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HomeMy WebLinkAbout03-27-2020 Continued Special Meeting Agenda Packet City Council/Disaster Council Agenda Friday, March 27, 2020 12:30 PM Continued Special Meeting TELECONFERENCE Based on the threat of COVID-19 as reflected in the Proclamations of Emergency issued by both the Governor of the State of California, the San Luis Obispo County Emergency Services Director and the City Council of the City of San Luis Obispo as well as the Governor’s Executive Order N-29-20 issued on March 17, 2020, relating to the convening of public meetings in response to the COVID-19 pandemic, the City of San Luis Obispo will be holding all public meetings via teleconference. There will be no physical location for the Public to view the meeting. Below are instructions on how to view the meeting remotely and how to leave public comment. Additionally, members of the City Council are allowed to attend the meeting via teleconference and to participate in the meeting to the same extent as if they were present. Using the most rapid means of communication available at this time, members of the public are encouraged to participate in Council meetings in the following ways: 1. Remote Viewing - Members of the public who wish to watch the meeting can view: a. Televised live on Charter Cable Channel 20 b. View a livestream of the meeting online at: https://www.slocity.org/channel20 2. Public Comment - The City Council will still be accepting public comment for Only items on the agenda. Public comment can be submitted in the following ways: • Mail or Email Public Comment • Received by 10:00 AM on the day of meeting - Can be submitted via email to: (emailcouncil@slocity.org ) or U.S. Mail to City Clerk at: 990 Palm St. San Luis Obispo, CA 93401 • Emails sent after 10:00 AM up until public comment is opened on the item – Limited to one page emailed to cityclerk@slocity.org will be read aloud during the public comment period. • Verbal Public Comment - Call (805) 781-7164; state and spell your name, mention the agenda item number you are calling about and leave your comment. The verbal comments must be received by 10:00 AM on the morning of the noticed meeting and will be limited to 3 minutes. All voicemails will be forwarded to the Council Members and saved as Agenda Correspondence. All comments submitted will be placed into the administrative record of the meeting. City of San Luis Obispo, Title, Subtitle San Luis Obispo City Council/Disaster Council Agenda March 27, 2020 Page 2 CALL TO ORDER: Mayor Heidi Harmon ROLL CALL: Council Members Carlyn Christianson, Andy Pease, Erica A. Stewart, Vice Mayor Aaron Gomez and Mayor Heidi Harmon PUBLIC COMMENT ON AGENDA ITEMS ONLY. BUSINESS ITEMS 1. RECEIVE AN UPDATE FROM THE EMERGENCY SERVICES DIRECTOR AND PROVIDE COVID-19 RELATED DIRECTION BASED ON CURRENT STATUS Recommendation: Receive and file report from Emergency Services Director and provide Council input and direction to the Emergency Services Director regarding any late breaking COVID-19 related concerns in light of fluid and constantly evolving circumstances 2. DELAY TRANSIENT OCCUPANCY TAX RELATED TO LATE FEES AND PENALTIES Recommendation: Adopt a Resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, authorizing the City’s Tax Collector to delay late fees and penalties for delinquent transient occupancy tax received for stays during February and March 2020” and authorizing the City’s Tax Collector to delay the collection of late fees and penalties for overdue Transient Occupancy Tax (TOT) received for stays during February and March 2020 until August 31, 2020.” ADJOURNMENT LISTENING ASSISTIVE DEVICES are available for the hearing impaired--please see City Clerk. The City of San Luis Obispo wishes to make all of its public meetings accessible to the public. Upon request, this agenda will be made available in appropriate alternative formats to persons with disabilities. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should direct such request to the City Clerk’s Office at (805) 781-7100 at least 48 hours before the meeting, if possible. Telecommunications Device for the Deaf (805) 781-7410. City Council regular meetings are televised live on Charter Channel 20. Agenda related writings or documents provided to the City Council are available for public inspection in the City Clerk’s Office located at 990 Palm Street, San Luis Obispo, California during normal business hours, and on the City’s website www.slocity.org. Persons with questions concerning any agenda item may call the City Clerk’s Office at (805) 781-7100. Department Name: Finance Cost Center: 2001 For Agenda of: March 27, 2020 Placement: Consent Estimated Time: N/A FROM: Brigitte Elke, Finance Director SUBJECT: RESOLUTION TO DELAY TRANSIENT OCCUPANCY TAX RELATED LATE FEES AND PENALTIES RECOMMENDATION Adopt a Resolution (Attachment A) authorizing the City’s Tax Collector to delay the collection of late fees and penalties for overdue Transient Occupancy Tax (TOT) received for stays during February and March 2020 until August 31, 2020. DISCUSSION Background On Tuesday, March 17, 2020, the City Council declared a state of emergency in response to the global health crisis and pandemic brought on by Covid-19 (Coronavirus). During these difficult times and in an effort to slow the spread of the disease, the County of San Luis Obispo has given “shelter at home” directive for non-essential services and activities and the City is partaking in these efforts. The impact of the global pandemic and the resulting response to slow the spread of the disease has impacted the business and tourism activities in the City and staff is in the midst of assessing the short- and long-term ramifications and effects on the City’s finances. One portion of the City’s projected losses is due to reduced TOT revenues. Most lodging businesses within the City are now experiencing dire declines in occupancy while trying to maintain their properties and operating cost. Staff has received several inquiries about the monthly TOT remittance and requests to postpone collection. To be clear, the request the payment of taxes collected on behalf of the City until August 31, 2020 and avoid any otherwise applicable late penalties that would be assessed consistent with adopted city policies. Recommended Action In an effort to assist the lodging industry during these daring times, staff recommends to delay otherwise applicable late fees and penalties on delinquent TOT remittance for February (due on March 31, 2020), and March (due on April 30, 2020), until August 31, 2020. August 31, 2020 is the latest date that these payments can be delayed while still recording the revenues to the applicable fiscal year. A question may arise, what about other taxes. TOT is one where the City has plenary authority to otherwise waive late penalties. Whereas, UUT and Sales Taxes are collected by the State of California and later remitted to the City’s. Business license fees are due later this summer and Staff will be monitoring recovery efforts. The bottom line is that the City like any business needs to maintain its own cash flow and TOT seemed appropriate given the focus of the economic impacts of COVID-19 on hoteliers given the stay in home orders. Packet Page 1 Policy Context Transient Occupancy Tax is governed by the City’s Municipal Code under Chapter 3.04. Public Engagement This item will be reviewed during a public session of the City Council acting as the Disaster Council of the City of San Luis Obispo and is based on feedback from the lodging industry. CONCURRENCE The City’s Tourism Business Improvement Board has not been able to meet on this item as its board meeting occurred on March 11, 2020. ENVIRONMENTAL REVIEW The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378. FISCAL IMPACT Budgeted: Yes Budget Year: 2019-20 Funding Identified: Yes/No Fiscal Analysis: Funding Sources Total Budget Available Current Funding Request Remaining Balance Annual Ongoing Cost General Fund N/A State Federal Fees Other: Total $ N/A This action does not waive the requirement to remit TOT to the City. It only postpones the assessment of penalties and interest charges on the debt to the City until August 31, 2020. The estimate of delayed taxes is approximately $400,000-$600,000. Since the number of late payments is unknown, the impact cannot yet be assessed. Since the action is only applicable to the February and March remittances, the City has sufficient cash flow to continue its services to allow for this action. ALTERNATIVES 1. The City Council could decide to allow additional months to fall under this provision. This is not recommended as it could jeopardize the City’s cash flow as remittance for subsequent months will already be diminished due to the effects of the travel ban and “Shelter at Home” directives. 2. The Council could decide to allow postponement of TOT remittance altogether. This is not recommended as it would jeopardize the City’s ability to provide essential services. Packet Page 2 Attachments: a – Draft Resolution Packet Page 3 R ______ RESOLUTION NO. _____ (2020 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, AUTHORIZING THE CITY’S TAX COLLECTOR TO DELAY LATE FEES AND PENALTIES FOR DELINQUENT TRANSIENT OCCUPANCY TAX RECEIVED FOR STAYS DURING FEBRUARY AND MARCH 2020. WHEREAS, On Tuesday, March 17, 2020, the City Council declared a state of emergency in response to the global health crisis and pandemic brought on by Covid-19 (Coronavirus); and WHEREAS, due to the immediate effect of the emergency shelter-at-home directive on the lodging industry, many hoteliers have inquired about the possibility to delay remittance of the collected transient occupancy tax; and WHEREAS, City staff has considered the projected COVID-19 losses and the possibility to assist the City’s lodging partners who are directly impacted by State and local shelter at home orders; WHEREAS, San Luis Obispo Municipal Code Section 3.04, provides that “Any operator who fails to remit any tax imposed by this chapter within the time required shall pay a penalty the amount of which will be set by resolution of the city council;” and WHEREAS, the Council wished to temporarily suspend the imposition of adopted penalties for late payment of currently due payments because the COVID-19 pandemic is acutely and disproportionately impacting the local lodging and hotel industry; and NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. Pursuant to Municipal Chapter 3.04.080, otherwise applicable penalties applicable to late payments are hereby temporarily suspended and the Tax Collector is authorized to delay imposition of late fees and penalties for late payment to the City of Transient Occupancy Tax (TOT) revenues received by lodging establishments for February 2020 and March 2020 transient occupancy lodging services until August 31, 2020. SECTION 2. Nothing herein shall relieve any person or entity of its obligation to pay and to remit to the City amounts otherwise due pursuant to Chapter 3.04 and any late fees or penalties that otherwise would have become due for failure or refusal to pay amounts due for February and March 2020 shall be assessed and shall become due and payable to the City if the referenced TOT payments due to the City have not been made in full by August 31, 2020 Upon motion of _______________________, seconded by _______________________, and on the following roll call vote: AYES: Packet Page 4 Resolution No. _____ (2019 Series) Page 2 R ______ NOES: ABSENT: The foregoing resolution was adopted this _____ day of _____________________ 2020. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Teresa Purrington City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, 2020. ____________________________________ Teresa Purrington City Clerk Packet Page 5