Palm Springs has taken a significant step toward creating a new hotel-funded tourism district that city leaders and hospitality operators say could provide a long-term financing stream for major convention center improvements and related upgrades intended to strengthen the city’s visitor economy.
The Palm Springs City Council voted unanimously to approve a Resolution of Intention to establish a Tourism Improvement District, advancing an industry-led proposal backed by P.S. Resorts, and the Preferred Small Hotels of Palm Springs. Supporters describe the effort as a unified push by the local lodging sector to invest in the future competitiveness of Palm Springs as a destination for meetings, conferences and overnight tourism.
If ultimately formed, the district would apply citywide to lodging businesses, including large hotels, small hotels and short-term rentals. Under the proposal, those operators would collect and remit a 1% assessment on stays, generating an estimated $4 million to $4.1 million annually. Restaurants and retail businesses would not be included in the district.
City and industry leaders say the money would be dedicated to the modernization of the Palm Springs Convention Center, expansion of the facility to the east with an improved eastern entrance, and public realm improvements aimed at strengthening walkability and better connecting the convention center to downtown.
The proposal reflects a broader strategy that treats the convention center not simply as a standalone civic building, but as a core economic asset tied directly to hotel demand, visitor spending, local jobs and the health of downtown businesses.
“This is about ensuring Palm Springs remains a top-tier destination for meetings and conferences well into the future,” said Peggy Trott, chairwoman of P.S. Resorts. “The Tourism Improvement District provides the dedicated funding needed to modernize our Convention Center, attract high-caliber events, and continue welcoming large groups and visitors whose spending supports our entire local economy. We’re proud to help lead this effort to invest in the long-term success of our city.”
The district structure is designed as a self-assessment by the hospitality industry rather than a broad-based tax on residents. Supporters say that distinction is important both economically and politically. The businesses that stand to benefit most directly from increased room nights and convention activity would be the ones funding the improvements.
Under the city’s management plan, the district would encompass all lodging businesses available for public occupancy within the city limits of Palm Springs, including existing operators and future properties. The annual assessment would be based on gross short-term sleeping room rental revenue. Certain exemptions would apply, including longer stays and some pre-existing contractual arrangements.
The proposed district is intended to help finance a multi-phase modernization and connectivity effort around the convention center at an estimated cost of $125 million. That includes upgrades to the building itself, improvements to the surrounding district, and expanded connections intended to make the area function more effectively as part of downtown Palm Springs. In practical terms, supporters say that means a more competitive convention facility, a more cohesive visitor experience and stronger economic spillover into nearby hotels, restaurants, shops and other businesses.
“This is an important moment for Palm Springs,” said Mayor Naomi Soto. “I want to show my appreciation and thank P.S. Resorts for taking the lead on this initiative. The Tourism Improvement District will provide a sustainable revenue path to ensure that our convention center remains competitive and drives our tourism economy. Now we can be confident that Palm Springs will continue to be a premier destination for visitors worldwide.”
The city has framed the proposal as part of its broader Convention Center Modernization and Connectivity Project, which is intended to reimagine both the facility and its relationship to the surrounding area. A multidisciplinary project design team has already been assembled through recent competitive procurements. The team includes LMN Architects and O2 Planning + Design for architecture and engineering, !Melk for urban design and connectivity, and Multistudio for district branding and marketing.
That design work underscores that the initiative is not solely about interior improvements or deferred maintenance. It is also about placemaking, circulation and the convention center’s role in shaping the physical and economic connection between the city’s tourism assets and downtown core.
A rendering of the future convention center facility from the early design phase
“The convention center and its surrounding district are vital economic engines for our city,” said Karen Totaro, general manager for Palm Springs Convention Center. “This effort strategically invests in maximizing economic impact, supporting local jobs, and generating lasting value for our community.”
P.S. Resorts is expected to serve as the owners’ association overseeing implementation of the district’s funds, a role that further reinforces the hospitality industry’s central involvement in the initiative. That governance structure is consistent with how tourism improvement districts are commonly designed, with the paying industry helping direct how revenues are used to benefit the sector and destination.
The proposal still faces additional public review before it can take effect. The city is moving into the required hearing and protest process, during which affected lodging businesses will have opportunities to weigh in. If sufficient protests are filed, the district could be halted. If not, the council could move to formally establish it.
Separately, the city said it plans to continue a public-facing process around the larger convention center modernization effort. A public meeting is expected in early summer, with residents, business owners and stakeholders invited to review initial design concepts and provide feedback.
For Palm Springs, the district proposal represents an unusual level of alignment across major hotels, smaller lodging operators and the vacation rental sector around a shared conclusion: that the city’s convention center and surrounding district need dedicated reinvestment if Palm Springs is to maintain and expand its position in a competitive tourism and meetings market.
The underlying calculation is straightforward. If better facilities and stronger district connectivity help attract larger events, more conferences and more overnight visitors, the businesses paying the assessment stand to benefit through stronger room demand and more sustained tourism activity. City officials, meanwhile, see the proposal as a way to finance needed improvements through a targeted revenue model tied directly to the industry that depends on the asset the most.
