Parking Occupancy Tax Bond - City of Los Angeles, CA in California

Brief Summary

Your bond amount in Los Angeles is set by each parking facility's gross receipts, from $5,000 for a lot taking in under $50,000 a year up to $700,000 for one above $6 million. Get the tier right, file the city's Form 001 on time, and you keep your auto park permit safe without tying up cash in a deposit account.

Los Angeles requires every non-governmental auto park operator to file a Parking Occupancy Tax Collection Bond with the Office of Finance for each parking facility it runs, under LAMC Chapter II, Article 1.15 and Ordinance No. 182283. The amount is tiered by the facility's prior calendar year parking fee gross receipts. Operators that accept credit cards, report and pay the tax on time, and give Finance access to their card records can apply for an exemption.

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How to Apply for a Parking Occupancy Tax Bond:

• Check whether you qualify for the credit card exemption before buying a bond.
• Work out each facility's prior calendar year parking fee gross receipts, or estimated receipts for a new lot.
• Match each facility to its tier in the LAMC Article 1.15 schedule and add the amounts if one bond will cover several sites.
• Have the surety issue the bond on the city's Form 001 with an effective date, signatures and seal.
• Complete the Parking Occupancy Tax Collection Bond/Escrow Application, online or on paper.
• Mail the original bond to the Office of Finance, PO Box 53234, Los Angeles, CA 90053-0234, by the last day of the month after the facility opens.

Detailed Information About the California Parking Occupancy Tax Bond:

Who has to post this bond

The City of Los Angeles amended its Parking Occupancy Tax article (LAMC Chapter II, Article 1.15) through Ordinance No. 182283 in October 2012. Since September 1, 2013, auto park operators must file a Parking Occupancy Tax Collection Bond with the Office of Finance for each parking facility they run. That covers operators acting as owner, lessee, mortgagee in possession, licensee, valet or other service supplier. Private companies running a lot on behalf of a government agency are covered too. Only an operator that is itself a governmental entity is outside the rule.

The exemption most operators miss

Since July 1, 2017, a parking lot or valet operator can apply for a bond exemption if it meets all three conditions. It must offer daily customers the option to pay by widely used credit cards, keep reporting and paying the monthly tax accurately and on time, and give the Office of Finance access to electronic records of its card transactions. The exemption is not automatic. You file the Parking Occupancy Tax Collection Bond Exemption Application with the Office of Finance.

How the amount is set

The bond is sized per facility from the prior calendar year's parking fee gross receipts, or estimated annual receipts for a new facility. Under $50,000 needs $5,000. The amount then rises in $5,000 steps for every $50,000 of receipts up to $500,000, which needs $50,000. From there it rises $10,000 per $100,000 of receipts up to $1,000,000 ($100,000 bond), then $25,000 per $250,000 up to $2,500,000 ($250,000 bond), then $50,000 per $500,000 up to $5,000,000 ($500,000 bond). Receipts from $5,000,000.01 to $6,000,000 need $600,000, and anything above $6,000,000 needs $700,000.

One bond can cover several facilities registered under the same legal name if its face amount equals the sum of each facility's requirement. If receipts rise at least five percent above the threshold for the next larger bond, you must obtain the larger bond by the end of the following February. If they fall at least five percent below the next smaller tier, you may apply for a reduction.

Deadlines and filing

For a new or added facility, the bond and the Bond/Escrow Application are due by close of business on the last day of the month after the month the facility opens. The bond must be written on the city's Form 001 by a surety licensed by the California Insurance Commissioner, signed by both parties, sealed, and filed as an original. It is continuous and stays in force for the life of the operator's Parking Occupancy Tax Certificate. The city keeps three years after cancellation to make a demand, and cancellation needs 30 days' notice to Finance.

An operator that cannot get a bond must instead open a cash deposit account equal to 50 percent of the required bond for each facility. Failing to file either can lead to revocation or denial of the Police Auto Park Permit.

Eligibility and Requirements for a California Parking Occupancy Tax Bond:

• Surety licensed by the California Insurance Commissioner for fidelity and surety business.
• City of Los Angeles, Office of Finance named as obligee on Form 001, which cannot be altered.
• Bond amount equal to the tier for each facility's annual gross receipts.
• Legal name and DBA on the bond matching the operator's city tax registration.
• A larger bond by February month end if receipts climb at least five percent past the next tier.

California Parking Occupancy Tax Bond FAQs:

Official and Additional Resources for the California Parking Occupancy Tax Bond: