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°��°Wiry°t�, STAFF REPORT
Office of the City Attorney
DATE: November 15, 2011
TO: HONORABLE MAYOR AND CITY COUNCIL
FROM: STEPHEN P. DEITSCH, CITY ATTORNEY �t, ► 12
SUBJECT: CONSIDERATION AND DISCUSSION REGARDING POSSIBLE
SUBMISSION TO THE VOTERS OF TRANSIENT OCCUPANCY TAX
("TOT") ORDINANCE AMENDMENT.
Recommended Action: Provide direction
SUMMARY
Consideration by the City Council of a proposed initiative to be submitted to the voters
at the April 10, 2012 General Municipal Election concerning an amendment to the City's
Transient Occupancy Tax Ordinance.
BACKGROUND
The City of Arcadia currently has a transient occupancy tax ordinance which imposes a
tax of ten percent (10%) on occupancy by transients at any hotel. "Occupancy" is
defined as the right to use or possess a room in a hotel. "Hotel" means any structure
designed for occupancy by transients for dwelling, lodging or sleeping purposes, and
includes any hotel, inn, tourist home, motel, lodging house, rooming house, apartment
house, dormitory, public or private club, mobile home or house trailer at a fixed location.
"Transient" means any person who is entitled to occupy a room for a period of thirty (30)
consecutive calendar days or less.
The City has recently been sued by guests of a certain hotel who have occupied a room
for more than thirty (30) days. The hotel (Extended Stay of America) initially applied for
and received a Conditional Use Permit ("CUP") in 1997 from the City, among other land
use approvals. One of the conditions of the CUP required that the hotel reregister
guests at the end of each thirty (30) day period in the event any guest remained longer.
Plaintiffs in the litigation argue that this is not permitted by statute.
As a result of the pending litigation (which is in the discovery phase), the City Attorney
has reviewed the long-standing Transient Occupancy Tax Ordinance to determine
whether amendments might be worth considering to address "extended stays", as well
as other issues. As a result, the City Attorney has prepared a draft amendment to the
Transient Occupancy Tax Ordinance. A copy of the proposed ordinance is attached as
Exhibit "A" and has provisions that require direction from Council prior to finalization.
The proposed ordinance is submitted for initial consideration and discussion by the City
Council and once it is finalized, would be brought before the Council at the December
6th Council meeting if the Council decides to move forward with this matter.
Additionally, attached as Exhibit "B" is a draft resolution calling an April 10, 2012
General Municipal Election by all mail ballot which will be presented at the December 6,
2011 City Council meeting.
If the City Council desires to proceed with an amendment to the Transient Occupancy
Tax Ordinance, the City Attorney recommends that the proposed ordinance be
submitted to the voters for approval at the April 10, 2012 General Municipal Election.
This is required by Proposition 218 if the amendment amends the definition of
"transient" to extend beyond thirty (30) days, since such an amendment would
constitute a change in the transient occupancy tax itself. Any new or increased tax
requires voter approval.
The City Attorney has prepared a memorandum focusing on certain issues for
discussion by the City Council. The memorandum is attached to this staff report.
RECOMMENDATION
The City Attorney and staff recommend that the City Council discuss the issues
described in the City Attorney's memorandum and provide direction to the City Attorney
and staff regarding possible consideration and action by the City Council at its
December 6, 2011 meeting regarding placement of an initiative on the April 2012
General Municipal Election ballot concerning this matter.
APPROVED:
Donald Penman
City Manager
Attachments
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/h tin ity°t MEMORANDUM
Office of the City Attorney
Date: November 15, 2011
TO: HONORABLE MAYOR AND CITY COUNCIL
FROM: STEPHEN P. DEITSCH, CITY ATTORNEY P.r
SUBJECT: ISSUES CONCERNING ROPOSED TRANSIENT OCCUPANCY TAX
("TOT") MEASURE
Before the City Council this evening is a proposed measure to amend the City's
Transient Occupancy Tax ("TOT") ordinance. In order to assist the City Council in its
deliberations, this Memorandum provides an analysis of the significant changes and
legal issues involved. For your reference, deletions are highlighted in strikeout t and
additions are highlighted in bold italics.
Section 2661.3 (Definition of "Occupancy") — This amendment clarifies that taxable
occupancy of a hotel room occurs even if a person does not actually use or possess the
room. Having the right to use or possession is sufficient. Therefore, if a person
registers for a room, fails to arrive at the hotel, and is still charged, the charges are still
taxable. This is consistent with existing law and is merely intended as a clarifying
amendment.
I have also added language clarifying that rental of non-dwelling hotel space is not
taxable (ie: office, ballroom or conference rooms). The legal authority to tax such usage
is unclear and at least one California charter city (Los Angeles) expressly exempts it.
Section 2661.4 (Definition of "Transient") — The proposed language makes many
significant amendments. First, it adjusts the period of taxable transiency from 30 days
to 90 days and deletes some legally problematic language regarding longer-term
agreements. This is intended to tax longer occupancies at so-called "extended stay"
hotels. General law cities are limited by State law to 30 days. (Revenue & Taxation
Code, Section 7280). However, charter cities are not subject to this limitation. San
Bernardino Hotel/Motel Assn. v. City of San Bernardino, (1997) 59 Cal. App. 4th 237.
In the San Bernardino case, the Court approved of the City's 90-day transiency period
since it was a charter city. However, it ruled that its language saying "unless there is an
agreement in writing. . ." was unconstitutionally vague because it was impossible to
distinguish a hotel occupancy agreement for a long-term lease. As a result, I am
recommending removing the same language from Municipal Code.
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An issue for the City Council to consider is whether to set this period of transiency
longer or shorter. I initially drafted the provision for 90 days because it is the maximum
period where there is clear legal authority to do so. Further, since TOT returns in
Arcadia are filed quarterly, I believed that this provided a nice fit for timing purposes. Of
course, the City Council may, in its discretion, propose to keep the transiency period at
30 days or propose another period, such as 60 days. However, it is unclear whether the
law will support a transiency period of longer than 90 days. There is no case law to this
effect and we must advise that the longer the transiency period, the more difficult it may
be to distinguish between taxable hotel occupancies and non-taxable leases. This will
increase the risk of legal challenge to the ordinance due to vagueness. I can attempt to
draft language to better draw this distinction, but there are no guarantees. The City
Council will have to consider whether the potential revenue benefits of a transiency
period longer than 90 days outweigh the risks.
I have also added language clarifying that the first 90 days (or other selected period) of
an occupancy is taxable, even if the occupant stays for a continuous period longer than
90 days. The current Code is unclear on this point. Should the occupant leave the
hotel and return (thus breaking the continuous occupancy), a new taxable 90 day period
would start.
There is also new language addressing reservations made by others on behalf of an
occupant. It clarifies that the tax applies if a person occupies or has a right to occupy
the room, regardless of whether that person actually made the reservation or someone
else did so on his or her behalf. Also, I have added language to address "block
reservations". This is a situation whereby a company reserves a group or "block" or
rooms on behalf of its employees to be used on an "as needed" basis (ie: an airline
company for its travelling pilots and flight crew). The agreement with the hotel may last
for several months or years, but the actual occupancies by individual employees
typically last less than 90 days. This language makes clear that those occupancies are
taxable because the tax is based upon the term of each occupancy, not the duration of
the "block reservation" agreement.
Section 2661.5 (Definition of "Rent") — This amendment is intended to include all
possible types of fees and charges that an occupant may be required to pay to occupy a
hotel room, including parking fees, block and advance registration fees, commissions,
etc. In this way, potential loopholes from payment are avoided and the maximum
collection of the tax ensured.
More specifically, this language is intended to address ongoing nationwide litigation
between many cities and online travel companies, such as Expedia, Travelocity, etc.
("OTC's"). To provide an example, an OTC will purchase a room from a hotel at
wholesale for $100 a night. A customer then goes online and purchases the room at
retail from the OTC for $150 a night. Arcadia's TOT rate is 10%. However, the OTC's
for many years have only remitted the TOT based upon the wholesale rate, contending
that the relevant taxable purchase occurred when they bought the room from the hotel.
However, cities contend that the relevant sale (and taxable event) occurs when the end
customer purchases the room, since he or she is the one who will actually enjoy
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"occupancy" of the room. As a result, Arcadia will be underpaid TOT by $5 per night
($150 - $100 x 10% _ $5). Multiply this by hundreds of millions of online hotel
reservations made over the last several years and one can understand the gravity of
this litigation. Therefore, the OTC's are contesting every local loophole they can find.
The proposed language states, in the most explicit language we can draft, that the full
retail price charged by the OTC to the customer is subject to the TOT.
This amendment also clarifies that rooms rented for free or on a complementary basis
(ie: to vacation contest winners) are not taxable. Collecting TOT on these types of
occupancies is problematic, at best, and most cities include this exemption in their
Codes. Also food and beverage items already subject to sales and use tax are made
exempt from the TOT, consistent with existing State law which also applies to charter
cities (Revenue & Taxation Code, Section 7282.3).
Section 2661.6 (Definition of "Operator") — For the reasons discussed above, this
amendment is also intended to address resellers and booking agents, such as OTC's
and other intermediaries that sell rooms on behalf of hotels.
Sections 2661.8 (Definitions of "Online Travel Company", "Person" and "Block
Reservation") — These are additional definitions intended to address the issues
discussed above.
Section 2662 (Tax Imposed) — A minor amendment has been made to conform the
language to the updated definitions discussed above. The fundamental policy question
posed by this section is whether the Council wishes to propose increasing the TOT rate.
The rate is currently at 10% of rent charged for a hotel room. There is no legal limit to
what rate may be charged, provided it is approved by a majority vote of the electorate
under Proposition 218.
Section 2663 (Exemptions) — No change is proposed to this section at this time.
However, an issue for the Council's consideration is whether it wants to set a non-
taxable floor. In other words, does the Council want to provide a TOT exemption stating
that if hotel room rent is below a certain amount per day, it is not taxable (ie: less than
$50 per day). There are no legal limitations and it is purely a policy decision.
Section 2663.2 (Same. Officials) — Language has been added to clarify what kind of
government employees are entitled to a TOT exemption. More specifically, the
language is intended to address large university events. Our office has encountered
the following situation: A State University is playing a large game in the area. The
team, band, boosters, fans, etc. stay at the hotel and all claim to be State University
"employees" by producing a student or employee identification card. When asked for
proof of "travel orders", they produce a letter from the Athletic Director saying that they
are officially attending on behalf of the University. While this was not the intent of the
State employee exemption, imprecise language in other cities has resulted in this
potentially expensive loophole. This language addresses that.
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Section 2663.4 (Same. Procedure) — Language has been added to enhance the
procedures for claiming a TOT exemption as a Federal or State employee. This
conforms to the proof requirements of State law (Revenue & Taxation Code, Section
7280(e)).
TEXT OF THE MEASURE. We have included provisional text for the ballot measure,
pending the City Council final direction on how to word the proposed ordinance. Staff
welcomes the City Council's input as to how to word the ballot text.
APPROVED:
Don Penman
City Manager
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Exhibit "A"
Proposed Ordinance Regarding Transient Occupancy Tax
ORDINANCE NO. XXXX
MEASURE " "
AN ORDINANCE OF THE PEOPLE OF THE CITY OF ARCADIA
AMENDING THE CITY'S TRANSIENT OCCUPANCY TAX CODE BY
INCREASING THE TAX RATE FROM 10% TO °A., EXTENDING
THE PERIOD OF TRANSIENCY SUBJECT TO THE TAX FROM 30 TO
90 DAYS, ADDRESSING ONLINE TRAVEL COMPANY BOOKINGS,
AND MAKING VARIOUS CONFORMING CHANGES.
(NOTE: additions are highlighted in bold italics and deletions are highlighted in
ses6Ft)
THE PEOPLE OF THE CITY OF ARCADIA, CALIFORNIA DO HEREBY
ORDAIN AS FOLLOWS:
SECTION 1. Divisions 1 through 3 of Part 6 of Chapter 6 of Article II of the
Arcadia Municipal Code are hereby amended to read as follows:
"PART 6 — UNIFORM TRANSIENT OCCUPANCY TAX
DIVISION 1. — DEFINITIONS
2661. - DEFINITIONS.
2661.1. - TITLE.
2661.2. - HOTEL.
2661.3. - OCCUPANCY.
2661.4. - TRANSIENT.
2661.5. - RENT.
2661.6. - OPERATOR.
2661.7. - TAX ADMINISTRATOR.
2661.8. — ONLINE TRAVEL COMPANY.
2661.9. - PERSON.
2661.10— BLOCK RESERVATION
2661. - DEFINITIONS.
For the purpose of this Part certain words and terms are hereafter defined and
shall have the meaning thus ascribed.
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2661.1. -TITLE.
This Part shall be known as the Uniform Transient Occupancy Tax Ordinance of
the City of Arcadia.
2661.2. - HOTEL.
"Hotel" means any structure, or any portion of any structure, which is occupied or
intended or designed for occupancy by 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.
2661.3. - OCCUPANCY.
"Occupancy" means the use or possession, or the right to the use or possession
of any room or rooms or portion thereof (whether or not the person entitled to the
use or possession actually uses or possesses such room or rooms or portion
thereof), in any hotel for dwelling, lodging or sleeping purposes. The use or
possession or right to use or possess any room or any suite of connecting rooms
as office space, banquet or private dining rooms, or exhibits, sample or display
space shall not be considered "occupancy" within the meaning of this definition
unless the person exercising occupancy uses or possesses, or has the right to
use or possess all or any portion of such room or suite of rooms for dwelling,
lodging or sleeping purposes.
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2661.4. - TRANSIENT.
"Transient" means any person who exercises occupancy or is entitled to
occupancy by reason of concession, permit, right of access, license or other agreement
for a period of thirty (30) ninety (90) consecutive calendar days or less, counting
portions of calendar days as full days. The following rules shall apply to this
definition:
A. Any such person so occupying space or entitled to occupy a room in a
hotel shall be deemed to be a transient until the period of thirty (30} ninety (90)
calendar days has expired unless there is an agreement in writing between the
- -- - - - •: - - • - - - - •-•• - - - - - - -- - - - . In the event
person exercises or is entitled to occupancy for a continuous and uninterrupted
period of longer than ninety (90) calendar days, he or she shall be deemed a
transient and subject to the tax for only the first ninety (90) calendar days of
occupancy and shall cease being a transient and the tax shall not apply on the
ninety-first (91st) day of occupancy and following. However, any break or
interruption in occupancy shall start a new ninety (90) day period subject to the
tax.
B. In determining whether a person is a transient, uninterrupted periods of
time extending both prior and subsequent to the effective date of this Part may be
considered.
C. Any person who exercises or is entitled to occupancy for a period of
ninety (90) consecutive calendar days or less shall be deemed to be a transient
for that period, regardless of whether the reservation and/or payment for
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occupancy is made directly by the person exercising occupancy or another
person. The intent is to tax the person exercising occupancy or having the
entitlement to occupancy of a hotel room.
D. In the case of a block reservation, a person's employee or agent
shall be deemed a transient if that employee or agent exercises or is entitled to
occupancy of a room for a period of ninety (90) consecutive calendar days or
less, regardless of the duration of any block reservation agreement. By way of
example, if a corporation enters into a one-year block reservation agreement with
an operator and one of the corporation's employees occupies a room for ninety
(90) calendar days, the employee shall be deemed a transient whose occupancy
is subject to the tax, notwithstanding the fact that the block reservation
agreement has a duration longer than ninety(90) calendar days.
2661.5. - RENT.
"Rent" means the total consideration charged to the transient, (including but
not limited to, room rates, service charges, parking fees, purchase price, advance
registration, block or group reservation charges, assessments, retail markup,
commission, processing fees, cancellation charges, attrition fees, or online
booking fees), 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. Nothing in this definition shall be construed to
mean that rent is charged directly or indirectly for occupancy in a hotel when a
room is provided to the transient as a compliment for the operator and where no
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consideration is charged to or received from any other person. Further, bona fide
charges for food and beverages which are subject to tax under the California
Sales and Use Tax Law (Revenue and Taxation Code Sections 6001 et. seq.) shall
not be deemed rent subject to the tax imposed by this Part.
2661.6. - OPERATOR.
"Operator" means a person who is proprietor of the hotel or any other person
who has the right to rent rooms within the hotel, whether in the capacity of owner,
lessee, sublessee, mortgagee in possession, licensee, seller, reseller, or any other
capacity. Where the operator performs his functions through a managing agent or
booking agent of any type or character, other than an employee (including, but not
limited to, an online travel company), the managing agent or booking agent shall
also be deemed an operator for the purposes of this Part and shall have the same
duties and liabilities as his principal. Full Gcompliance with the provisions of this Part by
either the principal or the managing agent or booking agent shall, however, be
considered to be compliance by both.
2661.7. -TAX ADMINISTRATOR.
"Tax Administrator" means the City License Officer Director of Finance, or his
or her designee.
2661.8. ONLINE TRAVEL COMPANY.
"Online Travel Company" shall mean any person, whether operating for
profit or not for profit, which enables transients to purchase occupancy in a hotel
via the Internet, or by similar electronic means.
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2661.9. - PERSON.
"Person" shall mean 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.
2661.10. — BLOCK RESERVATION.
"Block Reservation" shall means an arrangement whereby a person
reserves, whether on an exclusive or non-exclusive basis, a room or block/group
of rooms for a defined period of time under a written or oral agreement with an
operator, intending for such room(s) to be occupied by that person's employees
or agents on an intermittent, periodic or "as needed" basis during that defined
period of time.
DIVISION 2. IMPOSITION AND RATE
2662. - TAX IMPOSED.
2662. -TAX IMPOSED.
For the privilege of occupancy in any hotel, each transient is subject to and shall
pay a tax in the amount of ten percent (10%) 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 occupancy. If for any reason the
tax due is not paid to the operator of the hotel, the Tax Administrator may require that
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such tax shall be paid directly to the Tax Administrator. The proceeds of this tax are
allocated to the City's general fund for governmental expenditures.
DIVISION 3. - EXEMPTIONS
2663. - EXEMPTIONS
2663.1. - SAME. EXEMPTED BY LAW.
2663.2. - SAME. OFFICIALS.
2663.3. - SAME. FOREIGN AGENCIES.
2663.4. - SAME. PROCEDURE.
2663. - EXEMPTIONS.
The tax enacted by this Part shall not be imposed upon any person or agency
defined in the following subsections.
2663.1. - SAME. EXEMPTED BY LAW.
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.
2663.2. - SAME. OFFICIALS.
Any federal or State of 'California officer or employee when occupying a room
while on official government business. For purposes of this section, students, non-
employee supporters and volunteers of California public universities and
colleges shall not be deemed to be officers or employees of the State of
California.
2663.3. - SAME. FOREIGN AGENCIES.
Any officer or employee of a foreign government who is exempt by reason of
express provision of federal law or international treaty.
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2663.4. - SAME. PROCEDURE.
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 Tax
Administrator. Any federal or State of California officer or employee when on
official government business claiming such an exemption shall provide to the
operator as conclusive evidence that his or her occupancy is for the official
business of his or her employer:
(1) Travel orders from his or her government employer; or a government
warrant issued by his or her employer to pay for the occupancy; or a
government credit card issued by his or her employer to pay for the
occupancy; and
(2) proof of his or her governmental employment as an employee or
officer as described in paragraph (1) of this subsection (b), and
proof, consistent with these provisions, that his or her occupancy is
for the official business of his or her governmental employer.
It shall be the duty of an operator to keep and maintain for a period of three
(3) years written documentation in support of each exemption granted under this
Division 3."
SECTION 2. Effective Date. Pursuant to California Constitution Article XIIIC
§(2)(b) and California Elections Code §9217, if a majority of the qualified voters voting in
the election on Measure vote in favor of the adoption of such measure, this
ordinance shall be deemed valid and binding and shall be considered as adopted upon
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the date that the vote is declared by the City Council, and shall go into effect ten (10)
days after that date.
SECTION 3. Severability. If any section, sentence, clause or phrase of this
ordinance is for any reason held to be invalid or unconstitutional by a decision of any
court of competent jurisdiction, such decision shall not affect the validity of the
remaining provisions of this ordinance. The People of the City of Arcadia hereby
declare that they would have adopted this ordinance and each section, sentence,
clause or phrase thereof, irrespective of the fact that any one or more section,
subsections, sentences, clauses or phrases be declared invalid or unconstitutional.
SECTION 4. Certification/Summary. Following the City Clerk's certification
that the citizens of Arcadia have approved this Ordinance, the Mayor shall sign this
Ordinance and the City Clerk shall cause the same to be entered in the book of original
ordinances of said City; and shall cause the same, or a summary thereof, to be
published as required by law.
ADOPTED by the People of the City of Arcadia on the 10th day of April, 2012.
Mayor of the City of Arcadia
ATTEST:
City Clerk
APPROVED AS TO FORM:
Stephen P. Deitsch
City Attorney
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Exhibit "B"
Draft Resolution calling for the Placement of a General Tax Measure
RESOLUTION NO. XXXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA,
CALIFORNIA CALLING FOR THE PLACEMENT OF A GENERAL TAX
MEASURE ON AN ALL MAIL BALLOT TO BE HELD AT THE APRIL 10,
2012 GENERAL MUNICIPAL ELECTION FOR THE SUBMISSION TO
THE QUALIFIED VOTERS OF A PROPOSED ORDINANCE AMENDING
THE CITY'S TRANSIENT OCCUPANCY TAX BY INCREASING THE TAX
RATE FROM 10% TO %, EXTENDING THE PERIOD OF
TRANSIENCY SUBJECT TO THE TAX FROM 30 TO 90 DAYS,
ADDRESSING ONLINE TRAVEL COMPANY BOOKINGS, AND MAKING
VARIOUS CONFORMING CHANGES.
WHEREAS, pursuant to Section 9222 of the California Elections Code, the City
Council has authority to place propositions on the ballot to be considered at a Municipal
Election; and
WHEREAS, pursuant to Article II, Chapter 6, Part 6 of the Arcadia Municipal
Code (A.M.C. §§2661 — 2664.9), the City currently imposes a Transient Occupancy Tax
("TOT") at the rate of ten percent (10%) upon guests of hotels and other transient
accommodations within the City; and
WHEREAS, the City Council desires to increase the rate for the TOT to a total of
percent (_%) to be imposed upon the guests of hotels and other transient
accommodations located within the City; and [AMENDING RATE?]
WHEREAS, the City Council desires to amend the Arcadia Municipal Code to
extend the period of transiency subject to the imposition and collection of the TOT from
30 days to 90 days;and
WHEREAS, the City Council desires to amend the Arcadia Municipal Code to
allow for the imposition and collection of the TOT on the full rent charged to a guest for
hotel occupancy, whether the occupancy is booked directly by the guest, through the
guest's employer or agent, or through online travel companies which enable guests to
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purchase occupancy via the Internet, or by similar electronic means; and
WHEREAS, the TOT is a general tax the proceeds of which are deposited into
the City's general fund. The general fund pays for essential City services such as police
protection, fire and paramedic services, street operations and maintenance, library
services, parks and recreation services and general municipal services to the public;
and
WHEREAS, on November 6, 1996, the voters of the State of California approved
Proposition 218 (California Constitution, Article XIIIC), an amendment to the State
Constitution which requires that all general taxes which are imposed, extended or
increased must be submitted to the electorate and approved by a majority vote of the
qualified electors voting in the election; and
WHEREAS, an increase in the TOT rate constitutes an "increase" in the TOT
under Proposition 218; and [AMENDING RATE?]
WHEREAS, the amendments proposed in the attached ordinance extending the
period of transiency that may be subject to the TOT from 30 days to 90 days may be
characterized as an "increase" in the TOT under Proposition 218; and
WHEREAS, the amendments proposed in the attached ordinance which apply
the TOT rate to the total rent charged to a guest for occupancy in a hotel (including any
retail markup and other charges imposed through purchase of occupancy through an
employer, agent or on-line travel company) may also be characterized as an "increase"
in the TOT under Proposition 218; and
WHEREAS, pursuant to Proposition 218 (California Constitution Article XIIIC,
§2(b)), any election for the approval of an increase to a general tax must be
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consolidated with a regularly scheduled general election for members of the governing
body of the local government; and
WHEREAS, pursuant to the Arcadia City Charter, Section 1100, the City's
General municipal elections for the election of officers are held on the second Tuesday
in April in each even-numbered year. Therefore, the next regularly scheduled General
Municipal Election for the election of members of the City Council will be held on
Tuesday, April 10, 2012; and
WHEREAS, pursuant to California Elections Code, Section 4000 and Arcadia
Municipal Code, Section 1703, the City Council may, by resolution, authorize the
election on this Measure to be conducted by all-mail ballot; and
WHEREAS, the City Council desires to submit to the voters, via an all mail ballot,
at the April 10, 2012 General Municipal Election one ballot proposition, entitled:
"Shall an ordinance amending the Arcadia Municipal Code i° Increase the
rate for the City's transient occupancy tax from 10% to ' % of the rent
charged by hotel operators, including online travel companies, for the
transient ;occupancy of any hotel room, and to extend the period of
transiency subject to the tax from 30 days to 90 days, be adopted to help
the City preserve general City services`;such as police and fire protection?"
[TO BE REVISED.AS APPROPRIATE]
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA,
CALIFORNIA, DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:
SECTION 1. Findings. The City Council finds that all of the preceding recitals
are true and correct and are hereby incorporated and adopted as findings and
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determinations by the City Council as if fully set forth herein.
SECTION 2. Calling and Giving Notice of General Municipal Election. The City
Council hereby calls and gives notice of a General Municipal Election to be held on
Tuesday, April 10, 2012 to be conducted by all mail ballot in the City of Arcadia, County
of Los Angeles.
SECTION 3. Submission of Measure. Pursuant to applicable requirements of
the laws of the State of California, the City Council hereby orders the ordinance
attached hereto as Exhibit "A" and by this reference incorporated herein and made an
operative part hereof, to be submitted to the voters of the City at the General Municipal
Election by all mail ballot, to be held on Tuesday, April 10, 2012:
SECTION 4. The ballot proposition shall be presented and printed upon the
ballot submitted to the voters in the manner and form set forth in this Section 4. On the
ballot to be submitted to the qualified voters at the City General Municipal Election to be
held on Tuesday, April 10, 2012, in addition to any other matters required by law, there
shall be printed substantially the following:
"Shull an ordinance amrending the Arcadia YES
Municipal Cod �mn a the rate for
the City's transient occupx ncy ta from
10% to 'of the l ch � x �hotel
operators, including online travel
companies, for the transient occupancy,of
any hotel'room, and to extend the period
of transiency subjects to the tax,''from`3u
days to 90 days, be 'adopted to help the
City preserve general Cily. services such
as police and fire protection?"
[TO BE REVISED AS APPROPRIATE] NO
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SECTION 5. Conduct of Election. The City Clerk is authorized, instructed and
directed to procure and furnish any and all official ballots, printed matter and all
supplies, equipment and paraphernalia that may be necessary in order to properly and
lawfully conduct the election by all mail ballot. In all particulars not recited in this
Resolution, the election shall be held and conducted as provided by law for holding
municipal elections.
SECTION 6. That pursuant to the City of Arcadia Municipal Code, and other
applicable provisions of the City Charter and Ordinances of the City of Arcadia, said
General Election shall be conducted by all mail ballot, and shall be conducted pursuant
to Chapter 2 of Division 4 (commencing with Section 4100) of the California Elections
Code only insofar as required by law, and only where not inconsistent with the Charter
and Ordinances of the City of Arcadia. Notwithstanding Elections Code Section 4103,
ballots cast in this General Election shall be returned to the Office of the City Clerk no
later than ! p.m. on election day. Only ballots received in the Office of the City
Clerk by p.m. on election day shall be counted. [UNDER ELECTIONS CODE
4113, DEADLINE IS 8 ISM„ ON ELECTION DAY, BUT CITE COUNCIL MAY SET
DIFFERENT DEADLINE]
SECTION 7. Notice of Election. Notice of the time and place of holding the
election is hereby given, and the City Clerk is authorized, instructed and directed to give
further or additional notice of the election, in time, form and manner as required by law.
SECTION 8. Impartial Analysis. Pursuant to California Elections Code Section
9280, the City Council hereby directs the City Clerk to transmit a copy of the measure to
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the City Attorney. The City Attorney shall prepare an impartial analysis of the measure,
not to exceed 500 words in length, showing the effect of the measure on the existing
law and the operation of the measure, and transmit such impartial analysis to the City
Clerk within ten (10) days following the adoption of this Resolution.
SECTION 9. Certification. The City Clerk shall certify to the adoption of this
Resolution.
SECTION 10. Filing with County. The City Clerk shall, not later than the 88th
day prior to the General Municipal Election to be held on Tuesday, April 10, 2012, file
with the Board of Supervisors and the County Clerk — Registrar of Voters of the County
of Los Angeles, State of California, a certified copy of this Resolution.
SECTION 11. Public Examination. Pursuant to California Elections Code §9295,
this measure will be available for public examination for no fewer than ten (10) calendar
days prior to being submitted for printing in the sample ballot. The examination period
will end on the day that is seventy-five (75) days prior to the date set for the election.
The Clerk shall post notice in the Clerk's office of the specific dates that the examination
period will run.
[SIGNATURES ON NEXT PAGE]
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Passed; approved and adopted this day of , 2011.
Mayor of the City of Arcadia
ATTEST:
City Clerk
APPROVED AS TO FORM:
Stephen P. Deitsch
City Attorney
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