TOT numbers jumbled, show ups and downs
The city room tax collections for 1998 look good, but not that good.
An over-rosy picture of 1998 transient occupancy tax revenue collections had already been distributed before the discovery of a computer glitch.
The first report released by the city computed a 31.41 percent increase in revenue.
Debra Kirk, controller for the Lake Tahoe Visitors Authority, discovered an error while assembling data for the board of directors meeting.
The percentage in the city report compared revenue over two years, from 1996 to 1998, instead of a one-year span.
The actual change from 1997 to 1998 was plus 6.28 percent – a nice, if not spectacular, increase for an industry that has been in the doldrums.
“There was a bug in the program,” explained City Manager Kerry Miller. “It was transposing numbers from ’96 to ’97, which created the over-inflated percentage increases in TOT.”
The city’s new accounting manager, Robert Porfiri, worked furiously Tuesday to correct the problem and distribute revised reports for the last quarter of 1998.
In the process, Porfiri discovered another glitch.
Occupancy percentages were also skewed. The number of rooms available differ dramatically from reality.
One report lists 256,438 rooms available in the city in December. The revised number lists 188,588 rooms. The occupancy percentages vary from down 7 percent to up 3 percent.
Although average occupancy for 1998 remains uncertain, the month of December appears to be up 3 percent.
TOT revenues for December increased by 6.28 percent, carried more by an increase in room rates of $4.89 than the increase in occupancy.
Another factor in the good revenue collection is that more higher-end rooms are being rented, according to Terry LeBan, executive director of the Lake Tahoe Visitors Authority.
When the LTVA’s central reservations was operated by BASS Tickets, there were 90 properties on the system with a larger proportion of inexpensive motels, she said. Under the North Lake Tahoe Resort Association, there are 60 properties and more high-end rooms. Vacation rentals, which have higher rates, are also more popular.
It will take a few weeks to get a clear picture of how good 1998 was for the lodging industry. Among Porfiri’s first duties will be to go through the TOT numbers for the entire year and correct them if necessary.
Whatever the final numbers, the city has collected more in revenue than last year.
“Even the revised report looks good,” Miller said. “We are seeing a sustained increase in TOT (in ’98) over ’97.”
Miller attributed the increase to “great snow” and “aggressive advertising” by the Lake Tahoe Visitors Authority and private interest such as American Skiing Company.
“It reflects a major resurgence in our economy and probably it’s a reflection of the good economy statewide.”
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