The Pleasanton City Council is set to vote Tuesday on placing a hotel tax increase measure on the November general election ballot.
If passed by voters this fall, the hotel tax — also known as a transient occupancy tax or TOT — will go up from a rate of 8% to 10% starting July 2027. The measure also stipulates an additional increase from 10% to 12% would take effect the following year.
“Once the full 12% increase takes effect the measure is expected to generate approximately $2.8 million per year, all of which would remain in Pleasanton,” according to the July 7 City Council staff report.
Tuesday’s vote comes after several discussions at the council level and a general consensus from the dais that placing the measure on the upcoming ballot could be the best way to generate new revenue for the city, without having to burden local taxpayers.
“Approval of a TOT increase, combined with ongoing efforts to reduce spending, would help reduce the structural operating budget deficit and offset impacts on City services and programs,” according to Tuesday’s staff report.
Conversations surrounding the new tax measure started last August when the council directed staff to focus its efforts on evaluating the feasibility of getting a TOT increase passed by voters. Those conversations came after the city had previously placed a half-cent sales tax increase — Measure PP — on the 2024 general election ballot, which failed to get enough votes to pass.
Since then, the city has conducted community surveys and assessed the possibility of this proposed hotel tax measure getting enough votes. Staff then completed its draft resolution, draft ordinance and draft ballot question and presented those items to the council on June 2.
At that meeting, the council gave staff the green light to finalize those documents and bring them back to Tuesday’s meeting where the dais is poised to give staff the final OK to submit the documents to the county for placement on the November ballot.
According to the staff report, placing the measure on the ballot will cost the city anywhere from $243,265 to $340,445.
The City Council meeting is scheduled to begin at 7 p.m. Tuesday (July 7). The full agenda can be accessed here.
In other business:
* The council will be reviewing an application to rebrand the Sunoco gas station, located on the corner of First and Ray Street, to a Shell Gas station.
This item was meant to be discussed at the June 16 meeting but was continued by Council member Matt Gaidos who said the “information we received in the packet leaves me a little bit incomplete with what the visuals of it is going to be,” and asked for better visuals heading into Tuesday’s meeting.
According to Tuesday’s staff report, the dais will have to decide whether it wants to uphold city staff’s recommendation to deny the rebranding application, or if it wants to approve the application with certain changes, which is what the city’s planning commission is recommending.
In September 2025, Guy Houston — former state assemblymember and Dublin mayor — submitted a sign design review application with the city on behalf of the gas station’s property owner to rebrand the gas station, which is located at 4191 First St., and convert it into a Sunoco gas station. Before Sunoco, it was previously a 76 gas station.
According to staff, that original application sought to install a new monument, wall, canopy and pump signage, all with Sunoco branding.
However, the 2025 application was deemed incomplete. Tuesday’s report stated that staff expressed “general support for the site upgrade” but at the same time, they had requested a “reduction in franchise branding colors on the canopy fascia” in order to be consistent with the current gas station canopy.
After some time and further discussion, the applicant resubmitted the application in January and switched brands from Sunoco to Shell Gasoline. But while the branding change helped address some of the staff’s concerns regarding the colors, it did not address all of their issues.
“While the revised package reduced franchise color coverage compared to the earlier Sunoco proposal, the Shell Gasoline canopy design still featured approximately 66% yellow and red franchise branding color,” staff noted in Tuesday’s report. “Although staff indicated the project could be approved with reductions in the amount of branded color elements on the canopy, the applicant declined to make such changes.”
According to Tuesday’s report, staff thought the proposed canopy would “create an overly franchise-brand-forward visual emphasis that detracts from the intended Downtown entry character and does not reinforce the site’s relationship to the City’s broader aesthetic context and natural/visual setting.”
That’s why in February the city’s zoning administrator denied the proposed signage application, which then prompted the applicant to appeal the decisions and send it first to the planning commission for further review.
The commission heard the appeal on May 13 and approved it, with certain caveats. The commission outlined two conditions of approval: the first stipulates that the “height of the Shell Gasoline corporate branding color band shall not exceed 50% of the total canopy fascia height” while the second states that any canopy lighting other than the underlighting will automatically be turned off every night at 10 p.m.
* The City Council will also be voting on authorizing the interim city manager to execute two agreements related to the city’s Advanced Metering Infrastructure (AMI) Replacement Project.
The water meter project agreements were previously included in the June 16 consent calendar, which are items considered routine in nature and are typically approved by a single vote with minimal discussion. However, during that meeting, Interim City Manager Joe Calabrigo recommended to take this item off the consent calendar and discuss it before continuing the vote until Tuesday’s meeting.
At the time, he said his reasoning was because he had a meeting with the Zone 7 Water Agency that same day to discuss concerns the agency had over the project.
“The item was continued to July 7 in light of concerns raised by the Zone 7 Water Agency (Zone 7), to allow additional time for City staff to engage with Zone 7,” the July 7 staff report states. “The concerns raised by Zone 7 are technical in nature and involve the interpretation of the requirements of the 2025 two-party Settlement Agreement between the City and Zone 7.”
The agreement in question refers to a settlement agreement between the two agencies following a 2024 lawsuit Zone 7 filed against the city alleging it failed to pay over $18 million in connection fees. One of the stipulations in the agreement states that the two parties will work together to complete the city’s planned water meter replacement project within three years.
If approved, the city manager will execute an “AMI Capital Expenditure Project (CPX) Agreement and an AMI Operations Expenditure (OPX) Agreement with Core & Main LP in amounts not to exceed $10,262,257 and $2,514,096, respectively, authorize a five percent capital contingency for the project, and execute a twenty-year agreement term for the OPX Agreement.”
Prior to the commencement of Tuesday’s regular City Council meeting, the dais will come together for a special closed session meeting at 4:30 p.m. to confer with legal counsel regarding the settlement agreement “as it relates to the City’s purchase of water meters for its Water Meter Advanced Metering Infrastructure (‘AMI’) Project.”
* During that special closed session meeting, the council will also discuss the employment of a permanent city manager.
Pleasanton school board to consider accepting Ghysels' retirement letter, approving new superintendent contractSeptember 23, 2026 6:38 am
Planning Commission to discuss application for three new single-family homes off Vineyard AvenueSeptember 23, 2026 6:24 am
The TOT (hotel) tax is a no-brainer. Measures like this should have been pursued before asking residents to approve a sales tax increase.
One council member continues to bring up the failure of Measure PP at every opportunity. A clear majority of Pleasanton voters—54.18%—rejected Measure PP. As elected officials, council members represent the will of the voters, even when the outcome isn’t what they hoped for.
It’s time to stop dwelling on Measure PP failure and focus on practical solutions: pursuing new revenue opportunities, like the TOT tax, and reducing costs internally before asking residents to pay more.