Monday, June 18, 2018
News Roundup

Pinellas gay-lesbian resort claims discrimination is cause of high tax bill

The owner of a St. Petersburg hotel that markets itself to gay and lesbian guests is suing Pinellas County's property appraiser, claiming its tax bill is too high because of discrimination.

Pinellas Property Appraiser Pam Dubov said Monday she had not seen the lawsuit, but she was familiar with a previous complaint from the hotelier, and sharply disagrees.

"I categorically deny that we have any intent toward discrimination against the gay and lesbian community," Dubov said.

The Flamingo Resort, 4601 34th Street S, bills itself as "Florida's largest LGBT resort" and "a must at the top of your list of gay travel destinations."

The owner, Edge Partners, recently decided to challenge the hotel's $2.2 million tax assessment and, by extension, its property tax bill of $50,841. It appealed those numbers by going to the Value Adjustment Board.

Dubov said her staff bases its assessments on the market value of the property. And she gave an example: A restaurant that caters only to small children might have a small clientele, which would therefore cut down its business. But that doesn't mean the market value of the restaurant's building and land is worth any less.

The property appraiser's staff argued the Flamingo was aimed at "a 'niche' segment of the market (the gay and lesbian community) as opposed to operating the property to include all of the market," according to a written summary of the board hearing. Because of this, "occupancy has suffered and is below typical market indications."

Though the hotel reported effective gross income of $673,222 in 2012, the property appraiser calculated a potential $1.1 million income to use in its calculations of the property's worth.

But in explaining why the Flamingo should be assessed at a lower amount, a hotel representative cited several deficiencies, including that it's a 51-year-old motel that has had high maintenance costs, no renovations since construction, a 28 percent occupancy rate and few financing options, according to the board records. The former Howard Johnson hotel is "functionally obsolete" because of "the substandard location, and older furniture, fixtures and equipment that cannot be updated" the representative said, according to the board records.

The hotel representative, Jack Daugherty, said in the board meeting that financial institutions visit the hotel and say they don't want to invest in an older building. "The gay thing doesn't bother them at all," he said.

"The gay thing doesn't bother us either," said a property appraiser's representative, according to a recording of the meeting.

The Value Adjustment Board sided with the property appraiser to keep the higher assessed value. But hotel attorney David Sockol said the written summary of the board meeting makes it seem in some cases like it agrees with the hotel's position by pointing out:

• "It is difficult to determine whether or not this property could generate more net operating income if it did not appeal to a niche market."

• The property previously went into foreclosure "which suggests that perhaps it may not be able to generate more net income than it currently does, due to its quality condition and age."

Contact Curtis Krueger at [email protected] or (727) 893-8232. Follow @ckruegertimes

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