by Michael C. Lowe | July 25, 2013
The San Diego Tourism Authority announced layoffs for 40 percent of its 79-member staff, according to the San Diego Union-Tribune and verified by the San Diego Tourism Authority. Staff cuts to 31 employees, including administrative, sales and marketing positions, will take effect next Tuesday. (This will not have any impact on the Tourism Authority's convention center sales team, which is funded through a contract with the San Diego Convention Center Corp.) The move is a result of pending litigation that is limiting funding to the organization.

This past May, the hotelier-run San Diego Tourism Marketing District, San Diego Tourism Authority and the city of San Diego struck an agreement to release revenue collected from a 2 percent transient-occupancy assessment by area hotels to the San Diego Tourism Authority, on the condition that hoteliers making up the TMD sign waivers and indemnification agreements that would protect the city's general fund if the assessment is overturned by a judge. There are currently two lawsuits claiming the assessment is illegal. One already has been dismissed.

So far, only 34 of the more than 200 waivers have been received, meaning only a portion of the revenue produced by the assessment will be released - approximately $3 million, down from an expected $21 million. According to the Union-Tribune, owners of some of the city's largest hotel owners, including the Manchester Grand Hyatt, Hilton San Diego Bayfront and the Marriott Marquis & Marina, have not yet signed the waivers, out of concern that they would be bound to disclose such potential liability risks to their shareholders.