NEWS RELEASE FOR IMMEDIATE RELEASE APRIL 4, 2013 CONTACTS: SANDY BROWN 310-418-4335, LAURA LAKE 310-497-5550, HARALD HAHN 310-271-0568, NOEL WEISS, ESQ., 310-8220239
UC REGENTS SUED OVER WASTING MILLIONS ON UCLA LUSKIN HOTEL AND FAILING TO PAY TAXES Westwood B Save Westwood Village, Sandy Brown, and Harald Hahn filed a taxpayer lawsuit yesterday in LA Superior Court to compel UCLA and the UC Regents to comply with UC tax and financial policies and not waste public funds. These policies legally mandate providing an accurate budget and risk assessment to the Regents for the $162 million, $224/night, 250 room proposed Luskin Conference and Guest Center (Hotel) on UCLA’s Lot 6; prohibiting taxexempt financing for non-exempt purposes; reporting millions of dollars of Federal Unrelated Business Income (UBI) for UCLA’s existing and proposed hotels; and remitting local hotel tax. Other UC campus hotels comply with UC policies. UCLA does not. Violation of these policies threatens the tax-exempt status of the University of California. State law prohibits the Regents from wasting public funds (California Code of Civil Procedure Section 526a). Had the true cost of the Luskin Hotel been accurately presented to the Regents, it would have been evident that the Luskin Hotel would lose money and drain campus funds. To make the Luskin Hotel and its public restaurant appear profitable, UCLA added over $13 million in revenue from other UCLA hotels while it hid $52-93 M in expenses (see attached chart). Stanford University’s online UBIT tutorial makes it clear that university hotels are not exempt from federal taxation: “A University contemplates building and operating a full service hotel on campus to house visiting scholars, parents, visiting athletic teams and guests. The operation of the hotel is an unrelated business activity.” UCLA has never reported income from its hotels: ◊ UCLA Lake Arrowhead Conference Center and Mountain Resort (105 rooms) http://www.lakearrowheadmeetings.com/ ◊ UCLA Guest House Hotel (61 rooms) http://map.ais.ucla.edu/portal/site/UCLA/menuitem.3f8e7342ad4ca217b66d4ab4f848344a/?v gnextoid=fd5af9f9bd19ff00VgnVCM1000008f8443a4RCRD ◊ Tiverton House Hotel (100 rooms) http://tivertonhouse.ucla.edu/
◊ Courtside Collection summer hotel (100 rooms) http://courtside.hhs.ucla.edu/, and ◊ Dormitories converted to summer hotel (http://map.ais.ucla.edu/go/1002236) UCLA: In a July 12, 2012 letter to the Regents, UCLA Chancellor Gene Block stated: “We do not, and will not, advertise to the general public….” FACT: UCLA advertises its hotels to the public: (www.UniqueVentures.com; http://uclafacultyassociation.blogspot.com/2012/11/ucla-advertises-its-conference.html; and www.TripAdvisor.com includes guest reviews. UCLA: justified the Luskin Hotel by insisting that it lacks adequate conference space for academic meetings. FACT: UCLA has so much conference space (70,000 SF), it rents it out for private events (http://www.uclameetings.com/Meeting-Event-Spaces/Overview.aspx). UCLA: has insisted that only guests “affiliated” with UCLA can stay at its hotels. FACT: The UCLA Lake Arrowhead Conference Center website proclaims: “UCLA affiliation is NOT required.” (http://www.lakearrowheadmeetings.com/). The lawsuit names the Regents of the University of California, Meyer and Renee Luskin, the UCLA Foundation, and the Director of Finance for the City of Los Angeles (for failing to collect hotel tax). A copy of the complaint is attached. The conformed complaint is attached.
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