Lawsuit may benefit county
By Michael Prochaska
Morgan County may benefit from a class action lawsuit between numerous Georgia cities and counties and several online travel companies, such as Orbitz, Hotels.com, Priceline and Expedia.
The City of Rome, Hart County and the City of Cartersville filed suit in November of 2005 against online hotel reservation companies, claiming said companies should be taxed on rates they charge their customers instead of solely on the discounted rates they pay local hotels.
“You reserve a room, you pay, let’s say, $100. They charge you the local hotel/motel tax on that $100, but Hotels.com isn’t paying $100 for that hotel room,” explained Morgan County Attorney Christian Henry. “It’s only paying a discounted rate to the hotels. So that discounted rate might be $50. The hotel/motel tax on $50 isn’t what they charge to the consumer. So they pocket the difference in what they’re actually paying in hotel/motel tax...”
Morgan County had the choice to remain a plaintiff member and submit information regarding its hotel excise tax ordinance, remain a plaintiff member and object to the settlement or exclude itself from the class list of local government entities.
The Board of Commissioners agreed to take part in the lawsuit several weeks ago.
A partial settlement would provide cash payments for hotel excise taxes to the class members from May 16, 2011 (with interest at 7 percent until paid) and going forward. A final approval hearing is scheduled for August 16, 2012 at 1:30 p.m. at the Federal Courthouse in Rome, Ga.
At that time, The Court will decide how much to pay Class Council if it approves the settlement.
Henry said the county is not responsible for legal fees and that the county can only benefit from the lawsuit, though it’s speculative how much.
Printed in the July 5, 2012 edition