This is a bad headline:
Stadium measure would generate enough money if costs are right
This is the less-bad headline that the San Diego Union-Tribune later changed it to:
Chargers measure fiscally sound — if estimates are accurate
This is the actual story:
San Diego’s independent budget analyst says the Chargers proposed hotel tax hike would generate enough money to cover the team’s projected price tag for a combined stadium and convention center annex, but that the proposal may be underestimating those costs.
And this is what’s downplayed in the actual story: Whether the estimates are correct only determines whether the four-percentage-point hotel tax hike would generate enough money to cover the San Diego Chargers ownership’s requested costs. Either way, the city would be on the hook for $1.15 billion, it’s just a question of whether it would have to find more revenue on top of the hotel tax money.
Kids, always read the articles, not just the Facebook headlines, okay?
Neil,
I must note the irony of clipping the excerpt relevant to your narrative while not posting a link to the source material.
Sorry, I’m in Canada, I have to convert to metric links.
(It’s there now.)
I can attest that it is hard to multiply Ws by 1.8. Not impossible, but hard. Especially while juggling chainsaws.
So… question:
When they say the 4% increase in the hotel tax rate “would be enough to cover” the proposed costs, are they just taking the current amount of revenue raised by hotel taxes and adjusting it for the new rate?
Or is some effort made to account for the people who will either not visit San Diego or stay somewhere else when visiting because of the tax increase?
Every tax (or usury, in the case of private enterprise that lacks the power of taxation… or is supposed to lack the power of taxation anyway…), as we are constantly reminded by the neo-cons, is a drag on the economy. This must be true whether the tax revenue generated goes into government coffers or the Spanos family’s pockets.
There is a maximum amount of money that can be generated from any tax or user fee scheme. Raising the rate beyond the point at which maximum revenue is derived, obviously, lowers the amount of revenue generated.
“If estimates are accurate.”
Holy cow, do these people even listen to themselves? Orlando would be doing great today — if estimates were accurate.
When have they ever been accurate?