Pronghorn mislabeled room tax

Published 5:00 am Tuesday, March 20, 2012

Earlier this year, the operators of the upscale Pronghorn development near Redmond began charging guests a 10 percent county tax. Problem is, the county’s tourism tax rate is only 7 percent.

County Commissioner Tammy Baney discovered the discrepancy recently while staying at the resort. She told her fellow commissioners about it at a February meeting.

It turns out that Pronghorn’s homeowners association was charging guests a 3 percent fee to use the development’s bicycle paths and pools, according to emails between county staff and Pronghorn’s controller, Dawn Jackson. Guests had no idea they were paying a fee because it was labeled incorrectly as part of the county tax.

“This has since been fixed,” Jackson said on Monday. The mistake was unintentional, Jackson said, and arose from human error and problems with the development’s property management system.

She said it had occurred only since the beginning of the year.

“It’s something we’ve been doing since we have been opening our rooms up to the public,” she said.

The upscale resort’s website advertises wedding rentals and allows visitors to reserve luxury villas.

On Monday, that website still added 10 percent in “taxes” to a reservation and showed nothing on the line for fees and gratuities. For example, one night at a two-bedroom villa would cost $275, plus $27.50 in taxes and no fees, according to the website.

The resort’s actions violate county code, which requires hotels and other tourist lodging operators to list any of their own fees separately from the county tax. The county’s penalty for violation of this rule is $720, and the county has the ability to impose that amount for each day on which Pronghorn broke the rules.

It was unclear on Monday whether Pronghorn would face any penalty. Jackson said county staff have not indicated that they will assess one.

County Finance Director and Treasurer Marty Wynne did not return a call and email seeking comment.

Baney, meanwhile, said the violation appeared to be an accounting error, so the county should work with Pronghorn to fix it.

“I think with any violation it would be important to know whether it was a purposeful violation or an innocent violation,” Baney said. In this case, it appeared to be the latter, she said.

Cheryl Circle, revenue supervisor for the county, said county staff have not attempted to ascertain exactly when Pronghorn began mislabeling its fees and taxes.

Circle said this was not the first time a lodging operator in unincorporated Deschutes County mislabeled the tourist tax, but she could not recall the details of previous problems.

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