HomeMy WebLinkAboutITEM VIII-A-2A TY OF
UBURN
- WASHINGTON
AGENDA BILL APPROVAL FORM
Agenda Subject: Date:
Ordinance No. 6170 March 11, 2008
Department: Attachments: Budget Impact:
Finance Ordinance No. 6170
Administrative Recommendation:
City Council introduce and adopt Ordinance No. 6170.
Background Summary:
Ordinance No. 6170 amends sections 3.40.020, 3.41.010, 3.84.040, and 3.88.040 of the Auburn City
code and creates a new chapter 3.42 of the Auburn City code relating to the levy and collection of utility
taxes.
The City has reviewed its various utility tax funds and finds that it is appropriate that the provisions of the
City Code be amended to increase the City utility tax rates to meet the City's arterial street bond needs,
with the intention that the utility tax rates shall revert to the rates prior to the increases of this Ordinance if
state funding of the City's arterial street fund is provided in amounts off-setting the utility tax rate
increases of this ordinance.
N0407-1
F6.8
Reviewed by Council & Committees: Reviewed by Departments & Divisions:
? Arts Commission COUNCIL COMMITTEES: ? Building ? M&O
? Airport ® Finance ? Cemetery ? Mayor
? Hearing Examiner ® Municipal Serv. ® Finance ? Parks
? Human Services ? Planning & CD ? Fire ? Planning
? Park Board ®Public Works ? Legal ? Police
? Planning Comm. ? Other ® Public Works ? Human Resources
? Information Services
Action:
Committee Approval: ?Yes ?No
Council Approval: ?Yes ?No Call for Public Hearing
Referred to Until
Tabled Until
Councilmember: Backus Staff: Coleman
Meeting Date: April 7, 2008 Item Number: VIII.A.2
AUBURN *MORE THAN YOU IMAGINED
ORDINANCE NO.6 1 7 0
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
AUBURN, WASHINGTON, AMENDING CHAPTER 3.40 OF THE
AUBURN CITY CODE, AND AMENDING SECTIONS, 3.41.010,
3.84.040 AND 3.88.040 OF THE AUBURN CITY CODE AND
CREATING A NEW CHAPTER 3.42 OF THE AUBURN CITY CODE
RELATING TO THE LEVY AND COLLECTION OF UTILITY TAXES
WHEREAS, the City would like issue bonds for improvements to and
maintenance of its arterial streets; and
WHEREAS, the City has decided to fund the debt service for the bonds with
a one percent increase to the City's utility tax rates; and
WHEREAS, an Auburn citizen's advisory task force has recommended that
the City take steps to utilize its available taxing capacity in the utility tax to provide
revenue to improve and repair the City's arterial streets; and
WHEREAS, the City Council has reviewed its various utility tax funds and
finds that it is appropriate that the provisions of the City Code be amended to
increase the City utility tax rates to meet the City's arterial street bond needs, with
the intention that the utility tax rates shall revert to the rates prior to the increases
of this Ordinance if state funding of the City's arterial street fund is provided in
amounts off-setting the utility tax rate increases of this Ordinance; and
WHEREAS, it is also appropriate to establish in the City Code a Chapter
providing for utility taxes on the service of cable television business operating
within the corporate limits of the City; and
-----------------
Ordinance No. 6170
March 24, 2008
Page 1 of 7
WHEREAS, particularly in light of the recent annexations, and the City's
franchise agreement with Lakehaven Utility District whereby the City reserved the
right to apply and impose utility taxes, it is also appropriate to amend the
applicable sections of the City Code so as to apply utility taxes to that part of the
Utility District's service area within the City.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF AUBURN,
WASHINGTON, DO ORDAIN AS FOLLOWS:
Section 1. Amendment to City Code. That Chapter 3.40 of the City of
Auburn City Code is amended to read as follows:
Chapter 3.40
WATER AND SEWER UTILITY TAX
Sections:
3.40.010 Created.
3.40.020 Levy and collection.
3.40.010 Created.
There is created a tax in the amount of seven percent, effecc-tiveto be levied
on and after -July June 1, -` , against and upon the total
annual revenues of the water, storm drainage and sewer utility funds and
on all water storm drainage and sewer utilities business enterprises or
other entities engaged in providing such utility services within the City.
(Ord. 5699 § 1, 2002; Ord. 5280 § 1, 1999; Ord. 4178 § 2, 1986.)
3.40.020 Levy and collection.
There is levied a tax of six-seven percent per year upon the total
annual revenues of the water, storm drainage and sanitary sewer utility
funds and on all water, storm drainage and sewer utilities, business
enterprises or other entities engaged in providing such utility services within
the Cam, which tax shall be collected from and levied upon the total
revenues received by the water, storm drainage and sanitary sewer utility
funds and on the revenues derived from within the Cite of all water;-storm
drai?e and sewer utilities, business enterprises or oth entities ert? d
in rovidinri such utility services, for the benefit of the current expense funds
or as oth- 9- directed by the City. The finance director is directed to
collect the tax of six-seven percent out of the total revenues received each
-----------------
Ordinance No. 6170
March 24, 2008
Page 2 of 7
year in the water, storm drainage and sewer utility funds, commencing
dauaFy-Ap{+1• July 1, 2D032008, and the finance director is directed to pay
over the funds so collected into the current expense fund. The increase in
tax revenue generated by the additional one percent tax levied pursuant to
Ordinance No. 6170 shall be relegated for use by the City in support of its
arterial street system. It is provided however, that if the State of
Washington increases its provides a long term sustainable funding source
of to the City of Auburn Arterial Street Fund in an amount sufficient to off-
set the amount of the increases in utility tax rates of this Ordinance and the
long term funding source is sufficient to maintain the City of Auburn's
arterial street system's Pavement Condition Index ?PCI? at an averse of
70 PCI out of a score of 100 PCI for the foreseeable future,-the water,
storm drainage and sanitary sewer utility tax rate shall automatically revert
to six percent per year upon the total annual revenues of the water, storm
drainage and sanitary sewer utility funds. (Ord. 5699 § 1, 2002; Ord. 5280
§ 1, 1999; Ord. 4178 § 2, 1986.)
Section 2. Amendment to City Code. That Section 3.41.010 of the City
of Auburn City Code is amended to read as follows:
3.41.010 Tax created.
There is created a utility tax in the amount of six-seven percentjo be
levied on and after July 1, 2008 of the gross receipts against and upon the
total annual revenues of the garbage fund, and on all solid waste utilities
and upon every business enterprise or other entity engaged in handling
solid waste. For the purposes hereof, "solid waste" means garbage,
recyclables and yard debris. The increase in tax revenue generated by the
additional one percent tax levied pursuant to Ordinance No. 6170 shall be
relegated for use by the City in support of its arterial street system. It is
provided however that if the State of 1lllashington increases its provides a
long term sustainable funding source of to the City of Auburn Arterial Street
Fund in an amount sufficient to off-set the amount of the increases in utility
tax rates of this Ordinance and the long term funding source is sufficient to
maintain the City of Auburn's arterial street system's Pavement Condition
Index (PC[) at an average of 70 PCI out of a score of 100 PCI for the
foreseeable future the garbage and solid waste utility tax rate shall
automatically revert to six percent of the gross receipts against and upon
the total annual revenues of the garbage fund and on all solid waste
utilities and upon every business enterprise or other entity engaged in
handling solid waste. (Ord. 5700 § 1, 2002; Ord. 5671 § 1, 2002; Ord.
4393, 1989; Ord. 4179 § 2, 1986.)
-----------------
Ordinance No. 6170
March 24, 2008
Page 3 of 7
Section 3. Amendment to City Code. That Section 3.84.040 of the City
of Auburn City Code is amended to read as follows:
3.84.040 Tax - Imposed.
On and after April j--,---July 1, 28042008, there is levied upon and
there shall be collected from every person, firm or corporation engaged in
carrying on the following business for hire or for sale of a commodity or a
service within or partly within the corporate limits of the city, a tax for the
privilege of so doing business as defined in ACC 3.84.010. Upon any
telephone business there shall be levied a tax equal to five-six percent of
the total gross operating revenues, including revenues from intrastate tolls
derived from the operation of such business within the city. Gross operating
revenues for this purpose shall not include charges which are passed on to
the subscribers by a telephone company pursuant to tariffs required by
regulatory order to compensate for the cost to the company of the tax
imposed by this chapter. The increase in tax revenue generated by the
additional one percent tax levied pursuant to Ordinance No. 6170 shall be
relegated for use by the City in support of its arterial street system. It is
provided, however, that if the State of VOPashington increases its provides a
(?n term ;ustainable rUnding sourccof to the City of Auburn Arterial Street
amowit c -nt too i! unt of the increases in utility
tax ;tesof this Ordinance and the long term funding source is sufficient to
maintain the City of Auburn's arterial street system's Pavement Condition
Index (PCI) at an average of 70 PCI out of a score of 100 PCI for the
foreseeable future, the telephone utility tax rate shall automatically revert to
five percent of the total gross operating revenues on telephone businesses,
including revenues from intrastate tolls derived from the operation of such
business within the city. (Ord. 5797 § 1, 2003; Ord. 5673 § 2, 2002; Ord.
4185 § 2, 1986. Formerly 5.82.040.)
Section 4. Amendment to City Code. That Section 3.88.040 of the City
of Auburn City Code is amended to read as follows:
3.88.040 Tax - Levy.
FfGm--On and after April- July 1, 20842008, there is levied upon and
there shall be collected from every person, firm or corporation engaged in
carrying on an electric power business, natural gas business and/or
artificial gas business for hire within or partly within the city limits an annual
tax for the privilege of so doing, such tax to be equal to five-six percent of
the total gross revenues received from the operation of such businesses
within the city limits. The increase in tax revenue generated by the
additional one percent tax levied pursuant to Ordinance No. 6170 shall be
-----------------
Ordinance No. 6170
March 24, 2008
Page 4 of 7
relegated for use by the City in support of its arterial street system. It is
provided, however, that if the State of Washington increases its provides a
long term sustainable funding source of to the City of Auburn Arterial Street
Fund in an amount sufficient to off-set the amount of the increases in utility
tax rates of this Ordinance and the long term funding source is sufficient to
maintain the City of Auburn's arterial street system's Pavement Condition
Index (PCI at an average of 70 PCI out of a score of 100 PCI for the
foreseeable future, the electric power, natural gas business and artificial
gas business utility tax rate shall automatically revert to five percent of the
total gross revenues received from the operation of such businesses within
the city limits. (Ord. 5797 § 2, 2003; Ord. 5673 § 3, 2002; Ord. 4180 § 1,
1986; Ord. 3827 § 1, 1982; Ord. 3679 § 1, 1981; 1957 code § 5.42.030.
Formerly 5.88.040.)
Section 5. Creation of New Chapter to City Code. That a new Chapter
3.42 of the City of Auburn City Code is created to read as follows:
Chapter 3.42
CABLE TELEVISION UTILITY TAX
Sections:
3.42. 010 Tax created.
3.42.020 Levy and collection of tax.
3.42.010 Tax created.
There is created a utility tax in the amount of one percent to be
levied on and after July 1, 2008, as set forth below, of the gross receipts
against and upon the total annual revenues of cable television businesses
operating within the City.
3.42.020 Levy and collection of tax.
There is levied a tax of one percent on the gross income of, and
upon the total annual revenues of cable television businesses operating
within the City, which tax shall be collected from and levied upon the total
receipts of such cable television business(es). For the purposes hereof,
the following terms and definitions shall apply:
A. "Gross income" means the value proceeding or accruing from
the sale of any tangible property or service, and receipts (including all sums
earned or charged, whether received or not), by reason of the investment of
capital in the business engaged in, including rentals, royalties, fees, or
other emoluments, however designated (excluding receipts or proceeds
from the use or sale of real property or any interest therein, and proceeds
from the sale of notes, bonds, mortgages, or other evidences of
indebtedness, or stocks and the like) and without any deduction on account
-----------------
Ordinance No. 6170
March 24, 2008
Page 5 of 7
of the cost of the property sold, the cost of materials used, labor costs,
interest or discount paid, or any expense whatsoever, and without any
deduction on account of losses, including the amount of credit losses
actually sustained by the taxpayer whose regular books or accounts are
kept upon an accrual basis.
B. "Cable television business" means:
1. a system providing service pursuant to a franchise issued by
the City under the Cable Communications Policy Act of 1984 Public Law
No. 98-549, 47 U.S.C. § 521, as it may be amended or superseded; or
2. any system that competes directly with such franchised
system by employing antennae, microwave, wires, wave guides, coaxial
cables, or other conductors, equipment or facilities designed, construed or
used for the purpose of:
(a) collecting and amplifying local and distant broadcast television
signals and distributing and transmitting them;
(b) transmitting original cable-cast programming not received
through television broadcast signals; or
(c) transmitting television pictures, film and videotape programs
not received through broadcast television signals, whether or not encoded
or processed to permit reception by only selected receivers; provided,
however, that "cable television service" shall not include entities that are
subject to charges as "Commercial TV Stations" under 47 U.S.C. § 158, as
it may be amended or superseded.
C. The tax revenue generated by the one percent levied
pursuant to Ordinance No. 6170 shall be relegated for use by the City in
support of its arterial street system.
It is provided, however, that if the State of Washington provides a
long term sustainable funding source to the City of Auburn Arterial Street
Fund in an amount sufficient to off-set the amount of the cable television
utility tax rates of this Ordinance, and the long term funding source is
sufficient to maintain the City of Auburn's arterial street system's Pavement
Condition Index (PCI) at an average of 70 PCI out of a score of 100 PCI for
the foreseeable future„ the utility tax on cable television businesses shall
automatically terminate and the status of the tax shall be consistent with its
status prior to the adoption of this Ordinance.
Section 6. Implementation. The Mayor is hereby authorized to
implement such administrative procedures as may be necessary to carry out the
directives of this legislation.
-----------------
Ordinance No. 6170
March 24, 2008
Page 6 of 7
Section 7. Severability. If any section, subsection, clause,
phrase, or sentence, of this Ordinance, is for any reason held to be invalid or
unconstitutional, such invalidity or unconstitutionality of the remaining portions of
this ordinance, as it is being hereby expressly declared that this ordinance and
each section, subsections, clause, phrase, or sentence, hereof would have been
prepared, proposed, adopted, and approved and ratified irrespective of the fact
that any one or more section, subsection, clause, phase, or sentence, be declared
invalid or unconstitutional.
Section 8. Effective Date. This Ordinance shall take effect and be in
force five (5) days from and after its passage, approval and publication as
provided by law, and on July 1, 2008.
INTRODUCED:
PASSED:
APPROVED:
PETER B. LEWIS, MAYOR
ATTEST
Danielle E. Daskam, City Clerk
PUBLISHED:
-----------------
Ordinance No. 6170
March 24, 2008
Page 7 of 7