A Tourism Improvement District ("TID") was recently created by the San Francisco Board of Supervisors. The new TID is authorized to charge each hotel in the district an assessment based on its revenue from room rentals. The following summarizes pertinent provisions of the TID Management Plan, as approved by the Board of Supervisors. The Management Plan is available in its entirety at: http://www.sftid.com.
The TID assessment is required to be paid to the San Francisco Treasurer and Tax Collector's Office on a quarterly basis. The assessment will be effective as of January 1, 2009, and the first payment to the San Francisco Tax Collector will be due in April, 2009.
The assessment will be 1.5% of the gross revenue for a guest room for hotels located in Zone 1 and 1% of the gross revenue for a guest room for hotels located in Zone 2. Zone 1 hotels are all hotels with addresses on or east of Van Ness Avenue, on or east of South Van Ness Avenue, and on or north of 16th Street from South Van Ness to the Bay, including all hotels east of Van Ness Avenue as if it continued north to the Bay, and north of 16th Street as if it continued east to the Bay. Zone 2 hotels are all hotels with addresses west of Van Ness Avenue and South Van Ness Avenue, and all hotels south of 16th Street.
Hotels subject to the assessment are allowed to collect the amount of the assessment from hotel guests. If the assessment is passed on to guests, it must appear on a guest's bill as a separately stated line item called "Tourism Improvement District Assessment" or "Tourism District Assessment." It may not be included in the Transient Occupancy Tax billed to the guest. Charges for hotel guests who have made reservations in 2008 for 2009 occupancy are not exempt from the TID assessment.
For purposes of calculating the TID assessment, "Gross Revenue From Guest Rooms" means: the consideration received for occupancy valued in money, whether received in money or otherwise, including all receipts, cash, credits, and property of any kind or nature, without any deduction therefrom whatsoever. Gross revenue from guest rooms includes only the following charges, regardless of how such charges are characterized:
- Charges for a guest room (including non-refundable deposits) regardless of whether the guest uses the room
- Charges for additional guests to occupy the room
- Charges for guaranteeing the availability of a room (sometimes referred to as guaranteed "no-show" charges) regardless of whether the guest uses the room (excluding event attrition fees and event cancellation fees paid by event organizers)
"Gross Revenue From Guest Rooms" does not include:
- charges for guest rooms occupied by permanent residents, defined as: "Any occupant as of a given date who has or shall have occupied, or has or shall have the right of occupancy, of any guest room in a hotel for at least 30 consecutive days next preceding such date;"
- revenue from the lodging of airline crews, i.e., lodging provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews' performance of their jobs for the airline, including layovers between flights;
- the City's Transient Occupancy Tax collected on the room rent and remitted to the City and County of San Francisco; or
- charges for guest rooms located in non-profit, purely private social clubs that make guest rooms available only for the use of their members. The term "purely private social clubs" means non-profit, private membership clubs, whose primary purpose is social, which are owned by a limited membership, and which do not advertise or promote the use of their facilities by the public. Further, entities that allow guest rooms to be occupied by non-members, including via reciprocal arrangements with other clubs or organizations or upon referral of a member, shall not constitute "purely private social clubs" as defined herein.
Exemptions from the transient occupancy tax have no bearing on exemptions related to the TID assessment.
The San Francisco Treasurer and Tax Collector's Office will provide a process for reporting and paying the TID assessment.
For more information about the TID, including a copy of the Management Plan, please visit http://www.sftid.com or call the San Francisco Convention and Visitors Bureau at 415-974-6900 and ask to speak about the Tourism Improvement District.