The Porter County Convention Recreation and Visitor Commission has decided
to take legal action against three motels who have neglected to pass along
their monthly collection of the innkeepers tax to the county.
Last Thursday, PCCRVC attorney Dave Hollenbeck issued three lawsuits with
the Porter County Superior Court, each suit stating the businesses in
question are required under a resolution enacted by the Porter County
Council to collect a county innkeeper’s tax and pass on the levy monthly to
the Porter County Treasurer.
Hollenbeck said the tourism commission opted a number of years ago to have
the tax collected locally instead of by the state, but that means the
commission must enforce the tax collection itself.
He said there are 36 businesses in Porter County that the tourism commission
collects from. A monthly report is given to the tourism commission by the
The hotel properties accused of not following statutory obligation in the
suits are Don’s Motel of 5500 U.S. 20 in Portage, Delux Travel Inn of 6101
U.S. 20 in Portage, and Sands Inn Motel at U.S. 20 in Beverly Shores.
According to the suit, the PCCRVC filed the complaint to seek court orders
to turn the tax revenue over to Porter County.
Hollenbeck said over the past six months, a few properties have either
stopped giving payments or the payments would be sporadic. He said the
PCCRVC assigned him to work with those properties to get the matter
resolved, which has yielded the three lawsuits of properties who have not
followed through despite being sent letters notifying them about the levy.
Hollenbeck said he is unsure why the payments have not been transferred.
Both Don’s Motel and Travel Inn Portage did not return phone calls to the
Chesterton Tribune. The Sands Inn Motel was not reachable by phone.
PCCRVC Executive Director Lorelei Weimer said hotel guests are required to
pay a five percent innkeepers tax, just like a sales tax. The hotels collect
the tax which is given to the tourism commission which uses the money for
marketing and developing tourist destination sites.
Hollenbeck said questions have surfaced as to how much money is involved.
He said the magnitude of dollars is not very large since the units are
relatively small, but the reason the commission is going after the funds is
to correct a pattern of noncompliance.
Both Weimer and Hollenbeck said this is the first time the tourism
commission has filed lawsuits to go after revenue from the tax. Weimer said
sometimes hotels are late in their payments, but usually catch up. If the
property is delinquent more than three times, the matter is then turned over
to the attorney.
One of the reasons the hotels are unable to collect the taxes may be due to
the effects of a difficult economy, said PCCRVC Board President Jeff Good.
“When the cash flow situation doesn’t work out, this is one of the first
things they quit paying,” said Good who is also the owner of Good
Hospitality Services. He said he feels the lawsuit is a “necessary evil.”
“If we didn’t do it, we wouldn’t be auditing the law the way we should,” he
said. “It’s just a matter of getting the tourism bureau’s ducks in a row and
having the necessary paperwork.”
Good did say he hopes the lawsuits will spur the properties to forward the
collections in order for the matters to be resolved. Also, he said he hopes
that the tourism board will not have to make further lawsuits, pending a
turnaround in the economy.
The innkeepers tax is nothing new, Weimer said, noting that it is the main
way the PCCRVC is funded. The tax on hotel lodgers was enacted as a funding
mechanism for the agency the same year it was created by the county
commissioners in 1985.