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Vision of the rebuilt Miramar, from 2007 planning documents.

Vision of the rebuilt Miramar, from 2007 planning documents.


Incentivizing Luxury Hotels

HIP Is Hot


Thursday, April 19, 2012

I would like to commend the Santa Barbara County Board of Supervisors and county staff on their consideration of the proposed Santa Barbara County Hotel Incentive Program (HIP). I was impressed with the numerous factual justifications and supporting information that made for such a sound proposal.

In these current economic times, it is admirable to see the creativeness that went into coming up with a solution that will not only help us through this recession but will also make a positive impact on the community. Importantly, it incentivizes without taking away from any existing city, county, or state funding.

Here are some key points that I gathered:

1. The current economic recession that may continue for several years needs to be offset by proactive measures to minimize the sacrifices that will have to be made. The proposed HIP affects all new luxury hotels and renovations to existing hotels.

2. The Miramar alone brings at least one thousand construction and trade jobs and hundreds of permanent jobs. This amounts to a payroll of at least $10 million. All this at a time when our local unemployment rate is 8.7% and the state’s unemployment rate is much worse, at 10.9%.

Warren Butler
Click to enlarge photo

Warren Butler

3. A rising tide lifts all boats – luxury hotels like the Miramar bring tourism to the area, which will have a positive impact on Santa Barbara County. Their marketing efforts attract an untapped national and international audience.

4. It is in line with the county’s legislative platform of encouraging businesses to move forward and to make up for the demise of the Redevelopment Agencies. It is also in line with many local jurisdictions that have developed similar programs to stimulate the economy.

5. It will increase tax revenues which will help pay for necessary staff and services. We will not be able to meet the needs of community if the county continues to simply cut budget.

It’s obvious that the TOT (transient occupancy tax, also known as “bed tax”) rebate will be well offset by direct financial advantages (new revenue of close to $2.6 million) as well as indirect advantages like jobs and tourism to local stores. There will also be an investment of $170,000,000 into the property to build the Miramar.

The community wants the owner to move forward with this project:

1. The current Miramar building needs to be demolished. It stands as the gateway to our community and we should do everything we can to see it torn down. Caruso Affiliated has committed to demolition immediately following the passage of the TOT rebate.

2. The county hasn’t collected TOT from this property for the past 13 years and probably won’t for another 10 years if this proposal does not get approved. Without approval, we continue to see the rotting hotel and continue to collect minimal revenue. Once approved, we will see the buildings torn down, increases in property and sales tax, and a revitalized Miramar.

3. We could not ask for a better developer in Caruso Affiliated, which has committed to a high quality, luxury property and has the track record to achieve that result. They’ve also been a fantastic community partner in every project they’ve developed. My company has worked with the Caruso group for many years and can personally attest to their major positive impact to the communities they serve.

This ordinance will help us take control of our destiny in this tough economy. We should continue to develop Santa Barbara County as one of the best places to live, work. and visit from all over the world.

Warren Butler is the managing partner of the Marmalade Café, and owner of the Butler Event Center .