Background

• Nine Alabama municipalities and the Birmingham-Jefferson Civic Center Authority sued 16 OTCs seeking a declaration that OTCs owe lodgings tax on rooms rented through their services.
• OTCs facilitate hotel reservations online; customers pay room charge, lodgings tax recovery, and OTC service fees; hotels receive room charges and tax from OTCs.
• DOR had ruled that only hotel operators rent or furnish rooms and that OTCs are not obligated to collect/remit lodgings tax.
• Trial court granted summary judgment for OTCs, holding OTCs are not engaged in the business of renting or furnishing rooms and thus not subject to lodgings tax.
• On appeal, the Alabama Supreme Court affirmed, adopting the trial court’s order and concluding the plain language of statute and ordinances does not authorize taxation of OTC services.
• The Birmingham-Jefferson Civic Center Authority is a recipient of tax revenue, not a taxing authority, and does not levy lodgings tax itself.

Issues

Key Cases Cited

• City of Mobile v. GSF Properties, Inc., 531 So.2d 833 (Ala.1988) (municipal authority to levy lodging tax relies on state-granted power)
• Ex parte National Western Life Insurance Co., 899 So.2d 218 (Ala.2004) (statutory interpretation and legislative intent governs analysis)
• DeKalb County LP Gas Co. v. Suburban Gas, Inc., 729 So.2d 270 (Ala.1998) (statutory language must be given plain, ordinary meaning)
• Blue Cross & Blue Shield v. Nielsen, 714 So.2d 293 (Ala.1998) (plain-language approach; interpret statute as written)
• IMED Corp. v. Systems Eng’g Assocs. Corp., 602 So.2d 344 (Ala.1992) (interpretation framework for statutory inquiries)