December 14, 1995

You request a letter ruling regarding the application of the room occupancy excise, G.L. c. 64G, to transfers of occupancy in certain property that has been converted from a seasonal motel to condominium units.


You state the facts as follows: Prior to May 25, 1985, the property, which consists of forty‑five units, was operated as a seasonal motel. On May 23, 1985, the property was converted to condominiums pursuant to the provisions of Chapter 183A of the Massachusetts General Laws. During the period 1986 through 1993, the property had been licensed as a motel by the Town of ****** ("the Town") and the room occupancy excise was collected and paid over to the Commissioner. On May 4, 1994 the Town advised the taxpayer that licensing of these premises as a motel was no longer required, since the property has been converted to a condominium form of ownership. However, the Town required owners of rental property to register and obtain a Rental Occupancy Certificate for each rental unit.


For the room occupancy excise to apply to the converted condominium units in question, the units must be licensed or required to be licensed as a building or group of buildings which provide sleeping accommodations for transient motorists and which is not licensed as an inn. This licensing determination is made by local boards of health under the authority provided by G.L. c. 140, § 32B. If the local board of health determines that the property must be licensed as a "motel" under this provision, the premises fall within the definition of a "motel" for purposes of Chapter 64G, and the room occupancy excise applies to transfers of occupancy in these units. Conversely, if the local board of health determines that the property need not be licensed under the provisions of G.L. c. 140, § 32B, the property does not fall within the definition of a "motel" for purposes of G.L. c. 64G. In such cases, the room occupancy excise does not apply.


Based on the facts as you state them in your request, and for reasons discussed above, we rule that the premises are not subject to the room occupancy excise with respect to rentals commencing on or after May 4, 1994, the date the Town determined that the premises, or the relevant portion thereof, need not be registered as a motel under the provisions of G.L. c. 140, § 32B.

Very truly yours,

/s/Mitchell Adams

Mitchell Adams
Commissioner of Revenue


LR 95-12

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