Busy Summer Travel Season Brings Millions in Hotel Tax Revenue to Santa Barbara

SANTA BARBARA, Calif. — Summer visitors are filling hotels, restaurants and beaches across Santa Barbara, and city officials say those tourists are also helping fund local services through the city’s hotel occupancy tax.

From Stearns Wharf to State Street, tourists say they’re spending money on dining, shopping and activities during their trips to the South Coast.

“Every time we come to Santa Barbara, we’re spending close to $200 in one day,”

one visitor said.

City Finance Director Keith DeMartini said the biggest impact comes from overnight stays.

“Average daily hotel rates are just over $312, and occupancy in May was around 73 percent,”

DeMartini said. “Both of those numbers tend to increase in June and July when the summer months are really in full effect.”

Santa Barbara’s Transient Occupancy Tax (TOT), often called the hotel bed tax, is paid by people staying in hotels or short-term rentals for fewer than 30 days.

According to the city, the revenue helps support general city services, while a portion is dedicated to creek restoration and water quality projects.

DeMartini said the city has already collected more than $34 million in occupancy tax revenue this year, putting collections ahead of budget.

“The World Cup probably helped a little with our tax revenues, with people just out and about,”

he said.

Some international visitors said they are traveling through the region while following World Cup matches.

“We’re hoping to watch Spain play Belgium,”

one tourist from Spain said.

Still, not every business says it is seeing the same boost from summer tourism.

Dana Gedrick of Salt on State Street said many customers are being more selective with discretionary spending.

“The economy has taken a turn everywhere,”

Gedrick said. “People are a little more cautious about spending on wellness.”

Businesses are hoping upcoming summer events, including Old Spanish Days Fiesta, will bring more customers through their doors.

With the busiest weeks of summer still ahead, city leaders expect tourism to continue generating millions in tax revenue, while local businesses hope more of those visitors become paying customers.