Agenda Item No: M.3
AGENDA REPORT
DATE: August 19, 2025
TO: Mayor and Council
FROM: David Gassaway, City Manager
SUBJECT: Resolution 2025-171 FN Appeal to Determine the Delinquent Transient Occupancy Tax for Motel Located at 2170 North Texas St
[Approving/Sustaining] [Denying/Overruling] the Appeal of the City of Fairfield Administrative Hearing Determination Regarding Interest on Delinquent Transient Occupancy and Tourism Tax Assessment for Quality Inn Previously Known as Super 8 Motel Located at 2170 North Texas Street, Fairfield, CA 94533 Owners: Shri Guru Hari, LLC and Shri Mahant, LLC and Marie Parunjanwala
Funding Source: N/A
Contact: John Furtado, (707) 428-7629
RECOMMENDED ACTION
Hold a public hearing and adopt resolution.
STATEMENT OF ISSUE
The Fairfield Municipal Code allows the operator to appeal the assessment of the tax to the council. Fairfield Municipal Code section 18.20 requires the council to conduct a hearing and approve/sustain or deny/overrule the appeal.
DISCUSSION
On April 2, 2025, the City of Fairfield issued a letter of Notice of Assessment and Hearing Rights for Interest on Delinquent Transient Occupancy Tax (Attachment 3) to the operator of Super 8 (now renamed Quality Inn) located at 2170 North Texas Street for $ 34,327.15. The current operator of the motel, Shri Guri Hari, LLC, through their attorney Frank A. Weiser, appealed the assessment to the finance director (in his capacity of tax administrator) on April 9, 2025, and was granted a date of hearing on May 5, 2025, at 11 a.m. to have the appeal heard.
The tax administrator was provided with an appeal letter (Attachment 4) which was discussed during the hearing.
The C ity’s finance director, acting in their delegated capacity as the City tax administrator, reviewed and verified the information and documentation provided on behalf of the client by Mr. Weiser and determined that the request for relief of the total tax ass essment amount was denied and the proper interest amount on the tax to be remitted remains in the full amount of $34,327.15 (Attachment 5).
Similar to the two past appeals, the appeal contended that the client has no financial rapport with the prior hotel owner(s), was unaware of the outstanding Transient Occupancy and Tourism Tax (TOT) amount and is not responsible for such delinquent amounts. Pursuant to Chapter 18, Article III, Section 18.17.1(c) and (d) of the Fairfield Municipal Code, any person purch asing an ongoing hotel business may apply to the Tax Administrator for a tax clearance certificate showing the tax due, if any, from the selling operator. Suppose an operator is liable for delinquent taxes or penalties under this article and sells its busi ness. In that case, its successor shall withhold a sufficient portion of the purchase price to satisfy the delinquency.
On June 5, 2025, Shri Guri Hari, LLC, Shri Mahant, LLC, and Marie Parunjanwala, through their attorney Frank A. Weiser appealed the ass essment to the city clerk and are granted a date of hearing of August 19, 2025, at 6:00 p.m. to have the appeal heard by the council (Attachment 6 and 7).
On February 18, 2025, the owner/operator filed a lawsuit in Solano County. By their lawsuit, the Owners seek relief from the prior two decisions of the council on the TOT assessments; allege that the Fairfield Municipal Code’s provisions on Transient Occupancy Tax are unconstitutional; and seek damages in the amount of $10 million. The lawsuit has not yet been served on the City, so this matter is not stayed, and the City must move forward with its administrative process on this appeal of the finance director’s decision. The issues and arguments of the complaint are not before the council. The current operator of the motel, Shri Guri Hari, LLC, through their attorney Frank A. Weiser, previously had appealed the assessment for $686,542.98 and $58,356.15 to the finance director (in his capacity of tax administrator) and council an d both appeals were denied on April 12, 2023 , and August 12, 2024 , by the finance director and on August 15, 2023 , and November 19, 2024 , by the council, respectively. Since no payments were received after the respective denials, a lien for $686,613.98 and $58,427.15 was placed on February 15, 2024, and March 25, 2025 (Attachment 8).
Fairfield Municipal Code 18.20 states:
18.20 Appeal from decision of tax administrator; findings conclusive.
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 within fifteen days of 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 his 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.
FINANCIAL IMPACT
The financial impact is minimal, as the hearing will occur during a regularly scheduled City Council meeting. However, approving the appeal would cost the City $34,327.15 in lost TOT revenue, and could adversely impact the original amount due to the City ($686,613.98 and $58,356.15 ) that was sustained on the same grounds.
PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A
ALTERNATIVE ACTION
By operation of the Fairfield Municipal Code, the council must issue a ruling to approve/sustain or deny/overrule the appeal.
COORDINATED WITH
City Attorney’s Office
STAFF CONTACT
John Furtado, Finance Director
(707) 428-7629
[email protected]
ATTACHMENTS
Attachment 2: Proposed Resolution
Attachment 3: City of Fairfield Notice of Third Assessment and Hearing Rights Attachment 4: Operator Request for Appeal to Director of Finance Attachment 5: City of Fairfield Notice of Decision Regarding Administrative Hearing on Delinquent Transient Occupancy Tax Assessment
Attachment 6: Operator’s Attorney Letter to City Council Attachment 7: Appeal Notice Hearing with Council
Attachment 8: Lien Executed in the Past