Ordinance 928
ORDINANCE NO. 928
ORDINANCE OF THE CITY OF GILROY ADOPTING AS CHAPTER 25A
OF THE GILROY CITY CODE A TRANSIENT OCCUPANCY TAX,
ESTABLISHING THE RATES OF SAID TAX, PROVIDING FOR THE
ADMINISTRATION AND COLLECTION THEREOF AND PROVIDING
PENALTIES FOR VIOLATIONS.
THE CITY COUNCIL OF THE CITY OF GILROY DOES ORDAIN AS FOLLOWS:
SECTION I: The following is hereby adopted as Chapter 25A
of the Gilroy City Code:
CHAPTER 25A
TRANSIENT OCCUPANCY TAX
Sec. 25A.l. Definitions.
Except where the context otherwise requires, the definitions
given in this section govern the construction of this article.
Person. "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.
Hotel. "Hotel" means any structure, or any portion of any
structure, which is occupied or intended or designed for
occupancyby 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,
mobile home or house trailer at a fixed location, or other
similar structure or portion thereof.
Occupancy. "Occupancy" means the use or possession, or the
right to the use or possession of any room or rooms or portions
thereof, in any hotel for dwelling, lodging or sleeping
purposes.
Transient. "Transient" means any person who exercies
occupancy or is entitled to occupancy by reason of concession,
ORDINANCE NO. 928
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.
Rent. "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.
Operator. "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.
Tax Administrator. "Tax Administrator" means the Director
of Finance to be charged with administration of the tax.
Sec. 25A.2 Tax Imposed.
For the privilege of occupancy in any hotel, each transient
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is subject to and shall pay a tax in the amount of five
per cent (5%) of the rent charged by the operator. Said
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 director of finance may require
that such tax shall be paid directly to the director of
finance.
Sec. 25A.3. Exemptions.
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 herein
provided;
(b) Any officer or employee of a foreign government who
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 rent is collected and under penalty of
perjury upon a form prescribed by the director of finance.
Sec. 25A.4. Operator's Duties.
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
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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.
Sec. 25A.5. Registration.
Within thirty (30) days after the operative date of this
chapter or within thirty (30) days after commencing business,
whichever is later, each operator of any hotel renting
occupancy to transients shall register said hotel with the
director of finance 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 director of finance for the
purpose of collecting from transients the Transient Occupancy
Tax and remitting said tax to the director of finance. 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 cer-
tificate does not constitute a permit."
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Sec. 25A.6. Reporting and Remitting.
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 director of finance, make a return to the director of
finance 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 director
of finance. The director of finance 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 director of finance.
Sec. 25A.7. Penalties and Interest.
(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 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 10% of the amount of the tax in addition to the
amount of the tax and the 10% penalty first imposed.
(c) Fraud. If the director of finance determines that the
non-payment of any remittance due under this chapter is due
to fraud, a penalty of 25% of the amount of the tax shall be
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ORDINANCE NO. 928
added thereto in addition to the penalties stated in
subparagraphs (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 1% 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.
Sec. 25A.8. Failure to Collect and Report Tax - Determination
of Tax by Director of Finance.
If any operator shall fail or refuse to collect said tax
and to make, within the time provided in this chapter, any
report and remittance of said tax or any portion thereof
required by this chapter, the director of finance 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 director of finance shall procure 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 col~ct
the same and to make such report and remittance, 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 director of finance
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
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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 director of finance 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
director of finance shall became final and conclusive and
immediately due and payable. If such application is made,
the director of finance shall give not less than five (5)
days written notice in the manner prescribed herein to the
operator to show cause at a time and place fixed in said
notice why said 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 director of finance 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 25A.9.
Sec. 25A.9. Appeal.
Any operator aggrieved by any decision of the director of
finance 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 (15)
days of the 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
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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.
Sec~ 25A.lO. Records.
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 may have been liable for the collection of and
payment to the city, which records the director of finance
shall have the right to inspect at all reasonable times.
Sec. 25A.ll. Refunds.
(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 subparagraphs (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 withfue director of
finance within three years of the date of paYment. The claim
shall be on forms furnished by the director of finance.
(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 director of finance 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
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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 by filing a claim in the manner
provided in subparagraph (a) of this section, but only
when the tax was paid by the transient directly to the
director of finance, or when the transient having paid the
tax to the operamr, establishes to the satisfaction of the
director of finance 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.
Sec. 25A.12. Actions to Collect.
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
of Gilroy for the recovery of such amount.
Sec. 25A.13. Violations; Misdemeanor.
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 dollars
($500.00) or by imprisonment for a period of not more than
six months or by both such fine and imprisonment.
SECTION II: All ordinances and parts of ordinances in
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conflict herewith are hereby repealed.
SECTION III: This ordinance shall be effective thirty (30)
days from and after the date of its final passage except that
the tax imposed by this ordinance shall become operative and be
imposed on the first day of the calendar month immediately
following the effective date of this ordinance and shall not apply
prior to said date.
PASSED AND ADOPTED this 19th day of July, 1971, by the
following vote:
AYES:
COUNCILMEMBERS: BATREZ, DUFFIN, HUGHAN, PATE, SILVA,
STOUT and GOODRICH
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
APPR~VED: ~
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Mayor
ATTE~T:
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City C1etk
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ORDINANCE NO. 928
-- .
I, SUSANNE E. STEINMETZ, City Clerk of the City of Gilroy, do
hereby certify that the attached Ordinance No. 928
is an original
ordinance, duly adopted by the Council of the City of Gilroy at a
regular meeting of said Council held on the 19th day of Julv
, 19 -11, at which meeting a quorum was present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
official seal of the City of Gilroy, this 22nd day of July
. 19.1.L..
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7\ /". / A1t~I/' - /{;~:;~;~:~:II
C(ty Clerk of the City of Gilroy
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