Oxnard Council Scolds Hotel Over Unpaid Taxes

The Oxnard City Council on Tuesday blasted operators of the lavish Mandalay Beach Resorts Hotel for failing to meet their tax obligations and possibly forcing neighboring homeowners to make up a shortfall in maintenance fees to the city.

“I’m highly irritated by the fact that the council can’t collect from the hotel, and even more irritated that the other members of the district will have to make up the deficit,” Councilman Michael Plisky said.

“What upsets me is that I don’t believe the hotel doesn’t have the money to pay its taxes,” Councilwoman Dorothy Maron said.

For the second year in a row, Mandalay Beach Colony’s 440 homeowners would have to subsidize the hotel under a proposal to recover part of about $18,000 in unpaid fees for landscape and beach maintenance owed by the hotel to Oxnard.

The maintenance fees are taken out of property taxes paid by the hotel to the county, but the hotel has failed to pay its property taxes three times in the last four years.

As a result, the Mandalay maintenance district--which gets 75% of its funding from the hotel--has been saddled with a chronic deficit that homeowners made up in part by paying an added fee of $5 last year. Another $4,400 to cover the deficit has been borrowed from other assessment districts throughout the city.

Parks and Recreation Director Gary Davis proposed adding another $4.80 to the homeowners’ assessment this year because the hotel failed to meet its April 10 tax deadline. A public hearing has been scheduled for May 28 on the proposal.

Hotel representatives were not present at Tuesday’s meeting and would not comment afterward. But last Friday, a spokesman for the hotel played down the significance of his company’s failure to meet its tax deadline and denied that the hotel was in serious financial trouble.

“The first quarter did not meet expectations as far as revenues are concerned, and we just delayed our tax payment a little bit,” said Bob Dupree, the hotel’s general manager.

On Tuesday, a receptionist quoted room rates ranging from $180 for a garden view to $270 for an ocean view.

Under the city proposal to be discussed at the public hearing, Mandalay Colony’s homeowners would be assessed a $94.30 yearly fee to pay for maintenance costs, up from the $67.39 that they paid last year.

Only $4.80 per homeowner would go toward subsidizing the hotel, Davis said, adding that the increase also reflects a rise in maintenance costs. He said homeowners could be reimbursed if the hotel pays its share of the maintenance fee.

The hotel already owes the county $764,104.31 for failing to pay property taxes in fiscal years 1988 and 1989. Because the hotel did not pay its taxes, the city was unable to collect $45,116.50 from the county for the hotel’s share of the district maintenance costs during those years.

The city cannot foreclose on the hotel to collect its debt because the hotel is renegotiating its tax debt with the county, Parks and Recreation official Terri Murphy said in a report to the City Council.

However, the hotel last month defaulted in its five-year debt-payment plan to the county.

County tax officials said Monday that the hotel is allowed to default once before being disqualified from the tax-payment program, and that even if the hotel does not pay taxes and interest owed, the county cannot foreclose any earlier than 1993, five years after the hotel first defaulted on its tax payments.

Mandalay Colony residents did not attend Tuesday’s council meetings. But several of them said last week that they would fight the fee increases at the upcoming public hearing.

“I don’t feel we should be paying the assessment in the first place,” said colony resident Enid Leventhal, “much less make up the hotel’s debt.”