EDITORIAL : PAYING FOR SPORTS ARENA IT'S HARD TO JUSTIFY A TAX HIKE FOR THIS.

LOS ANGELES city officials are cheerleading for a proposed $240 million, city-subsidized sports arena next to the downtown Convention Center as a new home for the Kings hockey and Lakers basketball teams.

Already, City Council president John Ferraro and Councilwoman Rita Walters have signed a letter of endorsement urging the full council to review and approve a nonbinding development agreement. If that happens, the next step would be further discussion leading to a binding development agreement, which Kings owners hope the council will approve by October so design and construction can move forward without delay.

But while it would be easy to get swept away in the excitement of big-time sports, we urge city officials to exercise great caution in developing a financing plan for the proposed 20,000-seat sports arena on the southwest corner of Figueroa and 11th streets (now the site of the Convention Center's North Hall).

Already, there is talk of having the city help raise construction funds by issuing bonds and raising taxes.

It's one thing for the city to issue $60 million in revenue bonds to help finance the project, with the bonds being repaid from arena revenue including parking fees. But it's quite another thing for the financing plan to include a tax hike.

The plan reportedly calls for a 1 percent increase in the city's hotel tax - to 15 percent. Supporters of the plan may believe it would be a ``painless'' tax increase. But, frankly, the public is leery of higher taxes, no matter who pays. Indirectly, everyone pays.

Although it might seem politically safe to stick out-of-towners with the new tax burden, there is a downside locally - namely, the negative impact on Southern California's tourism and lodging industries if City Hall makes it more expensive to stay in L.A. hotels and motels.

Since the motive for building a new arena is to assist commercial sporting enterprises, City Hall would be well-advised to omit the tax increase. The public is in no mood to raise taxes even for essentials like health care and police, so opposition would be even stronger if the tax levy is to fund non-essential (although desirable and entertaining) activities like pro sports.

Bottom line: If extra revenue is needed to pay for the complex, a better source than higher taxes would be a surcharge on tickets sold for events there. That way, at least users will be the ones paying for it.

Certainly, there is bound to be opposition to that approach, too. But it's a more straightforward and logical way to raise the necessary revenue. And it's far better than sticking the burden on all L.A. hotel guests regardless of whether they're here to attend sporting events or not.