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ORD2022.1471-Room Tax COMMON COUNCIL - CITY OF MUSKEGO ORDINANCE #1471 AN ORDINANCE TO ADD CHAPTER 286 TO THE MUNICIPAL CODE OF THE CITY OF MUSKEGO (Room Tax) THE COMMON COUNCIL OF THE CITY OF MUSKEGO, WISCONSIN, DO ORDAIN AS FOLLOWS: SECTION 1: Chapter 286 is hereby added to the Municipal Code of the City of Muskego to read as follows: § 286-1. Definitions. The definitions set forth in Wisc. Stats. § 66.0615(1) are incorporated herein by reference. § 286-2. Room Tax Imposed. Pursuant to Wis. Stats. § 66.0615, a tax is imposed on the privilege of furnishing, at retail, rooms or lodging to customers by hotel keepers, motel operators, marketplace providers, owners of short-term rentals and other persons furnishing accommodations that are available to the public, irrespective of whether membership is required for the use of the accommodations. Such tax shall be at the rate of eight (8%) percent of the gross receipts from such retail furnishing of rooms or lodging. Such tax shall not be imposed on sales to the Federal Government and persons listed under Wis. Stats. § 77.54(9a). § 286-3. Distribution of Taxes Collected. The proceeds of such tax when collected shall be apportioned 30% to the City for general purposes and the remaining 70% shall be forwarded to a tourism entity to be spent on tourism promotion and development as defined in Wis. Stats. § 66.0615(1)(fm). § 286-4. Permit. A. Every person furnishing rooms or lodging under this chapter shall file with the City Clerk an application for a room tax identification permit for each location where such rooms or lodging is provided (“Lodging”). Every application shall be made upon a form prescribed by the City Clerk and shall set forth the name under which the applicant intends to provide lodging, location of the lodging, and such other information as the City Clerk requires. The application shall contain an authorization to the Wisconsin Department of Revenue to release sales tax returns and information to the City Clerk. The application shall be signed by the owner if residential property and, if not a residential property, by the person responsible who is authorized to act on behalf of the entity owning the lodging. Ord. #1471 2 B. After compliance with Subsection A above, the City Clerk shall grant and issue to each applicant a separate permit for each place of business within the City. Such permit is not assignable and is valid only for the person or entity in whose name it is issued and for the transaction of business and collection of the room tax at the place designated therein. It shall at all times be conspicuously displayed at the place for which it is issued. C. No permit under this section shall be granted or issued to any person or for any premises for which taxes or charges owed to the City are delinquent and unpaid. D. If the grant or issuance of a permit is denied for nonpayment of taxes or charges, the City Clerk shall notify the applicant in writing that the permit will not be granted or issued because of nonpayment of taxes or charges. The applicant may appeal the decision to the Finance Committee which may grant or deny the permit after affording the applicant a Hearing before the Finance Committee to be conducted in accordance with Chapter 6 of the Muskego Municipal Code. § 286-5. Notification by Owner. Every owner who rents their residential dwelling shall notify the City Clerk, in writing, when the first rental within a 365-day period began. § 286-6. Tourist Rooming House License/Short Term Rental License. Any person who maintains, manages or operates a short-term rental as defined in Wis. Stats. § 66.0615(dk)for more than ten nights each year shall obtain a tourist rooming house license as defined in Wis. Stats. § 97.01(15k); said person shall also obtain a short-term rental license in accordance with § 297-3 of the Muskego Municipal Code. § 286-7. Administration. A. Each person covered by this section shall submit a quarterly report to the City Clerk showing the gross receipts from furnishing such accommodations, rooms or lodging, along with a copy of the State Sales Tax Report for said business along with the effective percentage tax for the gross receipts as reported, by no later than 30 days from the end of each calendar quarter for the receipts of that past calendar quarter. All quarterly reports shall be signed by the person required to file a report or their authorized agent, but need not be verified by oath. The reporting period shall run from January 1st through December 31st of a calendar year. B. Taxes not paid with the report shall bear interest at the legal rate from the due date of the report. Failure to pay the tax, or delinquent payment of such taxes, shall be subject to a late filing penalty of $10.00 in addition to the interest imposed herein. C. Whenever the City has probable cause to believe that the correct amount of room tax has not been assessed or that the tax return is not correct, the City’s financial officers may inspect & audit the financial records of any person subject to § 286-2 above pertaining to the furnishing of accommodations to determine whether or not the correct amount of room tax is assessed and whether or not any room tax return Ord. #1471 3 is correct. As used in this section, “probable cause” means facts and circumstances within a person’s knowledge and of which he or she has reasonable trustworthy information that is sufficient to warrant a reasonable person in believing that a violation has been or is being committed. D. Any person who fails to comply with a request to inspect and audit the person’s financial records under Subsection C above shall pay a forfeiture of 5% of the tax due the City at the time of the audit. E. If any person required to make a report fails, neglects, or refuses to do so for the amount and in the manner, form, and time prescribed in this section, the City Clerk, according to his or her best judgment, shall determine the amount of the tax due the City and make a doomage assessment upon the person who fails to file and pay on a timely basis. F. Each person who is subject to Subsection E above shall pay an amount of taxes the City determines to be due under Subsection E plus interest at the rate of 1% per month on the unpaid balance. No refund or modification of the payment determined may be granted until the person files a correct room tax report and permits the City to inspect and audit the financial records as provided in Subsection C above. § 286-8. Confidentiality. Information obtained under this chapter shall be confidential, except the City Clerk may provide information to persons using the information in the discharge of duties imposed by law, the duties of their office, or by order of a court. Publication of statistics pertaining to room taxes received in the City of Muskego may be published so long as such statistics do not disclose the identity of particular tax returns. Any person violating the confidentiality provided for in this section may be required to pay a forfeiture of not less than $100.00 nor more than $500.00. § 286-9. Failure to Pay Tax When Due. A. Any person who fails to pay the tax due herein shall pay a forfeiture of 25% of the room tax due for the previous year or $5,000.00, whichever is less. B. The tax imposed by this chapter shall become delinquent if not paid within 30 days after the due date of the report. If a report is filed late, or there is no report filed, the due date for the taxes imposed is the due date of the report. § 286-10. Severability. If any portion of this chapter is ever determined by a court of competent jurisdiction to be unconstitutional or otherwise unenforceable, said portion shall be removed so as to allow the remaining provisions of this chapter to be enforceable. SECTION 2: The several sections of this ordinance are declared to be severable. If any section or portion thereof shall be declared by a decision of a court of competent jurisdiction to be invalid, unlawful, or unenforceable, such decision shall apply only to the Ord. #1471 4 specific section or portion thereof directly specified in the decision, and not affect the validity of all other provisions, sections, or portion thereof of the ordinance which shall remain in full force and effect. Any other ordinances whose terms are in conflict with the provisions of this ordinance are hereby repealed as to those terms that conflict. SECTION 3: This ordinance is in full force and effect from and after passage and publication subject to approval. PASSED AND APPROVED THIS 12th DAY OF APRIL 2022. CITY OF MUSKEGO _______________________________ Rick Petfalski, Mayor First Reading: March 22, 2022 ATTEST: Clerk-Treasurer Summary of Ordinance Published: ________, 2022 3/22cmc