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CVB files suit to collect transient room tax from Airbnb properties

The Danville-Boyle County Convention and Visitors Bureau has filed a lawsuit against the owners of three lodging businesses for not paying the required 3-percent transient room tax they should have been collecting and paying for more than a year.

According to the complaint filed Monday in Boyle Circuit Court by Danville attorney Ephraim Helton, the CVB is suing The Farm LLC, 450 Waterworks Road; Danville’s Delight, 340 North First Street; and The Lake House, 3035 Waterworks Road. All three are operated by Angela and Jacob Martin.

The complaint states, “…pursuant to Ordinance Number 1328 of Boyle County and the City of Danville, Kentucky, a 3-percent transient room tax is imposed on the rent of every suite, room or rooms, for any persons, companies, corporations, or other like or similar persons, groups or organizations doing business as motor courts, motels, hotels, inns or like similar accommodations or business.”

The complaint also states “the defendants have failed and or refused to pay” the transient room tax and the 6-percent penalty imposed monthly on their delinquent account.

“We tried for years and had no other alternative at this point,” CVB Executive Director Jennifer Kirchner said of the lawsuit.

During Monday morning’s CVB board meeting, Kirchner told the board that litigation had just been filed against an Airbnb for not paying the required transient room tax for more than a year. The total unpaid amount was going to be between $15,000 and $20,000 without counting the 6-percent late payment assessment, she said.

Later on Monday, Kirchner said many other privately-owned lodging properties in Boyle County are also not paying the tax. “Mostly, it’s a matter of them not knowing, and once we reach out to them, they start to pay. It’s been really time-consuming for us to get in order.”

She said property owners who also offer short term rentals need to collect and pay the tax.

Kirchner said getting a handle on all of the new properties that should be paying the transient room tax “has been a huge undertaking for us.”

“We send certified mail packets to all new properties we see,” Kirchner said, but many property owners still don’t realize they need to collect and pay the room tax.

“It’s a problem for the entire state of Kentucky and we are collectively working with Airbnb to get more procedures in place” so that the right taxes are collected and paid, she said. “Some taxes are collected and some are not, so that is confusing for the property owner, so we want to help.”

The CVB is a powerful marketing engine for Boyle County, Kirchner said, “so it’s in their best interest to be in good standing with the CVB.” Plus, paying the tax is the law, she said.