Governor Extends Hotel Tax Waiver to Oct.14 & THLA Q&A on Hurricane Issues

By Texas Hotel & Lodging Association

September 17, 2008

 

We have provided below updated information on the following questions that have been asked frequently by Texas hoteliers but are not currently addressed in FEMA or Corporate Lodging Consultants websites or materials.

 

1.       Extension of Governor’s Waiver of State and Local Hotel Tax to October 14th

2.       Additional Frequently Asked Questions and Answers:

·         Time Period FEMA Takes to Get Evacuees Registered onto the CLC Website as Eligible for Lodging Assistance

·         Timeline for Payment of Hotels by CLC for Lodging Assistance Program Guests

·         Application of State and Local Hotel Tax to CLC Lodging Assistance Guests

·         Right to Refuse Guests Who Want the Hotel to Invoice Corporate Lodging Consultants for Room Costs

·         Ability of Hotel to Limit Inventory of Rooms Provided as Part of FEMA/CLC Lodging Program

·         Ability to Compel Evacuees to Vacate Rooms so Hotel Can Honor Other Reservations

·         Right to Charge a Rate that is Higher than the Federal Per Diem Rate for Evacuees

·         Damages and incidental expenses related to evacuees

·         Information about Price Gouging

·         Important Phone and Contact Info for hotels and evacuees

 

 

1.      Extension of State and Local Hotel Tax to October 14th:

The Governor’s Office has announced that it has amended its Emergency Proclamation to extend the waiver of state and local hotel tax for all evacuees who are defined as “victims of Hurricane Ike.” This will include evacuees who are paying directly for their rooms and evacuees who are on a lodging assistance account through FEMA/Corporate Lodging Consultants.  Originally, the waiver applied from September 8th to September 21st.  The Governor has extended the waiver of state and local hotel tax for Hurricane Ike Victims through October 14th, to coincide with the current end date for lodging reimbursement from FEMA/Corporate Lodging Consultants.  As before, the victim must be from one of the designated counties or areas listed in the Governor’s disaster declaration.  For the most current list of these areas, use the following link:  www.texaslodging.com under the link labeled “Governor Declared Disaster Areas.”  

 

 

2.      Additional Frequently Asked Questions and Answers:

A number of questions have been asked by hoteliers about FEMA and working with the FEMA Corporate Lodging Consultants program.  Here are the answers to the most frequently asked questions.

 

 

Time Period FEMA Takes to Get Evacuees Registered onto the CLC Website as Eligible for Lodging Assistance

Question:  How much time does it take for FEMA to show approval of evacuee registrations on the CLC website as eligible for lodging assistance?

 

Answer:  FEMA has indicated that they enter this information once every hour, but that evacuees should allow two to three hours from the time that they completed their online registration with FEMA before they should expect their registration/application number to be part of the CLC website that hotels can access.    

 

 

Timeline for Payment of Hotels by CLC for Lodging Assistance Program Guests

Question:  If I register as a hotel to participate in the lodging assistance program, how quickly will Corporate Lodging Consultants provide payment to my property for guests who are qualified to stay under this program? 

 

Answer:  Corporate Lodging Consultants has indicated that hotels can invoice CLC as often as once daily through the CLC website.  CLC sends out checks to hotels once to twice weekly.  CLC does not pay by electronic transfer. 

 

 

Application of State and Local Hotel Tax to CLC Lodging Assistance Guests

Question:  When a hotel is billing CLC for guests under the lodging assistance program, should state and local hotel tax be included. 

 

Answer:  Since CLC is an entity under contract with the Federal Government, it is our belief that no state or local hotel tax is due on the CLC paid rooms of evacuees.  Similarly, if the evacuees pay for their rooms themselves, there also is no Texas state or local hotel tax due because the Texas Governor has exempted these taxes from September 8th to October 14th for eligible Hurricane Ike victims. 

 

 

Right to Refuse Guests Who Want the Hotel to Invoice Corporate Lodging Consultants for Room Costs

Question: Can a hotel insist that guests pay for their rooms and require the guest to seek any reimbursement for hotel charges from FEMA? 

 

Answer:  Yes, participation in any of the CLC or FEMA programs is voluntary.  Hotels can choose not to certify their hotels for participation in the lodging assistance program offered by Corporate Lodging Consultants.  In such a situation, the hotel will not be listed on Corporate Lodging Consultant’s website listing of lodging options for evacuees in your city.  Some guests may still seek to stay at your property, but many will choose to go to properties for which lodging reimbursement from CLC is provided. Guests who do stay at non CLC participating properties will need to submit their lodging cost claims to FEMA directly and be reimbursed through FEMA in the amount of the federal per diem for area.   Guests will need to confirm their eligibility for such reimbursement from FEMA.  To find the current Federal Per Diem rate for your city, visit:  http://www.gsa.gov/Portal/gsa/ep/perdiem.do?pf=y&queryYear=2008&queryState=Texas.  If your hotel property is not located in an area noted on the chart, the amount of federal per diem reimbursement is limited to $70 per night.  It should be noted that the new federal per diem rates do not go into effect until the 1st of October. 

 

 

Ability of Hotel to Limit Inventory of Rooms Provided as Part of FEMA/CLC Lodging Program

Question:  Can a hotel limit the number of rooms that it provides as a participating hotel in the FEMA/CLC Lodging Program?

 

Answer:  Yes, participation in any of the CLC or FEMA programs is voluntary and so is the amount of your inventory of rooms that you commit to the program. 

 

 

Ability to Compel Evacuees to Vacate Rooms so Hotel Can Honor Other Reservations

Question:  Can a hotel compel evacuees to vacate rooms so that the hotel can honor other reservations?

 

Answer:  It is certainly a difficult situation.  Whether participating in the FEMA/CLC program or not, hotels will want to avoid compelling evacuees to leave if the other area lodging resources and shelters are full and there are few to no alternative lodging options in the area for evacuees.  This is compounded by the likelihood that during an emergency, local authorities may refuse to compel evacuees to vacate lodging establishments to make room for incoming non-emergency guests.  With this in mind, we have advised hotels to work with incoming nonemergency guests and groups to reschedule their reservations and events to a date after the emergency has subsided and alternative lodging can be provided for emergency evacuees.  TH&LA outlined the notice process for such situations in a prior email that we can provide again upon request.

 

 

Right to Charge a Rate that is Higher than the Federal Per Diem Rate for Evacuees

Question:  Can a hotel charge a rate that is higher than the federal per diem for their area and ask the guest to cover the difference in rate?  

 

Answer:  A hotel that is participating in the CLC program (Corporate Lodging Consultants) to take hurricane victims can invoice the amount of the federal per diem rate to CLC for eligible guests and by separate agreement ask the eligible guest pay any difference in the nightly rate for the room.  Conversely, for guests who are paying all of the charges up front, the guest can apply to FEMA for reimbursement and FEMA will first determine the guest’s eligibility and will then reimburse at a rate that is no higher than the area’s federal per diem rate.  The guest would be liable for any difference above that rate.   Again, guests need to confirm with FEMA their eligibility and any requirements for direct reimbursement with FEMA.  It should be noted that many hotels that participate in the CLC program are honoring the federal per diem rate as a courtesy to the evacuees during this emergency period.  Additionally, close scrutiny is being paid by the Attorney General for any room night pricing by hotels that is increased beyond historic rates for that property when there is not an emergency. 

 

 

Damages and incidental expenses related to evacuees

Question:  Does FEMA or CLC cover damages to a hotel that may be caused by evacuees?

 

Answer:  Neither FEMA or CLC considers themselves liable for damages that may be caused by evacuees at a lodging property.  Such clams should be made directly against the evacuees.  CLC has not indicated in its rules whether a hotel may ask guests participating in the lodging assistance program for a credit card or a cash deposit for potential damages to the room.  It is clear that many evacuees may not have the financial resources to provide such guarantees or deposits due to the sudden circumstance and financial pressure caused by the emergency.  We advise definitively as soon as CLC addresses our inquiry on this issue. 

 

 

Information about Price Gouging

Question:  How can a lodging operator be sure that they are not “price gouging”? 

 

Answer:  Once the Governor has declared an emergency, certain limitations are in effect for the private sector.  For lodging operators, we have advised that a hotel cannot raise its rates to levels that are higher than the rates the hotel would normally have at full occupancy when there is not an emergency.  How does a hotel determine what would constitute price gouging during an emergency/evacuation period? 

1)      Hotels should review their prior rate history for comparable rooms at full occupancy at their property.  The pricing for the rooms during an emergency should be not be significantly above the hotel’s traditional full occupancy rate during that time period when there is not an emergency.  Whenever possible, a courtesy rate or reduction should be considered.  

2)      It is understood that in certain cases, lodging rates may be higher than usual if there is a city wide convention or special non-emergency event that already has market lodging rates in the area at a higher level.   

3)      When the State Attorney General’s Office evaluates price gouging complaints, it may subpoena a hotel’s guest records to see what rates the property has received for comparable rooms in past and future time periods.  They can use this information to determine if the rate during the emergency was significantly higher than what is normally charged under comparable non-emergency conditions during a similar time period. 

4)      Many of our lodging operators are offering special evacuee rates or are offering lower standard rates as a gesture of goodwill for the evacuees.  Additionally, many hotels are providing courtesy waivers on charges for added persons in the room.   Any assistance you can provide in this area to evacuees is appreciated. 

 

 

Important Phone Numbers and Contact Information for hotels and evacuees

·         Evacuees should contact FEMA for Assistance.  FEMA’s preferred method of contact is online at www.fema.gov.  Evacuees may also try calling FEMA at 800.621.3362.

·         Hoteliers with specific questions about the CLC / FEMA lodging assistance program can contact CLC at 866.545.9865, or online at www.corplodging.com/ela

·         Hoteliers with other questions may contact the Texas Hotel & Lodging Association at 800.856.4328