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G-1025 - 06/10/2014 - FINANCE - Ordinances Supporting Documents ITEM tO.B.2) of OAS del §r 9� i r.. R AtliWp. 3 a t o s r 1 O ti - cowl, AGENDA ITEM Regular Board of Trustees Meeting of June 10,2014 SUBJECT: Hotel Tax Ordinance FROM: Art Osten Jr., Interim Village Manager BUDGET SOURCE/BUDGET IMPACT: RECOMMENDED MOTION: Motion to approve Ordinance 2014-FI-HM-TX-G-1025,An Ordinance Amending Title 5, Chapter 5 Of The Village Code Regarding The Municipal Hotel Tax Background/History: At the April 8th Village Board meeting,Trustees Adler and Baar requested the Village Board discuss in detail a memo regarding the hotel tax ordinance that Peter Friedman had prepared. As a result of the follow-up discussion on May 13th, Attorney Friedman has provided an ordinance clarifying the existing use of the hotel tax by: 1. including language specifying the uses permitted by state statute, 2. defining the current distribution of the fund, and 3. providing for that distribution to be changed by Village Board action. In addition, the boundaries of the Hotel Beautification District have been enlarged to include the northern boundary of the Oak Brook Center 16th Street, between Rt. 83 and Spring Road. This is because Pedestrian Access Project`B"has been discussed and approved via Resolution 2013- Ped-Access-AG-R-1290, but is not currently in the District. Hotel Tax revenues will help fund and are available by Village policy for projects within the District. Recommendation: That the Village Board approve Ordinance G-1025 An Ordinance Amending Title 5, Chapter 5 Of The Village Code Regarding The Municipal Hotel Tax. Last saved by dbettin J:\Agenda ltems\hotel tax ordinance 6-10-14.doc I act nrintM 6/C0111.1 5.14 PM ORDINANCE 2014-FI-HM-TX-G-1025 AN ORDINANCE AMENDING TITLE 5, CHAPTER 5 OF THE VILLAGE CODE REGARDING THE MUNICIPAL HOTEL TAX WHEREAS, Section 8-3-14 of the Illinois Municipal Code, 65 ILCS 8-3-14 ("Hotel Tax Statute") generally authorizes the Village to impose a tax on hotels located in the Village; and WHEREAS, on September 25, 1990, the Village adopted Ordinance G-451, establishing a Hotel Tax in the Village and setting the rate of the Tax at 1 percent, all as set forth in Chapter 5 of Title 5 of the Village Code of Oak Brook ("Village Hotel Tax"); and WHEREAS, on November 28, 2006, the Village adopted Ordinance 2006-TX-HM-G-817 ("2006 Ordinance"), amending the Village Hotel Tax to increase the rate of the Tax to 3 percent and to establish a "Hotel Beautification District," generally encompassing public right-of-way and adjacent properties along 22nd Street from Illinois Route 83 to the east Village limits, along Spring Road from 22nd Street to 16th Street, and along Jorie Boulevard from 22nd Street to 31st Street ("Hotel District"); and WHEREAS, the 2006 Ordinance further provided that "certain of the tax revenues" from the Hotel Tax "maybe applied to the installation and maintenance of improvements" in the Hotel District, including "landscape and hardscape features, in the discretion of the Village Board, for the purpose of promoting tourism and conventions and attracting nonresident overnight visitors to the Village"; and WHEREAS, subsequent to the 2006 Ordinance, the Village has operated under a policy that provides that (i) 2 percent of the 3 percent Hotel Tax rate is dedicated to promote tourism and conventions or overnight stays within the Village by providing funds to the Village's beautification initiative in the Hotel District, and (ii) the remaining 1 percent of the 3 percent Hotel Tax rate has been dedicated for general purposes to promote tourism and conventions or overnight stays in the Village ("Hotel Tax Use Policy'); and WHEREAS, on August 26, 2008, the Village adopted Ordinance 2008-TX-HM-G-865, amending the contours of the Hotel District to include a portion of York Road between the 1-88 Off-Ramp onto York Road to Dover Drive; and WHEREAS, Village President and Board of Trustees have determined that it is in the best interest of the Village and its residents to codify the Hotel Tax Use Policy within the Village Code, to amend the Hotel Tax provisions in the Village Code to ensure that the Village Code is consistent with the Hotel Tax Statute, and to amend the boundaries of the Hotel District to accommodate approved beautification projects; NOW THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows: Section 1: Recitals. The foregoing recitals are hereby incorporated into, and made a part of, this Ordinance as the findings of the President and Board of Trustees of the Village of Oak Brook. Additions are bold and double-underlined; Ordinance 2014-2014-Fl-HM-TX-G-1025 Amending Title 5,Chapter 5 of the Village Code Page 2 of 3 Section 2: Amendment to Hotel Tax Definitions. Section 5-5-1, entitled "Definitions," of Chapter 5, entitled "Municipal Hotel Tax," of Title 5, entitled "Municipal Taxes," shall be amended to add the following new defined term: HOTEL BEAUTIFICATION DISTRICT: The public right of way and adjacent properties along 22nd Street from Illinois Route 83 to the east village limits, along Spring Road from 22nd Street to 16th Street, along Jorie Boulevard from 22nd Street to 31st Street, along 16th Street between Illinois Route 83 and Spring Road, and a portion of York Road between the 1-88 Off-Ramp onto York Road to Dover Drive. Section 3: Amendment to Village Hotel Tax Use. Section 5-5-2, entitled "Tax Imposed," of Chapter 5, entitled "Municipal Hotel Tax," of Title 5, entitled "Municipal Taxes," shall be amended in its entirety so that Section 5-5-2 shall hereafter be and read as follows: 5-5-2: TAX IMPOSED: A. Hotels subject to the tax imposed by this chapter may reimburse themselves for the tax liability for such tax by separately stating such tax as an additional charge of billings to persons renting hotel rooms, which charge may be stated in combination with the state tax imposed under the hotel operators occupational tax act. B. There is levied and imposed a tax of three percent (3%) of the gross rental receipts from the renting, leasing, or letting of rooms in a hotel or motel within the village, for each twenty four (24) hour period or any portion thereof for which a daily room charge is made, provided that the tax shall not be levied and imposed on any permanent resident or on a person who works and lives in the same hotel or motel. C. The ultimate incidence of any liability for payment of the tax is to be borne by the person or entity renting the hotel room. D. The tax levied shall be paid in addition to any and all other taxes and charges. It shall be the duty of the owner of every hotel or motel to secure the tax from the renter of the motel and hotel room and to pay over to the village treasurer, or any authorized representative of his office, the tax under procedures prescribed by the village treasurer, or as otherwise provided in this chapter. E. Every person or entity required to collect the tax levied by this chapter shall secure the tax from the renter at the time he collects the rental payment for the hotel or motel room. F. There is hereby created a hotel beautification district to include public right the east village limits, along Spring Road from 22nd Street to 16th Street, -- --- •- - - - .. •• e - - - - --- - '_ • • -. _- . - - Additions are bold and double-underlined; Ordinance 2014-2014-Fl-HM-TX-G-1025 Amending Title 5,Chapter 5 of the Village Code Page 3 of 3 the tax revenues imposed under subsection B of this scction may be created herein, including landscape and hardscapc f atures, in the discretion of the village board, for the purpose of promoting tourism and F.„ The amounts collected by the Village from the tax levied by this Chapter will be expended by the Village solely to promote tourism and conventions within the Village or otherwise to attract nonresident overnight visitors to the Village. G. Two-thirds of the amounts collected from the tax levied pursuant to this Chapter will be dedicated to promote tourism and conventions or overnight stays within the Village by providing funds to the Village's beautification initiative in the Hotel District, including, without limitation, the installation and maintenance of improvements in the Hotel District such as landscape and hardscape features. One-third of the amounts collected from the tax levied pursuant to this Chapter will be dedicated for general purposes to promote tourism and conventions within the Village or otherwise to attract nonresident overnight visitors to the Village, regardless of whether the project is located within the Hotel District. Section 4: Severability. If any provision of this Ordinance or part thereof is held invalid by a court of competent jurisdiction, the remaining provisions of this Ordinance shall remain in full force and effect, and shall be interpreted, applied, and enforced so as to achieve, as near as may be, the purpose and intent of this Ordinance to the greatest extent permitted by applicable law. Section 5: Effective Date. This Ordinance shall be in full force and effect from and after its passage, approval, and publication in the manner provided by law. APPROVED THIS 10th day of June, 2014. Gopal G. Lalmalani Village President PASSED THIS 10h day of June, 2014. Ayes: Nays: Absent: Additions are bold and double-underlined; e- • •e. - - -- . -- Ordinance 2014-2014-FI-HM-TX-G-1025 Amending Title 5,Chapter 5 of the Village Code Page 4 of 3 ATTEST: Charlotte K. Pruss Village Clerk #30331866_v3 Additions are bold and double-underlined; .