A long-simmering dispute between the city of Red Bluff, Calif., and its only RV park over the transient occupancy tax may be settled on the November ballot.
The city council this week voted 4-1 to submit to voters an ordinance restating what’s already on the books — that the 10% “bed” tax applies to RV parks, camping sites and campgrounds, the Redding Record-Searchlight reported.
The council’s action stems from efforts over recent years to collect the tax from Durango RV Resort, which opened in 2008.
In June 2011, city Finance Director Sandy Ryan sent a letter to resort management demanding almost $42,000 of taxes, interest and penalties.
While the city has maintained such facilities have been covered by its ordinance all along, it wasn’t until September that it was amended to specifically name RV parks and campgrounds in the definition of “hotel.” Officials at the time deemed the move a clarification, not an expansion of the tax.
City Manager Rick Crabtree said Thursday (July 19) that Durango lawyers disagreed, arguing the move was illegal under Proposition 218, the 1996 Right to Vote on Taxes Act, and suggesting the matter be put on the ballot.
“Rather than entering into a potentially protracted and expensive legal battle over these issues, staff recommends that the City Council submit the issue to voters for resolution,” Crabtree wrote in a report to the council.
He estimated the city’s loss in revenue from the 174-space resort at $52,000 for the first six months of this year.
Contacted Thursday, Durango co-manager Pam Cappello said she was concerned about how the tax would affect the business and its “competitive edge.”
“There’s not so much consideration for the fiscal impact to the resort,” she said. Still, Cappello looks forward to a resolution of the issue.
“We now have an opportunity to present this to the people of Red Bluff and let them make a decision,” she said.
Red Bluff’s original ordinance was adopted in 1965, setting the bed tax at 4%, and it was amended several times over the years. The tax applies only to stays of 30 days or less and proceeds go into the general fund.
In Redding, RV parks pay a 10% bed tax, Deputy City Manager Greg Clark said.
Voters in eastern California’s Tuolumme County will be asked during the June election to expand the Transient Occupancy Tax (T.O.T.) to include campgrounds, RV parks and house boats.
The Supervisors voted 5-0 to put the issue on the ballot. One person that spoke adamantly against the idea was Esther Osborne, owner/manager of the Marble Quarry RV Park, mymotherlode.com reported.
“This (tax) is not uniform and will nearly put us out of business,” said Osborne. “We will either have to go long term (leasing), or go out of business, because this is a tax that is insurmountable to us.”
Some others spoke in favor, including Dodge Ridge ski resort owner Frank Helm. “Tourism and recreation is, I believe, the largest contributor to income in the county,” said Helm. “We want to see that continue, and we understand the need to keep Railtown and the fairgrounds going.”
The expanded T.O.T. would bring in an estimated $300,000 to $350,000 a year, and funding would be utilized to help operations at the fairgrounds and Railtown 1897. Railtown is presently scheduled to close at the first of July and the fairgrounds are losing their state subsidy.
The T.O.T. tax, which is paid by visitors that stay at hotels, was first approved by voters in 1983. It was expanded from 8% to 10% in 2010.
Local organizations like the Tuolumne County Visitors Bureau and the Chamber of Commerce’s Governmental Affairs Committee have come out in favor of the expansion.
The Tuolumne County Supervisors in northern California will wait until their next meeting to finalize a plan for a ballot measure related to the Transient Occupancy Tax (T.O.T.) expansion.
The supervisors are planning to ask voters in June to expand the T.O.T. so that it includes campgrounds, RV parks and houseboats. The proposal that the Supervisors discussed today would exempt both the Boy Scouts and Girl Scouts from having to pay the T.O.T., mymotherlode.com reported.
Supervisor Evan Royce brought up that he’d like it also to exempt groups like those that currently run youth religious camps. Supervisor Dick Pland added that he supports that concept. There was also discussion about whether to exempt other youth organizations like the YMCA.
Supervisor John Gray said he would like more clarity regarding proposed exemptions at the next meeting, and the financial impact. Supervisor Liz Bass also voiced concerns about the idea of exemptions, and how it will be decided which groups apply.
A final T.O.T. proposal will be voted on in two weeks, and it would then go before voters in June.
The Tuolumne County Supervisors in Northern California are moving ahead with a plan to ask voters to expand the Transient Occupancy Tax (TOT).
Expanding the TOT to include campgrounds, house boats and RV parks would bring the county an estimated $350,000 a year, mymotherlode.com reported. The additional funding would be used to help Railtown 1897 and the Mother Lode Fairgrounds.
The supervisors voted 5-0 to direct county staff to draft a proposal to go before voters during the June election. The final proposal will have to be approved by the board at a later meeting.
Several people came to speak on the plan and just one spoke against it. Among those in favor was Tuolumne County Chamber of Commerce Executive Director George Segarini, who says the proposal is endorsed by his group’s Governmental Affairs Committee.
Tim Wyman, president of the Tuolumne County Visitors Bureau Board of Directors, says his organization held an emergency meeting Monday and voted unanimously to support of the TOT expansion.
A few community members came up and asked that youth and religious camps be exempt from the TOT, which is an idea the supervisors appeared willing to include in the final plan.
Only one person argued against the TOT expansion, saying it would send a bad message to RV users and campers considering a visit to the area.
The TOT was first approved in 1983. It was increased by voters in 2010 from 8% to 10%.
The Tuolumne County Supervisors in Sonora, Calif., will take up a proposal on Feb. 7 to expand the county’s 10% Transient Occupancy Tax (TOT) that is currently placed on hotels to include campgrounds, houseboats and RV parks.
“This would not be an increase in the rate that the voters approved in 2010, but the expansion of the application of the TOT,” said Criag Pedro, county administrator. “The primary folks that would pay this are those that visit our community, and this is a great way that they can help offset some of the costs that we incur providing services to the visitors.”
The county estimates that the expanded TOT would bring in around $350,000 annually, mymotherlode.com reported.
The TOT was first approved in 1983. It was increased by voters in 2010 from 8% to 10%.
The new revenue could keep both Railtown 1897 State Historic Park and the Mother Lode Fairgrounds open. Railtown is one of 70 state parks set for closure on July 1st. The state is also cutting off subsidies to county fairs.
Railtown currently needs around $200,000 a year to maintain modified year round operation, and the Fairgrounds require an additional $125,000 a year.
The state would continue to operate Railtown as part of the plan, and the county would look to enter into a Memorandum of Understanding regarding various matters.
Whether Durango RV Resort will pay transient occupancy tax (TOT) to Red Bluff, Calif., is still undecided after the City Council Tuesday (July 19) voted to table a decision to amend the TOT ordinance to explicitly include recreational vehicle parks and campgrounds.
According to the Red Bluff Daily News, the council voted 3-1-1 to table the decision as recommended by Councilman Rob Schmid. Councilwoman Daniele Jackson voted no, and councilman Wayne Brown was absent.
Durango owner Gary Breen questioned the council’s legal ability to approve the amendment, which would change and expand the existing tax base.
Proposition 218, passed by California voters in 1996, requires local governments to allow those who would be affected to vote on proposed taxes.
The law does not apply in this case, as this is not a new tax, City Attorney Richard Crabtree said. The city has never wavered on its position that the ordinance already includes RV parks and campgrounds.
“We don’t view this as an expansion of the tax base, so Prop 218 does not prohibit adoption of the ordinance before you,” Crabtree told the council.
Schmid stopped short of giving his own interpretation as to whether the ordinance already includes RVs, but said if the city is looking at rewriting the ordinance to clarify it, then it means the ordinance is open to interpretation and subjected to becoming matter for litigation. He wanted a second opinion on whether approval of the amendment would conflict with the law under Proposition 218.
The Red Bluff-Tehama County Chamber of Commerce supports the proposed amendment because it would create an ordinance that would leave no doubt, supposition or room for interpretation as to whether RV parks and campgrounds are covered in the TOT ordinance, said Chairman Greg Stevens, who spoke on behalf of the Chamber Executive Committee.
However, the chamber does not agree with the city’s interpretation that RV parks and campgrounds are already included in the ordinance as it is written, nor does it support the city wanting to collect retroactive taxes from Durango, especially considering that some hotels were forgiven following a 2009 audit that showed they had not been in compliance with the ordinance but promised to comply going forward, Stevens said.
“It’s not Durango’s fault it took the city a year to change the ordinance,” he said.
A handful of speakers representing downtown businesses and Durango employees and guests spoke on behalf of the RV park pointing out the many benefits and contributions it has provided to the city and community. They cautioned the city about the message it was sending in trying to single out Durango.
“It’s sad that the city would go after the best thing that’s happen to Red Bluff in a long time,” said Irene Fuller.
The dispute between the city and Durango over TOT has been ongoing since Durango opened in 2008. There have been ongoing efforts since 2009 to get Durango to voluntarily comply, Crabtree said.
The city estimates Durango owes about $42,000 in TOT going back to June 2010.