L.A. voters reject Measure TT hotel bed-tax hike

L.A. voters – Los Angeles voters turned down Measure TT, which would have raised the city’s hotel bed tax before the 2028 Olympics and extended it to short-term rentals booked through major online travel companies. Preliminary results from Tuesday’s primary showed the measu

Los Angeles voters were still being tallied on Wednesday after a key bed-tax measure landed short of the majority needed for passage, dealing a blow to city plans to raise hotel and short-term rental revenue ahead of the 2028 Olympics.

The measure at the center of the fight, Measure TT, would have increased the city’s hotel bed tax rate from 14% to 16% through the end of 2028, then kept it at 15% thereafter. It also would have extended the tax to short-term rentals booked through companies such as Airbnb and Expedia.

On the campaign stage and in the public debate, the timing mattered. City officials have projected that passing the measure would generate $44 million annually through 2028 and $22 million annually after that, with the 2027 Super Bowl and 2028 Summer Olympics expected to bring a surge of visitors.

Councilmember Tim McOsker had framed the vote as an opportunity for the visitor economy. “The Olympics are an opportunity to add some jet fuel to our visitor-serving community,” he said earlier this year, when the council voted to place the measure on the ballot.

But the opposition argued that the hotel industry can’t absorb new costs right now. Business groups said a tax increase would negatively impact hotels, already struggling with a lack of demand and facing pressure from the threat of incoming increased minimum wages.

Central City Assn. president and chief executive Nella McOsker—Tim McOsker’s daughter—opposed Measure TT on behalf of the advocacy organization. “At a time when you’re seeing these declines in demand and losing on tax revenue year over year to the magnitude of $20 million. it just seems like a wrong time to impose more burdens on that shrinking base. ” she told The Times in May.

While Measure TT fell short, voters appeared poised to move other parts of Los Angeles’ tax agenda forward.

Preliminary returns suggested there were significantly more “yes” votes than “no” votes for Measure TC. If approved. city estimates project it could raise $5 million per year for sidewalk and street repairs. parks. and other necessary services. City officials have sought to characterize Measure TC as closing a loophole that allowed travel companies like Hotels.com and Trivago to receive a discounted bed tax rate.

Measure TC would also shift how the city taxes online travel intermediaries: supporters and city officials said voters were favoring a change that would require online travel companies and other intermediaries to pay the city’s hotel tax based on the markup price they charge customers. rather than the discount price they paid for the room.

The election also included a ballot measure aimed at cannabis enforcement.

Voters were favoring Measure CB by a wide margin in preliminary returns. The measure would require cannabis businesses operating without a business license to pay the same tax on gross receipts that legal businesses pay. That tax structure includes 10% on cannabis sales, 5% on medical cannabis sales, and 2% on manufacturing, cultivation, or other commercialization.

To operate legally. cannabis businesses must be licensed with the state and city and follow a list of regulations depending on whether they sell. cultivate. manufacture. test. or deliver cannabis. City officials said they were less interested in actually collecting the taxes from unlicensed businesses—something they said would be difficult—than in using the tax requirement as a tool to pursue cases in court.

Supporters at City Hall, including Councilmember Katy Yaroslavsky, called the proposal a “loophole” fix. They said the measure would allow the city to take delinquent businesses to court for taxes and shut them down.

But the measure also drew pushback. Operators of legally sanctioned cannabis retailers have long said their tax burden is too high. arguing it allows illegal businesses to outpace them by selling product for less. Some critics of Measure CB argued that the tax requirement could legitimize illegal businesses and give the city a reason to keep them operating.

For now, Los Angeles is left with a bed-tax plan that voters rejected—at least this time—while other tax changes tied to travel intermediaries and cannabis enforcement move closer to approval as the ballots continue to come in.

Los Angeles Measure TT hotel bed tax Olympics 2028 short-term rentals Airbnb Expedia Measure TC sidewalk and street repairs parks Measure CB unlicensed cannabis businesses Katy Yaroslavsky Tim McOsker