HomeMy WebLinkAboutItem 8.2 - 3175 Transit Occupancy Tax Waiver of Penalties (2)
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STAFF REPORT
CITY COUNCIL
DATE: April 7, 2020
TO: Honorable Mayor and City Councilmembers
FROM:
Linda Smith, City Manager
SUBJECT:
Short-Term Waiver of Penalties for Late Payment of Transient Occupancy
Taxes
Prepared by: Lauren Quint, Assistant City Attorney
EXECUTIVE SUMMARY:
Dublin Municipal Code (DMC) Section 3.16 imposes a Transient Occupancy Tax (TOT)
within the City. In addition, the DMC imposes fines, penalties, and interest for late
payment of TOT. As a result of the economic hardships resulting from the novel
coronavirus (COVID-19) pandemic, hotel operators may benefit from a short -term
waiver of penalties associated with late payment of the TOT.
STAFF RECOMMENDATION:
Adopt a Resolution Permitting the Tax Administrator to Waive Penalties and Interest
for Failure to Timely Pay the City’s Transient Occupancy Tax.
FINANCIAL IMPACT:
All Transient Occupancy Taxes (TOT) will still be owed to the City. Payments due for
the period of January 1, 2020 through June 30, 2020 shall be remitted to the City no
later than July 31, 2020. Any waiver of fines, penalties or interest does not otherwise
relieve the hotel operator of their obligation to pay the principal amounts due to the City
and does not relieve those parties from the payment o f any fines, penalties, and interest
that accrue to the City of Dublin after June 30, 2020.
DESCRIPTION:
On March 16, 2020, the City’s Director of Emergency Services proclaimed that a Local
Emergency exists throughout the City of Dublin as a result of th e community spread of
COVID-19 and on March 18, 2020, the City Council of the City of Dublin ratified the
proclamation of existence of a local emergency and delegated authority to the City
Manager/Director of Emergency Services related to the COVID-19 pandemic.
On March 16, 2020, seven health officers within six Bay Area counties, including
Alameda County, took a unified step to slow the spread of COVID-19 and preserve
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critical health care capacity across the region by issuing a legal order directing their
respective residents to shelter at home and limiting activity, travel and business
functions to only the most essential needs for three weeks, beginning March 17. On
March 19, 2020, Governor Gavin Newson issued a statewide order ordering all
individuals living in the State of California to stay home or at their place of residence,
except as needed to maintain continuity of operation of the federal critical infrastructure
sectors. This was followed by an updated County order on March 31, 2020, superseding
the March 16, 2020 order and directing all individuals to shelter in place until May 3,
2020, clarifying, strengthening, and extending certain terms of the prior countywide
order to increase social distancing and reduce person-to-person contact.
The County and State orders have significantly impacted businesses and hotels within
the City. Businesses of all sizes have been closed, and both large and small events
across the Bay Area and in the City of Dublin have been cancelled or postponed. These
closures, cancellations, and postponements cause loss in revenue for business owners
and events, as well as surrounding local businesses and hotels that rely on business
and events to bring patrons to Dublin.
In order to provide short-term economic relief for hotel operators in the City, this action
would allow any hotel operating within the City to request the wavier of the fines,
penalties, and interest imposed by DMC section 3.16.080 related to the payment of the
City’s TOT through June 30, 2020. The resolution would grant the Tax Administrator
discretion to approve such waiver. Any waiver of fines, penalties or interest would not
otherwise relieve the hotel operator of their obligation to pay the principal amounts due
to the City of Dublin, and does not relieve those parties from the payment of any fines,
penalties, and interest that accrue to the City of Dublin after June 30, 2020.
STRATEGIC PLAN INITIATIVE:
None.
NOTICING REQUIREMENTS/PUBLIC OUTREACH:
None.
ATTACHMENTS:
1. Resolution Permitting the Tax Administrator to Waive Penalties and Interest for
Failure to Timely Pay the City's Transient Occupancy Tax
RESOLUTION NO. __-20
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN
* * * * * * * * *
PERMITTING THE TAX ADMINISTRATOR TO WAIVE PENALTIES AND INTEREST
FOR FAILURE TO TIMELY PAY THE CITY’S
TRANSIENT OCCUPANCY TAX
WHEREAS, on March 16, 2020, the City’s Director of Emergency Services proclaimed
that a Local Emergency exists throughout the City of Dublin as a result of the community
spread of novel coronavirus (COVID-19); and
WHEREAS, on March 18, 2020, the City Council of the City of Dublin ratified the
proclamation of existence of a local emergency and delegated authority to the City
Manager/Director of Emergency Services related to the COVID-19 pandemic; and
WHEREAS, on March 16, 2020, seven health officers within six Ba y Area counties,
including Alameda County, took a unified step to slow the spread of COVID-19 and preserve
critical health care capacity across the region by issuing a legal order directing their respecti ve
residents to shelter at home and limiting activity, travel, and business functions to only the
most essential needs for three weeks, beginning March 17, 2020; and
WHEREAS, on March 19, 2020, Governor Gavin Newson issued a statewide order
ordering all individuals living in the State of California to stay home or at their place of
residence, except as needed to maintain continuity of operation of the federal critical
infrastructure sectors; and
WHEREAS, on March 31, 2020, Alameda County issued an order that supersedes the
March 16, 2020 Alameda County Order, directing all individuals to shelter in place until May 3 ,
2020 and clarifying, strengthening, and extending certain terms of the prior countywide order to
increase social distancing and reduce person-to-person contact; and
WHEREAS, businesses of all sizes have been closed, and both large and small events
across the Bay Area and in the City of Dublin have been cancelled or postponed due to the
County and State orders. These closures, cancellations and postponements cause loss in
revenue for business owners and events, as well as surrounding local businesses and hotels
that rely on business and events to bring patrons to Dublin; and
WHEREAS, the City of Dublin’s Municipal Code (DMC) imposes fines, penalties, and
interest when a hotel operator does not pay the City’s transient occupancy tax; and
WHEREAS, DMC section 2.44.060(A)(6)(e) states that In the event of the proclamation
of a local emergency, the Director of Emergency Services is empowered to execute special
powers conferred upon them by resolution or emergency plan adopted by the City Council.
NOW, THEREFORE, BE IT RESOLVED by the City Council that:
1. Until June 30, 2020, any hotel operating within the City may request, and the Director of
Emergency Services may agree, to waive the fines, penalties, and interest imposed by
DMC section 3.16.080 related to the payment of the City’s transient occupancy tax.
2. Such waiver must be requested and approved in writing.
3. Any waiver of fines, penalties or interest does not otherwise relieve the hotel operator of
their obligation to pay the principal amounts due to the City of Dublin, and does not relieve
those parties from the payment of any fines, penalties, and interest that accrue to the City
of Dublin after June 30, 2020.
4. Payments due for the period of January 1, 2020 through June 30, 2020 shall be remitted
to the City no later than July 31, 2020.
BE IT FURTHER RESOLVED that this waiver may be extended or supplemented in
response to subsequent Executive Orders by the Governor of the State of California on this
subject, or orders or ordinances issued or adopted by Alameda County .
PASSED, APPROVED AND ADOPTED this 7th day of April, 2020 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Mayor
ATTEST:
City Clerk
3505161.1