In a move that helps clear the way for expanding the San Diego Convention Center, Superior Court Judge Ronald Prager has issued a final ruling that allows local hotels to fund the expansion through a self-imposed property tax covered by a surcharge on room rates.
The tax -- which is covered by surcharges of between 1 and 3 percent on hotel room rates -- is expected to generate roughly $30 million per year to provide funding for a $520 million expansion of the Convention Center.
The hoteliers hope to recoup that investment through the influx of 250,000 additional tourists that the enlarged Convention Center is projected to bring in.
Prager had given a tentative ruling upholding the tax on Monday, but issued a slightly revised final ruling on Thursday after giving both sides a final chance to air their claims.
Civic activist Melvin Shapiro and San Diegans for Open Government had challenged the tax, arguing that state law requires the public must vote on all taxes.
But Prager said the group of hotels that devised the tax -- the Convention Center Financing District -- was more like a property owner’s association, adding that the district was “properly formed” and that its vote for the tax “conformed with all applicable constitutional provisions, statutes and ordinances.”
City Attorney Jan Goldsmith said he welcomed the decision, describing it as “well-reasoned and based upon the law.”
Despite the ruling, it may take a while before construction on the center begins, since the opponents are expected to appeal -- a process that could last between one and three years.
Goldsmith, however, said he was “confident the decision will be upheld” even if it is appealed.
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