Budget committee advances hotel, parking and cannabis tax measures and orders studies of new revenue options
January 21, 2026 | Los Angeles City, Los Angeles County, California
This article was created by AI summarizing key points discussed. AI makes mistakes, so for full details and context, please refer to the video of the full meeting. Please report any errors so we can fix them. Report an error »
The Budget & Finance Committee on Jan. 20 approved sending several revenue proposals to the June 2026 ballot and asked the CAO to study other potential measures for future ballots.
CAO Matt Szabo presented a menu of options and revenue estimates: a half‑cent general sales tax (estimated $327,000,000 if pursued), a hotel tax (TOT) increase with options that would yield $45 million or $89 million depending on the rate, and an increase in the parking occupancy tax (POT) from 10% to 15% projected to yield about $67 million. Szabo also identified a cannabis parity proposal to tax unlicensed cannabis activity with an early estimate of $70 million and several items needing further analysis — including a major events tax, a shared‑ride tax, a vacancy tax and a retail delivery fee.
"Moving the sales tax in the report, we would recommend moving it up a half percent. That would yield 327,000,000," Szabo said as the CAO laid out the most fiscally productive options. The committee debated timing: staff urged moving some measures in June to avoid capacity constraints on the city’s sales‑tax rate and crowding on the November ballot.
On policy items, the committee discussed updating the vacation‑rental ordinance already pending in the Planning and Land Use Management (PLUM) committee and the need for stronger enforcement if caps or expansions are considered. Labor groups including Unite Here Local 11 urged the committee not to expand short‑term rentals, saying they displace housing; Andrea Romero of Unite Here told the committee, "Allowing second homes to be listed as short term rentals ... would allow for increase on conversion of housing into hotels and directly contradict the council's recent actions to strengthen enforcement of the home sharing ordinance." The chair asked the CLA and Office of Finance to coordinate with PLUM and return with revenue estimates tied to draft ordinance language.
The committee voted to move the CAO’s recommended TOT increase (4% up to the Olympics, 2% thereafter) forward and to put the POT increase and cannabis business tax parity on the June ballot. It also approved engaging consultants to study the additional revenue options for future ballots and set aside up to $100,000 per study. The CAO will return with refined cost and revenue estimates and a plan to account for borrowing costs and interest on any internal front‑funding arrangements.
Next steps: The City Attorney will prepare ballot language for the measures the committee approved to send to the June ballot; CAO will conduct studies on the items the committee asked to be analyzed and report back via the FSR and subsequent committee hearings.
CAO Matt Szabo presented a menu of options and revenue estimates: a half‑cent general sales tax (estimated $327,000,000 if pursued), a hotel tax (TOT) increase with options that would yield $45 million or $89 million depending on the rate, and an increase in the parking occupancy tax (POT) from 10% to 15% projected to yield about $67 million. Szabo also identified a cannabis parity proposal to tax unlicensed cannabis activity with an early estimate of $70 million and several items needing further analysis — including a major events tax, a shared‑ride tax, a vacancy tax and a retail delivery fee.
"Moving the sales tax in the report, we would recommend moving it up a half percent. That would yield 327,000,000," Szabo said as the CAO laid out the most fiscally productive options. The committee debated timing: staff urged moving some measures in June to avoid capacity constraints on the city’s sales‑tax rate and crowding on the November ballot.
On policy items, the committee discussed updating the vacation‑rental ordinance already pending in the Planning and Land Use Management (PLUM) committee and the need for stronger enforcement if caps or expansions are considered. Labor groups including Unite Here Local 11 urged the committee not to expand short‑term rentals, saying they displace housing; Andrea Romero of Unite Here told the committee, "Allowing second homes to be listed as short term rentals ... would allow for increase on conversion of housing into hotels and directly contradict the council's recent actions to strengthen enforcement of the home sharing ordinance." The chair asked the CLA and Office of Finance to coordinate with PLUM and return with revenue estimates tied to draft ordinance language.
The committee voted to move the CAO’s recommended TOT increase (4% up to the Olympics, 2% thereafter) forward and to put the POT increase and cannabis business tax parity on the June ballot. It also approved engaging consultants to study the additional revenue options for future ballots and set aside up to $100,000 per study. The CAO will return with refined cost and revenue estimates and a plan to account for borrowing costs and interest on any internal front‑funding arrangements.
Next steps: The City Attorney will prepare ballot language for the measures the committee approved to send to the June ballot; CAO will conduct studies on the items the committee asked to be analyzed and report back via the FSR and subsequent committee hearings.
View the Full Meeting & All Its Details
This article offers just a summary. Unlock complete video, transcripts, and insights as a Founder Member.
✓
Watch full, unedited meeting videos
✓
Search every word spoken in unlimited transcripts
✓
AI summaries & real-time alerts (all government levels)
✓
Permanent access to expanding government content
30-day money-back guarantee
