Chapter 12.05
ROOM TAX Revised 5/19

Sections:

12.05.010    Definitions.

12.05.015    Room Tax Imposed.

12.05.020    Collection of Room Tax by Operator.

12.05.025    Exemptions.

12.05.030    Registration of Operator – Form and Contents – Execution – Certification of Authority.

12.05.035    Remittance and Returns. Revised 5/19

12.05.040    Penalties and Interest.

12.05.045    Deficiency Determinations – Fraud, Evasion, Operator Delay. Revised 5/19

12.05.050    Redeterminations. Revised 5/19

12.05.055    Security for Collection of Tax.

12.05.060    Collection.

12.05.065    Lien.

12.05.070    Refunds. Revised 5/19

12.05.075    Authority of Tax Administrator. Revised 5/19

12.05.080    Administration.

12.05.085    Appeals to City Council.

12.05.090    Penalty.

12.05.010 Definitions.

The following definitions apply in this chapter.

A.    Occupancy means the right to the use or possession of any space in temporary lodging for dwelling, lodging or sleeping purposes for less than 30 days.

B.    Occupant means the person with the right to occupancy or who is responsible for payment for the occupancy.

C.    Operator means any person who receives rent from an occupant or a person paying an occupant’s rent.

D.    Rent means the consideration paid or payable by an occupant for the occupancy of space in temporary lodging valued in money, goods, labor, credits, property, or other consideration. If a separate fee is charged for services, goods or commodities and the fee is optional, that fee is not included in rent. A guaranteed no-show charge based on the rate charged for the room is considered rent, but a cancellation fee is not rent. Examples of optional services may include, but are not limited to: pay-per-view movies, room service, long-distance telephone calls, use of an honor bar or parking. Optional charges require express permission of the occupant to incur the cost. If a group of rooms is booked or arranged at a negotiated rate, an additional charge is optional if the person acting for the group can avoid the charge for the group. Rent includes all fees and assessments based on the number of occupants, human and pets (including but not limited to cleaning, pet, smoking or recreational fees) for which payment is not optional to the occupant. If the operator offers a lodging package that includes something that is not associated with the actual lodging or is provided by a third party, the rent is the price of the package less the cost of the non-lodging portion of the package. If the operator charges room tax based on the total package price, the rent is the full amount of the package.

Because neither the operator nor the City can keep track of every transaction, whether particular charges are part of rent is based on the operator’s standard practices. When an operator’s practices would result in a specific fee being optional for some and not others, it will be treated as not optional for all.

Examples:

1.    An operator charges $100.00 per night for a room. Occupants are provided a breakfast that is included in the per night fee. Occupants may also have lunch or dinner at the property and may charge the cost of these meals to their room. The rent is $100.00 per night because the breakfast is included in the room fee. The rent does not include any charges for optional meals purchased by occupants.

2.    An operator charges $90.00 for a room and $10.00 for parking. If occupants are made aware of the parking charge and have the opportunity to avoid it before incurring the charge, the rent is $90.00. If they are not made aware of the charge for parking and not given the opportunity to avoid the charge, the rent is $100.00.

3.    a.    An operator charges $100.00 for a room, but adds a mandatory three percent “resort fee” for use of hotel amenities. The rent is $103.00 because the resort fee charge is mandatory, not optional.

b.    An operator adds a facilities charge to all bills but will drop the facilities charge if an occasional occupant objects on the basis that the occupant did not use the “facilities.” The facilities charge is part of the rent because it is imposed on occupants and is imposed on many who did not give permission to incur the cost.

4.    A third-party tour company offers a package that includes both hotel and ski lift tickets for $130.00 and pays the operator $100.00 for the room. The rent is $100.00.

5.    An operator charges $90.00 for a smoking room and $80.00 for a nonsmoking room, and charges a $100.00 penalty for smoking in a nonsmoking room. The rent for the smoking room is $90.00, but the $100.00 penalty imposed on improper use of the nonsmoking room is not part of the rent.

6.    An operator charges a pet fee of $10.00 per night for all pets. The pet fee is part of the rent because it is based on occupancy of the room. If the operator charges a refundable pet deposit of $100.00, the deposit is not part of the rent, even if not refunded due to damages to the room.

7.    A group reserves 50 rooms at $80.00 per room and also orders a daily newspaper at an additional $1.00 per room. The rent for each room is $80.00 per night because the person acting for the group could have avoided the $1.00 newspaper charge.

8.    An online room wholesaler sells a room in a lodging facility for $130.00 to customers and pays the owner of the lodging facility $100.00. The rent is $130.00 because that is the amount paid by the customer and the wholesaler must collect the tax based on the $130.00 rent and report and remit the tax to the City, less the administration fee authorized by BC 12.05.035, unless the wholesaler has an approved tax collection and remission agreement, in which case the entity operating the facility will report and remit the tax to the City based on the full amount collected by the wholesaler, less the administration fee.

E.    Tax Administrator means the Finance Director of the City of Bend.

F.    Room tax means the tax payable by the occupant under this chapter.

G.    Temporary lodging means:

1.    Hotel, motel and inn dwelling units that are used for temporary overnight human occupancy;

2.    Spaces used for overnight parking of recreational vehicles or placement of tents during periods of human occupancy; or

3.    Houses, cabins, condominiums, apartment units or other dwelling units, or portions of any of these dwelling units that are used for temporary human occupancy.

H.    Tax collection and remission agreement means a written agreement between a “transient lodging intermediary” as that term is used in State law and a person operating temporary lodging that requires the transient lodging intermediary to collect the tax imposed by this chapter, forward the full amount of the tax collected to the person operating the temporary lodging along with information as to the full amount of rent collected, and requires the person operating the temporary lodging to report the full amount of the rent paid and to remit the tax, less the authorized administration fee, to the City. A tax collection and remission agreement is not valid until approved by the City. [Ord. NS-2253, 2015; Ord. NS-2163, 2011]

12.05.015 Room Tax Imposed.

A.    Effective June 1, 2015, each occupant shall pay a tax in the amount of 10.4 percent of the rent. The occupant shall pay the room tax with the rent payment. Tax amounts shall be rounded down to the nearest cent. The operator shall maintain records of all rent charged and room tax payments received. The amount of the room tax shall be stated separately from rent or any other charges on all receipts or invoices issued by the operator. If rent is paid in installments a proportionate share of the room tax shall be paid by the occupant to the operator with each installment unless the operator pays the entire amount with the first payment.

B.    Bills and invoices provided to occupants shall list the City of Bend room tax separately and must accurately state the amount of room tax. All amounts listed as room tax on invoices or bills must be reported as room tax and, after collection, must be turned over to the City, less the five percent administrative charge. [Ord. NS-2253, 2015; Ord. NS-2218, 2014; Ord. NS-2173, 2011; Ord. NS-2163, 2011]

12.05.020 Collection of Room Tax by Operator.

Every operator shall collect the room tax at the time rent is paid, unless an exemption under BC 12.05.025 applies. If payment is by credit card, payment is made at the time credit card information is provided, not when the tax collector ultimately received credit for the transaction. The operator holds the room tax payment in trust for the City until the taxes are remitted to the City as provided in BC 12.05.035. An operator may commingle the tax proceeds with funds of the operator, but the operator is not the owner of room tax proceeds, except that, when a return is filed, the operator becomes the owner of the administrative fee authorized to be retained under BC 12.05.035. Operators may choose to file returns and remit payment based on amounts accrued but not yet collected, and if they do so, will be entitled to a credit for any uncollectibles. The operator is liable for any tax that should have been collected from the occupant, except in cases of nonpayment of rent by the occupant. [Ord. NS-2253, 2015; Ord. NS-2163, 2011]

12.05.025 Exemptions.

No room tax shall be imposed upon:

A.    The United States or an employee of the Federal government while on Federal business;

B.    A dwelling unit in a hospital, health care facility, long-term care facility or any other residential facility that is licensed, registered or certified by the Department of Human Services;

C.    A dwelling unit in a facility providing treatment for drug or alcohol abuse or providing mental health treatment;

D.    A dwelling unit that is available for public lodging for fewer than 30 days per year (e.g., a hunting lodge that is only open one month during the year);

E.    A dwelling unit, the consideration for which is funded through a contract with a government agency and the purpose of which is to provide emergency or temporary shelter;

F.    A dwelling unit at a nonprofit youth or church camp, nonprofit conference center or other nonprofit facility; or

G.    A dwelling unit that is leased or otherwise occupied by the same person for a consecutive period of 30 days or more. The requirements of this subsection are satisfied even if the physical dwelling unit changes during the consecutive period, if:

1.    All dwelling units occupied are within the same facility; and

2.    The person paying consideration for the temporary lodging is the same person throughout the consecutive period. [Ord. NS-2163, 2011]

12.05.030 Registration of Operator – Form and Contents – Execution – Certification of Authority.

Every person engaging or about to engage in business as an operator shall provide a completed registration form to the Tax Administrator within 15 calendar days after commencing business. The registration form shall require the operator to provide the name of the business, any separate business address, and other information as the Tax Administrator may require. Operators who own or operate lodging facilities in Bend shall provide the address of the lodging facility. The registration form shall be signed by the operator. The Tax Administrator shall, within 15 days after registration, issue without charge a certificate of authority to collect the tax. The obligation to collect the tax is imposed once rent for a room is paid, even if the registration form has not been filed or if the certificate has not been issued. Operators who function as transient lodging intermediaries as that term is defined by State law are not required to register if they have and comply with tax collection and remission agreements with all entities within the City of Bend for whom they rent rooms.

Certificates shall be nonassignable and nontransferable, and shall be surrendered to the Tax Administrator when the business is sold or transferred or when a lodging facility ceases to operate at the location specified in the registration form. Each certificate issued to an operator for a specific lodging facility shall be prominently displayed at the lodging facility and include:

A.    The name of the operator;

B.    The address of the lodging facility;

C.    The date the certificate was issued;

D.    The certificate number as assigned by the Tax Administrator. [Ord. NS-2253, 2015; Ord. NS-2163, 2011]

12.05.035 Remittance and Returns. Revised 5/19

A.    Operators shall submit a completed tax return form to the Tax Administrator for each calendar month by the fifteenth day of the following month, accompanied by remittance of all tax collected, less a five percent administration fee. If the estimated monthly amount of average tax due is $100.00 or less, the operator has the option of filing the return and remitting the tax on a quarterly basis on the fifteenth day of the month following the end of each calendar quarter (April 15, July 15, October 15, and January 15). Operators shall also submit any tax that was due but not collected if the rent on which the tax is based was paid, unless the rent and tax were paid to a third party and not passed on in full to the operator, in which case the operator shall pay at least the tax based on the amount of rent received by the operator.

B.    Remittances are delinquent if not made by the twenty-fifth day of the month in which they are due.

C.    Returns shall show the gross rents collected, exempt rents, taxable rents, the total amount of room tax collected and the amount of the administrative fee retained by the operator. Returns shall also show the exempt rents and the basis for exemptions.

D.    Tax returns and remittances may be submitted in person, electronically or by mail. If the return and remittance are mailed, the postmark shall be considered the date of delivery.

E.    For good cause, the Tax Administrator may extend the time for making any return or remittance of room tax by up to 30 days. No further extension shall be granted, except by the City Council. Any operator to whom an extension is granted shall pay interest at the rate of one percent per month on the amount of the remittance due without proration for a fraction of a month. If a return is not filed, and the remittance and interest due are not paid by the end of the extension granted, then the interest shall become a part of the room tax for computation of penalties.

F.    The Tax Administrator, in order to insure remittance of tax collected or facilitate collection, may in individual cases require returns and remittances more frequently than monthly periods. [Ord. NS-2323, 2019; Ord. NS-2253, 2015; Ord. NS-2163, 2011]

12.05.040 Penalties and Interest.

A.    Original Delinquency. Any operator who fails to remit room tax collected by the operator other than the five percent administrative fee prior to the date the remittance becomes delinquent shall pay a penalty of 10 percent of the amount due.

B.    Continued Delinquency. Any operator who failed to remit any delinquent amounts within 30 days after the date the remittance first became delinquent shall pay a second delinquency penalty of 15 percent of the amount due. The second delinquency penalty does not apply if the operator has, in good faith, filed a return accompanied by remittance of the amount calculated on the return, and pays the delinquent amount within 30 days after notification of the error. For example, if a good faith error is discovered during an audit three years later and the operator pays within 30 days of notification of the audit result, the second delinquency penalty will not be charged.

C.    Fraud. If the Tax Administrator determines that failure to make any remittance is intended to evade the provisions of this chapter, a penalty of 25 percent of the amount due is imposed in addition to all other penalties and remittance obligations.

D.    Interest. In addition to the penalties imposed, any operator who fails to remit any tax by the delinquency date shall pay interest at the rate of one percent per month or fraction of a month without proration for portions of a month on the amount due to the City, exclusive of penalties, from the date on which the remittance first became delinquent until paid.

E.    Penalties Merged with Tax. Every penalty imposed and accrued interest shall be merged with and become a part of the amount of room tax to be remitted by the operator.

F.    Petition for Waiver. An operator who has paid penalties may petition the City Council for waiver and refund of the penalty or a portion of the penalty. The City Council may waive and direct a refund of the penalty or a portion of the penalty for good cause.

G.    Settlements. The Tax Administrator may, after consultation with the City Attorney, adjust or enter into a settlement as regards any amount believed to be due if, as a result of a bankruptcy filing, foreclosure, bona fide legal or factual dispute, or similar circumstance, it is in the best interest of the City. [Ord. NS-2163, 2011]

12.05.045 Deficiency Determinations – Fraud, Evasion, Operator Delay. Revised 5/19

A.    Deficiency Determination. The Tax Administrator may review tax returns and adjust the amount due based on the information in the return, on information obtained during a review or audit of records, or on the basis of other evidence. In the event of a deficiency, the Tax Administrator shall provide notice of the deficiency to the operator, who shall remit deficiencies within 10 business days of the deficiency notice. Notice may be by electronic mail if an operator’s email address is on file or personal delivery or certified or registered mail.

1.    In reviewing and adjusting tax returns, the Tax Administrator shall offset any amount received in excess of the remittances due against any shortages in remittances.

2.    Except in the case of fraud or intent to evade the room tax, notice of deficiency determinations shall be issued within three years of the period for which the deficiency determination is made.

3.    The time to remit deficient amounts payment under this section shall be extended if the operator timely requests a redetermination under BC 12.05.050.

B.    Fraud, Refusal to Collect, Evasion. If any operator fails to collect, report or remit the room tax as required, submits a fraudulent return, or otherwise violates or attempts to violate this chapter, the Tax Administrator shall estimate the tax due, and calculate the amount owing from the operator for tax remittance, interest and penalties and provide notice to the operator of the assessment. The determination and notice shall be made and mailed within three years of the discovery by the Tax Administrator of the violation. The determination is due and payable upon receipt of notice and shall become final 10 business days after the date notice was delivered if no petition for redetermination is filed. Notice will be mailed electronically if a valid email address is on file and by first class mail. If the notice is only mailed first class, then the postmark shall be considered the date of delivery. [Ord. NS-2323, 2019; Ord. NS-2163, 2011]

12.05.050 Redeterminations. Revised 5/19

A.    Any person affected by a determination under BC 12.05.045 may file a petition for redetermination with the Tax Administrator within 10 business days of service of notice of the tax deficiency. A determination under BC 12.05.045 becomes final if a petition for redetermination is not timely filed.

B.    If a petition for redetermination is filed within the allowable period, the Tax Administrator shall reconsider the determination and grant an oral hearing if requested. The petitioner shall be allowed at least 20 business days to prepare for the hearing.

C.    After considering the petition and all available information, the Tax Administrator shall issue a redetermination decision and mail the decision to the petitioner. During the redetermination process, the Tax Administrator may agree to a compromise of the amount due if there is a good-faith dispute over the amount owing. The redetermination decision will be mailed electronically if a valid email address is on file and by first class mail. If the notice is only mailed first class, then the postmark shall be considered the date of delivery.

D.    The decision of the Tax Administrator on redetermination becomes final and payment is due 10 business days after the decision is mailed unless the petitioner files an appeal to the Council within that time. The appeal shall be filed with the Tax Administrator. The Council’s decision shall be final when reduced to writing and mailed to the petitioner and all amounts due must be paid within 10 business days of mailing of the Council decision. [Ord. NS-2323, 2019; Ord. NS-2163, 2011]

12.05.055 Security for Collection of Tax.

The Tax Administrator may require an operator to deposit security in the form of cash, bond or other security acceptable to the Tax Administrator. The amount of the security shall be fixed by the Tax Administrator but shall not be greater than twice the operator’s estimated average monthly liability for the period, or $5,000, whichever is less. The amount of security may be increased or decreased by the Tax Administrator so long as the minimum security remains in place. The operator may appeal any decision of the Tax Administrator requiring security under BC 12.05.085. [Ord. NS-2163, 2011]

12.05.060 Collection.

The City may bring legal action to collect on any amounts owed to the City under this chapter within three years after remittance is due to the City or within three years after any determination becomes final. [Ord. NS-2163, 2011]

12.05.065 Lien.

The City may record a lien in the City’s lien docket against any real property owned by the operator in the City as to any delinquent remittances by the operator. [Ord. NS-2163, 2011]

12.05.070 Refunds. Revised 5/19

A.    Refunds by the City to the Operator. If the operator remits more tax, penalty or interest than is due, the operator may file a claim in writing or electronically stating the facts relating to the claim, within three years from the date of remittance. If the claim is approved by the Tax Administrator, the excess amount shall be either refunded or credited on any amount due from the operator.

B.    Refunds by City to Occupant. An occupant may file a claim for refund by filing a claim in writing or electronically within three years of payment providing the facts relating to the claim for refund. If the Tax Administrator determines that the tax was collected and remitted to the city and the occupant was not required to pay the tax or overpaid, the City shall issue a refund.

C.    Refunds by Operator to Occupant. If an occupant has paid tax to an operator, but then stays a total of 30 or more consecutive days, the operator shall refund to the occupant any tax collected for any portion of the continuous stay. The operator shall account for the collection and refund to the Tax Administrator. If the operator has remitted the tax prior to the refund or credit to the tenant, the operator shall be entitled to a corresponding refund or offset if the claim for refund is filed within three years from the date of collection.

D.    Burden of Proof. The person claiming the refund shall have the burden of proving the facts that establish the basis for the refund. [Ord. NS-2323, 2019; Ord. NS-2163, 2011]

12.05.075 Authority of Tax Administrator. Revised 5/19

The Tax Administrator shall have the power to enforce this chapter, and to adopt rules, regulations and forms consistent with this chapter. Rules and regulations of general application shall be mailed and emailed to all registered operators. The Tax Administrator may also issue written interpretations on request of an operator. As to the operator to whom the interpretation is issued, the City will act consistently with the interpretation until it is withdrawn, and the City shall provide 30 days’ written notice of withdrawal of an interpretation. [Ord. NS-2323, 2019; Ord. NS-2163, 2011]

12.05.080 Administration.

A.    Use of Room Tax Funds. Thirty-one and one-fifth percent of total room tax revenues will be used for tourism promotion. The City may enter into contracts with any entity for tourism promotion.

Thirty percent of room tax revenues received by the City based on any increment of tax between a nine percent tax rate and a 10.4 percent tax rate shall be used for police and fire services.

B.    Records Required from Operators. Every operator shall keep records of each transaction involving rent and/or collection of tax. All records shall be retained for at least three years and six months.

C.    Examination of Records – Investigations. The Tax Administrator or agent may examine all records of an operator relating to receipt of rent and tax and remittance of tax during normal business hours and may obtain copies of the records to audit returns.

D.    Confidential Character of Information Obtained – Disclosure Unlawful. The City shall maintain the confidentiality of information provided by operators. Nothing in this subsection shall be construed to prevent:

1.    The disclosure to, or the examination of records and equipment by, another City official, employee or agent for collection of taxes for the purpose of administering or enforcing any provisions of this chapter or collecting City business license fees.

2.    Disclosure of information to the operator and the operator’s agents.

3.    The disclosure of the names and addresses of any persons to whom Certificates of Authority have been issued.

4.    The disclosure of general statistics regarding taxes collected or business done in the City.

5.    Disclosures required by ORS Chapter 192. [Ord. NS-2291, 2017; Ord. NS-2218, 2014; Ord. NS-2163, 2011]

12.05.085 Appeals to City Council.

Any person aggrieved by any decision of the Tax Administrator may appeal to the City Council by filing a written appeal with the Tax Administrator within 10 business days of the serving or mailing of the decision being appealed. The City Manager shall schedule the hearing on a Council agenda and provide the appellant notice of the hearing at least 10 business days before the hearing. The City Council may agree to a compromise of the amount of tax remittance if there is a good faith dispute over the amount owing. Any person may appeal the issuance of a rule or regulation issued by the Tax Administrator to the Council by filing a written appeal within 10 business days of the mailing of the notice of the regulation. [Ord. NS-2163, 2011]

12.05.090 Penalty.

A violation of this chapter is a Class A civil infraction. Failing to register or file a return when required or submitting false or misleading information in a registration or return are violations of this chapter. Each day that a violation for failing to register, file a return, or remit when due remains uncured is a separate infraction. The Municipal Court may increase the amount of penalty up to 10 times the normal penalty imposed on an operator if the Municipal Court Judge finds that the operator collected the tax imposed by this chapter and intentionally failed to remit the tax proceeds to the City when required by this chapter. All amounts listed as room tax in bills or invoices issued by the operator shall be considered tax collected by the operator, unless the operator received no payment on the bill or invoice. [Ord. NS-2163, 2011]