• With a phase-out of vacation rentals, 6,061 currently permitted bedrooms in 1,930 homes would be eliminated.
• Palm Springs has 6,134 hotel rooms and 6,061 vacation rental bedrooms. That’s 12,195 sleeping accommodations. 
• If vacation rentals were banned, nearly 50% of sleeping accommodations would be gone.
• Reducing almost half the tourists to our City means eliminating over $100M of annual tourist spending to restaurants, shops, homeowners and other tourist dependent businesses.

• It would eliminate virtually all of the $10.7M in vacation rental Transient Occupancy Tax that goes to the City’s General Fund.
• A reduction in sales tax revenue (9.5%) collected in Palm Springs from which the City derives 1.5% from vacation rental guests.

If there was a ban to reduce or eliminate vacations rentals, these would be the outcomes:

• Vacation rental compliance does not use tax payer dollars to enforce the City Ordinance. This City department is paid for by the annual $944 vacation rental permit fee.
• The $1.8M from these permit fees funds the Office of Special Programs/Vacation Rental Department which employs 9 city staff who respond to any complaints or issues and write citations that range from $500 to $10,000.
• If vacation rentals are banned, there will be no fees to fund the Vacation Rental Compliance Department resulting in job losses and no direct oversight of illegal vacation rentals.
• Issues related to illegal vacation rentals will have to be handled by the police department or other city employees that are paid from the General Fund.

It is inevitable that the City will face a budget deficit from the loss of nearly $10.7M in Transient Occupancy Tax as well as sales tax revenue. To stem the loss, the City could be forced to impose a parcel tax which is essentially an increase in everyone’s property taxes. This is a flat tax and by law, would be applied to all property homeowners irrespective of property value.