Judge strikes down Tampa hotel room fee

The $1.50 per-room per-night assessment was created in 2017 to market downtown and Ybor City hotels. Florida House leaders successfully argued it was illegal.
Florida Education Commissioner Richard Corcoran said Friday that a Hillsborough judge's ruling striking down a tourism marketing fee applied to hotel room charges was a "victory for taxpayers."
Florida Education Commissioner Richard Corcoran said Friday that a Hillsborough judge's ruling striking down a tourism marketing fee applied to hotel room charges was a "victory for taxpayers." [ CHRIS URSO | Tampa Bay Times ]
Published Feb. 15, 2020

TAMPA — A Hillsborough judge this week struck down a 2017 city ordinance that created a tourism marketing district that charged a $1.50 per-room per-night fee in downtown and Ybor City hotels.

Former Florida House Speaker Richard Corcoran, who filed the lawsuit shortly after the ordinance was enacted, hailed the decision.

“First and foremost, this is a victory for taxpayers. This is a victory for the Constitution being upheld," Corcoran, who is now the state’s education commissioner, said Friday.

Bob Morrison, executive director of the Hillsborough County Hotel and Motel Association, said the fee generated an extra $5 million in revenue for the 13 hotels from increased marketing. He said he hoped the city would consider appealing the decision or revising the ordinance to avoid another legal challenge.

“This structure has been consistently applied coast to coast,” Morrison said. “We have seen, in the short time the assessment was in place, the benefits have exceeded our expectations.”

The House argued the room fee violated the Florida Constitution, which prohibits counties and municipalities from imposing taxes on economic activity without the Legislature’s approval.

Hillsborough Circuit Judge Rex Barbas agreed.

“The court concludes, as a matter of law, that the city acted beyond its legal authority,” wrote Barbas in a summary judgment issued Wednesday.

Although the city was a defendant in the case, it didn’t collect the fee or spend it, said Ashley Bauman, spokeswoman for Mayor Jane Castor.

Instead, the Hillsborough County Hotel and Motel Association was given sole power over the little more than $1 million in annual revenue from the charge, according to the House lawsuit.

The lawsuit said the interlocal agreement between the city and the association gave the association “carte blanche” to run the assessment district, violating state law which prohibits transferring power from a public agency to a private entity.

The fee was seen by some as a possible precedent for creating other special taxing districts within cities that could be used for a variety of things, including stadium construction. Corcoran was a vocal opponent of spending tax dollars on sports stadiums.

But Corcoran said his opposition to the fee wasn’t about a possible source of stadium funding.

“It’s illegally gotten money from the taxpayer,” he said.

The court ruling is the latest state preemption of local ordinances and proposals. The city’s tree ordinance was largely overturned last year shortly after a hard-fought compromise emerged between builders and tree advocates. The city’s attempts at gun show regulations and 5G wireless have also been stymied by state lawmakers.

Related: State guts Tampa's tree ordinance

But Corcoran said neither he nor House Speaker Jose Oliva, the current plaintiff in the case, saw the room charge issue as a fight over home rule.

“We’ve never viewed it as a battle between the state governments and local governments. We view it as a battle over whether we’re going to follow the (Florida) Constitution, follow the rule of law,” he said.

Tampa City Council member Joseph Citro, who has been a vocal critic of state preemption, said he didn’t see the ruling as a blow against Tampa’s home rule powers since the city was a largely passive player in the room charge.

“This is more of a preemption of self-promotion,” Citro said, referring to the hotels’ advertising efforts.