City may review B&Bs' lodgers' tax payments.
Adobe Abode, Casa de la Cuma and Pueblo Bonito.
These are some of the names that come to mind for Santa Fe visitors seeking a different sort of lodging experience in the City Different.
But as cozy as such bed and breakfasts can be, one city councilor has begun raising questions as to whether
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proprietors of bed and breakfast establishments are doing their fair share to support the city's economy. Specifically, Councilor Karen Heldmeyer wants to know if B&B owners are paying their legally mandated city lodgers' taxes and has requested a review of the matter.
"I would like the city to inquire as to who's paying lodgers' taxes and who's not," Heldmeyer says. "That revenue is supposed to compensate the city and offset the costs associated with tourists."
The councilor's concerns were first raised at the Sept. 13 City Council meeting and stem from her own cursory investigation. Earlier this month, Heldmeyer says she obtained a current list of all establishments that pay lodgers' taxes in Santa Fe and compared those businesses with Yellow Page listings.
Heldmeyer says she found 22 lodging entities that did not appear to have paid the requisite taxes. Ten were hotels, seven were B&Bs and five were vacation rentals. City law requires that all establishments that rent out three or more rooms for less than 30 consecutive
days pay the lodgers' tax, a 7 percent cut of every room charge.
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Heldmeyer would not reveal to SFR which establishments were no-shows on the city's lodgers' tax documents because, she says, it's possible that some of them might have indeed legally paid their taxes under a different name. Heldmeyer also would not release the list of those lodging establishments that did ante up, because City Attorney Frank Katz advised her that such information is not public record. Katz tells SFR that the city ordinance prohibits revealing the information because the city considers it confidential.
"Sure, it might be nice to know for any number of reasons," Katz says, "but we want you to tell us the truth when you pay your taxes. We don't want you to be reluctant with the information you give us. So we're not going to use that information for other purposes."
An amendment sponsored by Heldmeyer that would allow such information to become public record is currently working its way through city government. Heldmeyer also has requested that City Manager Asenath Kepler provide her with staff to conduct an inquiry into the situation.
Three local B&B owners randomly contacted by SFR say they are paying the tax and have no problem shelling out the dough.
"We pay the tax to the city every month," says Shaan Minhas, co-owner of Casa de la Cuma north of the Plaza. "We just feel fortunate to be part of this business in Santa Fe."
Amy Behm, innkeeper at Pueblo Bonito on Manhattan Avenue, says she too pays the tax and believes most of her colleagues in the B&B business do as well.
"Anybody who sets up a business in this town should follow the rules of the industry," Behm says.
Andy Duettra, owner of Adobe Abode on Chapelle Street, was surprised to hear that some B&B owners may not be paying their fair share of the lodgers' tax, even though he hasn't witnessed any active enforcement.
"I wish I'd known that there was an option," Duettra jokes. "I've never had anybody come and check or anything. I suppose if I didn't pay my taxes I might get a call, but I always pay my taxes. Obviously, if there's going to be a tax, it's probably best that everybody pays it."
Art Bouffard, president of the New Mexico Lodging Association and executive director of the Santa Fe Lodgers Association, helped write the state lodgers' tax law. Bouffard speculates that most proprietors are in compliance. Moreover, he says that the city stands to lose a lot more tax revenue from vacation rentals than bed and breakfasts.
Short-term rentals have been a source of recent controversy as some east-side residents and the Neighborhood Network have publicly raised concerns over the behavior of unruly short-term renters and whether the city is adequately enforcing its own laws on the issue. Rentals of fewer than 30 days are prohibited by city code.
"I don't think there are a whole lot of bucks in whether or not B&Bs are paying lodgers' tax," Bouffard says. "I think that most of them are. What really is an issue is rental properties. That's where I think we have a disconnect, where I don't think collections have necessarily been collected."
Either way, Heldmeyer is hopeful that city government will be able to get clarification on the lodgers' tax as soon as possible.
"It's the fair thing to do," Heldmeyer says. "Especially if some people are paying it and some aren't."
