Biz Buzz: Accuracy high in Pismo tax audit

The city of Pismo Beach has completed its first transient occupancy tax audit in more than 10 years, revealing that lodging providers have a high — though not perfect — record of accuracy in collecting the 10 percent bed tax on room rates.

Pismo Beach is especially reliant on the tax, as it is the city’s greatest source of income, contributing about 40 percent of its general fund, said the city’s administrative services director, George Edes.

The audit, which looked into taxes paid from June 2006 through June 2010, revealed perfect compliance at half of the 14 properties audited. The city has more than 40 transient occupancy tax agents, and the auditors selected properties from an initial survey to include a range of large and small hotels, motels and rentals.

According to the audit report, three of the properties, the Ocean View Motel, Sea Garden Motel and Shell Beach Inn, had remitted too much transient occupancy tax and were owed refunds totaling $8,843.

Four properties, the Cliffs at Shell Beach, Edgewater Inn and Suites, Pismo Coast Management and Pismo Property Management, had failed to remit payments totaling about $30,500. Those payments are completed or being arranged, Edes said.

The company Muni-Services performed the audit for $40,000. When the city is finished recovering payments, and if it does not levy penalties, the audit will have a net cost of about $20,000 — which amounts to less than one-tenth of 1 percent of the approximately $23.7 million in taxes collected during the audit period, according to Edes.

For the fiscal year 2010, Pismo Beach collected nearly $5.8 million in transient occupancy taxes, down 2.2 percent from $5.9 million in 2009, and down 6.4 percent from a peak in 2008 of nearly $6.2 million. Between 2001 and 2008, collection had grown 48.7 percent from $4.1 million.

That it has taken the city more than 10 years to audit is no oversight.

The last audit, which took place in 1999, “had shown such high compliance, relatively speaking, that the city decided it would not be an efficient use of public funds to do another one immediately,” Edes said.

— Julia Hickey

The Madonna-Twisselman Ranch in San Luis Obispo County is going on the auction block today at 1 p.m. at the Madonna Inn in San Luis Obispo.

Owned by Cathie and Karen Twisselman, daughters of Phyllis Madonna and the late Alex Madonna, the land consists of two adjacent ranches. They can be sold separately or as a unit at absolute auction, with no minimum bid or reserve price.

The ranches are more than two miles outside San Luis Obispo city limits, off Prefumo Canyon Road, and consist of 746 and 1229 acres.

The city of San Luis Obispo has no plans to acquire the property.

The lands are being used for livestock grazing.

“We don’t have a need for them,” Tim Twisselman, Karen’s husband, said when asked why the land is being put up for sale.

The combined ranches were last listed for $10 million.

— Julia Hickey