How We Are Funded
Business Improvement District (TBID) Assessment
VHB’s funding does not come from taxes paid by local residents or businesses. Funding is derived through a Tourism Business Improvement District (TBID) self-assessment paid by Huntington Beach lodging properties who collect the assessment from overnight guests choosing to stay in one of Huntington Beach’s 21 hotels (2,300 total available rooms) or in one of Huntington Beach's 200+ licensed vacation rentals.
What is the Tourism Business Improvement District (TBID)?
The TBID was originally formed in 2002 by Huntington Beach hotel properties and approved by City Council. All lodging properties within the TBID's boundaries (the city limits of Huntington Beach) agreed to place a self-assessment on overnight stays to help fund VHB's efforts to market and sell the destination to visitors. Currently, the TBID consists of 21 local hoteliers and over 200 licensed vacation rentals. The TBID assessment is paid by visitors who stay in Huntington Beach lodging properties. TBID assessment revenues provide a more dependable, long-term, sustainable revenue source to market Surf City USA® globally without any tax burden on local residents. Huntington Beach’s overnight hotel guests pay a 6% assessment for each occupied room/vacation rental per night during their stay.
How much TBID assessment revenue is dedicated to VHB?
The current TBID management district plan will go into effect on July 1, 2024 with a 6% self-assessment rate for all Huntington Beach lodging properties that would be used to fund VHB's program of work. Guests staying at these properties pay this rate upon checkout. In 2024, this plan is expected to result in annual TBID revenues of $10 million, with 90% of the assessment going toward sales and marketing efforts and the remaining 10% going toward Tourism Enhanced Programs that will mutually benefit visitors and residents.
How much is VHB's annual revenue?
In FY 2022-2023, VHB's annual revenue was approximately $6 million dollars, all paid by Huntington Beach’s overnight hotel visitors.
What is Transient Occupancy Tax (TOT) and how is it used?
Huntington Beach’s overnight lodging guests pay a 10% TOT per room per night. The City of Huntington Beach retains 100% of all TOT revenues as of February 1, 2019. (Previously, VHB had received 10% of TOT visitor tax revenues for destination marketing). These revenues support the City's general fund and help to pay for City services including police, fire, marine safety, beach maintenance, parks, and libraries. Note: City governments around the country retain an average of 50% of TOT revenues, with the remainder invested in destination marketing with the city's DMO. The City of HB retains 100%.
How much TOT revenue is generated each year?
In FY 2022-2023, total TOT revenue collections were approximately $16 million. Since 1996, over $200 million in TOT revenues have been collected by the City.
How much TOT revenue is dedicated to VHB?
0%. As of February 1, 2019, VHB does not receive any TOT funds.