Chapter 3.08
TRANSIENT OCCUPANCY TAX
Sections:
3.08.080 Reporting and remitting.
3.08.100 Uncollectible accounts.
3.08.110 Penalties – Interest.
3.08.120 Failure to collect and report.
3.08.180 Penalty for violations.
3.08.010 Short title.
This chapter shall be known as the transient occupancy tax ordinance of the city of Rancho Cordova. [Ord. 4-2003 § 1].
3.08.020 Definitions.
Except where the context otherwise requires, the definitions given in this section govern the construction of this chapter:
“City” means the city of Rancho Cordova.
“Hotel” means any structure, or any portion of any structure, which is occupied or intended or designed for occupancy by transients for dwelling, lodging or sleeping purposes, and includes any hotel, inn, tourist home or house, motel, studio hotel, bachelor hotel, lodging house, rooming house, apartment house, dormitory, public or private club, mobile home or house trailer at a fixed location, or other similar structure or portion thereof.
“Occupancy” means the use or possession, or the right to the use or possession, of any room or rooms or portion thereof, in any hotel for dwelling, lodging or sleeping purposes.
“Operator” means the person who is proprietor of the hotel, whether in the capacity of owner, lessee, sublessee, mortgagee in possession, licensee or any other capacity. Where the operator performs functions through a managing agent of any type or character other than an employee, the managing agent shall also be deemed an operator for the purpose of this chapter and shall have the same duties and liabilities as his or her principal. Compliance with the provisions of this chapter by either the principal or the managing agent shall, however, be considered to be compliance by both.
“Person” means any individual, firm, partnership, joint venture, association, social club, fraternal organization, joint stock company, corporation, estate, trust, business trust, receiver, trustee, syndicate or any other group or combination acting as a unit.
“Rent” means the consideration charged, whether or not received, for the occupancy of space in a hotel valued in money, whether to be received in money, goods, labor or otherwise, including all receipts, cash, credits and property and services of any kind or nature, without any deduction therefrom whatsoever.
“Tax collector” means the city finance director or his or her designee.
“Transient” means any person who exercises occupancy or is entitled to occupancy by reason of concession, permit, right of access, license or other agreement for a period of 30 consecutive calendar days or less, counting portions of calendar days as full days. Any such person so occupying space in a hotel shall be deemed to be a transient until the period of 30 days has expired unless there is an agreement in writing between the operator and the occupant providing for a longer period of occupancy. In determining whether a person is a transient, uninterrupted periods of time extending both prior and subsequent to the effective date of the ordinance codified in this chapter may be considered. [Ord. 13-2010 § 1; Ord. 42-2006 § 1; Ord. 4-2003 § 2].
3.08.030 Imposed.
A. For the privilege of occupancy in any hotel, each transient is subject to and shall pay a tax in the amount of 12 percent of the rent charged by the operator.
B. The tax constitutes a debt owed by the transient to the city, which is extinguished only by payment to the operator or to the city. The transient shall pay the tax to the operator of the hotel at the time the rent is paid. If the rent is paid in installments, a proportionate share of the tax shall be paid with each installment. The unpaid tax shall be due upon the transient’s ceasing to occupy space in the hotel. If for any reason the tax due is not paid to the operator of the hotel, the tax collector may require that such tax shall be paid directly to the tax collector.
C. Any dispute of the imposition of tax shall be made pursuant to the protest provisions in RCMC 3.08.130. All references to “chapter” herein shall mean this chapter. [Ord. 12-2004 § 1; Ord. 4-2003 § 3].
3.08.040 Exemptions.
A. No tax shall be imposed upon any person as to whom, or any occupancy as to which, it is beyond the power of the city to impose the tax herein provided.
B. Charges incurred by a person in the performance of official duties as an officer or employee of a local, state or federal government entity shall be exempted from the tax herein; provided, that an exemption certificate is submitted and payment is made either (1) directly to the hotel for rentals by the governmental entity; or (2) by government-sponsored corporate charge card.
C. No exemption shall be granted except upon a claim therefor made at the time rent is collected and under penalty of perjury upon a form prescribed by the tax collector. [Ord. 34-2010 § 1; Ord. 12-2004 § 2; Ord. 4-2003 § 4].
3.08.050 Operator’s duties.
Each operator shall collect the tax imposed by this chapter to the same extent and at the same time as the rent is collected from every transient. The amount of tax shall be separately stated from the amount of the rent charged, and each transient shall receive a receipt for payment from the operator. No operator of a hotel shall advertise or state in any manner, whether directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the operator, or that it will not be added to the rent, or that, if added, any part will be refunded, except in the manner hereinafter provided. [Ord. 4-2003 § 5].
3.08.060 Registration.
Prior to commencing operation of a hotel or other facility that rents occupancy to transients, the operator of said hotel shall file for and obtain a general business license from the tax collector. In addition to the license application form, each operator shall file a transient occupancy tax registration form, provided by the tax collector, and maintain the information contained therein. The registration form will include such information as the number and rental rate of the rooms in the hotel, the name and contact information for the hotel management, and any other information deemed appropriate to the collection of the tax. The form shall also contain the following statement:
By signing this form, I represent that ____________________ is the responsible owner/operator of the hotel/facility. I warrant that the information provided herein is true and correct and acknowledge that I shall be personally liable if any of the information provided herein is determined to be false.
[Ord. 12-2004 § 3; Ord. 4-2003 § 6].
3.08.070 Records.
It shall be the duty of every operator liable for the collection and payment to the city of any tax imposed by this chapter to keep and preserve, for a period of five years, all records necessary to determine the amount of the tax for which the operator may have been liable for the collection of and payment to the city. Records include, but are not limited to, all business records and bank statements, including electronic records. The tax collector shall have the right to inspect records at all reasonable times, including pursuant to the audit provisions of RCMC 3.08.090. [Ord. 13-2010 § 2; Ord. 4-2003 § 7].
3.08.080 Reporting and remitting.
A. Each operator shall make a return to the tax collector of the total rents charged and received and the amount of tax collected for transient occupancies. The tax collector shall provide the forms. At the time the return is filed, the full amount of the tax collected shall be remitted to the tax collector. Returns and taxes are due on or before the fifteenth day after the close of the month for which the tax was collected. Returns and taxes that are not remitted on or before the fifteenth day after the close of the month for which the tax was collected shall be considered delinquent. The tax collector may establish shorter reporting periods for any certificate holder if deemed necessary to ensure collection of the tax. The tax collector may require further information in the return. Returns and payments are due immediately upon cessation of business for any reason.
B. All taxes collected by operators pursuant to this chapter shall be held in trust for the account of the city until payment thereof is made to the tax collector.
C. If any operator liable for any amount of tax, interest or penalty under this chapter sells or otherwise disposes of the business, his successors or assigns shall withhold sufficiently from the purchase price to cover such amount until the former operator produces from the tax collector either a receipt reflecting full payment or a certificate stating that no amount is due.
D. If the purchaser of a business fails to withhold from the purchase price as required, he shall be personally liable for the payment of the amount required to be withheld by him to the extent of the purchase price.
E. If the transient or operator disputes the amount of tax owed, he or she may protest the tax pursuant to the procedure in RCMC 3.08.130. However, the transient or operator must first remit the tax to the tax collector. [Ord. 12-2004 § 4; Ord. 4-2003 § 8].
3.08.090 Audit.
A. The tax collector may call for an audit of the records, the tax collection and remittance procedures, or the tax collection and remittance amounts of any operator. The operator shall make available all records and documents, including electronic records and documents, that the tax collector believes shall reasonably indicate that the operator is in compliance with the provisions of this chapter.
B. The city shall bear the cost of the audit. However, if after conducting the audit the tax collector determines that the operator has underpaid by more than five percent of the amount actually due or that the operator has unreasonably failed to comply with the provisions of this chapter regarding collection, the operator shall bear the cost of the audit.
C. Any dispute regarding the audit may be appealed pursuant to the provisions in RCMC 3.08.140. [Ord. 4-2003 § 9].
3.08.100 Uncollectible accounts.
Any operator is relieved from liability for the remittance to the city of the tax imposed under this chapter insofar as the measure of the tax is represented by accounts which have been found to be worthless and charged off for income tax purposes. If the operator has previously remitted the tax, he or she may, pursuant to procedures prescribed by the tax collector, take as a deduction the amount of tax previously remitted for the worthless and charged off account. If any such accounts are thereafter in whole or in part collected by the operator, the amount so collected shall be included in the first return filed after such collection and the tax on such amount paid with the return. [Ord. 12-2004 § 5; Ord. 4-2003 § 10].
3.08.110 Penalties – Interest.
A. Original Delinquency. When a tax becomes delinquent, any operator who fails to remit any tax imposed by this chapter within the time required shall pay a penalty of 10 percent of the amount of the tax in addition to the amount of the tax.
B. Continued Delinquency. Any operator who fails to remit any delinquent remittance on or before a period of 30 days following the date on which the remittance first became delinquent shall pay a second delinquency penalty of 10 percent of the amount of the tax in addition to the amount of the tax and the 10 percent penalty first imposed.
C. Fraud. If the tax collector determines that the nonpayment of any remittance due under this chapter is due to fraud, a penalty of 25 percent of the amount of the tax shall be added thereto in addition to the penalties stated in subsections (A) and (B) of this section.
D. Interest. In addition to the penalties imposed, any operator who fails to remit any tax imposed by this chapter shall pay interest at the rate of one and one-half percent per month or fraction thereof, compounded, on the amount of the tax, exclusive of penalties, from the date on which the remittance first became delinquent until paid.
E. Penalties Merged with Tax. Every penalty imposed and such interest as accrues under the provisions of this section shall become a part of the tax herein required to be paid. [Ord. 12-2004 § 6; Ord. 4-2003 § 11].
3.08.120 Failure to collect and report.
A. If any operator makes any report and remittance of tax that the tax collector finds insufficient in any manner, the tax collector may require the operator to revise the report and remit the proper amount of tax. The notification of insufficiency shall occur pursuant to RCMC 3.08.170. Fifteen days after the notification of insufficiency, if the operator has failed to revise the report and remit the proper amount of tax, the tax shall become delinquent.
B. If any tax becomes delinquent or any operator shall fail or refuse to collect the tax and to make, within the time provided in this chapter, any report and remittance of said tax or any portion thereof required by this chapter, the tax collector shall proceed in such manner as deemed best to obtain facts and information on which to base an estimate of the tax due. The tax collector may conduct investigations or base an estimate on any information in his or her possession, including but not limited to prior tax records for said hotel or activity at similar hotels in the area. As soon as the tax collector shall procure such facts and information upon which to base the estimate of tax due, the tax collector shall proceed to determine and assess against such operator the tax, interest and penalties provided for by this chapter. In case such determination is made, the tax collector shall give written notice of the amount so assessed pursuant to RCMC 3.08.170. Within 10 days after the provision of such determination, the operator may make application in writing to the tax collector for a hearing on the amount assessed pursuant to the dispute procedure in RCMC 3.08.130. [Ord. 4-2003 § 12].
3.08.130 Dispute procedure.
A. Any transient or operator who disputes the determination of tax or the amount of tax imposed under any provision of this chapter may request an evidentiary hearing before the tax collector pursuant to the provisions of subsection (B) of this section. If such application is properly made, the tax collector shall give not less than five days’ notice pursuant to RCMC 3.08.170 to the transient or operator to show cause at a time and place fixed in said notice why the determination should be changed. At such hearing, the transient or operator may appear and offer evidence why such determination should be changed.
B. The request for an evidentiary hearing must be made in writing. The request for an evidentiary hearing must be made within 10 days after the notice of determination is provided. No request for a hearing shall be granted unless the tax, interest, and penalties (if any) imposed are remitted to the tax collector pending the outcome of the hearing. Failure to remit tax, interest, and penalties shall result in delinquency on the later of the dates determining delinquency under this chapter.
C. The tax collector’s determination of tax, interest and penalties (if any) shall become final and conclusive and immediately due and payable for failure to comply with any provision of subsection (B) of this section.
D. Within five days after the evidentiary hearing, the tax collector shall decide the proper tax, interest and penalties and shall thereafter give notice pursuant to SRCMC 3.08.170 of such determination. The decision shall indicate whether a refund is owed to a transient or operator from the amount remitted pursuant to subsection (B) of this section or whether the transient or operator is responsible for an additional amount of tax, interest and penalties. Any additional amount to be due shall be payable by the transient or operator to the tax collector after 10 days unless an appeal is taken as provided in RCMC 3.08.140. Any refund to be due shall be payable by the city after 10 days. [Ord. 4-2003 § 13].
3.08.140 Appeal.
A. Any transient or operator aggrieved by any decision of the tax collector with respect to the outcome of an evidentiary hearing under RCMC 3.08.130 or an audit under RCMC 3.08.090 may appeal to the city manager or his or her designee by filing a notice of appeal with the city manager pursuant to subsection (B) of this section. If such notice of appeal is properly made, the city manager shall give not less than five days’ notice pursuant to RCMC 3.08.170 to the transient or operator to show cause at a time and place fixed in said notice why the tax collector’s determination should be overturned. At such appeal hearing, the transient or operator may appear and offer evidence why the tax collector’s decision should be changed.
B. The filing of a notice of appeal must be made in writing. The filing of a notice of appeal must be made within 10 days of the tax collector’s decision under RCMC 3.08.130. No filing of appeal shall be granted unless any outstanding tax, interest, and penalties (if any) imposed or determined under this chapter have been remitted to the tax collector pending the outcome of the appeal. The filing of an appeal shall not toll the date on which a tax becomes delinquent under this chapter.
C. The tax collector’s decision shall become final and conclusive for failure to comply with any provision of subsection (B) of this section.
D. After the appeal hearing, the city manager shall render a decision. The decision shall be final and conclusive and shall be provided to the transient or operator pursuant to RCMC 3.08.170. The decision shall indicate whether the tax collector’s original determination stands, a refund is owed to a transient or operator, or whether the transient or operator is responsible for an additional amount of tax, interest and penalties. Any additional amount to be due shall be payable by the transient or operator to the tax collector after 10 days. Any refund to be due shall be payable by the city after 10 days.
E. Any transient or operator may seek judicial review of the city manager’s decision by filing a petition for a writ of mandate pursuant to Section 1094.5 of the California Code of Civil Procedure (CCP). [Ord. 4-2003 § 14].
3.08.150 Refunds.
A. Whenever the amount of any tax, interest or penalty has been overpaid or paid more than once or has been erroneously or illegally collected or received by the city under this chapter, it may be refunded as provided in subsections (B) and (C) of this section provided a claim pursuant to Chapter 2.38 RCMC is submitted.
B. An operator may claim a refund or take as credit against taxes collected and remitted the amount overpaid, paid more than once or erroneously or illegally collected or received when it is established in a manner prescribed by the tax collector that the person from whom the tax has been collected was not a transient; provided, however, that neither a refund nor a credit shall be allowed unless the amount of the tax so collected has either been refunded to the transient or credited to rent subsequently payable by the transient to the operator.
C. A transient may obtain a refund of taxes overpaid or paid more than once or erroneously or illegally collected or received by the city by filing a claim in the manner provided in subsection (A) of this section, but only when the tax was paid by the transient directly to the tax collector, or when the transient, having paid the tax to the operator, establishes to the satisfaction of the tax collector that the transient has been unable to obtain a refund from the operator who collected the tax.
D. No refund shall be paid under provisions of this section unless the claimant establishes the right thereto by written records showing entitlement thereto.
E. The refund procedure of this section shall only apply to claims not subject to the procedure in RCMC 3.08.120 through 3.08.140. Failure to follow the procedures in RCMC 3.08.120 through 3.08.140 where applicable shall render any request for refund under this section void. [Ord. 4-2003 § 15].
3.08.160 Actions to collect.
Any tax required to be paid by any transient under the provisions of this chapter shall be deemed a debt owed by the transient to the city. Any such tax collected by an operator which has not been paid to the city shall be deemed a debt owed by the operator to the city. Any person owing money to the city under the provisions of this chapter shall be liable for an action brought in the name of the city for the recovery of such amount together with any penalty, interest, court fees, attorney’s fees and other legal fees incident thereto any time within four years after the tax required to be paid becomes due and payable. [Ord. 13-2010 § 3; Ord. 4-2003 § 16].
3.08.170 Provision of notice.
Any action requiring the city to provide notice to an operator under this chapter shall be made to the operator at the address of the hotel subject to this chapter by United States Mail. Any action requiring the city to provide notice to a transient under this chapter shall be made at the transient’s last known address by United States Mail. Any action requiring a transient or operator to provide notice to the city under this chapter shall be made to the city clerk or his or her designee. [Ord. 4-2003 § 17].
3.08.180 Penalty for violations.
A. Any person violating any of the provisions of this chapter shall be guilty of a misdemeanor and shall be punishable therefor by a fine of not more than $1,000, or by imprisonment for a period of not more than six months, or by both such fine and imprisonment.
B. Any operator or other person who fails or refuses to register as required herein or to furnish any return required to be made or who fails or refuses to furnish a supplemental return or other data required by the tax collector, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor, and is punishable as aforesaid. Any person required to make, render, sign or verify any report or claim who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by this chapter to be made is guilty of a misdemeanor and is punishable as aforesaid. [Ord. 12-2004 § 7; Ord. 4-2003 § 18].