The Inn at Laguna Beach’s Pacific Terrace overlooks the ocean. Courtesy of Classic Hotels & Resorts

The Laguna Beach City Council unanimously voted Tuesday to increase funding for its COVID-19 relief package to $2 million, ramping up programs to assist local businesses, workers, and residents enduring the pandemic’s economic fallout.

The Council’s latest appropriation is $600,000 for the LB CARES Hotel Program, which will grant hoteliers up to 50% of the transient occupancy tax they collected from overnight guests during the Fourth Quarter of 2020. The City Council approved a minimum grant of $5,000 and a maximum of $100,000 per hotel—the vast majority of Laguna Beach’s 27 will qualify for some amount.

Visit Laguna Beach asked city leaders for financial assistance after a weeks-long regional stay at home order banned non-essential hotel stays. Weddings, banquets, and corporate events are still prohibited at hotels under state and county health orders.

“As you all have witnessed it’s been a difficult year for many especially our individually owned and operated businesses,” Visit Laguna Beach CEO Ashley Johnson said. “The beauty of Laguna Beach is that we’re filled with individually owned and small mom and pops, including our hotels who don’t have massive corporations backing them like Hiltons and Marriotts.”

Laguna Beach expects to get more transient occupancy tax than initially projected because of better-than-expected hotel business for the summer months, said Gavin Curran, director of administrative services. City officials will account for the $600,000 returned to the hotels by updating its TOT revenue estimate.

To qualify for a $100,000 tax relief grant, a hotel would have to show that its revenue was down from April 1 to Dec. 31, 2020, compared to the same period in 2019.

To offer this group some nominal relief, the City Council approved a $5,000 minimum grant to several hotels—provided that they’re in good standing for city tax collection.

Mark Christy, managing partner of the Ranch at Laguna Beach, wrote in an email that he greatly appreciated the City Council’s consideration of the hotel grant.

“Few, if any, business sectors were more severely impacted than hospitality as a result of the pandemic,” he wrote. “And though it will take a while to recover, this action by the City is meaningful in terms of both moral and financial support.

All Laguna Beach hotels are accepting overnight guests but state guidelines continue to effectively eliminate all group business and seriously curtail leisure travel, Christy said.

Laguna Beach resident Chris Catsimanes questioned whether the local hotel has trimmed their contributions to Visit Laguna’s operating budget due to the pandemic and expressed concern whether the grants would amount to a taxpayer-funded subsidy of a private industry group.

Visit Laguna is funded through a 2% self-assessment from local hotels. Johnson confirmed the organization’s budget is down nearly $400,000, which was achieved by reducing its staff from 10 employees—including several part-timers—to one full-time employee and a single part-timer. They’ve also pulled back on paid marketing efforts.

In another consequential move, the City Council also directed city staffers to immediately donate $150,000 to the Laguna COVID-19 Relief Fund stewarded by the Laguna Beach Community Foundation.

The Fund Advisors plan to issue $500 grants to about 900 needy Laguna Beach residents and employees who have already applied for financial assistance. The majority of applicants are laid-off employees of Laguna Beach restaurants, banquet halls, and hotels closed due to the pandemic, said Bob Mister, co-founder of the Laguna COVID-19 Relief Fund.

“Hearing the desperation of people that are calling, you can just sense how much the $500 means to them,” Mister said. “They’re appreciative of the fact the community has stepped up.”

At the request of councilmembers Toni Iseman and George Weiss, the City Council voted Dec. 22 to contribute $300,000 to the Laguna Beach Community Foundation to support grants for needy Laguna Beach residents and employees. The Council had originally intended this to be a grant that would attract matching donations but those continue to trickle in.

Community members have donated $140,000 to the relief fund’s latest campaign, which includes a $50,000 donation from the estate of former Laguna Beach mayor Wayne Peterson and his partner Terry Smith.

There was new urgency at Tuesday’s council meeting to get this money into people’s hands immediately.

“We’re getting money out the door to all the businesses … so I’d like to also get some money out the door quickly to residents and unemployed individuals while the matching effort is ongoing,” Mayor Bob Whalen said.

The City Council’s $150,000 donation to the relief fund will be followed by a $150,000 matching grant. Mister expects to reach that fundraising goal thanks to the community’s generosity.

Once selected to receive assistance, grantees will be get paid by checks, gift cards or other means as determined appropriate by the Fund Advisors. The Boys & Girls Club of Laguna Beach is partnering with the Community Foundation to provide practical assistance in the process of application submission and grant delivery.