No Hearing Date Set for Avalon Tax on Business

The City Council decided last week not to set a public hearing on a proposed business assessment district designed to raise money for an off-season promotional campaign for Santa Catalina Island, but Chamber of Commerce officials are still optimistic the plan will go forward.

“We were moving too fast,” said Paxson (Packy) Offield, a vice president of the Santa Catalina Island Co. and the main force behind the promotional campaign. “But I think we will still get it off the ground. Actually, I’m kind of happy to have a little more time to organize things.”

Offield said he hopes to be able to bring his request for a hearing on the assessment district back to the council in four to six weeks.

The Chamber of Commerce first brought up the idea of an off-season promotional campaign in March and proposed raising the $150,000 needed by increasing the wharfage fee--a 60-cent levy on passengers arriving and departing the island on commercial carriers--and raising the transient tax--a 7% levy on hotel rooms.

Business Complaints

Establishment of an assessment district was brought up last month after complaints from businesses that tourists were already overtaxed, and a warning by City Manager John Longley that the 1980 Gann initiative places limits on the amount of transient tax that can be collected and spent.

A four-member committee--two each from the City Council and the chamber--came up with a plan that would divide assessments based on the effect of increased tourism to a business. Under the plan:

- Hotels would pay 1% of annual gross revenues.

- Bars, restaurants, tours and amusement-related businesses would pay 0.5% of annual gross revenues.

- Commercial cross-channel carriers would pay $10 per seat for the year.

- Businesses with annual gross revenues less than $1,000 would pay $10 a year.

- All other businesses would pay $75 a year.

But the City Council expressed concern that the business community would not support such an assessment district and voted 4 to 1, with only Councilman W. F. (Oley) Olsen objecting, not to set a hearing date.

Businesses Not Informed

Councilman Gilbert Saldana said he is not opposed to the promotional campaign, but voted against setting a hearing date because he said the chamber has not sufficiently informed the business community of the program.

“I’ve had business people tell me it is unfair for the city to tax them for promotional purposes,” he said. “There are some older members of the business community who feel Avalon is a summer resort and never will be a year-round resort. For the program to have a chance, the chamber has to better inform the business people and get them behind it.”

Mayor George Scott agreed that the chamber should do a better job explaining the promotional campaign to the business community.

“If the people don’t want it, the council doesn’t want to put its necks in the wringer,” he said.