The Marriott AC Hotel and the Selene Palm Springs Resort qualified for transient occupancy tax rebates from the city of Palm Springs valued at over $50 million for each hotel over the next 30 years.
These two hotels will get back 75 percent of the TOT taxes they pay.
“The city created a program 6 years ago that has helped with both hotel remodels and the construction of the new hotels and the rebate helps to try to help fill the financing gap,” says John Raymond the Director of Community and Economic Development for the City of Palm Springs.
But it’s not just large hotels benefiting from TOT rebates for construction and remodeling in Palm Springs.
“We have had a number of new hotels the smallest being the Barefoot Inn had 11 rooms, the Sparrow has about 22 rooms, the brand new The Palm Springs Hotel has 15 rooms come into the program a qualify. And they have done really fantastic jobs renovating those properties,” says Raymond.
“We liked what palm springs was doing as far as the change that was happening, it seemed like la was coming back to palm springs it seemed like it was just coming back,” says Tom Adams co-owner of The Palm Springs Hotel which opened in November.
“The TOT rebate is something the city provided for us which is great, basically the TOT tax, which is the tourism tax that you pay the city, but under this program it’s incentive to redevelop the property and build it up. I have to be open for a year, and then after that I will start receiving a rebate every year on my TOT tax for 10 years. It’s great, it’s a nice incentive,” says Adams.
After the first year of operation, The Palm Springs Hotel will get back 50 percent of their TOT taxes for 10 years.
“It’s an advantage that you will get as the years go on and the business you create here in Palm Springs. You know, the more you have the more you get back with other businesses here, it seems to be good for everybody,” says Adams.
These rebates have already started to make money for the city.
“Back when we created the program back in 2008 the city collected $12.5 million, and this year we are almost 22 million a year,” says Raymond.
The program for smaller hotels to get TOT rebates ends this year.