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TC Ord. No. 1988-14I i i ORDINANCE NO. 88-14 ' AN ORDINANCE IMPOSING AN EXCISE TAX FOR GENERAL REVENUE PURPOSES ON THE OCCUPANCY OF TIME-SHARE UNITS WITHIN THE TOWN OF AVON; PROVIDING METHODS FOR THE COL- LECTION THEREOF; AND PROVIDING PENALTIES FOR THE VIOLATION HEREOF; AND PROVIDING FOR OTHER DETAILS IN RELATION THERETO. i WHEREAS, section 3.32.030 of the Municipal Code of i the Town of Avon imposed a tax on the use of any time-share unit within the Town; and WHEREAS, the aforesaid section 3.32.030 was determined to be invalid by the District Court for Eagle County in civil action no. 87CV936 on October 4, 1988; and WHEREAS it is the intent and purpose of the Town Council in the enactment hereof to comply with the decision of the District Court aforesaid; and i j WHEREAS, the Town Council finds and determines that short-term occupancy of time-share units within the Town has an impact on the provision of municipal services greater than that of other short-term occupancies in that sales and accommodations taxes are not derived from the occupancy of time-share units when those units are occupied by the owners thereof; and WHEREAS, the intent and purpose of the Town Council in the enactment hereof is to make uniform the imposition of excise taxes on the occupancy of short-term residential units within the Town; 0 i NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO: Section 1. Amendment. Title 3 of the Municipal Code of the Town of Avon is amended by the addition of a new Chapter 3.36 as follows: "Section 3.36.010 Definitions, A. 'Person' means any individual, corpora- tion, business trust, estate, trust, partnership, association or other legal entity. The singular thereof shall include the plural. B. 'Time-share unit' means time-sharing unit as defined in Section 17.08.650 of the Municipal Code of the Town of Avon, as from time to time amended. C. 'Time-share project' means any building or buildings or portions thereof approved by the Town Council of the Town to include time-share units. D. 'Director of finance' or 'director' means the person duly appointed to that office by the town manager. The term shall include any designee of the director." "Section 3.36.020 Imposition of tax. There shall be collected and paid as a tax the amount of $10.00 per night on the occupancy of any time-- share unit within the Town." "Section 3.36.030 Payment and collection required. It shall be a violation of this chapter for any occupant of a time-share unit to fail to pay or for any owners association of any time- share project or its rental agent to fail to collect the tax imposed by this chapter." "Section 3.36.040 Credit for sales or accommodations taxes paid. The tax imposed hereby shall not apply to the occupancy of any time-share unit if such occupancy is subject to a sales or accommodations tax or if such occupancy is for a time-period exceeding thirty days. A credit shall - 2 - • • be granted against the tax imposed hereby in the amount of sales and accommodations taxes paid to the Town; provided, the amount of the credit shall not exceed the amount of the tax imposed hereby." "Section 3.36.050 Duty to obtain license. Every person who has the duty to collect the tax imposed by this chapter shall obtain a license to collect the tax. A license issued to collect the Town's sales tax shall be deemed to be a license to collect the tax imposed by this chapter." "Section 3.36.060 Duty to keep books and records. It shall be the duty of every person required by the provisions of Section 3.36.050 to obtain a license, to keep and preserve suitable records and such other books or accounts as may be necessary to determine the amount of tax for the collection of which he is liable hereunder. It shall be the duty of every such person to keep and preserve for a period of three years all such records, and all such books, invoices and other records shall be open for examination at any time by the director of finance or his duly authorized agents." "Section 3.36.070 Tax Return. A. Every person required to obtain a license pursuant to the provisions of Section 3.36.050 shall file a tax return, upon forms approved by the director of finance, on or before the twentieth day of each calendar month for the activities of the preceding calendar month; providing, however, that if the accounting methods regularly employed or other conditions are such that reports made on a calen- dar monthly basis will impose unnecessary hard- ship, the directory may, upon request, accept reports at such intervals as will, in his opinion, better suit the convenience of the taxpayer. B. The returns so filed shall contain such information as may enable the director to ac- curately determine the amount of tax collected by the person filing the return, but, in all cases, shall contain the following information: 1. The total number of nights of occupancy of time-share units and the amount of tax derived therefrom. 2. The total amount of sales taxes collected and paid to the Town. - 3 - • C. The return shall be accompanied by an amount equal to the tax required to be collected which, in no case, shall be less than the amount actually collected." "Section 3.36.080 Examinations of returns-- Refunds--Deficiencies--Notice of appeal. A. As soon as practicable after any return is filed, the director of finance shall examine it, and if it then appears that the correct amount of tax to be remitted is greater or less than that shown in the return, the tax shall be recomputed. B. If the amount paid exceeds that which is due, the excess shall be refunded or credited against any subsequent remittance from the same taxpayer. C. If the amount paid is less than the amount due, or if the director of finance deter- mines that any amount of tax is due and unpaid, for any reason, the difference between the amount paid and the amount owed to the town, together with interest thereon at the rate of one and one-half percent per month from the time the return was due (unless provided otherwise herein), shall be paid within fifteen days after written notice and demand from the director of finance. D. In the event a taxpayer or person receiv- ing demand desires to appeal the decision of the director of finance, written notice of appeal shall be delivered to the director within fifteen days of the date of the demand. "Section 3.36.090 Investigation of books. For the purpose of ascertaining the correctness of a return, or for the purpose of determining the amount of tax due from any taxpayer, the director of finance may hold investigations and hearings concerning any matters covered by this section, and may examine any relevant books, papers, records, or memoranda of any such person, requiring the attendance of such taxpayer, or any officer or employee of such taxpayer, or of any person having knowledge of such sales, and taking such testimony and proof as may be necessary to properly ascertain any tax liability. The direc- tor shall have power to administer oaths to any person in the course of such investigations or hearings. Production of documents and attendance of witnesses shall be requested by the director on - 4 - • 1] i i his own motion or on motion of any party; any request for production or attendance shall inform persons that compliance is voluntary but that, if the request is not complied with, the director may apply to the municipal judge for issuance of a subpoena." "Section 3.36.100 Judge compels attendance. The municipal judge of the town, upon the applica- tion of the director of finance, may compel the attendance of witnesses, the production of books, papers, records or memoranda, and the giving of testimony before the director of finance or any of his duly authorized agents, by the issuance and enforcement of subpoenas, in the same manner as production of evidence may be compelled before the court." "Section 3.36.110 Tax information confiden- tial. A. Except in accordance with judicial order, or as otherwise herein provided, the town i shall not divulge any information gained from any return filed or as a result of any investigation or hearing held pursuant to the provisions of this section. B. Nothing contained in this subsection shall be construed to prohibit: 1. The delivery to a person, or to his duly authorized representative, of a copy of any return filed in connection with his tax; 2. The publication of statistics so classified as to prevent the identification of particular reports or returns and the items thereof; 3. The inspection by the town attorney, or any other legal representative of the town, of the return or other information relating to any taxpayer who may become involved in litigation with the town in which the said information may become material. C. Reports and returns shall be preserved for three years, and thereafter until the director of finance, with the approval of the town manager, shall order them destroyed." "Section 3.36.120 Unpaid tax a prior lien. - 5 - • A. The tax imposed by Section 3.36.020 shall be a first and prior lien upon the common elements of the time-share project as well as upon the personal property of the owners association thereof until said taxes are paid in full. B. The lien created by subsection A above shall take precedence over all other liens, encumbrances or claims of whatsoever nature and shall immediately attach to such items without the necessity of the filing of any notice of lien thereof." "Section 3.36.130 Enforcement of tares and foreclosure of liens. A. If any taxes, penalty or interest imposed by this chapter and shown due by returns filed by the taxpayer, or as determined pursuant to Section 3.36.211 are not paid within fifteen days after the same are due, the director of finance shall issue a warrant under his of- ficial seal directed to any public safety officer of the Town commanding him to levy upon, seize and sell sufficient real and personal property which is subject to the lien created by Section 3.36.120 for the payment of the amount due, together with interest, penalties and costs. B. Simultaneously with the issuance of said warrant, the director shall issue a notice of tax lien, setting forth the name of the taxpayer, the amount of the tax, penalties, interest and costs, the date of the accrual thereof, and that the town claims a first and prior lien therefor on the real and personal property of the taxpayer subject to said liens. C. Such notice shall be on forms prepared by the director, shall be verified by him and shall be filed in the office of the clerk and recorder of Eagle County. D. Upon the filing of said notice of lien, the effective date of the lien shall relate back to the date of the first transaction for which any tax is due." "Section 3.36.140 Notices sent by mail. All notices required to be given under the provisions of this chapter shall be in writing and, if mailed to a last-known address, shall be sufficient for the purposes of this chapter." - 6 - J • "Section 3.36.150 License and tax in addi- tion to all other taxes. The tax imposed by this chapter shall be in addition to all other taxes imposed by law, except as herein otherwise provid- ed." "Section 3.36.160 Administration. The administration of all the provisions of this chapter is vested in the director_ of finance, who may, with the approval of the town manager, prescribe forms and reasonable rules and regula- tions in conformity with this chapter for the making of returns, for the ascertainment, assess- ment and collection of the taxes imposed here- under, and for the proper administration and enforcement hereof, a copy of which forms, rules and regulations shall be made available to the public." "Section 3.36.170 Unlawful acts. It is unlawful for any person to fail to perform any affirmative duty required by this chapter, or to wilfully make, prepare or submit a tax return or other document containing any false statement, or to wilfully make a false statement in any inves- tigation or hearing, which may affect the tax liability of any person." "Section 3.36.180 Limitation of action. A. No tax or interest thereon or penalties with respect thereto, shall be assessed, nor shall any notice of lien be filed, or distraint warrant issued, or suit for collection be instituted, nor any other action to collect the same be commenced, more than three years after the date on which the tax was or is payable; nor shall any lien continue after such period, except for taxes assessed before the expiration of such period, notice of lien with respect to which has been filed prior to the expiration of such period, in which cases such lien shall continue only for one year after the filing of notice thereof. In the case of a false or fraudulent return with intent to evade tax, the tax together with interest and penalties thereon, may be assessed, or proceedings for the collection of such taxes may be begun at any time. Before the expiration of such period of limitation, the taxpayer and the director of finance may agree in writing to an extension thereof, and the period so agreed on may be extended by subsequent agreements in writing. - 7 - 0 0 B. In the case of failure to file a return, the tax may be assessed and collected at any time." "Section 3.36.190 Interest on underpayment, nonpayment, or extensions of time for payment of tax. A. If any amount of tax is not paid on or before the last date prescribed for payment, interest on such amount at the rate imposed under Section 3.36.212 shall be paid for the period from such last date to the date paid. The last date prescribed for payment shall be determined without regard to any extension of time for payment and shall be determined without regard to any notice and demand for payment issued, by reason of jeopardy, prior to the last date otherwise pre- scribed for such payment. In the case of a tax in which the last date for payment shall be deemed to be the date the liability for the tax arises, and in no event shall it be later than the date notice and demand for the tax is made by the director of finance. B. Interest prescribed under Sections 3.36.190 through 3.36.212 on any tax may be i assessed and collected at any time during the period within which the tax to which such interest relates may be assessed and collected." "Section 3.36.200 Deficiency due to negli- gence. If any part of the deficiency in payment of the tax is due to negligence or intentional disregard of the ordinances or of authorized rules and regulations of the town with knowledge there- of, but without intent to defraud, there shall be added ten percent of the total amount of such deficiency from the time the return was due, from the person required to file the return, which interest and additional interest shall become due and payable ten days after written notice and demand to him by the director of finance. If any part of the deficiency is due to fraud with the intent to evade the tax, then there shall be added one hundred percent of the total amount of the deficiency and in such case, the whole amount of the unpaid tax, including interest and the defi- ciency, shall become due and payable ten days after written notice and demand by the director of finance and an additional three percent per month on said amount shall be added from the date the i return was due until paid. - 8 - 0 0 li "Section 3.36.211 Neglect or refusal to make return or to pay. If a person neglects or refuses I to make a return in payment of the tax or to pay any tax as required, the director of finance shall make an estimate, based upon such information as may be available, of the amount of taxes due for the period for which the taxpayer is delinquent and shall add thereto a penalty equal to the sum of fifteen dollars for such failure or ten percent thereof and interest on such delinquent taxes at the rate imposed under Section 3.36.212 plus one-half percent per month from the date when due, not exceeding eighteen percent in the aggregate." j Section 3,36.12 Rate of interest. When j' interest is required or permitted to be charged under any provisions of Sections 3.36.190 through 3.36.211, the annual rate of interest shall be that established by the state commissioner of jl banking pursuant to C.R.S. Section 39-21-110.5" "Section 3.36.213 Other remedies. Nothing in Sections 3.36.190 through 3.36.212 shall I; preclude the town from utilizing any other appli- cable penalties or remedies for the collection or enforcement of taxes. The amount of tax due, together with penalties and interest, shall be deemed to be a debt of the owners association and of each occupant of a time-share unit." "Section 3.36.214 Final decision of town-- Appeals--Posting of bonds. A. Within fifteen days after filing a notice of appeal as provided I' in Section 3.36.080, the taxpayer shall file with the district court a surety bond in twice the amount of taxes, interest, and other charges stated in the final decision by the director of finance which are contested on appeal. The l taxpayer may, at his option, satisfy the surety bond requirement by a savings account or deposit in or a certificate of deposit issued by a state or national bank or by a state or federal savings and loan association, in accordance with the provisions of C.R.S., Section 11-35-101(1), equal to twice the amount of the taxes, interest, and other charges stated in the final decision by the director of finance. B. The taxpayer may, at his option, deposit the disputed amount with the director of finance I in lieu of posting a surety bond. If such amount is so deposited, no further interest shall accrue - 9 - 0 • on the deficiency contested during the pendency of the action. At the conclusion of the action, after appeal to the supreme court or the court of appeals or after the time for such appeal has expired, the funds deposited shall be, at the direction of the court, either retained by the director of finance and applied against the deficiency or returned in whole or in part to the taxpayer with interest at the rate imposed pursu- ant to Section 3.36.212. No claim for refund of amounts deposited with the director of finance need be made by the taxpayer in order for such amounts to be repaid in accordance with the direction of the court." Section 2. Repeal. Sections 3.32.030, 3.32.050 and 3.32.120, Chapter 32 of Title 3, Municipal Code of the Town of Avon are repealed; provided, such repeal shall not extinguish any amount determined to have been owing pursuant thereto. In the event that the tax imposed by this Ordi- nance should be held to be invalid and the decision of the District Court in civil action no. 87 CV 936 also reversed, i then the aforesaid sections shall be reinstated. i Section 3. Revival of Contract Liabilitv. If the tax imposed by this Ordinance shall be determined to be Iinvalid, such determination shall revive and reinstate any contract liability of the owners association of any manage- I ment company for any recreational or other fee established by subdivision agreement. I Section 4. Effective date. This Ordinance shall become effective on December 1, 1988. Section 5. Severability. If any part, section, I sentence, clause or phrase of this Ordinance is for any i j reason held to be invalid, such decision shall not affect - 10 - • 0 the validity of the remaining portions of this Ordinance; and the Town Council for the Town of Avon hereby declares it would have passed this Ordinance and each part, section, sub-section, sentence, clause or phrase thereof, irrespec- tive of the fact that any one or more parts, sections, sub-sections, sentences, clauses or phrases be declared invalid. I~ Section 6. Violations and Penalties. It is unlawful for any person to violate any provision hereof. I' Any person who violates any provision of this Ordinance shall be punished by a fine of not more than five hundred dollars or by imprisonment for a period of not more than ninety days or by both such fine and imprisonment; provided, no person under the age of eighteen years shall be punished by imprisonment. Any such person shall be guilty of a separate offense for each and every day during any portion of which a violation of any provision of this code is committed, continued, or permitted by such person and shall be punished accordingly. INTRODUCED, PASSED ON FIRST READING, APPROVED AND ORDERED POSTED, THIS 22nd day of November, 1988 and a public hearing on this Ordinance shall be held at the regular meeting of the Town Council of the Town of Avon, Colorado, on the 13th day of December, 1988 at 7:30 P.M. in the Municipal Building of the Town of Avon, Colorado. ATTEST: /s/ Gloria McRory Gloria McRory, Mayor Pro Tem /s/ Patricia J. Doyle Patricia J. Doyle, Town Clerk - 11 - • E INTRODUCED, PASSED ON SECOND READING, APPROVED AND ORDERED POSTED this 27th day of December , 1988, Allan Re Notting am, Mayor A1rTEtST e Patricia Doy e, own Clerk KORD5112388 I; I'. i I I - 12 - i I STATE OF COLORADO ) COUNTY OF EAGLE ) SS TOWN OF AVON ) NOTICE IS HEREBY GIVEN OF A PUBLIC HEARING BEFORE THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO, AT 7:30 P.M. ON THE 13th DAY OF DECEMBER, 1988, AT THE TOWN HALL FOR THE PURPOSE OF CONSIDERING THE ADOPTION OF ORDINANCE NO. 88-14, SERIES OF 1988: AN ORDINANCE IMPOSING AN EXCISE TAX FOR GENERAL REVENUE PURPOSES ON THE OCCUPATION OF TIME-SHARE UNITS WITHIN THE TOWN OF AVON; PROVIDING METHODS FOR THE COLLECTION THEREOF; AND PROVIDING PENALTIES FOR THE VIOLATION HEREOF. A copy of said Ordinance is attached hereto, and is also on file at the office of the Town Clerk, and may be inspected during regular business hours. Following this hearing the Council may consider final passage of this ordinance. This notice is given and published by order of the Town Council of the Town of Avon, Colorado. Dated this 25th day of October, 1988. OF,AVON , COL BY:A Zel , Patricia J./)60ylV, T n Cler POSTED AT THE FOLLOWING PUBLIC PLACES WITHIN THE TOWN OF AVON ON OCTOBER 27 , 1988: THE AVON POST OFFICE IN THE MAIN LOBBY THE CITY MARKET IN THEMAIN LOBBY C-MART AND; THE AVON MUNICIPAL BUILDING IN THE MAIN LOBBY