HomeMy WebLinkAboutItem #11 - Ordinance Amendment to Transient Occupancy TaxTransient Occupancy Tax
Ordinance Revisions
January 14, 2019
Recommendation
“INTRODUCE AN ORDINANCE AMENDING
DESIGNATED PORTIONS OF THE CITY OF SAN LUIS
OBISPO MUNICIPAL CODE SECTION 3.04.020,
SECTION 3.04.080, SECTION 3.04.090, SECTION
3.04.100 AND SECTION 3.04.130 OF MUNICIPAL
CODE CHAPTER 3.04 –TRANSIENT OCCUPANCY
TAX”
What is TOT?
A 10% tax levy by the City on transients for all applicable
room rent. Collected by business operator and
applicable for all stays under 30 days.
Each operator shall collect the tax imposed and remit to
the tax administrator within the period established in
Chapter 3.04.
The ordinance to collect TOT was implemented in 1955.
The City’s third largest source of General Fund
Revenue.
Traditionally a stable income from stable industry
(Hotels)
Why the change?
Lodging industry has dramatically changed with
homestays entering the market.
Less stable industry with a multitude of known and
unknown players
Enforcement action availability was limited
Currently around 100 permitted and at least 64
unpermitted homestays operating within the City
Third party host compliance company estimates over
$400,000 in TOT debt owed to the City.
Recommended Changes
Lien on Property: Since linked directly to property
rental, the tax administrator may take necessary
action to enforce a lien on the property for unpaid
taxes.
This process mirrors the adopted policy to collect debt
related to code enforcement, fire safety, and solid
waste violations.
Creates an even playing field for operators that have
been properly remitting TOT and long-term rentals
that maintain housing stock.
If unpaid, Tax
Administrator
assesses amount
due
Operator can
request appeal
of Tax
Administrator’s
decision with
Council
TOT Due
Operator may
request appeal
with Tax
Administrator
TOT is due
based on
council
decision
If TOT remains
unpaid it will be
placed as a lien on
the property
Proposed Appeal Process
Recommendation
“INTRODUCE AN ORDINANCE AMENDING
DESIGNATED PORTIONS OF THE CITY OF SAN LUIS
OBISPO MUNICIPAL CODE SECTION 3.04.020,
SECTION 3.04.080, SECTION 3.04.090, SECTION
3.04.100 AND SECTION 3.04.130 OF MUNICIPAL
CODE CHAPTER 3.04 –TRANSIENT OCCUPANCY
TAX”