Beanie Babies Billionaire Girds for Battle over Biltmore Property Taxes
But Settles Legal Showdown over Pickleball Noise at Montecito Club
Beanie Babies mogul Ty Warner, owner of Santa Barbara’s iconic and embattled Four Seasons Resort The Biltmore, says Santa Barbara County property tax collectors are charging him way too much and has appealed their assessment of the luxury hotel’s property value.
In 2020, agents for the reclusive owner said the Biltmore was worth $52.9 million, while county assessors said it was worth $232.1 million. The following year, agents for the hotel’s ownership group insisted the property — four parcels in all — was worth $117.1 million, while the county assessor valued it at $234.3 million.
Given that the assessed value is the starting point for determining the property tax burden, such differences could translate to a whole lot of money. In the past three years, the Biltmore has paid $2.9 million to $3 million a year in property taxes. That doesn’t count the bed taxes generated by the Biltmore, which, until going dark shortly after the COVID pandemic struck, charged up to $11,000 a night for some rooms. County tax collectors do not release the bed tax amounts generated by individual hotels, but Supervisor Das Williams — in whose district the Biltmore is situated — estimated it to be in the “millions” of dollars.
To date, the county assessor claims no justification has been provided by anyone associated with the Biltmore for their lower valuation. “The appellant will introduce their case at a public hearing. We can’t begin to speculate on what their case may be,” stated Susan Morrison with the County Clerk, Recorder, Assessor, and Elections Department. No hearing dates have yet been set. Efforts to reach Warner’s attorney Paul Wilcox or the agents handling his assessment appeals went unreturned by deadline.
Joe Holland, the county assessor, stated that the Biltmore ownership group’s decision to turn off its own lights and voluntarily starve themselves of revenue would not justify the changes in assessments being sought. Holland noted that the South Coast has been experiencing a brisk wave of hotel sales in recent months, adding that this would not be the first time this ownership group has filed similar actions.
Most perplexing to county officials has been the hotel’s decision to stay dark when other hotels have been posting record occupancy rates while charging robust room rates. This decision, in fact, made Warner the target of a class-action lawsuit filed last week on behalf of 450 Biltmore workers who’ve been placed in indefinite — and unpaid — furlough since March 2020 in response to the pandemic.
According to the lawsuit, filed by employment law litigator Bruce Anticouni, the Four Seasons notified Warner just months after the hotel shut down that it was safe to reopen. According to Anticouni’s filing, Warner has declined to give the green light to reopen the hotel, leaving otherwise generously paid employees suddenly out of work. Anticouni contends that a provision in Biltmore employee contracts includes a severance package for workers let go through no fault of their own. In the case of the Biltmore’s 450 employees, he contends that comes to $6 million-$8 million.
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To date, however, Anticouni got nowhere in two mediated settlement discussions with representatives of both Warner and the Four Seasons. Because the workers were furloughed and not terminated, they argued, that provision is not relevant. Still in its infancy, that case has a long way to go.
Supervisor Williams said he’s reached out to Biltmore representatives to gain a better understanding of what’s going on. He got nowhere. There’s speculation that Warner is now waging guerilla warfare with the Four Seasons operating group — billionaire Bill Gates is said to be a major owner — with whom he contracted to run his hotel. A similar scenario has been unfolding between Warner and the Four Seasons in New York City, but that hotel, unlike Santa Barbara’s, was represented by a union. As a result, the lights there are reportedly going back on and the employees going back to work.
If Santa Barbara’s Biltmore were to be the battleground on which Warner could lock horns with others of great wealth, it would hardly be the first time. Warner just settled what could have become a bruising legal fight with Angelo Mozilo — the former mortgage loan mogul whose aggressive lending practices at Countrywide Lending are often blamed for triggering the recession of 2008 — over a noise dispute with the Montecito Club, which Warner also owns. Mozilo, who lives next to the country club, filed a complaint alleging that the noise generated by a non-permitted pickleball court was extremely disruptive and inflicted irreparable damage to his property values.
The pickleball court was part of a much more expansive sports complex the country club had installed without first obtaining the necessary permits from the City of Santa Barbara, under whose jurisdiction it falls. Warner ultimately agreed to remove the pickleball courts and relocate them on the tennis courts and to relocate the recently installed batting cage and sand volleyball court.
In November 2021, the city’s Planning Commission approved these changes with no opposition from Mozilo, and in December, Mozilo and Warner reached a settlement.
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