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HomeMy WebLinkAbout38.131 ORDINANCE NO. 38.131 AN ORDINANCE OF THE CITY OF SARATOGA ADDING ARTICLE VII TO CHAPTER 14 OF THE SARATOGA CITY CODE, ESTABLISHING A UTILITY USERS TAX The City Council of the City of Saratoga does ordain as follows: SECTION 1: Article VII, entitled "Utility Users Tax," is hereby added to Chapter 14 of the City Code to read as follows: "ARTICLE ¥H. UTH/rY USERS TAX See. 14-80. Imposition and purpose of tax There is hereby 'established and imposed a utility users tax in the amount set forth in this Article for the purpose of raising revenues for the general governmental purposes of the City. All of the proceeds of the taxes levied under this Article shall be placed in the City's general fund. See. 14-81. Definitions For the purposes of this Article, the following words and phrases shall have the meanings respectively ascribed to them in this Section, unless the context or the provision clearly requires otherwise: (a) Service user means a person required to pay a tax imposed under the provisions of this Article. (b) Service supplier means a person required to collect and remit a tax imposed under the provisions of this Article. (c) Service address means the address of the ultimate consumer of the service supplied by the service supplier "' / (d) Tax Administrator means the Finance Director of the City. (e) Electrical Corporation and Gas Corporation, shall have the same meanings as defined in Sections 218 and 222, respectively, of the Public Utilities Code of the State. "Electrical Corporation" shall be construed to include any municipality or governmental agency engaged in the selling or supplying of electrical power to a service user. See. 14-82. Exemptions (a) Nothing in this Article shall be construed as imposing a tax upon any person when imposition of such tax upon that person would be in violation of the Constitution of the United States or the Constitution of the State. 3/20/85 -1- (b) No ta~ under this Article shall be imposed upon any service user exempted from the payment of Federal income tax, as determined by the Internal Revenue Service. (c) No tax under this Article shall be imposed upon the City or any other governmental entity. (d) The tax imposed by this Article shall not apply to the utilities for the personal residence of a service user if the combined annual gross income of all members of the household in which such individual resides is fifty percent or less of the median income for Santa Clara County and such individual applies for and is granted an exemption ~rom the tax in accordance with the provisions of Paragraph (e) of this Section. An exemption shall be granted for a period of one year if the service user establishes, to the satisfaction of the Tax Administrator, that the annual gross income of the service user and all members of his household will not exceed the limits set forth herein during such year. The exemption may be renewed for additional one year periods upon recertification by the service user of annual gross income showing qualification for the exemption. The median income for Santa Clara County shall be the amount shown as such median income for said County in the latest available federal census, adjusted annually as of July first of each subsequent year by the percentage of increase or decrease in the Consumer Price Index for the San Francisco/Oakland Area, All Items, All Urban Consumers, as published nearest to July first by the United States Department of Labor, Bureau of Labor Statistics, or such other median income as may be determined from time to time by resolution of the City Council. (e) Any service user exempt from the taxes imposed by this Article under the provisions of Paragraphs (a), (b), (c) or (d) above, may apply to the Tax Administrator for an exemption; provided, however, the Tax Administrator may waive the filing of an application for exemption under Paragraphs (a), (b) or (c) of this Section if the Tax Administrator has sufficient information to determine, in the absence of such application, that the service user qualifies for an exemption. The application shall be made upon forms supplied by the Tax Administrator and shall be accompanied by such additional information and documents as he may require to determine eligibility for an exemption. The Tax Administrator shall review all such applications and certify as exempt those applicants determined to qualify therefor. The Tax Administrator shall thereupon notify all service suppliers affected that an exemption has been granted stating the name .of the service user, the service address to which the utility is being supplied, the account number, if any, and such other information as may be necessary for the service supplier to remove the exempt service user from its tax collection procedure. Upon. receipt of such notice, the service supplier shall not be required to bill or collect any further tax imposed by this Article from such service user until further notice is given by the Tax Administrator. (f) All exemptions under this Section shall continue and be renewed by the Tax Administrator so long as the prerequisite facts supporting the initial qualification for exemption shall continue; provided, however, that the exemption shall automatically terminate upon any change in the service address of the exempt person, but such person may apply for a new exemption with each change of address. Any person exempt from the taxes imposed by this Article shall notify the Tax Administrator within ten days of any change in fact or circumstance which might disqualify such person from receiving the exemption. It shall be a misdemeanor for any person to 3/20/85 -2- knowingly receive the benefits of an exemption provided by this Section when the basis for such exemption does not exist or ceases to exist. (g) The exemptions provided by this Section shall not eliminate the duty of the service supplier to collect taxes from an exempt person or the duty of such exempt person to pay the taxes to the service supplier unless an exemption is granted by the Tax Administrator. Nothing herein shall prevent any person who is granted an exemption from thereafter applying for a refund of taxes previously paid, in accordance with the provisions of Section 14-92. (h) Any service supplier who determines by any means that a new or nonexempt service user is receiving service through a meter or connection exempt by virtue of an exemption issued to a previous user or exempt user of the same meter or connection, such service supplier shall immediately notify the Tax Adminstrator of such fact and the Tax Administrator shall conduct an investigation to ascertain whether or not the provisions of this Section have been complied with, and, where appropriate, order the service supplier to commence collecting the taxes from the nonexempt service user. See. 14-83. Electricity users tax (a) There is hereby imposed a tax upon every person in the City, other than an electrical corporation or a gas corporation, using electrical energy in the City. The tax imposed by this Section shall be at the rate of three and one-half percent of the charges made for such energy, including minimum charges for service, and shall be paid by the person paying for such energy. (b) As used in this Section, the words "using electrical energy" shall not be construed to mean: (1) The use of such energy from a storage battery, provided, however, that the term shall include the receiving of such energy for the purpose of using it in the charging of storage batteries; or (2) The receiving of such energy by an electrical corporation or a governmental agency at a point within the City for resale. (c) The tax imposed in this Section shall be collected from the service user by the person selling such electrical energy. The amount of tax collected in one month shall be remitted to the Tax Administrator on or before the last day of the following month; or at the option of the person required to collect and remit the tax, an estimated amount of tax collected, measured by the tax billed in the previous month, shall be remitted to the Tax Administrator on or before the last day of each month. See, 1484. Gas users tax (a) There is hereby imposed a tax upon every person in the City, other than a gas corporation or an electrical corporation, using gas in the City which is delivered through mains or pipes. The tax imposed by this Section shall be at the rate of three and one-half percent of the charges made for such gas, including minimum charges for service, and shall be paid by the person paying for such gas. 3/20/85 -3- (b) As used in this Section, the term "charges" shall not include charges made for gas used in the generation of electrical energy by a public utility or a governmental agency, and the term "using gas" shall not be construed to mean the receiving of such gas by a gas corporation or governmental agency at a point within the City for resale. (c) The tax imposed by this Section shall be collected from the service user by the person selling the gas. The amount collected in one month shall be remitted to the Tax Administrator on or before the last day of the following month; or at the option of the person required to collect and remit the tax, an estimated amount of tax collected, measured by the tax billed in the previous month, shall be remitted to the Tax Administrator on or before the last day of each month. See. 14-85. Actions to collect tax Any tax and/or penalty required to be paid by a service user under the provisions of this Article 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. Any person owing money to the City under the provisions of this Article shall be liable to an action brought in the name of the City for the recovery of such amount. See. 14-86. Duty to eolleet; preeedures The duty to collect and remit the taxes imposed by this Article shall be performed as follows: (a) Every service supplier who receives, or is entitled to receive, the payment of charges from a service user, shall collect the amount of tax imposed by this Article from each such service user. (b) The tax shall be collected insofar as practicable at the same time as and along with the charges made in accordance with regular billing practice of the service supplier. Except. in those cases where a service user pays the full amount of said charges but does not pay any portion of a tax imposed by this Article, or where a service user has notified a service supplier that he is refusing to pay a tax imposed by this Article which said service supplier is required to collect, if the amount paid by a service user 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. (c) The duty to collect the tax from a service user shall commence with the beginning of the first regular billing period applicable to that person which starts on or after the effective date of this Article. 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 period. See. 14-87. Powers and duties of Tax Administrator (a) The Tax Administrator shall have the power and duty, and is hereby directed to enforce the provisions of this Article. 3/20/85 -4- (b) The Tax Administrator shall have power to adopt rules and regulations not inconsistent with the provisions of this Article for the purpose of carrying out and enforcing the payment, collection and remittance of the taxes herein imposed. A copy of such rules and regulations shall be on file and available for public examination in the Tax Administrator's office. (c) The Tax Administrator may make administrative agreements to vary the strict requirements of this Article so that collection of any tax imposed herein may be made in conformance with the billing procedures of a particular service supplier so long as said agreements result in collection of tax in conformance with the general purpose and scope of this Article. A copy of each such agreement shall be on file and available for public examination in the Tax Administrator's office. See. 14-88. Delinquent tsxes -serviee supplier (a) Taxes collected from a service user which are not remitted to the Tax Administrator on or before the due dates provided in this Article are delinquent. 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. (b) Any service supplier who fails to remit any tax imposed by this Article within ten days after receipt of written notice from the City of such failure shall pay a penalty of ten percent of the amount of the tax. (e) If the Tax Administrator determines that the non-payment by any service supplier of any remittance due under this Article is due to fraud, a penalty of twenty- five percent of the amount of the tax shall be added thereto in addition to the penalty stated in Paragraph (b) of this Section. (d) In addition to the penalties imposed by Paragraphs (b) and (c) of this Section, any service supplier who fails to remit any tax imposed by this Article shall pay interest at the rate of one percent per month, or fraction thereof, on the amount of the tax, exclusive of penalties, from the date on which the remittance first became delinquent until the tax is paid in full. (e) Every penalty imposed upon a service supplier, and such interest as accrues, under the provisions of this Section shall become a part of the tax required to be remitted. See. 1489. Failure to eolieet and report tax (a) If any service supplier shall fail to make, within the time provided in this Article, any report and remittance of said tax or any portion thereof required by this Article, the Tax Administrator shall proceed in such manner as he may deem best to obtain facts and information on which to base his estimate of the tax due. As soon as the Tax Administrator shall procure such facts and information as he is able to obtain upon which to base the assessment of any tax imposed by this Article and payable by any service supplier who has failed to refused to make such report and remittance, he shall proceed to determine and assess against such service supplier the tax, interest and penalties provided for by this Article. In ease such determination is made, the Tax Administrator shall give a notice of the amount so assessed by serving it personally or 3/20/s5 -5- by depositing it in the United States mail, postage prepaid, addressed to the service supplier so assessed at his last known address. (b) The service supplier may within ten days after the serving or mailing of the notice referred to in Paragraph (a) of this Section make application in writing to the Tax Administrator for a hearing on the amount assessed. If application by the service supplier for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the Tax Administrator shall become final and conclusive and immediately due and payable. If such application is made, the Tax Administrator shall give not less than five days' written notice in the manner prescribed herein to the service supplier to show cause at a time and place fixed in said notice why said amount specified therein should not be fixed for such tax, interest and penalties. At such hearing, the service supplier may appear and offer evidence why such specified tax, interest and penalties should not be so fixed. (c) If a hearing is conducted on the amount of tax assessed, as provided in Paragraph (b) of this Section, the Tax Administrator shall d'~termine the proper tax to be remitted and shall thereafter give written notice to the service supplier of such determination and the amount of tax, interest and penalties due and payable to the City. Such amount shall be paid in full by the service supplier within ten days after the serving or mailing of the. notice unless, prior to the expiration of such ten day period, the service supplier files with the City Clerk a written notice of appeal to the City Council. In such event, the appeal shall be conducted in accordance with the procedure set forth in Section 2-3.2 of this Cede. No penalty provided for in this Article shall be imposed after the filing of an appeal to the City Council or until completion of the hearing thereon and the making of a determination on the subject of the appeal by the City Council. See. 14-90. Delinquent taxes - service user (a) Whenever the Tax Administrator determines that a service user has deliberately withheld the amount of any tax imposed by the provisions of this Article from the amounts remitted to a person required to collect the tax, or that a service user has failed to pay the amount of the tax to such person for a peried of four or more billing periods, or whenever the Tax Administrator deems it to be in the best interest of the City, he may relieve such person of the obligation to collect taxes due under this Article from certain named service users for specified billing periods. (b) The service supplier shall provide the Tax Administrator with a monthly report showing the name and address of each service user refusing to pay a tax imposed by the provisions of this Article, or failing to pay such tax for a period of four billing periods, and the amount of tax such service user has failed or refused to pay. (c) The Tax Administrator shall give written notice to the service user that he has assumed responsibility to collect the taxes due for the stated periods and demand payment thereof. 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 thereon, addressed to the service user at the address to which billing was made by the person required to collect the tax; or, if the service user has changed addresses, to the last known address of the service user. In the event the service user fails to pay the tax to the Tax Administrator within fifteen days from the date of service of the notice, which shah be the date of mailing if service is not accomplished in person, a penalty of twenty-five percent of the amount of the tax set forth in the notice shall be imposed, 3/20/85 -6- or Ten Dollars, whichever is greater. If the tax is not paid in full within sixty days from the date of service of the Tax Administrator's notice, the service user shall pay interest on the unpaid tax, exclusive of penalties, at the rate of one percent per month, or fraction thereof, from the date which is sixty days after service of the Tax Administrator's notice to the date on which the tax is paid in full. (d) Any penalty and interest charged to a service user pursuant to Paragraph (c) of this Section shall become a part of the tax required to be paid; provided, however, the Tax Administrator, or the City Council on appeal, shall have authority to waive collection of the penalty or interest or both if the service user establishes, to the satisfaction of the Tax Administrator or City Council, that failure to pay the tax was the result of financial inability, mistake, or excusable inadvertence. See. 14-91. Records It shall be the duty of every service supplier required to collect and remit to the City any tax imposed by this Article, to keep and preserve, for a period of three years, all records as may be necessary to determine the amount of such tax that such service supplier may have been required to collect and remit to the City, which records the Tax Administrator shall have the right to inspect at all reasonable times. See. 14-92. Refunds (a) Whenever the amount of any tax, interest or penalty has been overpaid or paid more than once, or has been erroneously or illegally collected or received by the City under this Article, it may be refunded as provided in Paragraphs (b) and (c) of this Section provided a claim in writing therefor, stating under penalty of perjury the specific grounds upon which the claim is founded, is filed with the Tax Administrator on such forms as he may prescribe. Claims for refunds must be filed within three years after the date of payment of the tax. {b) A service supplier may claim a refund or claim a credit against taxes collected but not yet remitted to the City, of the amount overpaid, paid more than once or erroneously or illegal collected or received, when it is established, in a manner prescribed by the Tax Administrator, that a refund is justified; provided, however, in the case of a tax erroneously or illegally collected by the service supplier, no refund shall be allowed unless the amount thereof has either been refunded by the service supplier to the service user or other person from whom the amount was collected, or credited against charges subsequently payable by such service user or other person. (c) A service user may obtain a refund of the amount overpaid, or paid more than once, or erroneously or illegally collected or received by the City, by filing a claim in the manner provided in Paragraph {a) of this Section, but only when the service user having paid the tax, interest and/or penalty establishes to the satisfaction of the Tax Administrator that: (i) the service user has been unable to obtain a refund from the service supplier who collected the same; and (ii) the refund is justified. (d) The decision of the Tax Administrator on any claim for a refund may be appealed to the City Council in accordance with the procedure set forth in Section 2- 3.2 of this Code. (e) Notwithstanding other provisions of this Section, whenever a service supplier, pursuant to an order of the California Public Utilities Commission or a court 3/20/85 -7- of competent jurisdiction, makes a refund. to service users of charges for past utility services, the taxes paid pursuant to this Article on the amount of such refunded service charges may also be refunded to service users by the service supplier and the service supplier can claim credit for such refunded taxes against the amount which is due upon any monthly returns. In the event this Article has been repealed as of the time such refund is to be made, the amount of any refundable taxes will be borne by the City. ' See. 14-93. Annual review of tax rate The rate of tax set forth in Subsections 14-83(a) and 14-84(a) shall be subject to annual review by the City Council at a public hearing to be conducted concurrently with the Councirs review of the annual fiscal year operating budget of the City; provided, however, nothing herein shall prevent the Council from adjusting such rate at any time by the adoption of an ordinance amending this Article. See. 14-94. California Public Utilities Commission jurisdiction Nothing contained in this Article is intended to conflict with applicable rules, regulations and tariffs of any service supplier subject to the jurisdiction of the California Public Utilities Commission. In the event of any conflict, the provisions of said rules, regulations and tariffs shall control. See, 14-95. Repeal of Article This Article shall automatically be repealed on the fifth anniversary of its effective date." SECTION 2: This Ordinance shall be in full force and effect on July 1, 1985. SECTION3: If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held by a court of competent jurisdiction to be invalid or unconstitutional, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council of the City of Saratoga hereby declares that it would have passed this Ordinance and each section, subsection, sentence, clause and phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases may be held invalid or unconstitutional. Passed and adopted at a regular meeting of the City Council of the City of Saratoga held on the 3rd day of April , 1985, by the following vote: AYES: Councilmembers Cl~Venge~-Hlava'~~ M~yles and Mayor Fanell i ' NOES: Councilmember Callon 3/20/85 -8- ABSTAIN: None MA~)R ATTEST~I,~/,,~ (~ ~ CITY CLERK The-above and forefioinn is a true and correct copy o! !.~r¢ina!'~ce :~;7_3/ which has been published acco~di~ j ~o ~aw. Depu[y City ~e~ / ~e 3/20/85 -9-