Sacramento Municipal Code Ch. 3.28 Uniform Transient Occupancy Tax

This chapter shall be known as the uniform transient occupancy tax of the city. (Prior code § 41.04.021)

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, lodginghouse, rooming house, apartment house, dormitory, public or private club, mobilehome or house trailer at a fixed location or other similar structure or portion thereof.

"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.

"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, 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 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 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.

"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. In determining whether a person is a transient, uninterrupted periods of time extending both, prior and subsequent to the effective date of this chapter may be considered. (Prior code § 41.04.022)

For the privilege of occupancy in any hotel, each transient is subject to and shall pay a tax in the amount of six percent of the rent charged by the operator. On and after August 1, 1976, said tax shall be in the amount of seven percent of such rent. Such 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 assessor-collector may require that such tax be paid directly to the assessor-collector. (Prior code § 41.04.023)

On and after June 30, 1978, an additional tax to that tax imposed by Section 3.28.030 of this chapter is levied in the amount of an additional three percent of the rent charged by the operator. Such additional tax shall in all respects be subject to the provisions of this chapter to the extent and in the same manner as the tax levied by Section 3.28.030 of this chapter, except that any other provision of this chapter to the contrary notwithstanding the following amounts shall be used for the following purposes:

A. For the purpose of funding the Sacramento Convention and Visitors Bureau:

1. For the fiscal year 1980-81, three hundred fifty thousand dollars ($350,000.00);

2. For each fiscal year thereafter, an amount equal to the previous year's allocation plus an amount equal to the annual increase in the consumer price index or ten (10) percent, whichever is less. As used herein, consumer price index means the U.S. Department of Labor, Bureau of Labor Statistics' Consumer Price Index (all urban) for the San Francisco-Oakland area (or the Sacramento area if the index is established for the Sacramento area).

B. For the fiscal year 1980-81, thirty thousand dollars ($30,000.00) in tax receipts shall be used for the purpose of funding the Sacramento Area Commerce and Trade Organization. Such money shall be used only to fund the performance of functions and activities substantially similar to any of those functions and activities which could be performed by the Sacramento Convention and Visitor Bureau. (Prior code § 41.04.023-1)

On and after July 1, 1990, an additional tax to those taxes imposed by Sections 3.28.030 and 3.28.040 of this chapter is levied in the amount of an additional one percent of the rent charged by the operator. On and after January 1, 1992, an additional tax to those taxes imposed by Sections 3.28.030 and 3.28.040 of this chapter is levied in the amount of an additional one and one-half percent of the rent charged by the operator. On and after July 1, 1994, an additional tax to those taxes imposed by Sections 3.28.030 and 3.28.040 of this chapter is levied in the amount of an additional two percent of the rent charged by the operator. Such additional taxes of one percent after July 1, 1990 and one and one-half percent after January 1, 1992 and two percent after July 1, 1994, shall in all respects be subject to the provisions of this chapter to the extent and in the same manner as the tax levied by Section 3.28.030 of this chapter, except that any other provision of this chapter notwithstanding, the proceeds of the taxes imposed by this section shall be paid to the general fund for the usual and current expenses of the city, including, but not limited to, meeting operating expenses, including wage rates and fringe benefits, purchasing or leasing supplies, equipment or materials, paying debt service and meeting financial reserve needs and requirements. (Prior code § 41.04.023-2)

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.

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 assessor-collector. (Prior code § 41.04.024)

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. (Prior code § 41.04.025)

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 assessor-collector, make a return to the assessor-collector, 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 assessor-collector. The assessor-collector may establish shorter reporting periods for any certificate holder if he or she deems it necessary in order to insure 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 assessor-collector. (Prior code § 41.04.027)

An operator is relieved from liability for the remission to the city of the tax imposed under this chapter insofar as the measure of the tax is represented by accounts which have been found to be worthless and charged off for income tax purposes. If the operator has previously remitted the tax, he or she may, pursuant to procedures prescribed by the assessor-collector, take as a deduction the amount of tax previously remitted for the worthless and charged off account. If any such accounts are thereafter in whole or in part collected by the operator, the amount so collected shall be included in the first return filed after such collection and the tax on such amount paid with the return. (Prior code § 41.04.027a)

A. Original Delinquency. Any operator who fails to remit any tax imposed by this chapter within the time required shall pay a penalty of ten (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 thirty (30) days following the date on which the remittance first became delinquent shall pay a second delinquency penalty of ten (10) percent of the amount of the tax in addition to the amount of the tax and the ten (10) percent penalty first imposed.

C. Fraud. If the assessor-collector determines that the nonpayment of any remittance due under this chapter is due to fraud, a penalty of twenty-five (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. (Prior code § 41.04.028)

If any operator shall fail or refuse to collect the tax under this chapter and to make, within the time provided in this chapter, any report, and remittance of such tax or any portion thereof required by this chapter, the assessor-collector 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 assessor-collector 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 assessor-collector 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. Such operator may within ten (10) days after the serving or mailing of such notice make application in writing to the assessor-collector 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 assessor-collector shall become final and conclusive and immediately due and payable. If such application is made the assessor-collector shall give not less than five days' written notice in the manner prescribed herein to the operator to show cause at a time and place fixed in such notice why such 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 assessor-collector 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 fifteen (15) days unless an appeal is taken as provided in Section 3.28.130 of this chapter. (Prior code § 41.04.029)

Any operator aggrieved by any decision of the assessor-collector 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 city council shall fix a time and place for hearing such appeal, and the city clerk shall give notice in writing to such operator at his or her last known place of 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. (Prior code § 41.04.030)

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 assessor-collector shall have the right to inspect at all reasonable times. (Prior code § 41.04.031)

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 that a claim in writing therefor is presented in accordance with the provisions of Section 3.04.070 within one year of the date of payment.

B. An operator may request a refund for the amount overpaid, paid more than once or erroneously or illegally collected or received, by establishing a right to a refund. In lieu of refunding an overpayment, the assessor-collector may allow the operator a credit of equal value to be applied against taxes to be remitted by the operator in the future. 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 or paid more than once or erroneously or illegally collected or received by the city, but only if it is established that the tax was not owed. If the transient has paid the tax to the operator the transient may obtain a refund of the overpayment only if the transient establishes that he or she 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 a right thereto by written records showing entitlement thereto. (Ord. 2010-036 § 5; prior code § 41.04.032)

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. (Prior code § 41.04.033)

Any person violating any of the provisions of this chapter shall be guilty of an infraction, subject to the provisions of Government Code Section 36900(b).

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 assessor-collector, or who renders a false or fraudulent return or claim, is guilty of an infraction. 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 an infraction. (Prior code § 41.04.034)

A. The assessor-collector shall pay into the treasury all moneys, including taxes and penalties, collected by him or her pursuant to this chapter for deposit to the credit of a revenue account to be known as the transient occupancy tax account. The revenue from the transient occupancy tax account shall be used solely and exclusively for the following purposes:

1. Administration of the provisions of this chapter;

2. Economic development projects to create local jobs;

3. Acquisition, construction, completion, operation, repair and maintenance of visitor-serving facilities that promote tourism, economic development, and other activities that bolster the local economy, such as convention halls and centers; theatre and arts venues; public off-street parking facilities and related site improvements; lands, easements, rights-of-way, and other works, property, or structures, necessary or convenient for these facilities;

4. Expense in connection with proposals or proceedings for acquisition of the facilities referred to in subsection 3 of this section;

5. Interest and principal payments on bonds issued to acquire any of the facilities referred to in subsection 3 of this section;

6. Lease payments for lease of any of the facilities referred to in subsection 3 of this section.

B. All spending pursuant to this section is subject to independent annual audits and full public disclosure as part of the city's annual external audit. (Ord. 2022-0032 § 1; prior code § 41.04.035)