Chapter 7 — TRANSIENT OCCUPANCY TAXES

This chapter shall be known as the "Uniform Transient Occupancy Tax Law" of the City.

(§ 1, Ord. 386)

For the purposes of this chapter, unless otherwise apparent from the context, certain words and phrases used in this chapter are defined as follows:

(a)

"Person" shall mean 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" shall mean 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 shall include 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, or any space, lot, area, or site in any trailer court, camp, or public or private park where a trailer, recreational vehicle, motor home, mobile home, or other similar conveyance is occupied or intended occupancy by transients for dwelling, lodging or sleeping purposes.

(c)

"Occupancy" shall mean the use or possession, or the right to the use or possession, of any room, or portion thereof, in any hotel for dwelling, lodging, or sleeping purposes.

(d)

"Transient" shall mean 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. In determining whether a person is a transient, uninterrupted periods of time extending both prior and subsequent to the effective date of the provisions of this chapter may be considered.

(e)

"Rent" shall mean 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, property, and services of any kind or nature, without any deduction therefrom whatsoever.

(f)

"Operator" shall mean the person who is the 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 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, however, shall be considered to be compliance by both.

(g)

"Tax Administrator" shall mean the Director of Finance.

(§ 2, Ord. 386, as amended by § 1, Ord. 418-C.S., eff. September 12, 1984, and § 3, Ord. 693-C.S., eff. October 10, 2001)

For the privilege of occupancy in any hotel, each transient shall be subject to and shall pay a tax in the amount of fifteen (15%) percent of the rent charged by the operator. Such tax shall constitute a debt owed by the transient to the City, which debt shall be 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.

(§ 3, Ord. 386, as amended by § 1, Ord. 447, § 1, Ord. 209-C.S., eff. July 27, 1977, § I, Ord. 454-85, eff. November 27, 1985, § 1, Ord. 519-C.S., eff. December 8, 1988, § 1, Ord. 774-C.S., eff. July 1, 2011; Ord. 897-C.S., § 1, eff. December 19, 2024)

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 provided for in this chapter; or

(b)

Any officer or employee of a foreign government, which officer or employee is exempt by reason of express provision of Federal law or international treaty.

No exemption shall be granted except upon a claim therefor made at the time the rent is collected and under penalty of perjury upon a form prescribed by the Tax Administrator.

(§ 4, Ord. 386, as amended by § 1, Ord. 418-C.S., eff. September 12, 1984)

Each operator shall collect the tax imposed by the provisions of 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 provided in this chapter.

(§ 5, Ord. 386)

On or before December 25, 1966, or within thirty (30) days after commencing business, whichever is later, each operator of any hotel renting an occupancy to transients shall register such hotel with the Tax Administrator and obtain from him a "Transient Occupancy Registration Certificate" which shall at all times be posted in a conspicuous place on the premises. Such certificate shall, among other things, set forth the following information:

(a)

The name of the operator;

(b)

The address of the hotel;

(c)

The date upon which the certificate was issued; and

(d)

A statement as follows: "This Transient Occupancy Registration Certificate signifies that the person named on the face hereof has fulfilled the requirements of the Uniform Transient Occupancy Tax Law by registering with the Tax Administrator for the purpose of collecting from transients the Transient Occupancy Tax and remitting such tax to the Tax Administrator. This certificate shall 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 shall not constitute a permit."

(§ 6, Ord. 386)

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, 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 deems it necessary in order to insure collection of the tax, and he

may require further information in the return. Returns and payments shall be due immediately upon cessation of business for any reason. All taxes collected by operators pursuant to the provisions of this chapter shall be held in trust for the account of the City until payment thereof is made to the Tax Administrator.

(§ 7, Ord. 386)

(a)

Original delinquency. Any operator who shall fail to remit any tax imposed by the provisions of this chapter within the time required shall pay a penalty in the amount of ten (10%) percent of the tax in addition to the amount of the tax.

(b)

Continued delinquency. Any operator who shall fail 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 in the amount of ten (10%) percent of the tax in addition to the amount of the tax and the ten (10%) percent penalty first imposed.

(c)

Fraud. If the Tax Administrator shall determine that the nonpayment of any remittance due pursuant to the provisions of this chapter is due to fraud, a penalty in the amount of twenty-five (25%) percent of the amount of the tax shall be added thereto in addition to the penalties set forth in subsections (a) and (b) of this section.

(d)

Interest. In addition to the penalties imposed, any operator who shall fail to remit any tax imposed by the provisions of this chapter shall pay interest at the rate 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 and interest merged with tax. Every penalty imposed, and such interest as accrues, pursuant to the provisions of this section shall become a part of the tax required to be paid by the provisions of this chapter.

(§ 8, Ord. 386, as amended by § 1, Ord. 418-C.S., eff. September 12, 1984)

If any operator shall fail or refuse to collect such tax and to make, within the time provided in this chapter, any report and remittance of such tax, or any portion thereof, required by the provisions of this chapter, the Tax Administrator shall proceed in such manner as he may deem best to obtain the facts and information

on which to base his estimate of the tax due. As soon as the Tax Administrator shall procure such facts and information as he is able to obtain upon which to base the assessment of any such tax imposed by the provisions of this chapter and payable by any operator who has failed or refused to col-lect the tax and to make such report and remittance, the Tax Administrator shall proceed to determine and assess against such operator the tax, interest, and penalties provided for by this chapter. In the event such determination is made, the Tax Administrator shall give 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 last known place of address. Such operator, within ten (10) days after the service or mailing of such notice, may make an ap-plication in writing to the Tax Administrator for a hearing on the amount assessed. If an application by the operator for a hearing is not made within the time prescribed, the tax, interest, and penalties, if any, determined by the Tax Administrator shall become final and conclusive and immediately due and payable. If such an application is made, the Tax Administrator shall give not less than five (5) days' written notice in the manner prescribed in this section to the operator to show cause at a time and place fixed in such notice why the 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 Tax Administrator shall determine the proper tax to be remitted and shall thereafter give written notice to the person in the manner prescribed in this section of such determination and the amount of such tax, interest, and penalties. The amount determined to be due shall be payable after fifteen (15) days, unless an appeal is filed as provided in Section 3-7.10 of this chapter.

(§ 9, Ord. 386)

Any operator aggrieved by any decision of the Tax Administrator with respect to the amount of such tax, interest, and penalties, if any, may appeal to the Council by filing a notice of appeal with the City Clerk. Appeals shall be heard and determined according to the procedures set forth in Chapter 4 of Title 1 of this Code.

(§ 10, Ord. 386, as amended by § 3, Ord. 444-85, eff. June 12, 1985)

It shall be the duty of every operator liable for the collection and payment to the City of any tax imposed by the provisions of 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 he 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. The records shall include daily summaries of room occupancies.

(§ 11, Ord. 386, as amended by § 1, Ord. 418-C.S., eff. September 12, 1984)

(a)

Any person seeking a refund of overpayment of taxes, interest or penalties imposed by this chapter and collected by the City must file a claim with the City Clerk pursuant to Chapter 3-15 of this Code.

(b)

Any 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, 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, 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)

No refund shall be paid pursuant to the provisions of this section unless the claimant establishes his right thereto by written records showing entitlement thereto.

(§ 12, Ord. 386, as amended by § 4, Ord. 693-C.S., eff. October 10, 2001)

(a)

Actions to collect. Any tax required to be paid by any transient pursuant to 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 pursuant to 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)

Recording certificate: Lien. If any amount required to be paid to the City under this chapter is not paid when due, the administrator, may, within three (3) years after the amount is due, file for record in the office of the San Mateo County Recorder a certificate specifying the amount of tax, penalties and interest due, the name and address as it appears on the records of the Tax Administrator of the operator liable for the same, and the fact that the Tax Administrator has complied with all provisions of this chapter in the determination of the amount required to be paid. From the time of the filing for record, the amount required to be paid together with penalties and interest constitutes a lien upon all real property in the County owned by the operator or acquired by him afterwards and before the lien expires. The lien has the force, effect and priority of a judgment lien and shall continue for ten (10) years from the time of the certificate unless sooner released or otherwise discharged.

(c)

Priority and lien of tax. The amounts required to be paid by any operator under this chapter with penalties and interest shall be satisfied first in any of the following cases:

(1)

Whenever the person is insolvent;

(2)

Whenever the person makes a voluntary assignment of his assets;

(3)

Whenever the estate of the person in the hands of executors, administrators, or heirs is insufficient to pay all the debts due from the deceased; or

(4)

Whenever the estate and effects of an absconding, concealed, or absent person required to pay any amount under this chapter are levied upon by process of law, this chapter does not give the City a preference over any recorded lien which attached prior to the date when the amounts required to be paid became a lien.

(d)

Warrant for collection of tax. At any time within three (3) years after any operator is delinquent in the payment of any amount herein the Tax Administrator may issue a warrant for the enforcement of any liens and for the collection of any amount required to be paid to the City under this chapter. The warrant shall be directed to any sheriff, marshal or constable and shall have the same effect as a writ of execution. The warrant shall be levied and sale made pursuant to it in the same manner and with the same effect as a levy of and a sale pursuant to a writ of execution. The Tax Administrator may pay or advance to the sheriff, marshal or constable, the same fees, commissions and expenses for his or her services as are provided by law for similar services pursuant to a writ of execution.

(e)

Seizure and sale. At any time within three (3) years after any operator is delinquent in the payment of any amount, the Tax Administrator may forthwith collect the amount in the following manner: The Tax Administrator shall seize any property, real or personal, of the operator and sell the property, or a sufficient part of it, at public auction to pay the amount due together with any penalties and interest imposed for the delinquency and any costs incurred on account of the seizure and sale. Any seizure made to collect occupancy taxes due shall be only of property of the operator not exempt from execution under the provisions of the Code of Civil Procedure.

(f)

Successor's liability: Withholding by purchaser. If any operator liable for any amount under this chapter sells out his business or quits the business, his successor or assignee shall withhold sufficient of the

purchase price to cover such amount until the former owner produces a receipt from the Tax Administrator showing that it has been paid or a certificate stating that no amount is due.

(g)

Liability of purchaser: Release. If the purchaser of a hotel fails to withhold funds from the purchase price as required, he shall become personally liable for the payment of the amount required to be withheld by him to the extent of the purchase price, valued in money. Within sixty (60) days after receiving a written request from the purchaser for a certificate, or within sixty (60) days from the date the former owner's records are made available for audit, whichever period expires later, but in any event, not later than ninety (90) days after receiving the request, the Tax Administrator shall either issue the certificate or mail notice to the purchaser at his or her address as it appears on the records of the Tax Administrator of the amount that must be paid as a condition of issuing the certificate. Failure of the Tax Administrator to mail the notice shall release the purchaser from any further obligation to withhold purchase price as above provided. The time within which the obligation of the successor may be enforced shall start to run at the time the operator sells his or her business or at the time that the determination against the operator becomes final, whichever event occurs the later.

(h)

Termination of operation: Liability. Sale of a hotel, dismissal of the operator or other termination of his or her rights to operate the facility shall not relieve him or her from liability for taxes due or owing under this chapter.

(§ 1, Ord. 386, as amended by § 1, Ord. 516-C.S., eff. October 12, 1988)

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 Five Hundred and no/100ths ($500.00) Dollars, or by imprisonment for a period of not more than six (6) months, or by both such fine and imprisonment.

Any operator or other person who fails or refuses to register as required, 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 shall be guilty of a misdemeanor and punishable as set forth in Chapter 2 of Title 1 of this Code. Any person required to make, render, sign, or verify any report or claim and who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by the provisions of this chapter to be made shall be guilty of a misdemeanor and punishable as provided in this section.

(§ 14, Ord. 386, as amended by § 1, Ord. 418-C.S., eff. September 12, 1984)