Commissioners authorize lawsuit seeking unpaid innkeeper taxes from hotel operator

DeKalb County commissioners voted to authorize filing suit to recover unpaid innkeeper taxes after staff said one or more hotels appear to be underpaying or improperly claiming high exemption rates.

Staff described an apparent mismatch between the hotels' reported exempt stays and industry norms, saying some properties were claiming exemption rates far above typical averages. A commissioner noted that state audit resources appeared limited and that filing suit would allow the county to use discovery to obtain records and, if successful, place liens on property to collect back taxes. “If it's the same person,” a staff member said of a name matching an out-of-state case, “we can get a big lien.”

Commissioners discussed alternatives including an audit, but agreed state capacity to undertake an in-depth investigation was limited. One commissioner argued that failing to pursue collection could create unfair competition for hotels that do pay the tax. The board voted to authorize filing suit against the corporate entity that owes the tax and directed county counsel to proceed.

Next steps: county counsel will prepare the complaint and pursue discovery to determine the extent of unpaid taxes and potential liens; the board did not specify an amount sought during the meeting.