County Supervisors approved continuing with an assessment district of lodging businesses to continue with tourism promotions but could do so under a different State Law.
Supervisors received the County Business Improvement District (CBID) annual report at their Feb. 10 meeting, outlining the activities of the CBID and reporting on how much it brought in and how the money was spent.
The report from Tessa Cornejo, the County’s principal administrative manager in the Executive Office, reported that the CBID brought in some $2.83 million in Fiscal Year 2024/25 through a 2% assessment on the cost of a room night stay. Included in the CBID are motels, hotels, B&Bs, and vacation rentals in the unincorporated areas of SLO County.
Out of that total, the report said, 2% or $56,000 was retained by the County for administrative costs and VR licensing; 50% of the remainder was spent on “regional CBID marketing and visitor initiatives;” and 50% was returned to the tourism boards from each community to spend in that community.
Part of the regional tourism marketing included the Highway 1 Road Trip promotion, and “Stewardship and Sustainability Programs.”
The regional monies were doled out to some 18 contracted vendors and totaled $1.48M, which exceeded the take of $1.41M. The County dipped into “carryover” funds to cover the shortfall.
“CBID admin expenses,” the report said, “include H1TA non-profit services [shared admin expenses], financial support, County general administration and County District administration fees totaling $152,089, which represents 8% of total income and 10% of total expenses of $1,497,395 [marketing and other].
“General administration and County District administration fees are shared expenses with the local fund areas based on their percentage of contribution.”
Direct costs totaled $663,000 or some 44.38%. And there are 18 business contracts “and represent 32 people that work directly on CBID business, with $833,000 in contractor fees or 55.7%.
The local tourism boards collectively got $1.41M and had $1.28M of it under contract. Typically, the local tourism boards have just one marketing contractor, either an individual or an ad agency, the report said.
From July 2024 to December 2025, the report said, the local tourism boards spent $334,000 on 34 local special events and infrastructure projects.
Since CBID started, the report said, they’ve collectively spent $1.69M on 218 special events.
In calendar year 2024 they spent $95,000 and $115,000 in 2025. There were 11 events in 2024 and 11 in 2025 that they funded.
As for the survey of CBID properties, “Overall perceived value of the CBID was rated above neutral,” according to the report.
“Tourism marketing and promotion emerged as the top priority. This includes both regional CBID-level marketing efforts and local tourism board activities. Marketing initiatives were most frequently ranked as the highest priority and received the strongest perceived impact ratings.”
Events and festivals were ranked second most important, followed by beautification and infrastructure.
And, “Stewardship initiatives were generally ranked lower in priority, though still viewed positively.”
The majority of respondents said they had a high or moderate understanding of what CBID does, and the minority said they didn’t know, with those folks being mostly newcomers to the lodging industry. And, “Approximately 75 percent of respondents indicated interest in greater engagement or learning more about CBID programs.”
The survey had a pretty good response at 235 total. Among those five of 32 B&Bs (16%) responded; 45 of 50 motels (90%); and 185 of 1,406 vacation rental owners (13%) responded. Of note, licensed zero-rent properties, 747 of the 1,406 total vacation rental licenses, responded, some 24%.
Also, “93 of the 185 were from individual owner/operators not vacation rental management companies.”
As for the governing law, the CBID was formed and has operated under the 1984 Streets and Highways Code, which applies to assessment districts of all types. It has drawbacks.
“The 1989 law,” the report explained, “does not require a comprehensive district management plan, provides fewer statutory standards related to governance structure and advisory body composition, and includes more general provisions for reporting and accountability.”
In 1994, the State passed the Tourism Business Improvement District Law to better address these shortcomings.
“The 1994 law requires adoption of a detailed District Management Plan that clearly defines district boundaries, assessment methodology, governance structure, program categories, and benefit rationale,” the report said. “It also provides enhanced transparency and accountability provisions, including clearer reporting expectations and renewal procedures, and offers greater flexibility to tailor governance and cost apportionment to reflect how different lodging businesses receive benefit.”
Switching the governing law means having to disband the old CBID and re-forming a new one. The County will have to go back to the assessment members and sell them on changing the governing law to the 1994 one.
