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Visitors help increase Manteca tax revenue

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The lobby of Manteca’s Bass Pro Shops that upwards of 2.9 million people pass through each year.

HIME ROMERO/The Bulletin

POSTED August 27, 2013 1:58 a.m.

Manteca’s fastest growing source of municipal revenue isn’t property tax nor is it sales tax.

It’s a tax Manteca residents don’t even pay. It’s the motel room tax.

Those spending the night in Manteca and paying a 9 percent room tax has jumped 13.7 percent in year-to-year comparisons. As a result Manteca has collected $420,870 so far in the first three quarters of this year compared to $370,235 for the first nine months of 2012.

That puts room tax revenue on track to push $500,000 or 1.7 percent of all the $27.8 million in general fund revenue the city anticipates collecting in the current fiscal year. While the dollar amount will be dwarfed by property taxes at $9.3 million and general sales tax at $7.3 million, room taxes have been growing at twice the rate of those two taxes since 2011.

What is bringing people to fill motel rooms? A survey of motel owners produces a list that includes Big League Dreams, soccer, traveling to and from the Sierra, specialized construction work, and Bass Pro Shops. The Bass Pro Shops visitors that stay in Manteca aren’t making the trip here for that specific reason. Rather they tie it into another destination and chose Manteca to stay because they can drop by the Bass Pro Shops store.

Bass Pro Shops is the South County’s biggest attraction drawing between 2.5 million and 2.9 million visitors each year. Big League Dreams is next with excess of 430,000 paid spectators a year. There is at least one out-of-town tournament scheduled every weekend at BLD.

State economists believe one out of every nine jobs in California are supported by tourism or visitors dollars. While many think of tourists as being those on a week-long trip that either fly or drive somewhere, it actually is anyone who travels to another destination for a recreational purist. By that standard, it is easy to understand how weekend or one day trips can generate significant revenue for a city.

It is against that backdrop Manteca leaders will be weighing the final economic analysis of the Great Wolf Resort proposal due in the coming months. If preliminary projections are correct and a Great Wolf Resort is built in Manteca, the percentage of Manteca’s general fund expenditures covered by out-of-town visitors via room taxes would soar from 1.7 to 14.7 percent.

Preliminary data gleaned from other Great Wolf Resorts when Manteca started the negotiation process with McWhinney Development to build between a 400 and 600 room resort with a 75,000-quare-foot indoor water park plus a conference center projected room tax revenues would range from $4 million to $6 million a year.

City leaders are negotiating with McWhinney Development to locate the resort on 30 acres owned by the city directly west of Costco along the 120 Bypass. The project could ultimately create 500 permanent jobs, draw 400,000 visitors annually, create 1,000 construction jobs, and cement Manteca as a legitimate tourist attraction.

Assuming the lower end that would add $4 million to the $520,000 in room taxes Manteca collected last year. That would jump the overall city revenue to $31 million assume nothing else changes.

Current visitors pay 9 percent on top of their room rental in transit occupancy taxes.

But if Great Wolf builds, guests would be subject to a special 15 percent entertainment zone room tax. That is how Manteca staff pegged the room tax potential at Great Wolf of being between $4 million and $6 million year. That is based on Great Wolf’s performance at other locations including Grand Mound in the State of Washington.

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