San Gabriel council upholds $19,107.75 tax bill for Champion Motel; 30-day payment deadline set

The San Gabriel City Council on Aug. 19 upheld a finance director's recalculation that Champion Motel owes $19,107.75 in unpaid transient occupancy tax (TOT) for three delinquent quarters and ordered the amount to be paid within 30 days.

Finance Director Will Kahulakula told the council that the original director's estimate used a $100 nightly rate and a 50% occupancy assumption, producing a $33,915 liability. After a hearing with motel representatives and post-shutdown site observations by city staff, the finance office recalculated the liability using a $33.33 nightly rate and an 18-room occupancy level, producing the $19,107.75 figure that the council upheld.

The council's vote followed an evidentiary hearing in which Champion Motel's representative disputed the occupancy and nightly-rate assumptions used to compute the tax. The motel's owner, ChenYong Xiao (through a translator), said she believed only eight to 10 units were occupied and presented refund receipts she said supported a $33.33 rate and roughly eight refunds. Kahulakula said those receipts were considered but that written statements from an on-site police officer and the city's code enforcement officer indicated about 18 occupied units when the property was shut down.

Officer Esther C., who assisted with relocation of displaced tenants during the shutdown, told the council she and other city staff contacted roughly 30 to 35 people at the property during the week leading up to the closure and found personal belongings in most rooms. Code enforcement also cited multiple health and safety violations that led to the closure. The finance director said staff used the best available evidence under San Gabriel Municipal Code section 35.063 to determine the tax due when the operator failed to file TOT returns.

The council's action accepted into evidence the written statements and photos submitted by both the city and the motel and upheld the director's revised $19,107.75 calculation. The resolution of the appeal also included a payment deadline the council set at 30 days from the date of the decision. The council recorded the vote as 5-0 in favor.

The council and staff noted the motel had been the subject of code enforcement for years and that tax delinquencies and code violations were separate but related enforcement tracks. The owner said she had been restricted from managing the property earlier and had been reimbursing some tenants after the closure; she said the property requires significant repairs to reopen.

The council's decision resolves the appeal of the finance director's calculated liability for the three quarters ending Sept. 30, 2024; Dec. 31, 2024; and March 31, 2025. Staff said the city may pursue collection if the amount is not paid within the time set by the council.

The council's action was taken after testimony, review of photo evidence, and written statements from city staff and witnesses.

Votes at a glance: Council voted 5-0 to uphold the finance director's calculation of $19,107.75 and to require payment within 30 days.