LANCASTER COUNTY, PA. – For the third time in as many years, the County of Lancaster has filed suit against Lancaster Family Hotel, 2250 Lincoln Highway East for failure to remit Hotel Taxes to the County Treasurer’s Office. The suit alleged that the hotel, previously known as the Ramada Inn, has failed to make their required Hotel Tax payments for the months of September 2014 through April 2015 and July 2015 through November 2015; a total of thirteen months.
The hotel also continues to owe money to the County in connection with a judgment entered as a result of prior litigation initiated by the County under similar circumstances. Specifically, a judgment entered on January 15, 2015 in the amount of $16,548.68 remains open against the hotel in favor of the County. One prior judgment entered in August 2014 in the amount of $20,363.00 has been satisfied by the hotel, but also required litigation to ensure proper payment of Hotel Taxes.
County Ordinances authorize a tax of 5% on payments received for room rentals by local hotels, including the Lancaster Family Resort; these taxes are levied directly on the hotel patrons and remitted as part of the room charge to the hotel for ultimate submission to the County. Operators of County hotels are required to submit reports reflecting the amount of taxes collected by them, and then remit appropriate tax payments to the County Treasurer’s Office on a monthly basis.
“Basically, the Lancaster Family Resort is collecting money from patrons on behalf of the County and then failing to turn that money over to the County in accordance with state statute and local ordinance,” reports Lancaster County Treasurer, Craig Ebersole, “And we have to repeatedly file suit in order to compel the Resort to comply. It’s a never-ending cycle of collection, non-remission litigation, judgment, and finally payment, and the more it happens the more it appears deliberate on the part of the Resort.”
Based on reports submitted to the County by the Ramada Inn/Lancaster Family Resort, the suit alleges that the amount of taxes currently owed to the County for the months of September 2014 through April 2015 is $14,301.60. While taxes were remitted for May and June 2015, prior to suit being filed, the suit further alleges that no reports or payments were provided to the County for the months of July through November 2015. Since no reports were provided to the County before the filing of the suit, the exact amount of taxes owed for this period is unknown; however, based on prior years’ reports for this same period, the amount is estimated to be $17,067.76. Subsequent to the filing of the litigation, the Resort did submit a report and payment for July 2015, reducing the outstanding remittances from thirteen months to twelve months.
The lawsuit names as Defendants: 501 Hospitality Management, LLC, the owner of the real estate parcel on which the Resort is located; IVS, LLC, the operating company for the Resort; Jay Sheth, Manager; and Rajan Sheth, General Manager.
