TOT appeal denied
The Mammoth Lakes Town Council squeezed another Transient Occupancy Tax (TOT) enforcement appeal hearing into an already packed schedule at Wednesday’s meeting, considering the case of property owner James Kaviani. Kaviani came to the Town’s attention last year, when the Town determined he had been renting his home for a three-year period, from September 2009 to August 2012, without paying TOT. Town staff assessed the period and came up with an estimate based on nightly rates received through sting emails, as well as additional information provided through website advertisement, of $20,980 owed in taxes, penalties and interest.
The Kavianis contested this amount before the Tax Collector in January 2013, providing detailed accounts including rental dates and bank statements. According to this documentation, the Kavianis had collected $46,905 in rent from October 2010 to September 2012. “The information provided was reasonable,” said Town Tax Collector Shannon Freeman, and the $20,980 assessment was reduced to $8,722, including past taxes, penalties, interest, and enforcement charges.
Although James Kaviani is the property owner, it was his daughter Christina Kaviani who responded to the sting emails, acting as booking agent, and it was his daughter who came in to the Town offices and paid past due TOT and interest after the first warning. According to the documentation provided by the Kavianis during their appeal to the Tax Collector, all bank statements were also under Christina Kaviani’s name.
Yet it was James Kaviani, confined to a wheelchair after a car accident several years ago, who appeared this week before the Town Council to appeal the charges. Kaviani had paid the $6,097 in past due TOT, he said, but was contesting the additional $2,671 in penalties and interest. “My complaint is against the method used to collect what the Town calls ‘TOT,’” Kaviani said. He noted changes in meeting dates, “[Which] they forgot to let me know,” as well as documents he said he did not receive in time to comment.
Kaviani also asserted that the Town had incorrectly calculated the interest due, citing $1,224 in interest as part of the original, $20,980 assessment, and $1,358 in interest in the final Notice of Determination for $8,722. “I feel that the whole operation wasn’t conducted correctly, and has put me through a lot of unnecessary pain and discomfort,” he said. “Basically, since they screwed up the whole operation in my case, I would like to be compensated by not having to pay the penalties.”
What Kaviani failed to note is that while the calculated interest may have gone up, the penalties actually went down, from $3,872 to $1,741. As Freeman pointed out, the original assessment was a rough estimate according to the available information; the Notice of Determination “has the correct periods for taxes due, in addition to penalties and interest,” she said. Moreover, she said, “The Notice of Determination was sent on January 15. We never received any information from anybody that the interest was incorrect, or that there were any problems. The interest is accurate, up until the time [Kaviani] paid.”
Council member Matt Lehman offered sympathy to Kaviani, but maintained that the Council should uphold the interest, penalties and fees. “It seems like every time we hear a case there’s some different reason as to why folks have trouble or an issue with why penalties and interest or even the TOT is due,” he said. “My personal thoughts are that in this particular case, we have a property owner that’s essentially agreed to the fact that this TOT is due, and we have a system in place whereby we do outline penalties and interest and enforcement, and while I can sympathize with the fact that there may be confusion on the part of the owner, we have laws in place. This is how the Town functions. This is how we remove snow on our streets, provide police protection, and everything else in our community. I think it’s important to understand that the Town needs to take a hardline stance on where we are with this.”
Town Council voted unanimously to enforce the $2,671 in interest, penalties and enforcement fees.
