If the City’s hotel owners got together and agreed to all raise their rates by $2.00 per night - that might be viewed as collusion and price fixing. It’s apparently a different matter altogether when they all agree to be taxed $2.00 per night.
The City has agreed to impose a “fee” that allows the hotel owners to extract more money from their customers without raising their published rates, while at the same time maintaining plausible deniability about their role in the matter. Customers will, no doubt, be told that the rooms cost more because the City has imposed a new fee. The customers will be assured that they would have to pay this same fee for any hotel room anywhere in the City.
It might not be mentioned that it is the hotel* owners themselves who benefit most directly from this new fee. That’s because the hotel owners are the ones who will decide how to spend the money.
The hotel owners control the Tourism Advisory Board. The Board is tasked with promoting the City as a tourist destination. Basically, the City is taxing visitors and giving the money to the hotel owners to pay for marketing that the hotel owners would otherwise have to fund from the rates they charge customers.
It may be legal, but to me, it doesn’t seem quite honest.
* “Hotel”, in this context, includes the Motel 6. In Walnut Creek, everything is upscale.
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