Agenda Item No. 9
CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: August 22, 2022 FROM: Matthew Bronson, City Manager
PREPARED BY: David P. Hale, City Attorney
Wendi Sims, City Clerk
SUBJECT: Administrative Appeal Hearing for Allen Thompson Appeal from Tax Administrator Hearing Finding of Failure to Pay Transient Occupancy Tax
RECOMMENDATION
Conduct an Administrative Evidentiary Appeal Hearing in accordance with Grover Beach Municipal Code Sections 10608 and 10609 to determine whether Mr. Allen Thompson owes Transient Occupancy Tax (TOT) for operation of a Short-Term Rental on his residential property and if so determine the amount owed to the City.
BACKGROUND
In 2019, City staff determined that Mr. Allen Thompson was operating a short-term rental (STR) unit within the City of Grover Beach. Mr. Thompson’s residential property consists of a singlefamily residence and is located at 1122 Newport Avenue. After the City adopted its STR ordinance on June 17, 2019, Mr. Thompson applied for and was issued an STR permit on January 16, 2020 to operate an STR at the subject residence in accordance with the new ordinance. The STR permit number is STR0082.
Staff later ascertained Mr. Thompson had failed to pay any transient occupancy tax (TOT) and countywide tourism management district (TMD) tax since the end of 2019. On January 20, 2022, the City initially served Mr. Thompson consistent with Grove Beach Municipal Code Section 10607 and 10608 a notice of taxes, interest and penalties estimated to be due at that time. See Attachment no. 1. After Mr. Thompson was served with a notice of taxes due by the City Tax Administrator (defined in the Municipal Code as the City Clerk), Mr. Thompson filed a timely request for a hearing to the City Tax Administrator’s (CTA) assessment in accordance with GBMC Section 10608. A hearing was scheduled and conducted on March 1, 2022. The CTA determined, based on the evidence presented by Mr. Thompson and staff, that Mr. Thompson owed an estimate of $15,284.26 in unpaid taxes, interest and penalties at that time. See Attachment no. 3 for the CTA’s Statement of Decision. Mr. Thompson was advised of his ability to appeal to Council the CTA’s decision and a timely appeal was filed.
It is understood that Mr. Thompson has continued since the hearing before the City Tax Administrator on March 1, 2022 to operate his STR from his subject property and has incurred additional TOT, TMD late fees and penalties owed to the City from the Tax Administrator’s hearing to the Council’s Appeal Hearing. See attachment no. 2 which represents an estimate of those unpaid taxes, late fees and penalties.
Staff Report: Thompson TOT Appeal Hearing Page 2
August 22, 2022
In addition, on July 25, 2022, staff requested to audit Mr. Thompson’s records in accordance with GBMC Section 10607 to ascertain the exact amount of taxes, interest and penalties owed for purposes of this hearing. This request was part of a citywide TOT audit conducted of lodging establishments. Mr. Thompson refused that request and the City has been unable to audit his records consistent with its authority under GBMC Section 10606, 10608 and 10610.
The hearing the Council is asked to conduct is an administrative evidentiary hearing wherein Mr.
Thompson, in accordance with GBMC 10609, will be given the ability to present evidence to the Council to support the reasons he believes there is no obligation for him to pay TOT to the City for operation of his subject STR. After Mr. Thompson has concluded his presentation of arguments and supportive evidence, staff will then be given the opportunity to rebut those statements and submit evidence to show Council why they believe Mr. Thompson owes the subject taxes, penalties and interest. Council will be the final arbitrator of this issue and in accordance with Grover Beach Municipal Code Section 10609, the Council’s decision shall be conclusive and final with no further appeal rights.
FISCAL IMPACT
There are no fiscal impacts to holding this administrative appeal hearing.
ALTERNATIVES
The Council has the following alternatives to consider:
1. Conduct the Administrative Evidentiary Appeal Hearing to accept evidence from Mr. Thompson and staff to make a determination whether TOT is owed to the City and in what amounts, if any, and conclude the hearing and give direction to staff to prepare and submit to Mr. Thompson a Statement of Findings as to the Council’s determination; or
2. Provide alternative direction.
PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act.
Attachments
1. January 20, 2022, Allen Thompson assessment for TOT, TMD, Late Fees and Penalty calculations
2. August 22, 2022, Allen Thompson assessment for TOT, TMD, Late Fees and Penalty calculations
3. CTA Statement of Decision
Allen Thompson STROO82
1122 Newport
TOT, TMD, Late Fees & Penalty Calculation
as of 12/31/21
1.OO% TMD Rate
TOT rate O.12 1.50% eff 7/1/20 TMD Rate
Month Year
January 2020
February 2020
March 2020
April 2020
May 2020
June 2020
July 2020
August 2020
September 2020
October 2020
November 2020
December 2020
January 2021
February 2021
March 2021
April 2021
May 2021
June 2021
July 2021
August 2021
September 2021
October 2021
Total
Total TOT,
TMD Tax
plus Late
Mo's Rent
(Orig Late Fees Fees Due
Amt Due) & & Pen
Delinquent Received TOTTax TMDtax TotalTax Penalties Due 1,530.00
918.00
612.00
258.00
2,780.00
1,788.00
2,384.00
2,176.00
1,800.00
2,400.00
900.00
930.00
1,550.00
1,240.00
2,212.00
1,264.00
1,780.00
2,376.00
3,780.00
2,136.00
2,492.00
1,780.00
183.60
110.16
73.44 30.96
333.60
214.56
286.08
261.12
216.00
288.00
108.00
111.60
186.00
148.80
265.44
151.68
213.60
285.12
453.60
256.32
299.04
213.60
15.30 9.18
6.12 2.58
27.80 17.88
35.76 32.64
27.00 36.00
13.50 13.95
23.25 18.60
33.18 18.96
26.70 35.64
56.70 32.04
37.38 26.70
igs.go
119.34
79.56 33.54
361.40
232.44
321.84
293.76
243.00
324.00
121.50
125.55
209.25
167.40
298.62
170.64
240.30
320.76
510.30
288.36
336.42
240.30
515.49
303.19
198.08
81.80 714.39
422.53
277.64
115.34
863.23 1,224.63
543.55 775.99
709.26 1,031.10
633.33
512.33
667.77
244.69
246.96
401.85
313.71
545.83
304.06
417.20
542.30
927.09
755.33
991.77
366.19
372.51
611.10
481.11
844.45
474.10
657.50
863.06
839.65 1,349.95
461.48
523.32
178.00
749.84
859.74
418.30
39,086.00 4,690.32 546.86 5,237.18 10,047.08
Attachment 1
Allen Thompson STROO82
1122 Newport
TOT, TMD, Late Fees & Penalty Calculation
as of 7/31/22
1.OO% TMD Raie
TOT rate O.12 1.50% eff 7/1/20 TMD Rate
Total TOT,
TMD Tax
Month Year
(Orig Late Fees plus Late
Mo's Est Rent Amt Due) & Fees Due
Delinquent Received TOTTax TMDtax TotalTax Penalties &PenDue January
February
March
April
May
June
July
August
September
October
November
December
January
February
March
April
May
June
July
August
September
October
November
December
January
February
March
April
May
June
July
Total
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2021
2022
2022
2022
2022
2022
2022
2022
1,130.00 135.60
718.00
512.00
258.00
86.16 61.44
30.96 1,880.00 225.60
1,184.00 142.08
1,542.00 185.04
1,476.00 177.12
1,231.00 147.72
1,700.00 204.00
700.00
732.00
84.00 87.84
1,150.00 138.00
940.00 112.80
1,584.00 190.08
964.00 115.68
1,380.00 165.60
1,865.00 223.80
2,660.00 319.20
1,636.00 196.32
1,892.00 227.04
1,380.00 165.60
1,380.00 165.60
0.00 0.00
1,124.00 134.88
353.00 42.36
1,480.00 177.60
1,710.00 205.20
1,721.00 206.52
2,004.00 240.48
11.30 7.18
5.12 2.58
18.80 11.84
23.13 22.14
18.47 25.50
10.50 10.98
17.25 14.10
23.76 14.46
20.70 27.98
39.90 24.54
28.38 20.70
20.70 0.00
16.86 5.30
22.20 25.65
25.82 30.06
146.90
93.34 66.56
33.54 244.40
153.92
208.17
199.26
166.19
229.50
94.50 98.82
155.25
126.90
213.84
130.14
186.30
251.78
359.10
220.86
255.42
186.30
186.30
0.00 151.74
47.66 199.80
230.85
232.34
270.54
442.22
276.02
193.30
95.64 684.06
422.78
540.20
507.17
414.75
561.46
226.56
232.09
357.09
285.76
471.25
280.58
392.79
518.92
589.12
369.36
259.86
129.18
928.46
576.70
748.37
706.43
580.94
790.96
321.06
330.91
512.34
412.66
685.09
410.72
579.09
770.70
723.20 1,082.30
434.44
490.51
349.13
340.52
655.30
745.93
535.43
526.82
0.00 0.00
263.45
80.57 328.75
369.45
361.41
200.40
415.19
128.23
528.55
600.30
593.75
470.94
1,710.00 205.20 25.65 230.85 0.00 230.85
39,996.00 4,799.52 571.53 5,371.05 10,844.47
Attachment 2
Attachment 3