Businessman’s Solution to Hotel Subsidy Controversy

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A prominent Anaheim businessman has proposed a solution to the ongoing controversy over a $158-million tax subsidy granted by the City Council to a hotel developer.

In a letter to council members, Bill Taormina proposes offering the same subsidy to all hoteliers who substantially remodel or expand their hotels during the next five years. The subsidy, granted to the developer of two proposed GardenWalk hotels, allows the developer to keep up to 80 percent of all room tax revenue collected for 15 years.

“Any incentive that was offered-up to one, should be available for all,” Taormina writes.

Taormina also proposes offering a permanent discount of 5 percent on room taxes to any hotelier who takes half of that incentive and invests it into the community. He suggests grants to hotel workers who live in motels to allow them to move into apartments, donations to after-school programs like the boys and girls clubs and investments in public works like graffiti cleanup.

Taormina writes that the city can save “tens of millions of dollars” annually by addressing a variety of internal costs. “By diverting the TOT [room tax] income stream directly back into the community, Anaheim’s government will be forced to trim itself to greatness,” he writes.

The Taormina family has been a key player in the city for decades. The family’s trash hauling company, Taormina Industries, merged with Republic Services in the 1990s, but Taormina is still heavily involved with the firm. He is also CEO of Clean City, a real estate development company.

It is clear from the letter that Taormina is also trying to patch a division between council factions. The vote to approve the subsidy was 3-2, with Mayor Tom Tait and Councilwoman Lorri Galloway dissenting.

“As a 60-year major stakeholder in the city, I am concerned that if this battle is allowed to continue, the negative political and community impacts will be irreparable,” Taormina wrote. “Somehow, this battle must be brought to a close with a compromise everyone can live with.”

— ADAM ELMAHREK

 

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