REPORT TO COUNCIL
SUBJECT
Title
Appeal of City Manager's Decision Determining Penalty and Interest Due from Sundowner/Days Inn Hotel on its Transient Occupancy Tax (TOT) Payment for the Month of August 2014
Report
BACKGROUND AND PROCEDURAL STATUS
This is an appeal by Shah Enterprises, Inc., operator of the Sundowner/Days Inn Hotel, of the City Manager's decision affirming the tax administrator's determination of penalty and interest owed for a late Transient Occupancy Tax (TOT) payment made for the month of August 2014.
Sunnyvale Municipal Code (SMC) Chapter 3.16 imposes a transient occupancy tax of 10 1/2 percent on transient hotel stays in the City. It is the duty of each hotel operator to collect the tax imposed and to remit the tax to the City each month. Pursuant to SMC Section 3.16.080, the tax payment is due and "must be received by the tax administrator on or before the last day of the month following the applicable reporting period. A postmark is insufficient." SMC Section 3.16.090, subdivision (a), provides that "any operator who fails to remit any tax imposed by this chapter within the time required shall be required to pay a penalty of ten percent of the amount of the tax in addition to the amount of the tax, unless waived for good cause by the tax administrator." SMC Section 3.16.090, subdivision (d), further provides that "in addition to the penalties imposed, any operator who fails to remit any tax imposed by this chapter shall be required to pay interest at the rate of one percent 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 unless waived for good cause by the tax administrator."
Under these rules, the TOT collected by the Sundowner/Days Inn for the month of August 2014 was due to the Finance Department on or before September 30, 2014. The payment was submitted one day late, on October 1, 2014, and was made in the form of...
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