The decision was based on a majority of petitions submitted by hotel/motel business owners who pay more than 50 percent of district assessments.
Ramirez said based on the facts, he had an obligation to vote to dissolve the district.
“I’ve looked at the legal analysis and the reports and really I feel that the interpretation that gives council discretion is a little bit of a stretch,” Ramirez said. “What’s clear is that hoteliers who belong to this district can vote … and that’s what carries the most weight for me.”
During a public hearing on the item, several people spoke on whether or not to keep the district in tact.
Holiday Inn Express general manager Rick Orr favored disestablishment, saying while his business is one of the largest payers of the district, he’s seen no profit.
“I think your responsibility is to uphold what the petitions were,” he said. “…It was all in good intent but … let the petitions speak.”
However, others disagreed.
Tourism district committee member Jyoti Patel said the chamber has taken proactive steps to include the district in decision-making processes.
“I’ve owned two hotels in the city … this initiative is very important to me,” Patel said. “I was born and raised in this business.”
Patel said that based on governance changes and developments this year, the tourism and marketing district is now a marketing tool and increases revenue to the district.
The district was originally established in July 2009 to run for five years, allowing hoteliers in Chula Vista to charge their customers an extra 2.5 percent assessment on top of the standard city tax.
The tax passed through the city and was spent by the chamber, which was responsible for managing the district and its daily operations, using the funds exclusively for the operation of the visitor information center, and advertising and promotion to increase hotel and motel occupancy.
In May the San Diego County Grand Jury issued a report which concluded that 72 percent of the collected revenue between July 2009 and June 2011 was used to pay Chamber of Commerce staff and only 10 percent for marketing hotels.
While an independent audit was conducted and misuse of revenue has since been corrected, the issue left several hotel owners concerned with a perceived lack of transparency.
Between July and August, 12 of the district’s 23 members submitted petitions to disestablish.
District committee member Lisa Johnson called the decision a big loss for the entire community.
“It’s a black eye for the city of Chula Vista,” Johnson said. “For the second largest city in the county to do something like this ... It’s the first time ever that a tourism and marketing district in the state of California has been disestablished.”
Councilwoman Pat Aguilar said while she is a fan of general tourism and marketing districts, she couldn’t support this one.
“It’s clear that at least up until now the chamber has not done a god job of operating this TMD,” Aguilar said. “That’s not my opinion. It’s the opinion of the majority of the people who pay the assessments. If we do not disestablish the message we will be sending the businesses is we don’t care what you think.”