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Transient Occupancy Tax
City of Kerman
Needs 51% to pass
1339 / 49.96% Yes votes ...... 1341 / 50.04% No votes
Index of all Measures
|Information shown below: Impartial Analysis | Arguments | Full Text|
Shall the City of Kerman establish a Transient Occupancy Tax (TOT) at the rate of 8 percent for the users of motels, hotels and similar temporary lodgings in the City to pay as part of their room rate?
A Transient Occupancy Tax ("TOT") is also known as a "room tax", "hotel/motel tax" or "bed tax." A TOT is collected by a hotel, motel or other business offering dwelling, lodging or sleeping accommodations as an additional charge to its overnight guests who stay for a period shorter than 30 consecutive days.
Many local cities and counties already impose a TOT, and the amount of their tax ranges from 4% to 10% of the room rental rate and reportedly helps pay for the public services and facilities that out of town visitors use when they stay in those cities and counties.
The TOT proposed by this ordinance would establish the tax as 8% of the room rate, and could not be changed except by the voters of Kerman. In addition, only the voters could expand the class of persons subject to the TOT. The City Council would have the power to change other provisions of this ordinance by a four-fifths vote.
This measure would require the operators of hotels, motels and similar lodgings to register with the City of Kerman and make monthly reports and payments of the TOT collected. The measure establishes procedures for proper record-keeping and collection of the TOT. If approved by the voters, the City would begin collecting the TOT in January, 2009.
This measure is not expected to have any impact on the physical or business environment, and its fiscal effect would be to produce revenue for the City's GeneralFund.
s/ Mark Blum
|Arguments For Measure T|
The Transient Occupancy Tax (TOT), or "Hotel Tax," is an 8% fee that will be added to the nightly room rate charged to guests in hotels and motels located in Kerman. With the possibility of a second local hotel/motel on the horizon, now would be the time to initiate a TOT.
The TOT ensures that future hotel visitors who travel city streets, frequent Kerman restaurants and retail areas, and rely daily on Kerman's police and other city services pay their fair share for local services and maintenance. If approved, Kerman's TOT revenues will go into the City's general fund and offset not only the costs associated with visitors, but also bolster City programs in the areas of public safety, community policing, graffiti removal, street maintenance, parks and recreation, code enforcement, and capital improvements.
Facts to consider:
1) This is NOT a tax that residents will have to pay.
2) This Measure sets a TOT rate of 8% that is within the average rate used by most area cities.
3) Approving this TOT Measure will help ensure that visitors to Kerman pay their fair share for City services they use and impact while staying in town - and even they will not have to pay the tax after the first 30 days.
4) This TOT would require a simple majority vote of the registered voters in Kerman.
This is truly an issue of fairness, equity and sustainability of our valued community. Please vote YES on this TOT Measure to help your community have safer streets, neighborhoods, and more recreational opportunities.
Remember, a NO vote on this Measure will mean that we lose out on an important revenue source that could help pay for public safety services and enhance other city services for our families.
s/ Michael W. Teixeira
s/ Keith B. Williams
s/ Dolores Amaro
s/ Phil Suson
(No arguments against Measure T were submitted)
|Full Text of Measure T|
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF KERMAN as follows:
Section 1: Pursuant to Section 2 of Article 13C of the California Constitution the City Council may submit to the electorate a proposal for the imposition of a general tax, and said tax may only be imposed if approved by a majority of the voters voting at a general election. The City Council therefore proposes for the approval of the electorate the text of an ordinance as set forth in Section 2. The proposed ordinance, if approved by the voters according to law, shall be added to the Kerman Municipal Code and shall be known as the Transient Occupancy Tax.
Section 2: The people of the City of Kerman do ordain as follows:
Chapter 5.50 is hereby added to Title 5 of the City of Kerman Municipal Code to read as follows:
Section 5.50.010 Definitions.
Section 5.50.010 Definitions. Except where the context otherwise requires, the Definitions given in this Section govern the construction of this chapter:
A. Person. "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.
B. Hotel. "Hotel" means:
(a) 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;
(b) Any portion of any real property occupied, intended to be occupied, or designed for occupancy by transients for dwelling, lodging or sleeping purposes in any recreational vehicle, trailer, trailer coach, house car or motor home, and includes campgrounds and recreation vehicle parks.
C. Occupancy. "Occupancy" means: The use or of, possession, of the right to use or possess any space, area, or room(s) or portion thereof in any hotel for dwelling, lodging or sleeping purposes.
D. Transient. "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 thirty (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 thirty (30) days has expired unless there is an agreement in writing between the operator and the occupant providing for a longer period of occupancy.
E. Rent. "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.
F. Operator. "Operator" means the person who is proprietor of the hotel, whether in the capacity of owner, lessee, subleasee, mortgagee in possession, licensee or any other capacity. Where the operator performs his 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 purposes of this Chapter and shall have the same duties and liabilities as his principal. Compliance with the provisions of this Chapter by either the principal or the managing agent shall, however, be considered to be compliant by both.
5.50.020. Tax Imposed. For the privilege of occupancy in any hotel, each transient is subject to and shall pay a tax in the amount of eight percent (8%) of the rent charged by the operator. Said 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 ceasing to occupy space in the hotel. If for any reason the tax due is not paid to the operator of the hotel, the City Clerk may require that such tax shall be paid directly to the City Finance Department.
5.50.030. Exemptions. No tax shall be imposed upon: a) Any person as to whom, when in the performance of that person's official duties, or any occupancy as to which, it is beyond the power of the City to impose the tax herein provided; or b) Any officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty.
No exemption shall be granted except upon a claim therefore made at the time rent is collected and under penalty of perjury upon a form prescribed by the City Clerk. The transient shall be required to provide the necessary proof of exemption. Governments and governmental agencies are generally not exempt from taxation. A copy of eligible exemption claims shall be submitted monthly at the same time as the required tax return reporting.
5.50.040. 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 of 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.
5.50.050. Registration of Hotels/Motels. Within thirty (30) days after commencing business, each Operator of any hotel/motel renting occupancy to transients shall register said hotel/motel with the City Clerk and obtain a "transient occupancy" registration certificate" to be at all times posted in a conspicuous place on the premises. Said certificate shall, among other things, state the following:
a) Name of the operator.
b) Address of the Hotel/Motel.
c) Date upon which the certificate was issued.
d) "This transient occupancy registration certificate signifies that the person named on the face hereof has fulfilled the requirements of the City of Kerman Municipal Code pursuant to the Uniform Transient Occupancy Tax by registering with the City Clerk for the purpose of collecting from transients the transient occupancy tax and remitting said tax to the City Finance Department. This certificate does not authorize any person to conduct any unlawful business or to conduct any lawful business in an unlawful manner, nor to operate a hotel/motel without strictly complying with all local applicable laws, including but not limited to those requiring a permit from any board, commission, department, or office of this City. This certificate does not constitute a permit."
5.50.060. Reporting, Remitting. On or before the tenth (10th) day of each calendar month, each operator shall make a return to the City declaring the total rents charged and received and the amount of tax collected for transient occupancies for the month next preceding the previous month. At the time the return is filed, the full amount of the tax collected shall be remitted to the City. The City Clerk may establish shorter reporting periods for any certificate holder if deemed necessary in order to insure collection of the tax which may require further information in the return. Returns and payments are due immediately upon cessation of business for any reason. All taxes collected by operators pursuant to this Article shall be held in trust for the account of the City until payment thereof is made to the City Clerk.
5.50.070. Penalties and Interest.
a) Original delinquency. Any operator who fails to remit any tax imposed by this Article within the time required shall pay a penalty of ten percent (10%) of the amount of the tax in addition to the amount of the tax.
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 to an action brought in the name of the City for the recovery of such amount.
b) Continued delinquency. Any operator who fails to remit any delinquent remittance on or before a period of thirty (30) days following the date on which the remittance first became delinquent shall pay a second delinquency penalty of ten percent (10%) of the amount of the tax in addition to the amount of the tax and the ten percent (10%) penalty first imposed.
c) Fraud. If the City Clerk determines that the nonpayment of remittance due under this Article is due to fraud, a penalty of twenty-five percent (25%) 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 Article shall pay interest at the rate of one percent (1%) per month or fraction thereof on the amount of the tax from the date on which the remittance first became delinquent until paid.
e) Penalties, Interest 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.
5.50.080. Failure to Collect and Report Tax; Determination of Tax by City Clerk. If any operator shall fail or refuse to collect said 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 City Clerk shall proceed in such manner deemed best to obtain facts and information on which to base the estimate of the tax due. As soon as the City Clerk shall procure such facts and information on which to base the assessment of any tax imposed by this Chapter and payable by any operator who has failed or refused to collect the same and make such report and remittances, the City Clerk shall proceed to determine and assess against such operator the tax, interest and penalties provided by this Chapter. In case such determination is made, the City Clerk shall give a notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the operator so assessed at the last known address. Such operator may within ten (10) days after the serving of mailing of such notice make application in writing to the City Clerk for a hearing on the amount assessed. If application by the operator for the hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the City Clerk shall be final and conclusive and immediately due and payable. If such application is made, the City Clerk shall give not less than five (5) days written notice in the manner prescribed herein to the operator to show cause at a time and place fixed in said notice why said amount specified therein should not be fixed for such tax, interest and penalties. At such hearing, the operator may appear and offer evidence why such specified tax, interest and penalties should not be so fixed. After such hearing, the City Clerk shall determine the proper tax to be remitted and shall thereafter give written notice to the person in the manner prescribed herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable within fifteen (15) days, unless an appeal is taken as provided in Section 5.50.110.
5.50.090. Liability of Successor for Failure to Withhold - Notice of Amount Due. If the successor to the business fails to withhold a portion of the purchase price for payment of the tax owing as of the close of escrow for the transfer of ownership of any hotel, said successor shall be liable to the City for the payment of the amount owing at the close of escrow. Within thirty (30) days after receiving written request from the successor for a tax clearance certificate stating that no tax or penalty is due, the City Clerk shall either issue the certificate or mail notice to the successor at its address as it appears on the records of the City Clerk of the estimated amount of the tax and penalty that must be paid as a condition of issuing the certificate.
5.50.100. Duty of Successor of Operator. If an operator who is liable for any tax or penalties under this Chapter sells or otherwise disposes of his/her business, his/her successor shall notify the City Clerk of the date of the sale at least thirty (30) days before the date of sale, or if the decision to sell was made less than thirty (30) days prior to the actual sale, then immediately shall withhold a sufficient portion of the purchase price to equal the amount of such tax or penalty until the selling operator produces a receipt from the collector showing that the tax or penalty has been paid or a tax clearance certificate from the City Clerk stating that no tax or penalty is due. If the seller does not present a receipt or tax clearance certificate within thirty (30) days after such successor commences to conduct business, the successor shall deposit the withheld amount with the City Clerk pending settlement of the account of the seller.
5.50.110. Appeal. Any operator aggrieved by any decision of the City Clerk with respect to the amount of such tax, interest and penalties, if any, may appeal to the City Council by filing a notice of appeal with the City Clerk within fifteen (15) days of the serving or mailing of the determination of tax due. The Council shall fix a time and place for hearing such appeal and the City Clerk shall give notice in writing to such operator at the last known place of address. The findings of the Council shall be final and conclusive and shall be served upon the appellant in the manner prescribed above for service of notice of hearing. Any amount found to be due shall be immediately due and payable upon the service of notice.
5.50.120. 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 three (3) years all records as may be necessary to determine the amount of such tax as the operator may have been liable for the collection of said payment to the City, which records the Collector shall have the right to inspect at all reasonable times.
5.50.130. 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 in writing therefore, stating under penalty of perjury the specific grounds upon which the claim is founded, is filed with the City Clerk within three (3) years of the date of payment. The claim shall be on forms furnished by the City Clerk.
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 City Clerk 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 City Clerk, or when the transient having paid the tax to the operator, established to the satisfaction of the City Clerk that the transient has been unable to obtain a refund from the operator who collected the tax.
d) No refund shall be paid under the provisions of this Section unless the claimant establishes his right thereto by written records showing entitlement.
5.50.140 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 the City under the provisions of this chapter shall be liable to an action brought in the name of the City of Kerman for the recovery of such amount.
5.50.150 Violation - Penalty. Any person violating any of the provisions of this Chapter shall be guilty of a misdemeanor. 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 to refuses to furnish a supplemental return or other data required by the City Clerk, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor. 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.
5.50.160. Severability and Amendment. If any section, sub-section, subdivision, paragraph, clause or phrase in this ordinance, or any part thereof, is for any reason held to be invalid or unconstitutional , such decision shall not affect the validity of the remaining sections or portions of this ordinance or any part thereof. The City Council hereby declares that it would have passed each section, sub-section, subdivision, paragraph, sentence, clause or phrase of this ordinance irrespective of the fact that any one or more sections, sub-sections, subdivisions, paragraphs, sentences, clauses or phrases may be declared invalid or unconstitutional.
The City Council shall have the power to amend any provision of this Chapter by vote of four-fifths of its members, excepting that an amendment increasing the rate of the tax or expanding the class of those subject to the tax shall require the approval of a majority of the electorate.
5.50.170. Effective Date. This Chapter shall be considered adopted upon the date that the City Council declares that a majority of the voters voting at the general election in November, 2008 has voted in favor of the proposition adopting this Chapter, and shall go into effect 10 days after said date pursuant to Section 9217 of the Elections Code, except that the tax imposed by this Chapter shall become operative and be imposed on and after January 1, 2009.
Section 3: The proposed ordinance set forth in Section 2 shall be submitted as a ballot measure to the electors of the City of Kerman at the general election to be held on November 4, 2008. If not less than a majority of the voters voting at said election vote in its favor, the ordinance shall become a valid and binding ordinance of the City. The ordinance shall be considered adopted upon the date that the City Council declares that a majority of the voters voting at the general election in November, 2008 has voted in favor of the proposition adopting this Chapter and shall be effective as stated in Section 5.50.170 of the proposed ordinance.
Section 4: The Clerk of the City of Kerman, the City Attorney and public officials providing elections services are hereby authorized, requested and directed to prepare all documents, notices, or other instruments, and to perform all other acts necessary or convenient to place the proposed ordinance on the ballot for the November 4, 2008 general election.
Section 5: Sections 1, 3, 4 and 5 of this ordinance shall take effect immediately upon passage as an urgency ordinance pursuant to Government Code Section 36937, as it relates to a pending election. Publication of the same or a summary of the same within fifteen days of passage pursuant to the laws of the State of California in the Kerman News, a newspaper of general circulation published and circulated in the City of Kerman is hereby ordered and directed.
The foregoing ordinance was first read at a regular meeting of the City Council of the City of Kerman, held on the ___ day of ____________, 2008 and finally read and adopted after a duly noticed public hearing at a regular meeting of said Council held on the _____ day of ______, 2008 by the following vote: