Ojai City Council Special Meeting

Sunido Inn TOT Audit Hearing

• Council members debated the clarity of the transient occupancy tax ordinance regarding cancellation fees.
• The majority supported the Tax Collector’s application of the code despite ambiguity concerns.
• The Council voted to uphold the findings while waiving all penalties and interest.

Casa Ojai Inn TOT Audit Hearing

• Staff argued that ancillary fees constitute taxable rent under the municipal code.
• The appellant contested the tax base expansion and liability for uncollected taxes.
• The Council upheld the base tax determination but removed penalties and interest.

• The City Council concluded a special hearing session involving Transient Occupancy Tax (TOT) audits against two hotel operators. The session addressed the Sunido Inn case first, followed by a detailed hearing regarding the Casa Ojai Inn (operator Cameron Larner).

First Hearing (Sunido Inn)

• Discussion: Council members debated the clarity of the TOT ordinance regarding cancellation fees and tax liability. While some members (Council Member Rule) felt the ordinance was ambiguous and relied too heavily on interpretation, others (Whitman, Lang, Mang, Gilman) supported the Tax Collector's application of the code.
• Outcome: The Council voted to uphold the Tax Collector’s findings but waived all penalties and interest.
• Vote: Passed 4-1 (Yes: Lang, Whitman, Mang, Gilman; No: Rule).
• Scheduling Adjustment: To manage time for the second hearing and accommodate public comment on an upcoming at-large voting item (Item 11), the Council decided to move that discussion to a separate special meeting, likely on the 19th or 26th.

Second Hearing (Casa Ojai Inn / Cameron Larner)

• City’s Position: Staff and City Attorney argued that the audit findings were correct under Measure C. They maintained that cleaning, crib, pet, and rollaway bed fees constitute taxable "rent" under the Municipal Code because they are tied to occupancy. They also asserted that hotel operators are liable for remitting taxes even if those taxes were not collected from the transient.
• Appellant’s Position (Larner): Larner argued that the tax is on "occupancy," not "rent," and that Measure C incoherently expanded the tax base without changing the definition of occupancy. He contended that ancillary fees are not occupancy and that penalizing operators for uncollected tax contradicts the ordinance's specific sections regarding remittance duties. He also noted a lack of clear city guidance prior to enforcement.
• Council Discussion: Council Member Rule reiterated her view that the ordinance is ambiguous and she could not support upholding the findings. However, the majority (Lang, Whitman, Mang, Gilman) found the code clear and supported the audit findings, agreeing to waive penalties and interest as a compromise.
• Outcome: The Council voted to uphold the Tax Collector’s April 8th determination regarding the tax owed ($9,519 base tax + penalties totaling $11,423.37) but removed the penalties and interest.
• Vote: Passed 4-1 (Yes: Lang, Whitman, Mang, Gilman; No: Rule).
• The special session was adjourned following the vote, with the Council scheduled to reconvene for a regular session.