What are TOT and TBID?
Transient Occupancy Tax (TOT) is paid only by overnight visitors who stay in local hotels or short-term rentals. Per the Placer County Board of Supervisors direction, 100% of TOT funding generated in Eastern Placer County is to be spent to benefit the area. The Board of Supervisors looks to the NTCA Board of Directors and committees for recommendations on how to spend a portion of this funding.
A Tourism Business Improvement District (TBID) is a mechanism for funding economic development activities designed to increase revenues for the assessed businesses. Through the TBID, both day visitors and overnight visitors contribute to North Lake Tahoe’s vitality through purchases at activity providers, restaurants, and retailers.
Unlike TOT, TBID funds must be spent on programs and activities that directly benefit the businesses paying the assessment. The NTCA board and committees are the approving authority for these dollars, which means more local control, and more money spent on projects that are important to TBID members. Locally generated revenue is reinvested locally.
The North Tahoe business community’s decision to form the TBID, which the Placer County Board of Supervisors voted unanimously to support for a five-year period from July 1, 2021 to June 30, 2026, freed up TOT funds that were previously used to market the region. The Placer County Board of Supervisors has committed to use these freed up TOT funds to support workforce housing and transportation initiatives that benefit North Lake Tahoe residents, business, and visitors.
What will TBID revenues be spent on?
TBID revenues must be spent on programs and activities that benefit the businesses paying the assessment.
Through the TOT-TBID Dollars At Work program, TBID revenues are being allocated to initiatives that are making progress on workforce housing, regional transportation, economic vitality, trails, recreation, and tourism mitigation.
Who manages TBID funds?
The NTCA manages the funds generated by the TBID with oversight from the NTCA Board of Directors and committees made up of representatives from assessed businesses. The TBID is operated in accordance with a Management District Plan (MDP) and representatives of businesses paying the assessment are asked to participate. The NTCA is committed to incorporating public input and participation in decision-making and all Committee and Board of Directors meetings are open to the public.
What’s the difference between TOT and TBID funding structures?
TOT funds are generated by a total of 10% North Lake Tahoe hotel tax paid only by overnight lodging guests who stay in hotel and short-term rental properties. 8% TOT is generated in unincorporated areas throughout Placer County and there is an additional 2% TOT that is charged only in North Lake Tahoe. This 2% TOT was approved by voters most recently in 2022. These funds help pay for projects and quality-of-life services exclusively for our community that we wouldn’t otherwise be able to afford like workforce housing, traffic reduction and transportation initiatives, bike paths, and trash and litter services in public areas. 41% of this TOT (or around $11 million annually) are funds that the NTCA Board of Directors and committees are charged with making recommendations to the Placer County Board of Supervisors for infrastructure improvements and programs that are important to North Lake Tahoe residents and businesses.
TBID funds are used to increase revenues for assessed businesses by helping to bolster a year-round economy, offset tourism impacts and provide support for local businesses. The TBID is a 1% assessment of all gross revenues on tourism related businesses. Lodging has a 2% assessment, except for those in Palisades Tahoe and Northstar, which have a 1% assessment because those areas already have assessments in place to fund transportation. These assessments are generally passed on to the customer at the point of sale. TBID revenues generate approximately $6m per year to be reinvested in our community.
We need both because of the need to support our local business community while continuing to address critical transportation and workforce housing initiatives. It has become nearly impossible for people working in North Lake Tahoe to afford to live here and that’s why addressing workforce housing has become a top priority for use of TOT funds generated by those who visit our region.
In 2026, the North Tahoe business community will have the ability to renew the TBID. Its continuation will allow the valuable work being done through the TOT-TBID Dollars At Work program to support local businesses and our region’s community vitality and economic health.