Perhaps you heard a chorus of whoops emanating from the City of Miami Beach's finance department late last month. That was the sound of giddy bean counters celebrating a milestone in the annals of local taxation. For the first time ever, city officials broke the $900,000 barrier in their monthly resort-tax collection -- $911,796, to be precise.
Implemented in 1967, the resort tax is a two percent assessment on all room rents and food and beverage sales at hotels, restaurants, and bars in Miami Beach. The tax, added to customers' tabs, is theoretically passed on to the city each month. (Rooming houses, apartment/hotels, and other transient rental lodgings pay annually.) Half of the money goes to the Greater Miami Convention and Visitors Bureau. The other half is earmarked for a variety of government, tourism, social service, and cultural purposes in Miami Beach. Among other expenditures, the tax has been used to subsidize community programs for the homeless, fund the renovation of the Miami Beach Convention Center, support the Bass Museum and Area Stage theater company, and assist the commercial districts along Washington Avenue, Ocean Drive, and Lincoln Road.
Not all the Beach's 1400 hotels, restaurants, and bars have been kicking in their fair share, though. According to city records, 33 establishments owe back taxes ranging from as little as $16 to as much as $30,620. (See accompanying list.) Some are more than six months in arrears.
Piss you off? It certainly chafes Robert Nachlinger. The city's finance director doesn't suffer deadbeats kindly. Not that he isn't equitable: When a business fails to come through with a monthly revenue statement and tax payment on time, Nachlinger sends its delinquent owners a notice of nonpayment and adds a penalty equivalent to ten percent of the estimated tax. But after allowing a grace period of a month or two, whammo! Nachlinger hauls the owners into court, impounds their equipment, and hits them with liens of all sorts. "Several people on this list have businesses that may have failed and not paid us, and we have liens on some of their personal assets, like their house," Nachlinger says indignantly. "Excuse me if I seem very proprietary about [the resort tax], but this is not their money. It isn't a tax paid by the business owner, it's paid by the consumer. Just like sales tax, the business owner is holding it in trust."
The city has filed liens against at least three delinquent businesses: the Charles Hotel, Mad Max Italian Cuisine, and the Spot (owned by nightlife promoter and man-about-town Gary James.) The city also filed a lien against a Palm Island house belonging to an owner of Mickey's, the now-defunct nightspot named after actor Mickey Rourke. Two other businesses have signed promissory notes with the city -- Mimosa and Sushi Hana -- and are gradually paying back their debt, according to Nachlinger.
Of course, everyone has an excuse for nonpayment, the best being bankruptcy, which has afflicted more than a few businesses on the list. Among them: the Spot, which recently closed after three raucous years. Owner Gary James explains that as the business' fortunes began to fade this past year, taxes were among the least of his concerns. "You put things off and pay your employees and buy your liquor. Things like taxes, you push them aside," says James, who says he's now involved in the recently opened Neva on Washington Avenue.
Jules Wang, owner of Mimosa, blames his delinquency on his former bookkeeper. "I had someone here taking charge of all those things, but he just never did it," the restaurateur asserts. "He was from Europe, and he, I guess, just didn't know how things were done here. Anyway, the problem is [the city] charges too much money for resort tax. If you have a business that's borderline, I believe these taxes are what's going to put you out of business." Nachlinger says Mimosa's resort-tax payments were an estimated nine months in arrears before Wang signed a promissory note.
Several other delinquent business owners are due to face off against city attorneys in court this Thursday, at which time Nachlinger expects to secure court orders against them. "Once they're on the list," he chortles, "They're mine forever!
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