HomeMy WebLinkAboutResolution - 3553 STATE OF CALIFORNIA ) RESOLUTION NO. 3553
COUNTY OF RIVERSIDE)ss
CITY OF SAN JACINTO )
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN
JACINTO, CALIFORNIA CALLING FOR THE HOLDING OF AN ALL
MAIL BALLOT SPECIAL MUNICIPAL ELECTION ON MAY 59 2015 FOR
THE SUBMISSION TO THE QUALIFIED VOTERS OF A PROPOSED
ORDINANCE ENACTING A FIVE PERCENT (5%) UTILITY USERS TAX
WITHIN THE CITY FOR A PERIOD OF TEN (10) YEARS, MAKING
CERTAIN FINDINGS, AND DIRECTING THE CITY ATTORNEY TO
PREPARE AN IMPARTIAL ANALYSIS.
WHEREAS, pursuant to California Elections Code Section 9222, the City Council
would like to submit to the voters a measure enacting a five percent (5%) utility users tax
("UUT"), on electricity, gas, water, telecommunications, video, sewer and refuse usage
within the City for a period of ten (10) years; and
WHEREAS, the UUT is a general tax which would fund the City's general fund.
The general fund pays for essential City services such as police, fire and paramedic
services, street operations and maintenance, library services, parks and recreation
services and general municipal services to the public; and
WHEREAS, on November 6, 1996, the voters of the State of California approved
Proposition 218 (California Constitution, Article XIIIC), an amendment to the State
Constitution which requires that all general taxes which are imposed, extended or
increased must be approved by a majority vote of the voters; and
WHEREAS, like many other cities, the City has been undergoing a financial crisis
due to the economic downturn, takeaways by the State of California and decreasing
revenues; and
WHEREAS, the City has made significant cuts to the budget, including cuts to
public safety services; and
WHEREAS, despite such actions, the City continues to run an approximately
$1,025,000 annual structural deficit in the general fund; and
WHEREAS, the City has evaluated the impacts of decreased general fund
revenues on its ability to provide vital services to the public, including evaluation and
implementation of measures to reduce costs, as well as measures to increase revenue;
and
WHEREAS, without voter approval of the proposed UUT, the City will face serious
financial shortfalls and be required to reduce essential City services, such as an additional
15 percent cut to Law Enforcement (equivalent to 5 of the current 32.5 officers) or an
additional cut to hours at City Hall and concessions from employees, which will endanger
the health, safety and general welfare of the City and its residents and, as such, there is
there is a need to adopt the UUT in order to maintain adequate funding for City services at
existing levels for the health, safety and general welfare of the residents of the City; and
WHEREAS, Proposition 218 permits the City Council to call a special election to
impose, increase or extend a general tax, only if the City Council finds, by a unanimous
vote, that there exists an emergency requiring a special election to be conducted earlier
than the next regularly scheduled general election at which City Council members are to
be elected; and
WHEREAS, the next regularly scheduled general election at which City Council
members are to be elected is November 8, 2016; and
WHEREAS, as described above, the health, safety and general welfare of the
citizens of the City would be endangered if the City were unable to place the UUT
before its voters until November 8, 2016; and
WHEREAS, all of the circumstances described above create an emergency
situation warranting the placement of a measure enacting a UUT on the next available
special election ballot to permit the voters to decide on enacting the UUT pursuant to
Proposition 218; and
WHEREAS, the City Council desires to conduct the special municipal election as
an all mail ballot election; and
WHEREAS, the proposed date for this election is one of the dates specifically
authorized for all mail ballot elections pursuant to Section 1500 of the California
Elections Code.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN JACINTO
DOES RESOLVE, DECLARE, DETERMINE AND ORDER AS FOLLOWS:
Section 1. Findings. The City Council finds that all of the preceding recitals
are true and correct, are incorporated herein by this reference made an operative part
hereof.
Section 2. Declaration of Emergency. Pursuant to California Constitution,
Article XIIIC, Section 2(b), the City Council hereby unanimously declares the existence
of an emergency in that there are imminent financial risks and dangers, as described
above, to the public welfare and the City's financial ability to provide essential municipal
services without disruption, so that a special election is necessary to address such risks
and dangers.
Section 3. Submission of Measure at All Mail Ballot Election. Pursuant to
California Constitution, Article XIIIC, Section 2(b), California Government Code Section
53724 and any other applicable requirements of the laws of the State of California
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relating to general law cities, the City Council, by a unanimous vote, hereby orders the
following proposed measure/ordinance to be submitted to the voters of the City at a
special municipal election to be conducted by all mail ballot on Tuesday, May 5, 2015:
"San Jacinto City Services Stability Measure. To maintain current YES
police, firefighter and paramedic service levels, maintain 9-1-1
emergency response times, maintain operational levels for existing
neighborhood fire stations, parks, community buildings and
infrastructure, and create jobs; shall the City of San Jacinto establish
a 5% Utility Users Tax for 10 years on utility services within the City,
while exempting low-income seniors, requiring annual audits and
allowing no tax rate increase without voter approval?"
NO
Section 4. Text of Ordinance. The text of the ordinance to be submitted to
the voters is attached as Exhibit A.
Section 5. Form of Ballots. The ballots to be used at the special municipal
election shall be in form and content as required by law.
Section 6. Conduct of All Mail Ballot Election. The City Clerk is authorized,
instructed and directed to procure and furnish any and all official ballots, printed matter
and all supplies, equipment and paraphernalia that may be necessary in order to
properly and lawfully conduct the election by all mail ballot. Said special municipal
election shall be conducted by all mail ballot, and shall be conducted pursuant to
Chapter 2 of Division 4 (commencing with Section 4100) of the California Elections
Code only insofar as required by law. In all particulars not recited in this Resolution, the
election shall be held and conducted as provided by law for holding municipal elections.
Section 7. Deadline for Returning All Mail Ballots. Ballots cast in this
special municipal election shall be returned to the Office of the City Clerk no later than 8
p.m. on election day. However, a ballot shall be deemed timely returned if it is received
by the Office of the City Clerk via the United States Postal Service or a bona fide private
mail delivery company no later than three (3) calendar days after election day and either
of the following is satisfied:
(a) The ballot is postmarked on or before election day or is time stamped or
date stamped by a bona fide private mail delivery company on or before
election day; or
(b) If the ballot has no postmark, a postmark with no date, or an illegible
postmark, the vote by mail ballot identification envelope is date stamped
by the Office of the City Clerk upon receipt of the vote by mail ballot from
the United States Postal Service or a bona fide private mail delivery
company, and is signed and dated by the voter pursuant to Section 3011
of the California Elections Code on or before election day.
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Only timely received ballots shall be counted.
Section 8. Notice of Election. Notice of the time and place of holding the
election is hereby given, and the City Clerk is authorized, instructed and directed to give
further or additional notice of the election, in time, form and manner as required by law.
Section 9. Impartial Analysis. Pursuant to California Elections Code Section
9280, the City Council hereby directs the City Clerk to transmit a copy of the measure to
the City Attorney. The City Attorney shall prepare an impartial analysis of the measure,
not to exceed 500 words in length, showing the effect of the measure on the existing
law and the operation of the measure, and transmit such impartial analysis to the City
Clerk not later than the deadline for submittal of primary arguments for or against the
measure, as set forth in City Resolution No. 3554.
The impartial analysis shall include a statement indicating whether the measure
was placed on the ballot by a petition signed by the requisite number of voters of by the
City Council. In the event the entire text of the measure is not printed on the ballot, nor
in the voter information portion of the sample ballot, there shall be printed immediately
below the impartial analysis, in no less thanl0-font type, the following: "The above
statement is an impartial analysis of Ordinance or Measure . If you desire a copy
of the ordinance or measure, please call the Office of the City Clerk at [insert phone
number] and a copy will be mailed at no cost to you."
Section 10. Certification. The City Clerk shall certify to the passage and
adoption of this Resolution and enter it into the book of original Resolutions.
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PASSED, APPROVED AND ADOPTED this 3rd day of February, 2015, by the
following vote:
Ayes: Bartel, Ledezma, Miller, Ruiz
Nays: None
Absent: Kotyuk
Abstain: None
City of San Jacinto
Crys al uiz, Mayor
ATTEST:
6 4" U�&-,
Richard Miller, City Clerk
APPROVED AS TO FORM:
Best Best & Krieger LLP
JeffJeff . Ballinge�ty Attorney Attorney
5
I, Richard Miller, City Clerk of the City of San Jacinto, do hereby certify that the
foregoing resolution is the actual resolution duly and regularly adopted by the City
Council at a regular meeting on the 3rd day of February, 2015, by the following vote to
wit:
Ayes: Bartel, Ledezma, Miller, Ruiz
Nays: None
Absent: Kotyuk
Abstain: None
Richard Miller, City Clerk
6
ATTACHMENT "A"
ORDINANCE REGARDING UTILITY USER TAX
[SEE ATTACHED PAGES 8 THROUGH 35]
7
STATE OF CALIFORNIA ) ORDINANCE NO. 15-01
COUNTY OF RIVERSIDE ) ss
CITY OF SAN JACINTO )
MEASURE " "
AN ORDINANCE OF THE PEOPLE OF THE CITY OF SAN
JACINTO, CALIFORNIA, ADDING CHAPTER 3.22 TO
TITLE 3 OF THE SAN JACINTO MUNICIPAL CODE,
ENACTING A FIVE PERCENT (5%) UTILITY USERS TAX
WITHIN THE CITY
THE PEOPLE OF THE CITY OF SAN JACINTO, CALIFORNIA, DO ORDAIN
AS FOLLOWS:
SECTION 1. Chapter 3.22 is hereby added to Title 3 of the San Jacinto
Municipal Code, and shall read as follows:
"Chapter 3.22 - UTILITY USERS TAX
Sections:
3.22.010 Purpose.
3.22.020 Definitions.
3.22.030 Communication users tax.
3.22.040 Electricity users tax.
3.22.050 Gas users tax.
3.22.060 Collection of Tax From Service Users Receiving Direct Purchase of
Gas or Electricity.
3.22.070 Water users tax.
3.22.080 Video service users tax.
3.22.090 Sewer service users tax.
3.22.100 Solid Waste Service users tax.
3.22.110 Constitutional, Statutory and Other Exemptions.
3.22.120 Substantial Nexus/Minimum Contacts.
3.22.130 Duty to collect--Procedures.
3.22.140 Filing Return and Payment.
3.22,150 Collection of Penalties.
3.22.160 Deficiency Determination and Assessment —Tax Application Errors.
3.22.170 Administrative Remedy — Non-Paying Services Users.
3.22.180 Actions to Collect.
3.22.190 Additional Powers and Duties of Tax Administrator.
3.22.200 Records.
3.22.210 Refunds.
3.22.220 Appeals.
3.22.230 No Injunction/Writ of Mandate.
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3.22.240 Remedies Cumulative.
3.22.250 Notice of Changes to Ordinance.
3.22.260 Penalties.
3.22.270 Future Amendment to Cited Statute.
3.22.280 Independent Audit of Tax Collection, Exemption, Remittance and
Expenditure.
3.22.290 Amendment or Repeal — Adjustment of Taxing Rate or Methodology.
3.22.300 Sunset of Tax.
3.22.010 Purpose. This chapter is enacted solely to raise revenue for the
general governmental purposes of the City. All of the proceeds from the tax imposed by
this chapter shall be placed in the City's general fund and used for the usual current
expenses of the City.
3.22.020 Definitions. The following words and phrases whenever used in this
chapter shall be construed as defined in this section.
"Ancillary Telecommunications Services" means services that are associated
with or incidental to the provision, use or enjoyment of telecommunications services,
including but not limited to the following services:
1 . "Conference bridging service" means an ancillary service that links two or
more participants of an audio or video conference call and may include the
provision of a telephone number. Conference bridging service does not
include the telecommunications services used to reach the conference
bridge.
2. "Detailed telecommunications billing service" means an ancillary service of
separately stating information pertaining to individual calls on a customer's
billing statement.
3. "Directory assistance" means an ancillary service of providing telephone
number information, and/or address information.
4. "Vertical service" means an ancillary service that is offered in connection
with one or more telecommunications services, which offers advanced
calling features that allow customers to identify callers and to manage
multiple calls and call connections, including conference bridging services.
5. "Voice mail service" means an ancillary service that enables the customer
to store, send or receive recorded messages. Voice mail service does not
include any vertical services that the customer may be required to have in
order to utilize the voice mail service.
"Ancillary Video Services" shall mean services that are associated with or
incidental to the provision or delivery of Video Services, including but not limited to
electronic program guide services, search functions, recording services, interactive
services or other communications services that are associated with or in incidental to
the provision, use or enjoyment of video services.
9
"Billing Address" means the mailing address of the service user where the
service supplier submits invoices or bills for payment by the service user.
"City" means the city of San Jacinto.
Except as otherwise provided in this chapter, "Charges" shall include the value of
any other services, credits, property of every kind or nature, or other consideration
provided by the service user in exchange for the utility services being provided.
"Communication Services" means telecommunication services and ancillary
telecommunication services.
"Gas" means natural or manufactured gas or any alternate hydrocarbon fuel
which may be substituted therefor.
"Mobile Telecommunications Service" shall have the same meaning and usage
as set forth in the Mobile Telecommunications Sourcing Act (4 U.S.C. Section 124) and
the regulations thereunder.
"Month" means a calendar month.
"Municipal Organization" means an organization or association created by statute
or by voluntary action, whose purpose is to facilitate the development and dissemination
of uniform rulings or interpretations regarding the application of utility user taxes to
communications services in the State of California.
"Nonutility supplier" means:
1. A service supplier, other than a supplier of electric distribution services to
all or a significant portion of the city, which generates electricity for sale to
others, and shall include but is not limited to any publicly owned electric
utility, investor-owned utility, co-generator, distributed generation provider,
exempt wholesale generator (15 U.S.C. Section 79z-5a), municipal utility
district, federal power marketing agency, electric rural cooperative, or
other supplier or seller of electricity;
2. An electric service provider (ESP), electricity broker, marketer, aggregator,
pool operator, or other electricity supplier other than a supplier of electric
distribution services to all or a significant portion of the city, which sells or
supplies electricity or supplemental services to electricity users within the
city; or
3. A gas service supplier, aggregator, marketer or broker, other than a
supplier of gas distribution services to all or a significant portion of the city,
which sells or supplies gas or supplemental services to gas users within
the city.
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"Person" means, without limitation, any natural individual, firm, trust, common law
trust, estate, partnership of any kind, association, syndicate, club, joint stock company,
joint venture, joint powers authority, limited liability company, corporation (including
foreign, domestic, and non-profit), municipal district or municipal corporation (other than
the city) cooperative, receiver, trustee, guardian, or other representative appointed by
order of any court.
"Place of Primary Use" means the street address representative of where the
customer's use of the communications service primarily occurs, which must be the
residential street address or the primary business street address of the customer.
"Post-Paid Telecommunication Service" shall mean the telecommunication
service obtained by making a payment on a telecommunication-by-telecommunication
basis either through the use of a credit card or payment mechanism such as a bank
card, travel card, credit card, or debit card, or by charge made to a service number
which is not associated with the origination or termination of the telecommunication
service.
"Prepaid Telecommunication Service" shall mean the right to access
telecommunication services, which must be paid for in advance and which enables the
origination of telecommunications using an access number or authorization code,
whether manually or electronically dialed, and that is sold in predetermined units or
dollars of which the number declines with use in a known amount.
"Private Telecommunication Service" shall mean a telecommunication service
that entitles the customer to exclusive or priority use of a telecommunications channel
or group of channels between or among termination points, regardless of the manner in
which such channel or channels are connected, and includes switching capacity,
extension lines, stations, and any other associated services that are provided in
connection with the use of such channel or channels. A telecommunications channel is
a physical or virtual path of telecommunications over which signals are transmitted
between or among customer channel termination points (i.e., the location where the
customer either inputs or receives the telecommunications).
"Service Address" means the residential street address or the business street
address of the service user. For a communication or video service user, "service
address" means any of the following:
1. The location of the service user's communications equipment from which
the communication originates or terminates, regardless of where the
communication is billed or paid; or,
2. If the location in subsection (1) of this definition is unknown (e.g., mobile
telecommunications or VolP service), the service address means the
location of the service user's place of primary use, or
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3. For prepaid telecommunication service, "service address" means the
location associated with the service number, or, if not known, the point of
sale of the services.
"Service supplier" means any entity or person, including the City, that provides
communication, electric, gas, video, sewer, solid waste or water services to a user of
such services within the City, including any entity or person required to collect or self-
collect and remit a tax as imposed by this chapter, including its billing agent.
"Service user" means a person required to pay a tax imposed by this chapter.
"State" means the state of California.
"Streamlined Sales and Use Tax Agreement" means the multi-state agreement
commonly known and referred to as the Streamlined Sales and Use Tax Agreement,
and as it is amended from time to time.
"Tax administrator" means the Finance Director of the city of San Jacinto or his
or her designated representative.
"Telecommunications services" means the transmission, conveyance, or routing
of voice, data, audio, video, or any other information or signals to a point, or between or
among points, whatever the technology used. The term "telecommunications services"
includes such transmission, conveyance, or routing in which computer processing
applications are used to act on the form, code or protocol of the content for purposes of
transmission, conveyance or routing without regard to whether such services are
referred to as voice over internet protocol (VoIP) services or are classified by the
Federal Communications Commission as enhanced or value added, and includes video
and/or data services that is functionally integrated with "telecommunication services".
"Telecommunications services" include, but are not limited to the following services,
regardless of the manner or basis on which such services are calculated or billed:
ancillary telecommunication services; intrastate, interstate, and international
telecommunications services; mobile telecommunications service; prepaid
telecommunication service; post-paid telecommunication service; private
telecommunication service; paging service; 800 service (or any other toll-free numbers
designated by the Federal Communications Commission); 900 service (or any other
similar numbers designated by the Federal Communications Commission for services
whereby subscribers who call in to pre-recorded or live service).
"Telephone corporation," "electrical corporation," "gas corporation" and "water
corporation" shall have the same meanings as defined in Sections 234, 218, 222, and
241, respectively, of the California Public Utilities Code except, "electrical corporation,"
"gas corporation" and "water corporation" shall also be construed to include any
municipality or public agency engaged in the selling or supplying of electricity, gas or
water to a service user.
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"Value-Added Non-Voice Data Service" means a service that otherwise meets
the definition of "Telecommunication Services" in which computer processing
applications are used to act on the form, content, code, or protocol of the information or
data primarily for a purpose other than transmission, conveyance or routing.
"Video programming" means those programming services commonly provided to
subscribers by a video service supplier, including, but not limited to, basic services,
premium services, audio services, video games, pay-per-view services, video on
demand, origination programming, or any other similar services, regardless of the
content of such video programming, or the technology used to deliver such services,
and regardless of the manner or basis on which such services are calculated or billed.
"Video service supplier" means any person, company, or service which provides
or sells one or more channels, programs or individual episodes of video programming,
or provides or sells the capability to receive one or more channels, programs or
individual episodes of video programming, including any communications that are
ancillary, necessary or common to the use and enjoyment of the video programming, to
or from a residential or business address in the city, where some fee is paid, whether
directly or included in dues or rental charges for that service, whether or not public
rights-of-way are utilized in the delivery of the video programming or communications. A
"video service supplier" includes, but is not limited to, multichannel video programming
distributors [as defined in 47 U.S.C.A. Section 522(13)], open video systems (OVS)
suppliers, suppliers of cable television or video program delivery of any kind, be it
through channel or other subscribers or to individual buyers of programs or unique
episodes, master antenna television, satellite master antenna television, multichannel
multipoint distribution services, video services using VoIP (ie: IP-TV and IP-Video,
which provide, among other things, broadcasting and video on demand), direct
broadcast satellite (to the extent allowed by federal law), and other suppliers of video
programming or communications (including two-way communications), whatever their
technology.
"Video services" means video programming and any and all services related to
the providing, recording, delivering, use or enjoyment of video programming (including
origination programming and programming using VolP, (e.g.: IP-TV and IP-Video)),
using one or more channels by a video service supplier, regardless of the technology
used, to deliver, store or provide such services, and regardless of the manner or basis
on which such services are calculated or billed, including ancillary video services, data
services, telecommunication services, or interactive communication services that are
functionally integrated with video services.
"VoIP" (voice over internet protocol) means the digital process of making and
receiving real-time voice transmissions over any Internet Protocol network.
"800 service" means a "telecommunications service" that allows a caller to dial a
toll-free number without incurring a charge for the call. The service is typically marketed
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under the name "800", 11855% 1186611, "877% and "888" toll-free calling, and any
subsequent numbers designated by the Federal Communications Commission.
"900 service" means an inbound toll "telecommunications service" purchased by
a subscriber that allows the subscriber's customers to call in to the subscriber's
prerecorded announcement or live service. "900 service" does not include the charge
for: collection services provided by the seller of the "telecommunications services" to
the subscriber, or service or product sold by the subscriber to the subscriber's
customer. The service is typically marketed under the name "900" service, and any
subsequent numbers designated by the Federal Communications Commission.
3.22.030 Communication users tax.
A. There is imposed a tax upon every person who uses any communication
services in the city, other than a telephone corporation. The tax imposed by this section
shall be at the rate of five percent (5%) of the charges made for such communication
services. The tax shall be collected from the service user by the communication
services supplier or its billing agent. There is a rebuttable presumption that
communication services, which services are capable of terminating a call to another
person on the general telephone network, and which are billed to a billing or service
address in the City, are used, in whole or in part, within the City's boundaries, and such
services are subject to taxation under this chapter. If the billing address of the service
user is different from the service address, the service address of the service user shall
be used.
B. "Mobile Telecommunications Service" shall be sourced in accordance with
the sourcing rules set forth in the Mobile Telecommunications Sourcing Act (4 U.S.C.
Section 124). The Tax Administrator may issue and disseminate to communication
service suppliers, which are subject to the tax collection requirements of this Part,
sourcing rules for the taxation of other communication services, including but not limited
to post-paid telecommunication services, prepaid telecommunication services, and
private telecommunication services, provided that such rules are based upon custom
and common practice that further administrative efficiency and minimize multi-
jurisdictional taxation (e.g., Streamlined Sales and Use Tax Agreement).
C. As used in this section, the term "communications services" shall include,
but shall not be limited to charges for: connection, reconnection, termination,
movement, or change of communications services; late payment fees; detailed billing;
central office and custom calling features (including but not limited to call waiting, call
forwarding, caller identification and three-way calling); voice mail and other messaging
services; directory assistance; access and line charges; universal service charges;
regulatory, administrative and other cost recovery charges; local number portability
charges; and text and instant messaging. "Communication services" shall not include
digital downloads such as, music, ringtones, games, and similar digital products.
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D. To prevent actual multijurisdictional taxation of communication services
subject to tax under this section, any service user, upon proof to the tax administrator
that the service user has previously paid the same tax in another state or city on such
communication services, shall be allowed a credit against the tax imposed to the extent
of the amount of such tax legally imposed in such other state or city; provided, however,
the amount of credit shall not exceed the tax owed to the city under this section.
E. The Tax Administrator, from time to time, may issue and disseminate to
communication service suppliers that are subject to the tax collection requirements of
this chapter, an administrative ruling identifying those communication services that are
subject to the tax of subsection (A) above. This administrative ruling shall not impose a
new tax, revise an existing tax methodology as stated in this chapter, or increase an
existing tax except as allowed by California Government Code Section 53750(h)(2), as
it may be amended from time to time.
F. To facilitate the uniform interpretation and application of similar
ordinance provisions in other local jurisdictions in the state, the Tax Administrator may,
prior to issuing and disseminating a sourcing rule or an administrative tax ruling, submit
his or her proposed sourcing rule or administrative tax ruling to a Municipal Organization
for review and comment, according to the rules and procedures of that Municipal
Organization, or its successor organization.
3.22.040 Electricity users tax.
A. There is imposed a tax upon every person other than a water corporation,
electrical corporation, or gas corporation, using electricity in the City. The tax imposed
by this section shall be at the rate of five percent (5%) of the charges made for such
electricity, and for any supplemental services or other associated activities directly
related and/or necessary for the provision of electricity to the end-user, which are
provided by a service supplier or non-utility supplier to a service user. The tax shall be
collected from the service user by the service supplier or non-utility service supplier, or
its billing agent.
B. As used in this section, the term "charges" shall apply to all services,
components and items that are: i) necessary or common to the receipt, use and
enjoyment of electric service; or, ii) currently, or historically have been, included in a
single or bundled rate for electric service by a local distribution company to a class of
retail customers. The term "charges" shall include, but is not limited to, the following
charges:
1 . energy charges;
2. distribution and transmission charges;
3. metering charges;
4. stand-by, reserves, firming, ramping, voltage support, regulation,
emergency, or other similar minimum charges for services;
5. customer charges, service establishment or reestablishment charges,
demand charges, fuel or other cost adjustments, power exchange
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charges, independent system operator (ISO) charges, stranded
investment or competitive transition charges (CTC), public purpose
program charges, nuclear decommissioning charges, trust transfer
amounts (bond financing charges), franchise fee, franchise surcharge,
annual and monthly charges, and other charges, fees and surcharges
which are necessary to or common for the receipt, use and enjoyment of
electric service; and
6. charges, fees, or surcharges for electricity services or programs, which
are mandated by the California Public Utilities Commission, or the Federal
Energy Regulatory Commission, whether or not such charges, fees, or
surcharges appear on a bundled or line item basis on the customer billing.
C. As used in this section, the term "using electricity" shall not be construed to
mean the storage of such electricity by a person in a battery owned or possessed by
him or her for use in an automobile or other machinery or device apart from the
premises upon which the electricity was received; provided, however, that the term shall
include the receiving of such electricity for the purpose of using it in the charging of
batteries; nor shall the term include electricity used and consumed by an electric public
utility; nor shall the term include the mere receiving of such electricity by an electric
public utility or governmental agency at a point within the City for resale; or the use of
such electricity in the production or distribution of water by a public utility or a
governmental agency.
D. The tax on electricity provided by self-production or by a non-utility supplier or
an electric utility not under the jurisdiction of this Chapter shall be collected and remitted
in the manner set forth in Section 3.22.060. All other taxes on charges for electricity
imposed by this section shall be collected from the service user by the electric service
supplier or its billing agent. The amount of the tax collected in one month shall be
remitted to the Tax Administrator on or before the twentieth (20th) day of the following
month or, at the option of the person required to collect or remit the tax, such person
shall remit an estimated amount of the tax measured by the tax billed in the previous
month or upon the payment pattern of the service user, which must be received by the
Tax Administrator on or before the twentieth (20th) day of the following month, provided
that the service user shall submit an adjusted payment or request for credit, as
appropriate, within sixty (60) calendar days following each calendar quarter. The credit,
if approved by the Tax Administrator, may be applied against any subsequent tax bill
that becomes due.
3.22.050 Gas users tax.
A. There is imposed a tax upon every person, other than a water corporation,
electrical corporation, or gas corporation, using gas in the City, which is transported
through a pipeline distribution system or by mobile transport. The tax imposed by this
section shall be at the rate of five percent (5%) of the charges made for such gas,
including all services related to the storage, transportation, and delivery of such gas,
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and shall apply to all uses of gas, including but not limited to heating, electricity
generation, or the use of gas as a component of a manufactured product.
B. As used in this section, the term "charges" shall apply to all services,
components and items for gas service that are: i) necessary or common to the receipt,
use and enjoyment of gas service; or, ii) currently, or historically have been, included in
a single or bundled rate for gas service by a local distribution company to a class of
retail customers. The term "charges" shall include, but is not limited to, the following
charges:
1. the commodity charges for purchased gas, or the cost of gas owned by
the service user (including the actual costs attributed to drilling,
production, lifting, storage, gathering, trunkline, pipeline, and other
operating costs associated with the production and delivery of such gas),
which is delivered through a gas pipeline distribution system or by mobile
transport;
2. gas transportation charges (including interstate charges to the extent not
included in commodity charges);
3. storage charges; provided, however, that the service supplier shall not be
required to apply the tax to any charges for gas storage services when the
service supplier cannot, as a practical matter, determine the jurisdiction
where such stored gas is ultimately used; but it shall be the obligation of
the service user to self-collect the amount of tax not applied to any charge
for gas storage by the service supplier and to remit the tax to the
appropriate jurisdiction;
4. capacity or demand charges, service establishment or reestablishment
charges, administrative charges, marketing charges, transition charges,
customer charges, minimum charges, annual and monthly charges, and
any other charges which are necessary or common to the receipt, use and
enjoyment of gas service; and
5. charges, fees, or surcharges for gas services or programs, which are
mandated by the California Public Utilities Commission or the Federal
Energy Regulatory Commission, whether or not such charges, fees, or
surcharges appear on a bundled or line item basis on the customer billing.
C. The following shall be excluded from the base on which the tax imposed in
this section is computed:
1. Charges made for natural gas which is to be resold and delivered through
mains and pipes;
2. Charges made for natural gas sold for use in the generation of electrical
energy or for the production or distribution of water by a public utility or
governmental agency;
3. Charges made by a gas utility for gas used and consumed in the conduct
of business of gas public utilities;
4. Charges made for gas used in the propulsion of motor vehicles, as that
phrase is defined in the vehicle code of the state, utilizing natural gas;
and,
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5. Charges made for gas used by a nonutility supplier to generate electrical
energy for its own use or for sale to others provided the electricity so
generated is subject to the tax in accordance with Section 3.22.060 of this
chapter.
D. The tax on gas provided by self-production or by a non-utility supplier not
under the jurisdiction of this Chapter shall be collected and remitted in the manner set
forth in Section 3.22.060. All other taxes on charges for gas imposed by this section
shall be collected from the service user by the gas service supplier or its billing agent.
The amount of tax collected in one month shall be remitted to the Tax Administrator,
and must be received by the Tax Administrator on or before the twentieth (20th) day of
the following month; or, at the option of the person required to collect or remit the tax,
such person shall remit an estimated amount of tax measured by the tax billed in the
previous month or upon the payment pattern of the service user, which must be
received by the Tax Administrator on or before the twentieth (20th) day of the following
month, provided that the service user shall submit an adjusted payment or request for
credit, as appropriate, within sixty (60) calendar days following each calendar quarter.
The credit, if approved by the Tax Administrator, may be applied against any
subsequent tax bill that becomes due.
3.22.060 Collection of Tax from Service Users Receiving Direct Purchase of Gas or
Electricity.
A. Any service user subject to the tax imposed by Sections 3.22.040 or
3.22.050, hereof, which produces gas or electricity for self-use, or which receives gas or
electricity, including any related supplemental services, directly from a non-utility
supplier not under the jurisdiction of this chapter, or which otherwise is not having the
full tax due on the use of gas or electricity in the City that is directly billed and collected
by the service supplier or its billing agent, shall report said fact to the Tax Administrator
and shall remit the tax due directly to the Tax Administrator within thirty (30) calendar
days of such use. In lieu of paying said actual tax, the service user may, at its option,
remit to the Tax Administrator within thirty (30) calendar days of such use an estimated
amount of tax measured by the tax billed in the previous month, or upon the pattern
payment of similar customers of the service supplier using similar amounts of gas or
electricity, provided that the service user shall submit an adjusted payment or request
for credit, as appropriate, within sixty (60) calendar days following each calendar
quarter. The credit, if approved by the Tax Administrator, may be applied against any
subsequent tax bill that becomes due.
B. The Tax Administrator may require said service user to identify its non-utility
supplier and provide, subject to audit, invoices, books of account, or other satisfactory
evidence documenting the quantity of gas or electricity used and the cost or price
thereof. If the service user is unable to provide such satisfactory evidence, or, if the
administrative cost of calculating the tax, in the opinion of the City, is excessive, the City
may determine the tax by applying the tax rate to the equivalent charges the service
user would have incurred if the gas or electricity used had been provided by the service
supplier which is the primary supplier of gas or electricity.
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3.22.070 Water users tax.
A. There is imposed a tax upon every person, other than a water corporation,
electrical corporation, or gas corporation, using water in the City which is transported
and delivered through a pipeline distribution system. The tax imposed by this section
shall be at the rate of five percent (5%) of the charges made for such water and shall be
collected from the service user by the water service supplier, or its billing agent.
B. As used in this section, the term "charges" shall apply to all services,
components and items that are: i) necessary for or common to the receipt, use or
enjoyment of water service; or, ii) currently are or historically have been included in a
single or bundled rate for water service by a local distribution company to a class of
retail customers. The term "charges" shall include, but is not limited to, the following
charges:
1. water commodity charges (potable and non-potable);
2. distribution or transmission charges;
3. metering charges;
4. customer charges, late charges, service establishment or reestablishment
charges, franchise fees, franchise surcharges, annual and monthly
charges, and other charges, fees and surcharges which are necessary for
or common to the receipt, use or enjoyment of water service; and,
5. charges, fees, or surcharges for water services or programs, which are
mandated by a water district or a state or federal agency, whether or not
such charges, fees, or surcharges appear on a bundled or line item basis
on the customer billing.
C. There shall be excluded from the base on which the tax imposed in this
section computed charges made for water which is to be resold and delivered through a
pipeline distribution system; and charges made by a municipal water department, public
utility or a county or municipal water district for water used and consumed by such
department, utility or district in the conduct of the business of such department, utility or
district.
D. The tax on water service imposed by this section shall be collected from the
service user by the water service supplier or its billing agent. The amount of tax
collected in one (1) month shall be remitted to the Tax Administrator, and must be
received by the Tax Administrator on or before the twentieth (20th) calendar day of the
following month.
3.22.080. Video service users tax.
A. There is imposed a tax upon every person using video services in the city from
a video service supplier. The tax imposed by this section shall be at the rate of five
percent (5%) of the charges made for such video services. There is a rebuttable
presumption that video services which are billed to a billing or service address in the city
are used, in whole or in part, within the City's boundaries, and such services are subject
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to taxation under this section. The tax shall be collected from the service user by the
video service supplier or its billing agent.
B. The tax administrator may issue and disseminate to video service suppliers
which are subject to the tax collection requirements of this section, an administrative
ruling identifying those video services, or charges therefor, that are subject to or not
subject to the tax of subsection (A) above. This administrative ruling shall not impose a
new tax, revise an existing tax methodology as stated in this chapter, or increase an
existing tax except as allowed by California Government Code Section 53750(h)(2), as it
may be amended from time to time.
C. As used in this section, the term 'charges" shall include, but not be limited
to:
1. regulatory fees and surcharges, franchise fees and access fees (PEG);
2. initial installation of equipment necessary for provision and receipt of video
services;
3. late fees, collection fees, bad debt recoveries, and return check fees;
4. activation fees, reactivation fees, and reconnection fees;
5. video services;
6. equipment leases (e.g. remote, recording and/or search devices;
converters); and
7. service calls, service protection plans, name changes, changes or
services, and special services.
D. The tax imposed in this section shall be collected from the service user by
the video service supplier, its billing agent, or a reseller of such services. In the case of
video service, the service user shall be deemed to be the purchaser of the bulk video
service (e.g. an apartment owner), unless such service is resold to individual users, in
which case the service user shall be the ultimate purchaser of the video service. The
amount of tax collected in one month shall be remitted to, and received by, the tax
administrator on or before the twentieth (20t") calendar day of the following month.
3.22.090 Sewer service users tax.
A. There is imposed a tax upon every person in the City using sewer service in
the City. The tax imposed by this section shall be at the rate of five percent (5%) of the
charges made for such sewer service and shall be paid by the person paying for such
sewer services.
B. As used in this section, the term `charges" shall apply to all services,
components and items that are: i) necessary for or common to the receipt, use or
enjoyment of sewer service; or ii) currently are or historically have been included in a
single or bundled rate for sewer service to retail customers. The term "charges" shall
include, but is not limited to, the following charges: customer charges, late charges,
service establishment or reestablishment charges, annual and monthly charges, and
other charges, fees and surcharges which are necessary for or common to the receipt,
use or enjoyment of sewer service; and charges, fees, or surcharges for sewer services
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or programs which are mandated by the city, a state or federal agency, whether or not
such charges, fees, or surcharges appear on a bundled or line-item basis on the
customer billing.
C. The tax on sewer service imposed by this section shall be collected from the
service user by the sewer service supplier or its billing agent. The amount of tax
collected in one month shall be remitted to the tax administrator, and must be received
by the tax administrator on or before the twentieth (20th) calendar day of the following
month.
3.22.100 Solid Waste service users tax.
A. There is imposed a tax upon every person in the City receiving solid waste
collection, recycling and/or disposal services from the city or any solid waste hauler
franchised by the city. There is also imposed a tax upon every person in the city that
delivers solid waste directly to a transfer station or disposes of solid waste at any city-
owned or city-contracted recycling facility or landfill. The tax imposed by this section
shall be at the rate of five percent (5%) of the charges made for such service and shall
be paid by the person paying for such solid waste service.
B. As used in this section, the term "charges" shall apply to all services,
components and items that are: i) necessary for or common to the receipt, use or
enjoyment of solid waste collection, recycling and/or disposal services; or ii) currently
are or historically have been included in a single or bundled rate for solid waste
collection, recycling and/or disposal services to retail customers. The term "charges"
shall include, but is not limited to, the following charges: customer charges, late
charges, service establishment or reestablishment charges, annual and monthly
charges, and other charges, fees and surcharges which are necessary for or common
to the receipt, use or enjoyment of solid waste collection, recycling and/or disposal
services; and charges, fees, or surcharges for solid waste collection, recycling and/or
disposal services or programs which are mandated by the city, a state or federal
agency, whether or not such charges, fees, or surcharges appear on a bundled or line-
item basis on the customer billing.
C. The tax imposed by this section on every person in the city using solid waste
collection, recycling and/or disposal services shall be collected from the service user by
the service supplier or its billing agent. The amount of tax collected in one month shall
be remitted to the tax administrator, and must be received by the tax administrator on or
before the twentieth (20th) calendar day of the following month.
D. The tax imposed upon every person in the city that delivers solid waste
directly to a transfer station or landfill shall be collected from the service user by the
operator of the transfer station or landfill, provided that the transfer station or landfill
operator shall not collect the tax from any person who shows proof, in a form deemed
satisfactory by the tax administrator, that the person's place of primary use is outside
the city's jurisdiction. The amount of tax collected by the transfer station or landfill
21
operator in one month shall be remitted to the tax administrator, and must be received
by the tax administrator on or before the twentieth (20th) calendar day of the following
month.
3.22.110 Constitutional. Statutory and Other Exemptions.
A. The taxes imposed by this Chapter shall not apply to:
1. Any person or service user if imposition of such tax upon that person or
service user would be in violation of a federal or state statute or the
Constitution of the United States or the Constitution of the State of
California, or otherwise exempted by this Chapter;
2. The City; and
3. Any household in which a senior aged sixty-two (62) years or older resides
and the total income of the household in which such senior resides is at or
below fifty percent (50%) of the area median income, adjusted for family
size, as determined under the Section 8 Income Limits for Riverside
County as published by the United States Department of Housing and
Urban Development.
B. This chapter shall require the city to levy and collect a utility users tax from
service users for the utility services described herein, except where any such service
user or utility service is made expressly exempt from utility users tax by this chapter.
Notwithstanding the above, the City Council is hereby expressly authorized, by
ordinance or resolution, to establish classes of persons or classes of utility service
otherwise subject to payment of the tax imposed by this chapter, and to suspend the
collection of utility users tax, in whole or in part, from such classes of persons or utility
service, and may, from time to time, repeal or modify any such ordinance or resolution,
provided that no such action shall result in the collection of utility users tax from any
service user in the City for any class of utility service in excess of the maximum rates
and methodology set forth in this chapter.
C. Any service user that is exempt from the tax pursuant to subsection (A), or
from whom the City Council has suspended collection of the tax imposed by this
Chapter pursuant to subsection (B) shall file an application with the Tax Administrator
for said exemption or suspension; provided, however, this requirement shall not apply to
a service user that is a state or federal agency or subdivision with a commonly
recognized name. Said application shall be made upon a form approved by the Tax
Administrator and shall state those facts, declared under penalty of perjury, which
qualify the applicant for an exemption or suspension, and shall include the names of all
utility service suppliers serving that service user. If deemed subject to an exemption or
suspension by the Tax Administrator, such service user shall give the Tax Administrator
timely written notice of any change in utility service suppliers so that the Tax
Administrator can properly notify the new utility service supplier of the service user's tax
exempt or suspended status. A service user that fails to comply with this section shall
not be entitled to a refund of utility users taxes collected and remitted to the Tax
Administrator from such service user as a result of such non-compliance. Upon request
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of the Tax Administrator, a service supplier or non-utility supplier, or their billing agents,
shall provide a list of names and addresses of those customers which, according to their
billing records, are deemed exempt or suspended from the payment of utility users tax.
D. The decision of the Tax Administrator may be appealed pursuant to Section
3.22.220 of this Chapter. Filing an application with the Tax Administrator and an appeal
to the City Manager pursuant to Section 3.22.220 of this Chapter is a prerequisite to a
suit thereon.
E. Following application and approval of any exemption or suspension from the
payment of all or any part of the utility users tax by the City, the Tax Administrator shall
prepare a list of the persons exempted or suspended from the payment of such tax by
virtue of this section and shall furnish a copy thereof to each service supplier.
F. Any service user who has been exempted or suspended from the collection of
utility users tax pursuant to this section shall notify the Tax Administrator within ten (10)
calendar days following a change in facts or circumstances which may disqualify said
service user from receiving such exemption or suspension. It shall be a misdemeanor
for any person to knowingly receive the benefits of an exemption or suspension
provided by this section when the basis for such exemption or suspension does not
exist or ceases to exist.
3.22.120 Substantial Nexus / Minimum Contacts.
A. For purposes of imposing a tax or establishing a duty to collect and remit a
tax under this Chapter, "substantial nexus" and "minimum contacts" shall be construed
broadly in favor of the imposition, collection and/or remittance of the utility users tax to
the fullest extent permitted by state and federal law, and as it may change from time to
time by judicial interpretation or by statutory enactment. A service supplier shall be
deemed to have sufficient activity in the City for tax collection and remittance purposes
if its activities include, but are not limited to, any of the following: maintains or has within
the City, directly or through an agent or subsidiary, a place of business of any nature;
solicits business in the City by employees, independent contractors, resellers, agents or
other representatives; solicits business in the City on a continuous, regular, seasonal or
systematic basis by means of advertising that is broadcast or relayed from a transmitter
with the City or distributed from a location with the City; or advertises in newspapers or
other periodicals printed and published within the City or through materials distributed in
the City by means other than the United States mail; or if there are activities performed
in the city on behalf of the service supplier that are significantly associated with the
service supplier's ability to establish and maintain a market in the city for the provision
of services that are subject to a tax under this chapter.
B. The City shall make available, upon request, an accurate description of its
jurisdictional boundaries based on street addresses and/or ZIP Plus Four, in an
electronic format. If a service supplier relies upon such information provided by City, it
shall not be responsible for any errors in taxation that may result.
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3.22.130 Duty to collect--Procedures.
The duty to collect and remit the taxes imposed by this chapter shall be performed as
follows:
A. The tax shall be collected insofar as practicable at the time and along with the
charges made in accordance with the regular billing practices of the service supplier.
Where the amount paid by a service user to a service supplier is less than the full
amount of the charge and tax which has accrued for the billing period, a proportionate
share of both the charge and the tax shall be deemed to have been paid. In those
cases where a service user has notified the service supplier of refusal to pay the tax
imposed on said charges, Section 3.22.170 shall apply.
B. The duty to collect tax from a service user shall commence with the beginning
of the first full regular billing period applicable to the service user where all charges
normally included in such regular billing are subject to the provisions of this chapter.
Where a person receives more than one billing, one or more being for different periods
than another, the duty to collect shall arise separately for each billing.
3.22.140 Filing Return and Payment. Each person required by this Chapter to remit a
tax shall file a return to the Tax Administrator, on forms approved by the Tax
Administrator on or before the due date. The full amount of the tax collected shall be
included with the return and filed with the Tax Administrator. The Tax Administrator is
authorized to require such additional information as he/she deems necessary to
determine if the tax is being levied, collected, and remitted in accordance with this
Chapter. Returns are due immediately upon cessation of business for any reason.
Pursuant to Revenue and Tax Code Section 7284.6, the Tax Administrator, and its
agents, shall maintain such filing returns as confidential information exempt from
disclosure provisions of the Public Records Act.
3.22.150 Collection Penalties.
A. Taxes collected from a service user, or self-collected by a service user
subject to Section 3.22.060 of this Chapter, are delinquent if not received by the Tax
Administrator on or before the due date. Should the due date occur on a weekend or
legal holiday, the return must be received by the Tax Administrator on or before the first
regular working day following the weekend or legal holiday. A direct deposit, including
electronic fund transfers and other similar methods of electronically exchanging monies
between financial accounts, made by a service supplier in satisfaction of its obligations
under this subsection shall be considered timely if the transfer is initiated on or before
the due date, and the transfer settles into the City's account on or before the following
business day. Any tax billed to a service user but not paid to the service supplier shall
not be deemed an obligation of the service supplier unless such tax is thereafter paid to
the service supplier.
24
B. If any service supplier fails to collect the tax (by failing to properly assess the
tax on one or more services or charges on the service user's billing) or fails to remit any
collected tax imposed by this chapter to the city within the time required, or if any
service user subject to Section 3.22.060 of this chapter fails to remit any tax due within
the time required, said person shall pay a penalty for such delinquencies at the rate as
set forth by resolution of the City Council of the total tax that is delinquent in the
remittance, and shall pay interest at the rate as set forth by resolution of the City
Council, on the amount of the tax, exclusive of penalties, from the date on which the
remittance first became delinquent, until paid.
C. The Tax Administrator shall have the power to impose additional penalties
upon persons required to collect and/or remit taxes pursuant to the provisions of this
Chapter for fraud or gross negligence in reporting or remitting at the rate as set forth by
resolution of the City Council of the amount of the tax collected and/or required to be
remitted, or as recomputed by the Tax Administrator.
D. For collection purposes only, every penalty imposed and such interest that is
accrued under the provisions of this section shall become a part of the tax herein
required to be paid.
E. Notwithstanding the foregoing, the Tax Administrator may, in his or her
discretion, modify the due dates of this chapter to be consistent with any uniform
standards or procedures that are mutually agreed upon by other public agencies
imposing a utility users tax, or otherwise legally established, to create a central payment
location or mechanism.
3.22.160 Deficiency Determination and Assessment—Tax Application Errors.
A. The Tax Administrator shall make a deficiency determination if he or she
determines that any person required to collect or self-collect taxes pursuant to the
provisions of this Chapter has failed to collect and remit the proper amount of tax by
improperly or failing to apply the tax to one or more taxable services or charges.
Nothing herein shall require the tax administrator to institute proceedings under this
section if, in the opinion of the tax administrator, the cost of collection or enforcement
likely outweighs the tax benefit.
B. The Tax Administrator shall mail a notice of such deficiency determination to
the person required to pay or remit the tax, which notice shall refer briefly to the amount
of the taxes owed, plus penalties and interest at the rate as set forth by resolution of the
City Council, on the amount of the tax from the date on which the tax should have been
received by the City. Within fourteen (14) calendar days after the date of service of
such notice, the person may request in writing to the Tax Administrator for a hearing on
the matter. If the person fails to request a hearing within the prescribed time period, the
amount of the deficiency determination shall become a final assessment, and shall
immediately be due and owing to the City.
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C. If the person requests a hearing, the Tax Administrator shall cause the matter
to be set for hearing, which shall be held within thirty (30) calendar days after receipt of
the written request for hearing. Notice of the time and place of the hearing shall be
mailed by the Tax Administrator to such person at least ten (10) calendar days prior to
the hearing, and, if the Tax Administrator desires said person to produce specific
records at such hearing, such notice may designate the records requested to be
produced.
D. At the time fixed for the hearing, the Tax Administrator shall hear all relevant
testimony and evidence, including that of any other interested parties. At the discretion
of the Tax Administrator, the hearing may be continued from time to time for the
purpose of allowing the presentation of additional evidence. Within a reasonable time
following the conclusion of the hearing, the Tax Administrator shall issue a final
assessment (or non-assessment), thereafter, by confirming, modifying or rejecting the
original deficiency determination, and shall mail a copy of such final assessment to the
person owing the tax. The decision of the Tax Administrator may be appealed pursuant
to Section 3.22.220 of this Chapter. Filing an application with the Tax Administrator and
appeal to the City Manager pursuant to Section 3.22.220 of this Chapter is a
prerequisite to a suit thereon.
E. Payment of the final assessment shall become delinquent if not received by
the Tax Administrator on or before the thirtieth (30th) calendar day following the date of
receipt of the notice of final assessment. The penalty for delinquency shall be at the
rate as set forth by resolution of the City Council on the total amount of the assessment,
along with interest at the rate as set forth by resolution of the City Council, on the
amount of the tax, exclusive of penalties, from the date of delinquency, until paid. The
applicable statute of limitations regarding a claim by the City seeking payment of a tax
assessed under this Section shall commence from the date of delinquency as provided
in this subsection.
F. All notices under this section may be sent by regular mail, postage prepaid,
and shall be deemed received on the third (3rd) calendar day following the date of
mailing, as established by a proof of mailing.
3.22.170 Administrative Remedy - Non-Paying Service Users.
A. Whenever the Tax Administrator determines that a service user has
deliberately withheld the amount of the tax owed by the service user from the amounts
remitted to a person required to collect the tax, or whenever the Tax Administrator
deems it in the best interest of the City, he or she may relieve such person of the
obligation to collect the taxes due under this Chapter from certain named service users
for specific billing periods. Whenever the service user has failed to pay the amount of
tax owed for a period of two (2) or more billing periods, the service supplier shall be
relieved of the obligation to collect taxes due. The service supplier shall provide the City
with the names and addresses of such service users and the amounts of taxes owed
under the provisions of this Chapter. Nothing herein shall require the tax administrator
26
to institute proceedings under this section if, in the opinion of the tax administrator, the
cost of collection or enforcement likely outweighs the tax benefit.
B. In addition to the tax owed, the service user shall pay a delinquency penalty
at the rate as set forth by resolution of the City Council of the total tax that is owed, and
shall pay interest at the rate as set forth by resolution of the City Council, on the amount
of the tax, exclusive of penalties, from the due date, until paid.
C. The Tax Administrator shall notify the non-paying service user that the Tax
Administrator has assumed the responsibility to collect the taxes due for the stated
periods and demand payment of such taxes, including penalties and interest. The
notice shall be served on the service user by personal delivery or by deposit of the
notice in the United States mail, postage prepaid, addressed to the service user at the
address to which billing was made by the person required to collect the tax; or, should
the service user have a change of address, to his or her last known address.
D. If the service user fails to remit the tax to the Tax Administrator within thirty
(30) calendar days from the date of the service of the notice upon him or her, the Tax
Administrator may impose an additional penalty of twenty-five percent (25%) of the
amount of the total tax that is owed. The penalty shall become part of the tax herein
required to be paid.
3.22.180 Actions to collect. Any tax required to be paid by a service user under the
provisions of this Chapter shall be deemed a debt owed by the service user to the City.
Any such tax collected from a service user which has not been remitted to the Tax
Administrator shall be deemed a debt owed to the City by the person required to collect
and remit and shall no longer be a debt of the service user. Any person owing money to
the City under the provisions of this Chapter shall be liable to an action brought in the
name of the City for the recovery of such amount, including penalties and interest as
provided for in this Chapter, along with any collection costs incurred by the City as a
result of the person's noncompliance with this Chapter, including, but not limited to,
reasonable attorneys fees and court costs. Any tax required to be collected by a
service supplier or owed by a service user is an unsecured priority excise tax obligation
under 11 U.S.C. §507(a)(8)(C). Service suppliers who seek to collect charges for
service in bankruptcy proceedings shall also include in any such claim the amount of
taxes due the city for those services, unless the tax administrator determines that such
duty is in conflict with any federal or state law, rule, or regulation or that such action
would be administratively impractical.
3.22.190 Additional Powers and Duties of Tax Administrator.
A. The Tax Administrator shall have the power and duty, and is hereby directed,
to enforce each and all of the provisions of this Chapter.
B. The Tax Administrator may adopt administrative rules and regulations not
inconsistent with provisions of this Chapter for the purpose of interpreting, clarifying,
27
carrying out and enforcing the payment, collection and remittance of the taxes herein
imposed. A copy of such administrative rules and regulations shall be on file in the Tax
Administrator's office. To the extent that the tax administrator determines that the tax
imposed under this chapter shall not be collected in full for any period of time from any
particular service supplier or service user, that determination shall be considered an
exercise of the tax administrator's discretion to settle disputes and shall not constitute a
change in taxing methodology for purposes of Government Code Section 53750 or
otherwise. The tax administrator is not authorized to amend the city's taxing
methodology for purposes of Government Code Section 53750, and the city does not
waive or abrogate its ability to impose the utility users' tax in full as a result of
promulgating administrative rulings or entering into agreements.
C. Upon a proper showing of good cause, the Tax Administrator may make
administrative agreements, with appropriate conditions, to vary from the strict
requirements of this Chapter and thereby: (a) conform to the billing procedures of a
particular service supplier (or service user subject to Section 3.22.060 of this Chapter)
so long as said agreements result in the collection of the tax in conformance with the
general purpose and scope of this Chapter; or, (b) to avoid a hardship where the
administrative costs of collection and remittance greatly outweigh the tax benefit. A
copy of each such agreement shall be on file in the Tax Administrator's office, and are
voidable by the Tax Administrator or the City at any time.
D. The Tax Administrator may conduct an audit, to ensure proper compliance
with the requirements of this Chapter, of any person required to collect and/or remit a
tax pursuant to this Chapter. The Tax Administrator shall notify said person of the
initiation of an audit in writing. In the absence of fraud or other intentional misconduct,
the audit period of review shall not exceed a period of three (3) years next preceding the
date of receipt of the written notice by said person from the Tax Administrator. Upon
completion of the audit, the Tax Administrator may make a deficiency determination
pursuant to Section 3.22.160 of this Chapter for all taxes, penalties and interest owed
and not paid, as evidenced by information provided by such person to the Tax
Administrator. If said person is unable or unwilling to provide sufficient records to
enable the Tax Administrator to verify compliance with this Chapter, the Tax
Administrator is authorized to make a reasonable estimate of the deficiency. Said
reasonable estimate shall be entitled to a rebuttable presumption of correctness.
E. Upon receipt of a written request of a taxpayer, and for good cause, the Tax
Administrator may extend the time for filing any statement required pursuant to this
Chapter for a period of not to exceed sixty (60) calendar days, provided that the time for
filing the required statement has not already passed when the request is received. No
penalty for delinquent payment shall accrue by reason of such extension. Interest shall
accrue during said extension at the rate of three-quarters of one percent (3/a%) per
month, prorated for any portion thereof.
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F. The Tax Administrator shall determine the eligibility of any person who
asserts a right to exemption or suspension from, or a refund of, the tax imposed by this
Chapter.
G. The Tax Administrator or the City Manager, with the written approval of the
City Attorney, may compromise a claim pursuant to this Chapter where the portion of
the claim proposed to be released is equal to or less than the amount set by ordinance
or resolution of the City Council relating to the settlement of general liability claims
against the City and, with the approval of the City Attorney and the City Council, may
compromise such a claim where the portion proposed to be released is greater than the
amount set by ordinance or resolution of the City Council relating to the settlement of
general liability claims against the City by the Tax Administrator or City Manager.
H. Notwithstanding any provision in this Chapter to the contrary, the Tax
Administrator may waive any penalty or interest imposed upon a person required to
collect and/or remit for failure to collect the tax imposed by this Chapter if the non-
collection occurred in good faith. In determining whether the non-collection was in good
faith, the Tax Administrator shall take into consideration industry practice or other
precedents.
I. The tax administrator may, from time to time, survey the various service
suppliers to identify residential and business customers in the city, and the charges
therefor, including those items that are mandated by state or federal regulatory
agencies as a condition of providing such services. The tax administrator may,
thereafter, issue and disseminate to such service suppliers administrative rulings
identifying those components and items which are subject to the tax. If any nontaxable
charges are bundled with and not separately stated from taxable service charges on the
customer bill or invoice of a service supplier, the combined charge is subject to tax
unless the service supplier identifies, by reasonable and verifiable standards, the
portions of the combined charge that are nontaxable and taxable through the service
supplier's books and records kept in the regular course of business, and in accordance
with generally accepted accounting principles, and not created and maintained for tax
purposes. The service supplier has the burden of proving the proper apportionment of
taxable and non-taxable charges. If the service supplier offers a combination of taxable
and non-taxable services, and the charges are separately stated, then for taxation
purposes, the values assigned the taxable and non-taxable services shall be based on
its books and records kept in the regular course of business and in accordance with
generally accepted accounting principles, and not created and maintained for tax
purposes. The service supplier has the burden of proving the proper valuation of the
taxable and non-taxable services.
3.22.200 Records.
A. It shall be the duty of every person required to collect and/or remit to the City
any tax imposed by this Chapter to keep and preserve, for a period of at least three (3)
years, all records as may be necessary to determine the amount of such tax as he/she
may have been liable for the collection of and remittance to the Tax Administrator,
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which ,records the Tax Administrator, or the Tax Administrator's designated
representative, shall have the right to inspect at a reasonable time.
B. The City may issue an administrative subpoena to compel a person to deliver,
to the Tax Administrator, copies of all records deemed necessary by the Tax
Administrator to establish compliance with this Chapter, including the delivery of records
in a common electronic format on readily available media if such records are kept
electronically by the person in the usual and ordinary course of business. As an
alternative to delivering the subpoenaed records to the Tax Administrator on or before
the due date provided in the administrative subpoena, such person may provide access
to such records outside the City on or before the due date, provided that such person
shall reimburse the City for all reasonable travel expenses incurred by the City to
inspect those records, including travel, lodging, meals, and other similar expenses, but
excluding the normal salary or hourly wages of those persons designated by the City to
conduct the inspection.
C. The Tax Administrator, or the Tax Administrator's designated representative,
is authorized to execute a non-disclosure agreement approved by the City Attorney to
protect the confidentiality of customer information pursuant to California Revenue and
Tax Code Sections 7284.6 and 7284.7. The Tax Administrator, or the Tax
Administrator's designated representative, may request from a person providing
transportation services of gas or electricity to service users within the City a list of the
names and addresses, and other pertinent information, of its transportation customers
within the City pursuant to Section 6354(e) of the California Public Utilities Code.
D. If a service supplier uses a billing agent or billing aggregator to bill, collect,
and/or remit the tax, the service supplier shall: i) provide to the Tax Administrator the
name, address and telephone number of each billing agent and billing aggregator
currently authorized by the service supplier to bill, collect, and/or remit the tax to the
City; and, ii) upon request of the Tax Administrator, deliver, or effect the delivery of, any
information or records in the possession of such billing agent or billing aggregator that,
in the opinion of the Tax Administrator, is necessary to verify the proper application,
calculation, collection and/or remittance of such tax to the City.
E. If any person subject to record-keeping under this section unreasonably
denies the Tax Administrator, or the Tax Administrator's designated representative,
access to such records, or fails to produce the information requested in an
administrative subpoena within the time specified, then the Tax Administrator may
impose a penalty of five hundred dollars ($500) on such person for each day following:
i) the initial date that the person refuses to provide such access; or, ii) the due date for
production of records as set forth in the administrative subpoena. This penalty shall be
in addition to any other penalty imposed under this Chapter.
3.22.210 Refunds. Whenever the amount of any tax has been overpaid or paid more
than once or has been erroneously or illegally collected or received by the Tax
Administrator under this Chapter, it may be refunded as provided in this section:
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A. The Tax Administrator or City Manager may refund any tax that has been
overpaid, paid more than once, or has been erroneously or illegally collected or
received by the Tax Administrator under this Chapter, provided that no refund shall be
paid under the provisions of this section unless the claimant or his or her guardian,
conservator, executor or administrator has submitted a written claim, under penalty of
perjury, to the Tax Collector. The period for filing a claim for refund shall be one (1)
year from the time the tax was paid or erroneously or illegally collected; provided
however, that in no event shall the period to file such claim expire prior to the shortest
period allowable for filing a tax refund claim under Title 1, Division 3.6, Part 3, Section
911.2 of the California Government Code. Such claim must clearly establish claimant's
right to the refund by written records showing entitlement thereto, and must clearly set
forth the facts and legal theories under which the claimant believes he or she has right
to a refund. Nothing herein shall permit the filing of a refund claim on behalf of a class
or group of taxpayers, unless each member of the class has submitted a written claim
under penalty of perjury as provided by this subsection. Where the amount of any
individual refund claim is in excess of the amount set by ordinance or resolution of the
City Council relating to the settlement of general liability claims against the City by the
Tax Administrator or City Manager, City Council approval shall be required.
B. The filing of a written claim pursuant to Government Code Section 935 is a
prerequisite to any suit thereon. Any action brought against the City pursuant to this
section shall be subject to the provisions of Government Code Sections 945.6 and 946.
C. Notwithstanding the notice provisions of subsection (A), a service supplier
that has collected any amount of tax in excess of the amount of tax imposed by this
Chapter and actually due from a service user (whether due to overpayment or
erroneous or illegal collection of said tax), may refund such amount to the service user,
or credit to charges subsequently payable by the service user to the service supplier,
and claim credit for such overpayment against the amount of tax which is due upon any
other monthly returns to the Tax Administrator, provided such credit is claimed in a
return dated no later than one (1) year from the date of overpayment or erroneous or
illegal collection of said tax. The Tax Administrator shall determine the validity of the
service user's claim of credit, and the underlying basis for such claim.
D. Notwithstanding the notice provisions of subsection (A), in the event that a
service supplier, or a person required to self-impose a tax imposed by this Chapter,
remits a tax to the City in excess of the amount of tax imposed by this Chapter, said
service supplier, or a person required to self-impose a tax imposed by this Chapter, may
claim credit for such overpayment against the amount of tax which is due upon any
other monthly returns to the Tax Administrator, provided such credit is claimed in a
return dated no later than one (1) year from the date of overpayment of said tax, and
provided that the Finance Director shall first determine the validity of the service user's
claim of credit, and the underlying basis for such claim.
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3.22.220 Appeals.
A. The provisions of this section apply to any decision, deficiency determination,
assessment, or administrative ruling of the Tax Administrator. Any person aggrieved by
any decision, deficiency determination, assessment, or administrative ruling of the Tax
Administrator, shall be required to comply with the appeals procedure of this section.
Compliance with this section shall be a prerequisite to a suit thereon. [See Government
Code Section 935(b).]
B. If any person is aggrieved by any decision, deficiency determination,
assessment, or administrative ruling of the Tax Administrator; he or she may appeal to
the City Manager by filing a notice of appeal with the City Clerk within fourteen (14)
calendar days of the date of the decision, deficiency determination, assessment, or
administrative ruling of the Tax Administrator which aggrieved the service user or
service supplier.
C. The matter shall be set for hearing no more than thirty (30) calendar days from
the receipt of the appeal. The appellant shall be served with notice of the time and
place of the hearing, as well as any relevant materials, at least five (5) calendar days
prior to the hearing. The hearing may be continued from time to time upon mutual
consent. At the time of the hearing, the appealing party, the Tax Administrator, and any
other interested person may present such relevant evidence as he or she may have
relating to the determination from which the appeal is taken.
D. Based upon the submission of such evidence and the review of the City's
files, the City Manager shall issue a written notice and order upholding, modifying or
reversing the determination from which the appeal is taken. The notice shall be given
within fourteen (14) calendar days after the conclusion of the hearing and shall state the
reasons for the decision. The notice shall specify that the decision is final and that any
petition for judicial review shall be filed within ninety (90) days from the date of the
decision in accordance with Code of Civil Procedure Section 1094.6. If the City
Manager fails or refuses to act on an appeal within the fourteen (14) day period, the
appeal shall be deemed to have been denied by the City Manager on the fifteen (15th)
calendar day.
E. All notices under this section may be sent by regular mail, postage prepaid,
and shall be deemed received on the third (3rd) calendar day following the date of
mailing, as established by a proof of mailing.
3.22.230 No Iniunction/Writ of Mandate. No injunction or writ of mandate or other legal
or equitable process shall issue in any suit, action, or proceeding in any court against
this City or against any officer of the City to prevent or enjoin the collection under this
Chapter of any tax or any amount of tax required to be collected and/or remitted.
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3.22.240 Remedies Cumulative. All remedies and penalties prescribed by this Chapter
or which are available under any other provision of law or equity, including but not
limited to the California False Claims Act (Government Code Section 12650 et seq.) and
the California Unfair Practices Act (Business and Professions Code Section 17070 et
seq.), are cumulative. The use of one or more remedies by the City shall not bar the
use of any other remedy for the purpose of enforcing the provisions of this Chapter.
3.22.250 Notice of Changes to Ordinance.
A. Service suppliers and service users who self-collect shall begin to collect the
tax imposed by this chapter as soon as feasible after the effective date of the ordinance
codified in this chapter, but in no event later than permitted by Section 799 of the
California Public Utilities Code.
B. If a tax under this chapter is added, increased, reduced, or the tax base is
changed, the Tax Administrator shall follow the notice requirements of California Public
Utilities Code Section 799. Prior to the effective date of the change, the service supplier
shall provide the Tax Administrator with a copy of any written procedures describing the
information that the service supplier needs to implement the change. If the service
supplier fails to provide such written instructions, the Tax Administrator, or his or her
agent, shall send, by first class mail, a copy of the change to all collectors and remitters
of the City's utility users taxes according to the latest payment records of the Tax
Administrator.
3.22.260 Penalties. Any person violating any of the provisions of this Chapter shall be
deemed guilty of a misdemeanor or an infraction at the discretion of the City Attorney.
3.22.270 Future Amendment to Cited Statute. Unless specifically provided otherwise,
any reference to a state or federal statute in this Chapter shall mean such statute as it
may be amended from time to time; provided, that such reference to a statute herein
shall not include any subsequent amendment thereto, or to any subsequent change of
interpretation thereto by a state or federal agency or court of law, to the extent that such
amendment or change of interpretation would require voter approval under California
law, or to the extent that such change would result in a tax decrease (as a result of
excluding all or a part of a utility service, or charge therefor, from taxation). Only to the
extent voter approval would otherwise be required or a tax decrease would result, the
prior version of the statute (or interpretation) shall remain applicable. For any
application or situation that would not require voter approval or would not result in a
decrease of a tax, provisions of the amended statute (or new interpretation) shall be
applicable to the maximum possible extent. To the extent that the city's authorization
to collect or impose any tax imposed under this chapter is expanded or limited as a
result of changes in state or federal law, no amendment or modification of this chapter
shall be required to conform the tax to those changes, and the tax shall be imposed and
collected to the full extent of the authorization up to the full amount of the tax imposed
under this chapter.
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3.22.280 Independent Audit of Tax Collection, Exemption, Remittance, and
Expenditure. The City shall annually verify that the taxes owed under this Chapter have
been properly applied, exempted, collected, and remitted in accordance with this
Chapter, and properly expended according to applicable municipal law. The verification
shall be performed by a qualified independent third party and the review shall employ
reasonable, cost-effective steps to assure compliance, including the use of sampling
audits. The verification shall not be required of tax remitters where the cost of the
verification may exceed the tax revenues to be reviewed. The results of each review
shall be published in an annual expenditure report.
3.22.290 Amendment or Repeal — Adjustment of Taxing Rate or Methodology. This
chapter may be repealed or amended by the city council without a vote of the people.
However, as required by California Constitution Article XIIIC (Proposition 218), voter
approval is required for any amendment or provision that would increase the maximum
rate or methodology of any tax levied pursuant to this chapter. The people of the city of
San Jacinto affirm that the following actions shall not constitute an increase of the rate
or methodology of the utility users tax requiring subsequent voter approval:
1. The restoration of the rate of the tax to a rate that is no higher than the maximum
set by this voter-approved chapter, if the city council has previously acted to reduce the
rate of the tax;
2. An action that interprets or clarifies the methodology of the tax, or any definition
applicable to the tax, so long as interpretation or clarification (even if contrary to some
prior interpretation or clarification) is not inconsistent with the language of this chapter;
3. The establishment of a class of person or service that is exempt or excepted from
the tax or the discontinuation of any such exemption or exception (other than the
discontinuation of an exemption or exception explicitly set forth in this chapter); and
4. Resuming collection of the tax imposed by this chapter, even if the city had, for
some period of time, either suspended collection of the tax or otherwise failed to collect
the tax, in whole or in part.
3.22.300 Sunset of Tax. The tax imposed by this chapter shall automatically be
terminated, without further action by the city council, or the electors of the city, ten (10)
years after the effective date of this ordinance. After said date, the tax imposed by this
chapter can only be continued or reestablished by a majority vote of San Jacinto voters
pursuant to California Propositions 62 and 218."
SECTION 2. If any section, subsection, sentence, clause, phrase or word of
this Ordinance is for any reason held to be invalid or unconstitutional by the decision of
any court of competent jurisdiction, such decision shall not affect the validity of the
remaining portions of this Ordinance. The People of San Jacinto hereby declare that
they would have adopted this Ordinance, and each and every section, subsection,
sentence, clause, or phrase not declared invalid or unconstitutional without regard to
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whether any portion or the Ordinance would be subsequently declared invalid or
unconstitutional.
SECTION 3. Following certification that the citizens of San Jacinto have
approved this Ordinance, the Mayor shall sign it attesting to its adoption by the People
voting thereon at the May 5, 2015 Special Municipal Election, and the City Clerk shall
cause the same to be entered in the book of original ordinances of said City; and shall
cause the same, or a summary thereof, to be published as required by law. .
SECTION 4. This Ordinance shall take effect only if approved by a majority of
the eligible voters of the City of San Jacinto voting at a Special Municipal election to be
held on May 5, 2015, and shall take effect ten (10) days after the City Council has
certified the results of the Special Municipal election by resolution.
PASSED, APPROVED AND ADOPTED by the People of the City of San Jacinto
on May 5, 2015.
City of San Jacinto
By: Crystal Ruiz, Mayor
ATTEST:
Rick Miller, City Clerk
APPROVED AS TO FORM:
Best Best & Krieger LLP
Jeffrey S. Ballinger, City Attorney
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