Faced with a halt of revenue due to Covid-19, businesses seek late tax penalty relief.

Monterey Zoo founder Charlie Sammut has no qualms about paying taxes on his River Road facility, Vision Quest Ranch. “It’s how the county runs,” he says. Twice a year, he writes a check for about $10,000 and sends it to the Monterey County Treasurer-Tax Collector’s office. Quarterly, he cuts a check for about $11,000 to pay the facility’s transient occupancy tax of 10.5 percent, added to the amount charged to guests at hotels and bed-and-breakfasts, like the one at Vision Quest Ranch, where visitors can breakfast while watching elephants roam the property.

Then came the pandemic and with it, the loss of the facility’s income. But at the zoo, where every creature from elephants and tigers to kangaroos and spiders needs to be fed – at a cost of about $50,000 a month – the expenses of running the place never went away.

“Although all of our income was completely and abruptly cut off, our responsibility to the animals we care for remained the same,” Sammut says. “There were very few places we could cut back on overhead while still delivering the legally required humane quality of care for the animals.”

Sammut paid his taxes, but he paid them late – the TOT payment, he says, was six days late. And for those late payments, he was fined $2,000.

The Tax Collector’s Office has since refunded the penalty on the property tax, but Sammut is still fighting to get the TOT penalty refunded.

In June, he filed a claim against the county.

“We have never been unable to, or refused, to fulfill our financial obligations to any of our vendors, to include our obligation to the county,” Sammut wrote in the claim. “Until of course this unprecedented worldwide event forces us to choose between doing so and the health and well-being of our animals.”

Sammut is not alone in his frustrations. Monterey Holdings LP, the parent company of Bernardus Lodge & Spa in Carmel Valley, was assessed a whopping $19,880 penalty for a late payment on its first-quarter TOT this year. In a claim filed in June, Kambiz Babaoff, chairman of the real estate company that owns Bernardus, wrote that cash at the time of the pandemic outset was used to refund guest deposits and pay employee benefits and payroll. He notes that late payment penalties for other properties owned by Ensemble Real Estate Solutions & Investments were waived and “it was assumed that Monterey County would also show leniency for late payments during this crisis.”

Monterey County Supervisor Chris Lopez, who helped Sammut with the property tax situation, says penalties have to be handled on a case-by-case basis because there’s no mechanism in place at the Tax Collector’s office to automatically refund the money.

“I see it as a unique case for (Sammut) because they were closed but had immediate bills to pay,” Lopez says. “I’m supportive of anyone who has a valid hardship bringing that forward to us so we can see if we can get them some immediate relief.”