Mandatory Parking Occupancy Tax Collection Bond Requirement FAQ

What is the Parking Occupancy Tax (POT) Collection Bond?

The Los Angeles City Council, with the approval of the Mayor, passed Ordinance No. 182283 in October 2012 amending Chapter II, Article 1.15, Parking Occupancy Tax, of the Los Angeles Municipal Code to require all auto park operators to post a bond to ensure payment of delinquent parking occupancy taxes and to allow the City to pursue all persons responsible for collecting and remitting the parking occupancy taxes to the City.

Are all parking operators required to obtain the POT Collection Bond?

This bond requirement does not apply to an operator that is a governmental entity. However, this bond requirement is applicable to all non-governmental applicants operating a parking facility on behalf of a governmental entity.

This bond requirement is applicable for each parking facility conducted by the operator, whether in the capacity of owner, lessee, mortgagee in possession, licensee, valet or other service supplier or any other capacity.

This bond requirement does not apply to an operator that qualifies for the Parking Occupancy Tax Collection Bond Exemption.

Who are EXEMPT from the POT Collection Bond?

A parking lot / valet parking operator that meets ALL the following exemption requirements:

  • Offers its daily customers the option to pay by credit cards widely used by or generally available to the public.
  • Continues to report accurately and pay timely the monthly Parking Occupancy Tax, and
  • Provides Office of Finance access to electronic records of credit card transactions.

How do I apply for the POT Collection Bond EXEMPTION?

A parking lot / valet parking operator MUST comply with ALL the POT Collection Bond exemption requirements.

To apply for the Parking Occupancy Tax Collection Bond Exemption, please complete the Parking Occupancy Tax Collection Bond Exemption Application.

If you submitted a Cash Deposit In-Lieu of the required Parking Occupancy Tax Collection Bond, please complete the Parking Occupancy Tax Cash Deposit Refund Application.

Please mail the completed document(s) to:

City of Los Angeles

Office of Finance

Attn: POT Bond Unit

PO Box 53234

Los Angeles, California 90053-0234

When is the POT Collection Bond filing deadline?

Effective September 1, 2013, a Parking Occupancy Tax (POT) Collection Bond must be filed with the Office of Finance for each parking facility conducted by an auto park operator.

For existing facilities, operators must file their POT Collection Bond with the Office of Finance no later than October 31, 2013. New and renewed bonds must be issued in the form of the sample bond that was enclosed with the initial notice mailed to auto park operators. Here is a sample PDF iconParking Occupancy Tax Collection Bond

For every parking facility commencing business after such date, the operators must file the applicable bond no later than the close of business on the last day of the month following the month in which the operator commences operation of the parking facility.

What is the amount required for the POT Collection Bond?

The bond face value or amount requirement is based on the prior calendar year’s parking fee gross receipts for each parking facility or the estimated annual gross receipts for a new parking facility. It has been established in LAMC Chapter II, Article 1.15, Parking Occupancy Tax as follows:

 

If the annual gross receipts for the parking facility, or the estimated annual gross receipts for a new parking facility, are:
Then the bond amount shall be:
Less than $50,000
$5,000
$50,000.01 - $100,000
$10,000
$100,000.01 - $150,000
$15,000
$150,000.01 - $200,000
$20,000
$200,000.01 - $250,000
$25,000
$250,000.01 - $300,000
$30,000
$300,000.01 - $350,000
$35,000
$350,000.01 - $400,000
$40,000
$400,000.01 - $450,000
$45,000
$450,000.01 - $500,000
$50,000
$500,000.01 - $600,000
$60,000
$600,000.01 - $700,000
$70,000
$700,000.01 - $800,000
$80,000
$800,000.01 - $900,000
$90,000
$900,000.01 - $1,000,000
$100,000
$1,00,000.01 - $1,250,000
$125,000
$1,250,000.01 - $1,500,000
$150,000
$1,500,000.01 - $1,750,000
$175,000
$1,750,000.01 - $2,000,000
$200,000
$2,000,000.01 - $2,250,000
$225,000
$2,250,000.01 - $2,500,000
$250,000
$2,500,000.01 - $3,000,000
$300,000
$3,000,000.01 - $3,500,000
$350,000
$3,500,000.01 - $4,000,000
$400,000
$4,000,000.01 - $4,500,000
$450,000
$4,500,000.01 - $5,000,000
500,000
$5,000,000.01 - $6,000,000
$600,000
Greater than $6,000,000.01
$700,000

Do I have to file a single POT Collection Bond for every parking facility that I operate?

Every operating parking facility must be secured with a bond with the face value as established in Chapter II, Article 1.15, SEC. 21.15.6. (d) 1 (see table above)

However, an operator may file a single bond to cover multiple active parking facilities registered under the same legal name and for the amount that equals the sum total of the amount required for each facility.

To illustrate:

A parking operator with 3 locations, each with a gross receipt of $10,000, is required to file a bond in the amount of $15,000 ($5,000 bond for location 1 + $5,000 bond for location 2 + $5,000 bond for location 3).

What if I am unable to obtain a POT Collection Bond?

An auto park operator that fails to qualify for the issuance of a bond by a surety is required to establish a cash deposit account with City of Los Angeles Office of Finance in the amount of fifty percent of the prescribed bond amount for each parking facility conducted by the operator.

An operator that fails to submit the bond filing(s) to the Office of Finance or fails to establish a deposit account within the prescribed time periods will also be subject to the revocation or denial of a Police Auto Park Permit.

What determines a valid bond that is accepted by the Office of Finance?

A valid bond shall be executed by the operator as principal, and by a corporation or association which is licensed by the Insurance Commissioner of the State of California to transact the business of fidelity and surety insurance, as surety. A surety bond must be issued in the same language as provided in the sample here PDF iconParking Occupancy Tax Collection Bond

Where do I file POT Collection Bond with the Office of Finance?

Following the guidelines outlined through this text, you must file a bond issued in the form of the sample Parking Occupancy Tax Collection Bond along with a completed Parking Occupancy Tax Collection Bond Application by the specified due date. A cash deposit in lieu of the bond is accepted in the form of a check or a money order.

Please submit your requirements by mail to:

City of Los Angeles - Office of Finance

Parking Occupancy Tax Collection Bond

PO Box 53234 Los Angeles, CA 90053-0234

I have current a POT Collection Bond for each of my parking operation locations. Do I need to file a new POT Collection Bond for additional locations?

An operator must file the applicable bond and Bond Application no later than the close of business on the last day of the month following the month in which the operator commences operation of the new or additional parking facility/location.

Do I need to update my bond amount if my gross receipts changes within the year?

If, at the end of the calendar year, the gross receipts for a parking facility have increased to at least five percent above the amount that would be required for the next larger bond under the above schedule, the auto park operator shall obtain a new bond in the increased amount by the following February month-end.

If at the end of any calendar year the gross receipts for the parking facility have decreased by at least five percent below the amount that would be required for the next smaller bond under the current schedule, the auto park operator may apply for a reduction of the bond amount.

How is the POT Collection Bond exercised?

When there is an assessment of POT against an auto park operator, the assessment shall also be issued against the operator’s surety. The operator and the surety shall be provided a Notice of Assessment and either may request an administrative hearing to protest the assessment within fifteen days from the date of the notice. The taxpayer and surety hearing may be consolidated at the discretion of the Director of Finance.

Upon exhaustion of the administrative appeals process, the operator and the surety shall be liable to the City of Los Angeles in the amount of the determination or decision reached by the Assessment Review Officer or Board of Review, provided that the surety’s liability shall not exceed the face amount of the bond. If neither the operator nor the surety request an administrative hearing, the operator and the surety shall be liable to the City of Los Angeles in the amount of the assessment, provided that the surety’s liability shall not exceed the face amount of the bond.

How do I cancel my existing POT Collection bond?

An auto park operator and the surety have the express duty to notify Finance no later than 30 days prior to the termination of a bond agreement. The surety shall not be discharged from any liability relating to periods prior to the cancellation of the bond. The bond shall not be deemed cancelled until after the expiration of the thirty (30) day notice period.

Where can I find more information about this?

This document is intended to summarize some of the changes to Parking Occupancy Tax requirements as stated in the Ordinance No. 182283. More detailed information may be found by accessing the links below:

How may I contact the Office of Finance?

To assist you with inquiries in matters relating to the Parking Occupancy Tax Collection Bond requirement, you may contact a staff member by phone, fax, e-mail, or by mail with the contact information listed below.

Phone:     213.744.9750

Fax :         213.928.9391

Email:       finance.autopark@lacity.org

Mail:  

City of Los Angeles - Office of Finance
Parking Occupancy Tax Collection Bond
PO Box 53234
Los Angeles, CA 90053-0234