San Antonio Lifts the Hotel Fee to 2%
The City Council unanimously approved Visit San Antonio's request to raise the fee guests pay at many hotels from 1.25% to 2%. The increase is 60% and yields about $6.4 million more a year for the organization.
The fee adds $2 to $4 to the average visitor's bill. It sits on top of the city's hotel occupancy tax.
The city's hotel occupancy tax rate is 16.75%: 6% to the state, 9% to the city and 1.75% to Bexar County. Of the city's 9%, seven points fund tourism operations and two points fund Convention Center debt.
Where the Money Goes
Visit San Antonio will spend the money on rent discounts at the Convention Center and on marketing. Chief executive Mario Bass said the organization needs both to win conferences.
Bass said conference guests stay longer and spend more on hotels, restaurants, bars and entertainment. Conventions also book years ahead.
Bookings Lead Through 2029
Bass said bookings for major conferences run ahead of competitor cities through 2029 and fall behind from 2030. Dallas and Austin expect to finish their convention center work around then.
Visit San Antonio booked 801 events, 991,000 room nights and 790,000 attendees in fiscal 2025 on its own figures. It targets 965,000 room nights, 75 citywides and 825 events in fiscal 2027.
Bass told council members last spring that federal research funding cuts pose a risk to convention attendance and hotel revenue. He named national economic and political uncertainty as a further pressure.
Ten More Years for the District
The fee is tied to a city-wide tourism public improvement district that started in 2019. The district was due to expire on 30 September. The council extended it by 10 years.
The fee applies to hotels with 100 rooms or more. Hoteliers asked for the increase. State law requires sign-off from more than 60% of eligible properties before the council can act.
Most of the state's largest cities run tourism districts that charge 2%. Bass told the council earlier this year that San Antonio was catching up.
What the District Buys
Visit San Antonio used district money in 2023 to host the U.S. Travel Association's annual conference. It spent more than $5 million on Convention Center rent, parties for attendees and expenses for travel journalists. The event drew more than 5,000 attendees.
The organization offers 35% to 50% off Convention Center rental rates for conventions booked between January 2030 and September 2031, subject to minimum spending on rent and food.
The district also pays hotels that attract overnight meetings. A hotel can collect up to $75,000 for a group that rents a set number of rooms and generates at least $7 in room revenue for every $1 the district awards.
Rentals Take Room Nights
Bass said room-night bookings at short-term rental properties rose from 400,000 in 2019 to 1.1 million in 2025.
The Convention Center at Capacity
Visit San Antonio has pushed to enlarge the Convention Center. The city plans an expansion inside a proposed sports and entertainment district downtown. City officials have said the building is at capacity and expect to recommend a scope later this year.
The Skeptic
Heywood Sanders, professor emeritus of public administration at the University of Texas at San Antonio, studies the convention center business. He said cities keep expanding while attendance at many events nationwide trails pre-pandemic levels.
"What's been happening in the convention center world is that the market is enormously overbuilt," Sanders said.
Sanders criticizes the rent and cost discounts that tourism leaders use to attract conventions. The tourism public improvement district is one way cities pay for those subsidies, he said.
The Budget Behind the Push
Visit San Antonio moved in 2016 from the city's Convention and Visitors Bureau to a public-private nonprofit. Its fiscal 2027 budget totals $48.5 million. Hotel tax supplies 59% of that and the hotel fee 36%.
The council vote extends the funding behind the booking plan.