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One of Santa Barbara mayor Helene Schneider’s proposed ballot measures, an additional tax on several bars and nightclubs in Santa Barbara’s busy downtown area, has recently come under fire from local business owners.
The Entertainment District Ordinance, part of a four-part package of initiatives Schneider is currently petitioning to place on the November ballot, would impose a 0.25 percent fee on all revenues earned by downtown establishments that serve alcohol after 11 p.m. six nights per week or more. According to the initiatives’ website, investinsantabarbara2012.com, the EDO would bring in approximately $250,000 annually to help fund the disproportionately large police presence in the entertainment district during busy weekend nights and festivals.
However, SOhO Restaurant and Music Club owner Bob Hansen said the tax should not apply to his establishment as existing police presence near the venue is largely unnecessary.
“The entertainment district, as pre-defined in the municipal code, starts on Cabrillo, right by the ocean, and goes up State Street about 15 blocks or so,” Hansen said. “Only three blocks of concentrated bars and clubs are where the police are typically called to. It is unfair to those other thirteen blocks to pay a fee for something that they don’t do.”
The majority of the police force’s patrol officers are on duty downtown on Friday and Saturday nights after bars and nightclubs close at 2 a.m., Schneider said in a statement on investinsantabarbara.com. According to the statement, the city budgets roughly $250,000 to pay officers overtime for Santa Barbara’s “Fiesta” festival alone.
“While everyone pays taxes for public safety, it is only fair that the establishments that contribute towards this additional public safety presence pay their fair share towards the City’s General Fund budget without creating an undue burden on their business,” Schneider said in the EDO’s notice of intent to circulate petitions supporting the initiative.
Fourth-year economics major Hanna Norrlid said although certain aspects of the proposed tax seem reasonable, it could be a burden for struggling storeowners and serve as a deterrent to prospective businesses. “For some of those establishments, 0.25 percent may be a lot out of their profits, and it’s another barrier against those that might be interested in entering the market,” Norrlid said. “It would be better if they could specify more what types of places should be paying the fee. There is a big difference between a nightclub, a bar and a restaurant. I think that they should cover the cost, but it is unfair towards the others that aren’t calling the police.”
Hansen said he believes the proposal should be redefined or amended to highlight specific areas that require additional police presence. “Some of those places are
open for breakfast, and that revenue generated from breakfast is counted towards the fee,” Hansen said. “There are certain aspects of the fee that don’t make sense.”
Hansen said the tax would add to an already hefty financial burden shouldered by downtown establishments.
“I love, respect and truly admire the businesses that operate down in that area where those problems happen,” Hansen said. “They put lot of money and effort into controlling those behaviors that get the cops called. They also generate a lot of money in sales tax to the city. There is also a business improvement city tax that all businesses pay, which covers the 75 minutes of free parking and things like that. This is essentially going to triple-tax businesses that are generating a lot of business for them.”
According to Hansen, the initiative would likely seem fair to voters who are unfamiliar with the specifics of its implementation.
“It covers very emotional topics: young people drinking, partying, causing potential damage and safety,” Hansen said. “That will appeal to voters, many of whom don’t know what the real situation is like.”