ANAHEIM : Bed Tax Hiked to 15%, Third Highest in U.S.

The City Council gave final approval Tuesday to a hotel bed tax increase that will help finance a $172.5-million revitalization project around Disneyland.

In a 3-0 vote, the council authorized raising the bed tax by 2 percentage points, effective July 1. At the new rate of 15%, Anaheim’s bed tax will rank third highest in the nation, after Columbus, Ohio, and Seattle.

“We have to reinvest to stay competitive,” said Mayor Tom Daly. “One thing is clear to me is the area around Disneyland must be revitalized and this bed tax will help us do that.”

Councilmen Bob D. Simpson and Fred Hunter were absent.

The tax, city officials argued during the public hearing, is critical in helping to pay for a massive overhaul of 550 acres around Disneyland and the Anaheim Convention Center. Federal, state and regional transportation money will fund two-thirds of the so-called Anaheim resort plan, and city officials say the bed tax revenue will help generate the remaining one-third.

The beautification program, which has already begun with overhead utility lines being buried along major streets, is seen as a vital accompaniment to Walt Disney Co.’s $3-billion expansion project. As proposed, the project would include 1,800 new hotel rooms, a 5,000-seat amphitheater, landscaped walkways and a new theme park next to Disneyland, called Westcot.

The bed tax, which has risen 63% since 1983, is expected to generate $5 million in annual revenue. All hotels in Anaheim are affected.