Chapter 6.09 — UNIFORM TRANSIENT OCCUPANCY TAX

Except where the context otherwise requires, the definitions given in this section govern the construction of this chapter:

"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 structures or portion thereof, except that no lodging house, rooming house, apartment house, dormitory, public or private club, mobile home or house trailer at a fixed location or other similar structure shall be deemed a hotel, when less than 10 percent of the annual dollar value of the rentals it earns derives from transient occupancy, and when it does not by signs or other advertising invite transient occupancy.

"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.

"Online travel company" means any person, whether operating for profit or not for profit, which enables transients to purchase occupancy of space in a hotel via the internet, or by similar electronic means.

"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 his or her functions through a managing agent of any type or character other than an employee, including but not limited to an online travel company, 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 to the transient (including, but not limited to, room rates, service charges, retail markup, commissions, processing fees, cancellation charges, attrition fees or online booking fees), 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 administrator" means the city clerk.

"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.

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City of Pacific Grove, CA § 6.09.010

PACIFIC GROVE CODE

§ 6.09.050

• (Ord. 484 N.S., 1965; Ord. 18-017, 2018)

For the privilege of occupancy in any hotel on and after July 1, 2019, each transient is subject to and shall pay a tax in the amount of 12 percent of the total rent paid by the transient. 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 administrator may require that such tax shall be paid directly to the tax administrator.

(Ord. 484 N.S., 1965; Ord. 597 N.S., 1968; Ord. 724 N.S. § 1, 1972; Ord. 1021 N.S. § 1, 1978; Ord. 1557 N.S. § 1, 1987; Ord. 18-017, 2018)

No tax shall be imposed upon:

• (a) 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) 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 therefor made to the tax administrator and under penalty of perjury upon a form prescribed by the tax administrator. (Ord. 484 N.S., 1965; Ord. 542 N.S., 1966)

Each operator shall collect the tax imposed by this chapter at the same time the rent is collected from every transient, and each transient shall be given reasonable notice that the tax herein levied is included in his or her bill. The tax administrator shall make detailed regulations for the billing of the tax where transients are billed as a group, or where the billing includes the cost of meals. No operator of a hotel shall advertise that the tax or any part thereof will be assumed or absorbed by the operator in newspapers, periodicals, on the radio, on signs directed towards attracting guests or by way of any commercial advertising media, except that a sign on the interior of a building and illegible from the exterior of the building and showing the amount of tax charged per accommodation, or any declarations in bills, statements, pamphlets or brochures which quote prices including the tax shall not be deemed to be such advertising. (Ord. 484 N.S., 1965)

Within 30 days after April 1, 1965, or within 30 days after commencing business, whichever is later, each operator of any hotel renting occupancy to transients shall register the hotel with the tax administrator and obtain from him or her a "transient occupancy registration certificate" to be at all times posted in a conspicuous place on the premises. The certificate shall, among other things, state the following:

• (1) The name of the operator;

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City of Pacific Grove, CA

REVENUE AND FINANCE

§ 6.09.050

§ 6.09.080

• (2) The address of the hotel;

• (3) The date upon which the certificate was issued;

• (4) "This transient occupancy registration certificate signifies that the person named on the face hereof has fulfilled the requirements of the uniform transient occupancy tax ordinance by registering with the tax administrator for the purpose of collecting from transients the transient occupancy tax and remitting said tax to the tax administrator. 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 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."

• (Ord. 484 N.S., 1965)

Each operator shall, on or before the last day of the month following the close of each calendar quarter, or at the close of any shorter reporting period which may be established by the tax administrator, make a return to the tax administrator, on forms provided by him or her, of the total rents charged and received and the amount of tax collected for transient occupancies. At the time the return is filed, the full amount of the tax collected shall be remitted to the tax administrator. The tax administrator may establish shorter reporting periods for any certificate holder if he or she deems it necessary in order to ensure collection of the tax and he or she 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 chapter shall be held in trust for the account of the city until payment thereof is made to the tax administrator.

(Ord. 484 N.S., 1965)

• (a) Original Delinquency. 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 administrator determines that the nonpayment or 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-half of one percent per month or fraction thereof 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. 484 N.S., 1965)

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City of Pacific Grove, CA § 6.09.080

PACIFIC GROVE CODE

§ 6.09.090

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 tax administrator shall proceed in such manner as he or she may deem best to obtain facts and information on which to base his or her estimate of the tax due. As soon as the tax administrator shall procure such facts and information as he or she is able to obtain upon 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 to make such report and remittance, he or she 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 administrator 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 his or her last known place of address. (Ord. 484 N.S., 1965; Ord. 25-018, 10/1/2025)

• (a) Right to Appeal. Any person aggrieved by any decision of the tax administrator with respect to the amount of such tax, interest and penalties, if any, has a right to file a written appeal the within 15 calendar days following the date of service of the determination of tax due.

• (b) Effect of Failure to Appeal. Failure to appeal is waiver of the right to challenge the decision and failure to exhaust administrative remedies. In this event, the decision order is final, and any tax, interest, and penalties are immediately due and payable.

• (c) Selection of Hearing Officer. The City Manager will select the hearing officer. The hearing officer must be selected in a manner that avoids the potential for pecuniary or other bias.

• (d) Scheduling and Noticing of the Hearing. If a timely and proper appeal is filed, then the City Clerk must schedule the hearing no sooner than 15 days and no later than 60 days from receipt of the notice of appeal, unless the parties waive such time limits. The failure to hold the hearing within this time period does not invalidate any action of the hearing officer. The City Clerk must notify the appellant in writing of the date, time, and location of the hearing at least 10 days before the date of the scheduled hearing. The notice of hearing must be served personally or by depositing it in the United States mail, postage prepaid, addressed to the operator so assessed at their last known place of address.

• (e) Burdens and Standard. The City bears the initial burden to produce evidence showing a reasonable basis for the estimate and assessment made under this chapter. If the City meets that burden, the operator bears the burden to produce records or other evidence sufficient to rebut the estimate and assessment.

• (f) Decision. The hearing officer’s decision must be in writing, set forth the hearing officer’s findings of fact and conclusions of law, determine the proper tax to be remitted, and include a 15-day deadline for payment of any upheld amount to the City. If the hearing officer determines that each nuisance condition described in the compliance order is nonexistent, the compliance order is deemed cancelled. The hearing officer must render a decision within 15 days following the conclusion of the hearing. Failure of the hearing officer to render a decision within this time period does not invalidate any action of the hearing officer or automatically grant the appeal. The hearing officer’s decision must be served

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City of Pacific Grove, CA

REVENUE AND FINANCE

§ 6.09.090

§ 6.09.120

personally or by depositing it in the United States mail, postage prepaid, addressed to the operator so assessed at their last known place of address. The decision must contain the following statement: “The decision of the hearing officer is final and binding. Judicial review of this decision is subject to the provisions and time limits set forth in California Code of Civil Procedure section 1094.6 et seq.”

(Ord. 484 N.S., 1965; Ord. 25-018, 10/1/2025)

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 years, all records as may be necessary to determine the amount of such tax as he or she may have been liable for the collection of and payment to the city, which records the tax administrator shall have the right to inspect at all reasonable times.

(Ord. 484 N.S., 1965)

• (a) Filing Claim. 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 therefor is filed with the tax administrator. The claim shall conform in all respects to the requirements set forth for claims against the city in Chapter 6.06 PGMC.

• (b) Refund to Operator. 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 administrator 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) Refund to Transient. 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 administrator, or when the transient having paid the tax to the operator, establishes to the satisfaction of the tax administrator that the transient has been unable to obtain a refund from the operator who collected the tax.

• (d) Proof Required. No refund shall be paid under the provisions of this section unless the claimant establishes his or her right thereto by written records showing entitlement thereto.

• (Ord. 484 N.S., 1965; Ord. 02-28 § 2, 2002)

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 of Pacific Grove for the recovery of such amount.

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City of Pacific Grove, CA § 6.09.120

PACIFIC GROVE CODE

§ 6.09.130

(Ord. 484 N.S., 1965)

Any violation of any of the provisions of this chapter is unlawful and may be enforced pursuant to Chapter 1.16 PGMC.

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 administrator, 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. 484 N.S., 1965; Ord. 08-006 § 12, 2008)

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City of Pacific Grove, CA

REVENUE AND FINANCE

§ 6.10.010

§ 6.10.020