Shilo Inn

The city took action against Shilo Inn this month in Clatsop County Circuit Court.

The city is seeking almost $150,000 in unpaid lodging taxes for the quarter ending in September, with an additional 25% penalty of more than $37,000.

Taxes from the period were due Oct. 15.

“I’ve dealt with (Shilo Inn owner) Mark Hemstreet for years,” City Attorney Dan Van Thiel said. “I don’t understand him. This has got to be the most expensive money in the world to fool around like this. But it’s his money, not mine.”

Representatives of Shilo Inn did not respond to requests for comment.

The lawsuit covers taxes on $1.7 million in room rental revenue.

According to the complaint, Shilo Inn “continues to withhold the payment of these taxes, notwithstanding numerous demands” by the city.

In June, the city sued Shilo Inn for more than $45,000 in lodging taxes for the period ending in April. With penalties and interest, the total sought was more than $58,000.

That suit was closed in October after Shilo Inn paid the taxes and the penalty.

In 2016, Seaside sued the company for delinquent taxes of more than $112,500. Shilo Inn paid out almost $146,000 in back taxes and penalties.

Earlier this year, Warrenton sued Shilo Inn after more than $130,000 in lodging taxes, penalties and accrued interest went unpaid.

Warrenton settled its case against Shilo Inn in August.

“When you see people doing this, it’s because they’re utilizing the city’s money,” Van Thiel said. “This is not their money. This is what is an irritation to me. As I represent in the complaint, that’s what we categorize as a ‘fiduciary.’ They collect it, but they’re using our money.”

Seaside’s Shilo Inn is not the only Shilo property that goes into delinquency, Van Thiel added. “This is a recurring problem,” he said.

Seaside could eventually profit from the delinquency, Van Thiel said.

“If you have to pay us $147,000 and you don’t pay us and then you’ve got to pay us another $37,000-plus because you didn’t pay us on time, that’s a good deal for the city. I sue them periodically and I keep on telling them, ‘I don’t understand why you do this. It doesn’t make sense to me.’”

Van Thiel said he expected the case to be resolved quickly.

“I think it will be settled, and it will be settled before long,” he said.