The city must allow the public to vote on its transit occupancy tax, but if voters reject an attempt to boost the rate, it could revert back its level of more than a decade ago of 8%.
In 1991, the City Council voted to raise the tax from 8% to 10%. But last year, the California Supreme Court ruled in July that state law requires voter approval of TOT increases, including increases made before the ruling.
The council is expected to place a measure on the November ballot to keep its TOT at 10% or to raise it. The City Council must decide what to do by early August.
City officials expect TOT revenue to dip to about $1.3 million in 2001-02 because of a weak economy and the Sept. 11 terrorist attacks.
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