Nearly 20 El Paso hotels are on the hook after a fresh city audit found more than $1.13 million in uncollected hotel-occupancy taxes, with problems concentrated in airport-area chains and older downtown motels. The findings are now headed to City Hall, where leaders are set to dig into the details at a Financial Oversight and Audit Committee meeting on Thursday.
According to a report by the City of El Paso Internal Audit Department, contractor Neumo (formerly Avenu) wrapped up Round 10 of hotel-occupancy tax compliance reviews on April 21, 2026, and identified $1,131,941.83 in tax deficiencies across 19 of the 20 hotels examined. The report breaks down the shortfalls property by property and recommends that the Office of the Comptroller collect the unpaid principal plus any applicable penalties and interest. Determination letters were mailed to the hotels flagged in the review on April 23, according to the audit materials.
As reported by KFOX14/CBS4, the list includes several airport-adjacent national brands along with a cluster of smaller downtown motels. One Comfort Inn & Suites alone was cited for a $262,687.65 shortfall. City Chief Financial Officer Robert Cortinas told KFOX the city has been running hotel audits for about a decade and that earlier rounds have already helped bring in “over four million dollars” in late or missing hotel-occupancy tax payments. Cortinas also noted that when hotels refuse to pay, enforcement can escalate to legal action and, in at least one previous case, a court order that shut down a property until it complied.
Common problems found
Auditors said the most frequent issues involved under-reported gross and miscellaneous revenue, tax exemptions that were claimed improperly, and failure to report taxable add-on fees such as pet charges or cancellation fees. A prior Avenu review posted on the city website in 2024 documented many of the same problems across an earlier group of hotels, suggesting the compliance program has repeatedly uncovered similar reporting mistakes cycle after cycle.
What the law allows
The audit advises the Office of the Comptroller to move ahead with collection efforts, while pointing out that hotels can challenge the findings through the state’s administrative system. Under Texas law, businesses may petition the comptroller for a redetermination and request a hearing or file an appeal, and penalties and interest can be tacked on if the disputed amounts remain unpaid. The relevant procedures are laid out in the state Tax Code.
Why it matters locally
By city charter, hotel-occupancy tax revenue is restricted and must be used for tourism promotion, marketing, and city-owned venues, money that supports the Convention Center, the Abraham Chavez Theatre, and debt tied to the downtown ballpark. When hotels underpay, it can chip away at the funds available for events and promotions that city officials argue help draw visitors and economic activity into El Paso.
What to expect next
The Financial Oversight and Audit Committee is scheduled to take up the Round 10 findings at its May 21 meeting in City Hall’s council chambers, according to the committee agenda. City staff plan to ask the Office of the Comptroller to pursue collections, and the council could consider whether tougher enforcement steps are warranted. The hotels involved retain their administrative appeal rights under state law while those processes unfold.
