Deadbeat Days Inn Owes Arcata $130,776.62 – March 3, 2010
Eye Business Editor
VALLEY WEST – The newly opened Hampton Inn and its 82 high-end hotel rooms are expected to be a boon to Arcata’s tourist industry. By Community Development Director Larry Oetker’s estimates, the arrival of Hampton Inn could mean the addition of $85,000 per year to the City in Transient Occupancy Taxes (TOT), commonly referred to as bed tax.
Additionally, Hampton gives traveling sports teams visiting HSU another close stay option. According to HSU Associate Athletic Director Tom Trepiak, Hampton could be attractive to coaches looking for lodging where the team is insured breakfast.
However, an existing Valley West motel continues to drag its heels on paying its fair share of City taxes – undermining Arcata’s General Fund during lean budget years and creating an ongoing headache for City staff.
On Jan. 7, Finance Director Janet Luzzi made yet another attempt to collect on the Valley West Days Inn’s outstanding TOT. She was already over a year-and-a-half into the effort and had been rebuffed by hotel management regularly. But this time she brought backup in the form of Arcata Police Department Sgt. Bob Martinez. According to Luzzi, she wanted to make an impression on Days Inn management, who’d repeatedly blown off City bills. “We’ve been struggling with them since October 2008,” Luzzi said.
Nearly two years of unpaid TOT has built up to $108,000. What’s more, Days Inn is delinquent in over $22.776.62 in unpaid water bills. Considering Arcata’s annual TOT take is some $900,000, the outstanding $130,000 is a major chunk of City revenue. Collection attempts through the firm’s Arcata management have been somewhat fruitless – until Finance received a partial bill payment last year. That check bounced.
The hotel was purchased from the Trinidad Rancheria three years ago, which had operated the North Coast Inn. In the late 1990s, the tribe made a massive renovation to the facility for what was planned as a tourist layover and shuttle service funneling point to Cher-Ae Heights Casino.
The 78-room hotel rebuilt its conference room and installed a three-meal restaurant, bar and lounge. However, the rancheria struggled to make the hotel work and finally sold to John Markley who’s operated Days Inn under the name Penta Arcata A LLC of Orinda. Like Luzzi’s, repeated calls from the Arcata Eye to Markley went unanswered. The developer is active in Orinda public life and has served as chair of that city’s Parks and Recreation Commission.
The Days Inn franchise has been reportedly lumbering since day one under mismanagement. Rotary Club of Arcata Sunrise had traditionally held its weekly luncheons there, but pulled out after a series of scheduling snafus, “The service was so bad,” said Sunrise President Julie Vaissade-Elcock. “It didn’t seem like they even wanted us there.”
While most City residents would find their water shut off 60 days after failing to pay a water bill, City Manager Randy Mendosa has so far been unwilling to flip that switch on Days Inn. Mendosa reasons that the shutoff could likely be the nail in Days Inn’s coffin, and its closure would not only mean the layoff of hotel staff, but could open up a major Valley West building to neglect and blight.
“We’re still trying to find ways to work with these owners for the good of the City,” Mendosa said. “We still have a ways to go. I don’t want to see this become the Eureka Inn of Arcata,” he said, referring to the Eureka hotel that has spent the past decade slowly degrading since its closure.
According to Mendosa, a City lien on Days Inn property and equipment should ensure that Arcata would see its money. “We fully intend to get it,” he said. “I am sure that we will recover our costs.” In the meantime, it’s a waiting game as Arcata watches to see if the giant piece of Valley West real estate can hold on.