1990 BED-TAX INCREASE MAY BE PUT TO VOTE : WESTLAKE VILLAGE EYES COURT MOVES ON SPECIAL TAXES.

Byline: R.A. Hutchinson Daily News Staff Writer

While neighboring Agoura Hills struggles to cope with the loss of its tax on utilities, Westlake Village officials are wondering whether to put their transient occupancy tax to a vote in November.

Despite a flurry of legal rulings surrounding special-use taxes, City Council members have avoided placing the 1982 tax on the ballot, according to City Manager Ray Taylor. But he says recent developments call for an update. The deadline for placing issues on the Nov. 5 ballot is Aug. 9.

``We're just raising the question. That's been our policy - wait and see,'' Taylor said. ``The only factor here is the timing.''

Since September 1995, city officials across California have been trying to unravel the impact of a state Supreme Court decision upholding the validity of Proposition 62. The 1986 ballot initiative requires voters to approve general or special-use taxes implemented by local government agencies. Prior to the September ruling, which the high court clarified in December, lower courts had rejected Proposition 62 as violating the California state constitution.

For Westlake Village, questions about such taxes jeopardize $250,000 collected since 1990, when it increased its occupancy tax from 6 percent to 10 percent. The city's General Fund budget totals about $4 million for the fiscal year and the reserve account totals about $1.8 million.

Because the 6 percent rate was implemented in 1982 - four years before Proposition 62 - there is no question about its legality. However, the impact of the proposition on the 1990 increase remains in dispute.

``That increase is in question,'' Taylor said.

The money has been collected from a single source, the Westlake Inn. For the city, the logistics of returning the money would be simple if the December ruling is eventually declared retroactive to 1986.

``The dilemma is how would the Westlake Inn reimburse the money?'' Taylor said.

Those questions and others about the court decision are being addressed by the judicial system and in the state Legislature, according to JoAnne Speers, general counsel and assistant director of the League of California Cities.

Speers said a case in appellate court in Butte County speaks to the retroactivity question, while several cases at the trial-court level address whether Proposition 62 applies to charter cities, and other issues. In the state Assembly, legislation is pending that would clarify the court ruling.

``We had hoped it would be part of the budget bill, but it didn't make it. We're waiting to see what happens in August,'' Speers said.

City officials in Agoura Hills, beleaguered by critics since their utilities tax was approved in 1994, bowed to pressure with a special election on June 25. The tax was defeated, leaving the city with a $1.5 million loss in annual revenue.

``There have been several elections, but few have been successful,'' Speers said.

Taylor said he expects the city of Westlake Village will continue to await the outcome of the legal questions before taking action on the occupancy tax because the amount of money would not severely affect the city's finances.

``Legislation is proceeding but no one knows how it's going to turn out. It's not as big a problem for us as it is in Agoura Hills,'' Taylor said. ``It is a tiny problem, but none the less, we're treating it seriously.''