Chapter 4.44 — TRANSIENT OCCUPANCY TAX

This chapter shall be known as the "transient occupancy tax ordinance" of the city.

(Ord. 4645 § 1, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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

A.

"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, mobilehome or house trailer at a fixed location, or other similar structure or portion thereof.

B.

"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.

C.

"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 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 compliance by both.

D.

"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.

E.

"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.

"Tax administrator" means the city assessor, tax and license collector.

G.

"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 herein may be considered.

(Ord. 4645 § 2, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

For the privilege of occupancy in any hotel, each transient is subject to and shall pay a tax in the amount of 7% of the rent charged by the operator. 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 the tax shall be paid directly to the tax administrator.

(Ord. 5374 § 1, 1978; 5038 § 1, 1971; Ord. 4858 § 1, 1968: Ord. 4645 § 3, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

A.

No tax shall be imposed upon 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, including, but not limited to, any officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty.

B.

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

(Ord. 4846 § 1, 1967; Ord. 4645 § 4, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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 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 hereinafter provided.

(Ord. 4645 § 5, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

Within 30 days after the effective date of the ordinance codified herein, or within 30 days after commencing business, whichever is later, each operator of any hotel renting occupancy to transients shall register said hotel with the tax administrator and obtain from him 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.

The name of the operator;

B.

The address of the hotel;

C.

The 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 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. 4645 § 6, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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 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. 4645 § 7, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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% of the amount of the tax.

B.

Continued Delinquency. Any operator who fails to remit the tax on or before the 20th day following the date on which the tax first became delinquent shall pay a second delinquency penalty of 10% of the amount of the tax in addition to the amount of the tax and the 10% penalty first imposed pursuant to subsection A herein, up to a maximum of 50% of the amount of the tax.

C.

Fraud. If the tax administrator determines that the nonpayment of any tax due under this chapter is due to fraud, a penalty of 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 chapter shall pay interest at the rate of 1% per month, or fraction thereof, on the amount of the tax, exclusive of penalties, from the date on which the tax first became delinquent until paid.

E.

Penalties and 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.

(Ord. 6566 §§ 3, 4 (part), 1993; Ord. 4645 § 8, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

If any operator fails or refuses to collect the tax and to make, within the time provided in this chapter, any report and payment of the tax or any portion thereof required by this chapter, the tax administrator shall proceed in such manner as he may deem best to obtain facts and information on which to base his estimate of the tax due. As soon as the tax administrator procures such facts and information as he 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 payment, he 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 last known address. Such operator may within 10 days after the serving or mailing of the notice make application in writing to the tax administrator for a hearing on the amount assessed. If 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 application is made, the tax administrator shall give not less than 5 days' written notice in the manner prescribed herein to the operator to show cause at a time and place fixed in the notice why the amount specified therein should not be fixed for such tax, interest and penalties. At the hearing the operator may appear and offer evidence why such specified tax, interest and penalties should not be so fixed. After the 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 herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable after 15 days unless an appeal is taken as provided in Section 4.44.100.

(Ord. 4645 § 9, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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 city council by filing a notice of appeal with the city clerk within 15 days of the serving or mailing of the determination of tax due. The city council shall fix a time and place for hearing the appeal, and the city clerk shall give notice in writing to such operator at his last known address. The findings of the city 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.

(Ord. 4645 § 10, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

A.

It shall be the duty of every operator to keep all records as may be necessary to determine the amount of tax due hereunder and shall preserve the same for a period of 4 years. The tax administrator shall have the right to inspect such records at all reasonable times.

B.

The finance director shall determine the mode and method of recordkeeping required to assist the tax collector to perform the duties required of him under this section.

C.

Any audit which must be performed to secure compliance with the terms of this section is to be performed in the city of Pasadena. If for any reason the audit cannot be performed in Pasadena, the operator shall reimburse the city for the actual cost of all transportation, lodging, meals, travel time and other incidental costs reasonably incurred by the city in conducting the audit.

(Ord. 6566 § 4(part), 1993; Ord. 4645 § 11, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

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 therefor, stating under penalty of perjury the specific grounds upon which the claim is founded, is filed with the tax administrator within 3 years of the date of payment. The claim shall be on forms furnished by the tax administrator.

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 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.

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 under the provisions of this section unless the claimant establishes his right thereto by written records showing entitlement thereto.

(Ord. 4645 § 12, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

Any tax required to be paid by any transient under the provisions of this chapter is 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, and for attorney's fees and costs incurred in the enforcement of this chapter.

(Ord. 4645 § 13, 1963)

(Ord. No. 7401, § 2, 9-22-2022)

If any amount to be paid to the city under this chapter is not paid when due, the tax administrator, upon expiration of the continued delinquency period referenced in Section 4.44.080, may, within four years after the amount is due, record in the office(s) of the county recorder(s) of any county in the state of California a certificate specifying the amount of tax, the name and address 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 recording, the amount required to be paid shall constitute a lien upon any and all real property in any county in the state of California owned by the operator or thereafter acquired by the operator. The lien shall have the force, effect, and priority of a judgment lien and shall continue for ten (10) years from the time of filing of the certificate, unless sooner released or otherwise discharged.

(Ord. No. 7401, § 2, 9-22-2022)

At any time after any operator is delinquent in the payment of any amount herein required to be paid off after recording a certificate of lien under Section 4.44.140, the tax administrator may issue a warrant directed to any sheriff or marshal 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 have the same effect as a writ of execution, and be executed in the same manner and with the same effect as a levy and sale pursuant to a writ of execution. The tax administrator may pay or advance to the sheriff or marshal such fees, commissions, and expenses for services as are provided by law for similar services pursuant to a writ of execution.

(Ord. No. 7401, § 2, 9-22-2022)

At any time after any operator is delinquent in the payment of any amount or after recording of a certificate of lien, the tax administrator may forthwith collect the amount in the following manner: The director of finance 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 the tax due under this chapter shall be only of property of the operator not exempt from execution under the provisions of the California Code of Civil Procedure.

(Ord. No. 7401, § 2, 9-22-2022)

A.

If any operator, while liable for any amount under this chapter, sells, assigns or otherwise transfers the hotel or quits the hotel, whether voluntarily or involuntarily, the operator's subsequent successor, assign or other transferee, or other person or entity attempting to obtain ownership of the hotel, shall notify the tax administrator of the date of transfer at least thirty days prior to the date of the sale or, if the agreement to sell, transfer, or otherwise dispose of the hotel was made less than thirty days prior to the date of transfer, notice shall be provided immediately.

B.

The successor operator, assignee, purchaser, transferee, or other person or entity who obtains ownership of the hotel shall satisfy any transient occupancy tax liability associated with the property owed to the city. Failure to do so for the benefit of the city will result in being personally liable to the city for the full amount of the tax liability, which includes interest and penalties.

C.

The successor operator, assign, purchaser, transferee, or other person or entity who obtains ownership of the hotel shall be deemed to have complied with the requirements of this section if that person or entity complies with the requirements of California Revenue and Taxation Code Section 7283.5 by withholding from the purchase price an amount sufficient to cover the tax liability, or by otherwise paying the tax liability until the tax administrator provides a "transient occupancy tax clearance certificate" showing that the tax liability has been paid in full and stating that no tax liability is due through the date of transfer.

D.

The tax administrator, within ninety (90) days of receiving a written request from a successor operator, assign, purchaser, transferee, or other person or entity who obtains or attempts to obtain ownership of the hotel, may issue a "transient occupancy tax clearance certificate" stating either the amount of tax liability due and owing for the property, or stating that there is no tax liability due and owing for the property. The tax administrator may also request financial records from the current or former owner or operator to conduct an audit of the transient occupancy tax that may be due and owing. After completing the audit within ninety (90) days after the date that the records were made available, the tax administrator may

issue a tax clearance certificate within thirty days of completing the audit, stating the amount of the tax liability owed, if any. If the city determines that the records provided for an audit are insufficient, the tax administrator may rely on the facts and information available to estimate any transient occupancy tax liability associated with the property. The tax administrator may issue a tax clearance certificate stating the amount of the tax liability, if any, based on such facts and information available. The tax clearance certificate shall serve as conclusive evidence of the tax liability associated with the property as of the date specified on the certificate.

(Ord. No. 7401, § 2, 9-22-2022)

A.

Any operator or other person who willfully violates any provision of this chapter and is convicted of a misdemeanor shall be punished by a fine of not more than $1,000, or by imprisonment in the county jail not to exceed six months, or by both.

B.

The conviction and punishment of any person for failure to comply with the provisions of this chapter shall not relieve such person from paying any tax due and unpaid at the time of such conviction nor shall payment prevent prosecution of a violation of any of the provisions of this chapter.

C.

All remedies prescribed by this chapter, or any other provisions of law, and the use of one or more remedies by the city are cumulative, and shall not bar the use of any other remedy for the purpose of enforcing the provisions of this chapter.

(Ord. No. 7401, § 2, 9-22-2022)

Any person occupying a room pursuant to an emergency shelter grant from the Red Cross or similar organization as a result of a natural disaster such as fire or flood shall not be charged the transient occupancy tax set forth herein.

(Ord. 6566 § 5, 1993)

(Ord. No. 7401, § 2, 9-22-2022)

Editor's note— Ord. No. 7401, § 2, adopted September 22, 2022, amended the Code by, in effect, renumbering former § 4.44.140 as a new § 4.44.190.

In addition to all other powers conferred upon her, the finance director shall have the power for good cause shown to extend the time for filing any required information for a period not to exceed 30 days, and in such case may waive any penalty that would otherwise have accrued. She shall also have the power, with the consent of the city council, to compromise any claim as to amount of transient occupancy tax due. Negligence on the part of the applicant shall not constitute good cause shown within the meaning of this section.

(Ord. 6566 § 6, 1993)

(Ord. No. 7401, § 2, 9-22-2022)

Editor's note— Ord. No. 7401, § 2, adopted September 22, 2022, amended the Code by, in effect, renumbering former § 4.44.145 as a new § 4.44.200.