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CC RESOLUTION 3484RESOLUTION NO. 3484 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL SEGUNDO, CALIFORNIA, CALLING AND GIVING NOTICE OF THE HOLDING OF A SPECIAL MUNICIPAL ELECTION ON TUESDAY, NOVEMBER 3, 1987, FOR THE SUBMISSION TO THE QUALIFIED VOTERS OF AN ORDINANCE ESTABLISHING A UTILITY USERS TAX. WHEREAS, the State of California State Proposition 62 (Government Code Sections 53720 et seq.) was approved by the electorate on November 4, 1986; and WHEREAS, Proposition 62 provides in pertinent part that no local government may impose a general tax unless and until such general tax is submitted to the electorate of the local government and approved by a majority vote of the voters voting in an election on the issue; and WHEREAS, Proposition 62 further provides in pertinent part that the City Council of the City of E1 Segundo shall propose a general tax by a resolution of the City Council which is approved by a two - thirds vote of all members of the City Council; and WHEREAS, the City Council desires to submit an ordinance of the City of E1 Segundo establishing a Utility Users Tax for vote of the electorate at a Special Municipal Election to be held on November 3, 1987. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF EL SEGUNDO, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE AND ORDER AS FOLLOWS: SECTION 1. Pursuant to the requirements of the laws of the State of California relating to general law cities, there is called and ordered to be held in the City of E1 Segundo, California, on Tuesday, November 3, 1987, a Special Municipal Election for the purpose of submitting the following measure for vote of the electorate of the City: Shall an ordinance of the City of E1 YES Segundo, California establishing a Utility Users Tax be adopted? NO 0 SECTION 2. The text of the ordinance submitted to the voters is attached as Exhibit A. -1- R- 8487.CA FOLLOWS: Exhibit A AN ORDINANCE OF THE CITY OF EL SEGUNDO, CALIFORNIA, ESTABLISHING A UTILITY USERS TAX. THE ELECTORATE OF THE CITY OF EL SEGUNDO DOES ORDAIN AS SECTION 1: The E1 Segundo Municipal Code is hereby amended by adding a new Chapter 3.24 to read as follows: "Title 3 Revenue and Finance Chapter 3.24 Utility Users Tax 3.24.010: Definitions. The following words and phrases whenever used in this ordinance shall be construed as defined in this section. (a) "Person" shall mean any domestic or foreign corpora- tion, firm, association, syndicate, joint stock company, partnership of any kind, joint venture, club, Massachusetts business or common law trust, society or individuals. (b) "City" shall mean the City of E1 Segundo. (c) "Telephone corporation ", "electrical corporation ", "gas corporation ", and "water corporation" shall have the same meaning as defined in Sections 234, 218, 222, 241 and 215 -5, respec- tively, of the Public Utilities Code of the State of California as said sections existed on January 1, 1975, except "electrical corporation" shall be construed to include any municipality, fran- chised agency, or cogenerator engaged in the selling or supplying of electrical power to a service user. (d) "Tax Administrator" shall mean the Finance Director of the City of E1 Segundo. (e) "Service supplier" shall mean any entity which receives taxes paid and remits same as imposed by this ordinance. (f) "Service user" shall mean a person required to pay a tax imposed by this ordinance. (g) "Month" shall mean a calendar month. (h) " Cogenerator" shall mean any corporation or person employing cogeneration technology for producing power from other than a conventional power source for the generation of electricity for sale to others. 3.24.020: Exemptions. Nothing in this ordinance 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 that of the State of California or upon the City or any of its departments, agencies, boards or commissions or upon the El Segundo Unified School District, Centinela Valley Union High School District and the Wiseburn School District, or upon any . other person when imposition of such tax upon that person would be in violation of the Constitution of the United States or the -1- 0- 8487.F Constitution of the State of California. The Tax Administrator shall prepare a list of the persons exempt from the provisions of this Chapter by virtue of this section and furnish a copy thereof to 10 each service supplier. 3.24.030: Telephone Users Tax. (a) There is hereby imposed a tax on the amounts paid for any intrastate telephone services by every person in the City (other than a telephone corporation regulated by the California Public Utilities Commission) using such services. The tax imposed by this section shall be at the rate of four percent (40) of the charges made for such services and shall be paid by the person paying for such services. (b) As used in this section, the term "charges" shall not include charges for services paid for by inserting coins in coin - operated telephones except that where such coin - operated service is furnished for a guaranteed amount, the amounts paid under such guarantee plus any fixed monthly or other periodic charge shall be included in the base for computing the amount of tax due; nor shall the term "charges" include charges for any type of service or equipment furnished by a service supplier subject to Public Utility regulation during any period in which the same or similar services or equipment are also available for sale or lease from persons other than a service supplier subject to Public Utility regulation; nor shall the words "telephone communication services" include land mobile service or maritime mobile services as defined in Section 2.1 of Title 47 of the Code or Federal Regulations, as said section existed on January 1, 1970. The term "telephone communication services" refers to that service which provides access to a tele- phone system and the privilege of telephone quality communication with substantially all persons having telephone stations which are part of such telephone system. The Telephone Users Tax is intended to, and does, apply to all charges billed to a telephone account having a situs in the City, irrespective of whether a particular communication service originates and /or terminates within the City. (c) The tax imposed by this section shall be collected from the service user by the person providing the intrastate tele- phone communication services, or the person receiving payment for such services. The amount of the tax collected in one (1) month shall be remitted to the Tax Administrator on or before the last day of the following month. (d) Notwithstanding the provisions of subsection (a), the 40 tax imposed under this section shall not be imposed upon any person for using intrastate telephone communication services to the extent that the amounts paid for such services are exempt from or not subject to the tax imposed under Division 2, Part 20 of the Cali- fornia Revenue and Taxation Code, or the tax imposed under Section 4251 of the Internal Revenue Code. 3.24.040: Electricity Users Tax. (a) There is hereby imposed a tax upon every person in the City using electrical energy in the City. The tax imposed by this section shall be at the rate of four percent (4 %) of the charges made for such energy and shall be paid by the person paying for such energy. "Charges ", as used in this section, shall include charges made for: (1) metered energy, and (2) minimum charges for service, including customer charges, service charges, demand charges, standby charges and annual and monthly charges, fuel, cost adjustments, etc. (b) As used in this section, the term "using electrical energy" shall not be construed to mean the storage of such energy by a person in a battery owned or possessed by him for use in an automobile or other machinery or device apart from the premises upon which the energy was received, provided however, that the term shall include the receiving of such energy for the purpose of using it in the charging of batteries; nor shall the term include electricity -2- 0- 8487.F used and consumed by an electric utility supplier in the conduct of its business as an electric public utility; nor shall the term include the mere receiving of such energy by an electric public utility or governmental agency at a point within the City of E1 Segundo for resale; or the use of such energy in the production or distribution of water by a public utility or a governmental agency. (c) The tax imposed by this section shall be collected from the service user by the person providing such energy. The amount of the tax collected in one (1) month shall be remitted to the Tax Administrator on or before the last day of the following month. Remittance of tax may be predicated on a formula based upon the payment pattern of the supplier's customer. 3.24.050: Gas Users Tax. (a) There is hereby imposed a tax upon every person in the City other than a gas corporation or electrical corporation, using in the City, gas which is delivered through mains or pipes. The tax imposed by this section shall be at the rate of four percent (4%) of the charges made for such gas and shall be paid by the person paying for such gas. "Charges ", as used in this section, shall include: (1) gas which is delivered through mains or pipes; (2) minimum •charges for services, including customer charges, service charges, and annual and monthly charges. (b) There shall be excluded from the base on which the tax imposed in this section is computed: (1) charges made for gas which is to be resold and delivered through mains or pipes; (2) charges made for 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 public utility for gas used and consumed in the conduct of the business of gas public utilities; (4) charges made for gas used in the propul- sion of a motor vehicle, as that phrase is defined in the Vehicle Code of the State of California, utilizing natural gas; and (5) charges related to late payments and returned checks. (c) The tax imposed by this section shall be collected from the service user by the person selling the gas. The person selling the gas shall, on or before the 20th of each calendar month, commencing on the 20th day of the calendar month after the effective date of this part, make a return to the Tax Administrator stating the amount of taxes billed during the preceding calendar month. At the time such returns are filed, the person selling the gas shall . remit tax payments to the Tax Administrator in accordance with schedules established or approved by the Tax Administrator. 3.24.060: Water Users Tax. (a) There is hereby imposed a tax upon every person in the City using water which is delivered through mains or pipes. The tax imposed by this section shall be at the rate of four percent (4°s) of the charges made for such water and shall be paid by the person paying for such water. (b) There shall be excluded from the base on which the tax imposed in this section is computed charges made for water which is to be resold and delivered through mains or pipes; 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. (c) The tax imposed by this section shall be collected from the service user by the person selling the water. The amount collected in one (1) month shall be remitted to the Tax Admini- strator on or before the last day of the following month. -3- 0- 8487.F 3.24.070: Reporting and Remitting. Each service supplier shall, on or before the last day of each month, make a return to the Tax .Administrator on forms provided by him, stating the amount of taxes billed by the service supplier during the preceding month, except as provided in section 3.24.050 (c) of this chapter. At the time the return is filed, the full amount of the tax collected shall be remitted to the Tax Administrator. The Tax Administrator is authorized to require such further information as he deems necessary to determine if the tax imposed hereby is being levied and collected in accordance with this chapter. 3.24.080: Interest and Penalty. (a) Taxes collected from a service user which are not remitted to the Tax Administrator on or before the due dates provided in this ordinance are delinquent. Should the due date occur on a weekend or legal holiday, the return may be postmarked the first regular working day following a Saturday /Sunday, or legal holiday. (b) Penalties for delinquency in remittance of any tax collected or any deficiency determination pursuant to this chapter shall attach to, and be paid by, the person required to collect and remit at the rate of fifteen percent of the total tax collected or • imposed by this chapter. (c) The Tax Administrator is hereby empowered to impose additional penalties upon persons required to collect and remit taxes under the provisions of this chapter for fraud or negligence in reporting or remitting at the rate of fifteen percent of the amount of the tax collected or as recomputed by the Tax Admini- strator. (d) Every penalty imposed under the provisions of this section shall become a part of the tax required to be remitted. 3.24.090: Actions to Collect. Any such tax received from a service user which has willfully been withheld from the Tax Administrator shall be deemed a debt owed to the City by the person required to collect and remit. Any person holding such money contrary to the provisions of this ordinance shall be liable to an action brought in the name of the City for the recovery of such amount. 3.24.100: Duty to Collect - Procedures. The duty to icollect and remit the taxes imposed by this ordinance shall be performed as follows: (a) Notwithstanding the provisions of section 3.24.050 (c), the tax shall be collected insofar as practicable at the same time as 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 energy charge and tax which has accrued for the bill- ing period, such amount and any subsequent payments by a service user shall be applied to the utility charge first until such charge has been fully satisfied. Any remaining balance shall be applied to taxes due. In those cases where a service user has notified the service supplier of his refusal to pay the tax imposed on (any) charges section 3.24.120 (c) will 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 ordinance. 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. -4- 0- 8487.F 3.24.110: Additional Power 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 ordinance. (b) The Tax Administrator shall have the power to adopt rules and regulations not inconsistent with provisions of this ordinance 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 in the Tax Administra- tor's office. (c) The Tax Administrator may make administrative agree- ments to vary the strict requirements of this ordinance so that collection of any tax imposed here may be made in conformance with the billing procedures of particular service supplier so long as said agreements result in collection of the tax in conformance with the general purpose and scope of this ordinance. A copy of each such agreement shall be on file in the Tax Administrator's office. (d) The Tax Administrator shall determine the eligibility .of any person who asserts a right to exemption from the tax imposed by this ordinance. The Tax Administrator shall provide the service supplier with the name of any person who the Tax Administrator determines is exempt from the tax imposed hereby, together with the address and account number to which service is supplied to any such exempt person. The Tax Administrator shall notify the service supplier of the termination of any person's right to exemption hereunder, or the change of any address to which service is supplied to any exempt person. 3.24.120: Assessment - Administrative Remedy. (a) The Tax Administrator may make an assessment for taxes not remitted by a person required to remit. (b) whenever the Tax Administrator determines that a service user has deliberately withheld the amount of the tax owed by him from the amounts remitted to a person required to collect the tax, or that a service user has refused to pay the amount of tax to such person, or whenever the Tax Administrator deems it in the best interest of the City, he may relieve such person of the obligation to collect taxes due under this ordinance from certain named service • users for specified billing periods. (c) The service supplier shall provide the City with amounts refused and /or unpaid along with the names and addresses of the service users neglecting to pay the tax imposed under provisions of this ordinance. whenever the service user has failed to pay the amount of tax for a period of two or more billing periods, the service supplier shall be relieved of the obligation to collect taxes due. (d) The Tax Administrator shall notify the service user that he has assumed responsibility to collect the taxes due for the stated periods and demand payment of such taxes. The notice shall be served on the service user by handing it to him personally or by deposit of the notice in the United States mail, postage prepaid thereon, addressed to the service user at the address to which bill- ing was made by the person required to collect the tax; or, should the service user have changed his address, to his last known address. If a service user fails to remit the tax to the Tax Administrator within fifteen (15) days from the date of the service •of the notice upon him, which shall be the date of mailing if service is not accomplished in person, a penalty of twenty -five percent (25 %) of the amount of the tax set forth in the notice shall be imposed, but not less than $5.00. The penalty shall become part of the tax herein required to be paid. -5- 0- 8487.F 3.24.130: Records. It shall be the duty of every person required to collect and remit to the City any tax imposed by this ordinance to keep and preserve, for a period of three (3) years, all records as may be necessary to determine the amount of such tax as he may have been liable for the collection of a remittance to the Tax Administrator, which records the Tax Administrator shall have the right to inspect at all reasonable times. 3.24.140: Refunds. (a) Whenever the amount of any tax has been overpaid or paid more than once or has been erroneously or illegally collected or received by Tax Administrator under this ordinance, it may be refunded as provided in subsections (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 within three years of the date of payment. The claim shall be on forms furnished by the Tax Administrator. (b) Notwithstanding the provisions of subsection (a) of this section, a service supplier may claim a refund or take as credit against taxes collected and remitted the amount overpaid, •paid more than once, or erroneously or illegally collected or received when it is established that the service user from whom the tax has been collected did not owe the tax; provided, however, that neither a refund nor a credit shall be allowed unless the amount of the tax so collected has either been refunded to the service user or credited to charges subsequently payable by the service user to the person required to collect and remit. A service supplier that has collected any amount of tax in excess of the amount of tax imposed by this ordinance and actually due from a service user, may refund such amount to the service user and claim credit for such over- payment against the amount of tax which is due upon any other monthly returns, provided such credit is claimed in a return dated no later than three (3) years from the date of overpayment. (c) No refund shall be paid under the provisions of this section unless the claimant establishes (in writing) his right thereto by written records showing entitlement thereto. (d) Notwithstanding other provisions of this section, whenever a service supplier, pursuant to an order of the California Public Utilities Commission or a court of competent jurisdiction, makes a refund to service users of charges for past utility ser- vices, the taxes paid pursuant to this ordinance on the amount of such refunded charges shall also be refunded to service users, and the service supplier shall be entitled to claim a credit for such refunded taxes against the amount of tax which is due upon the next monthly returns. In the event this ordinance is repealed, the amounts of any refundable taxes will be borne by the City. (e) A service supplier may refund the taxes collected to the service user in accordance with this section or by the service supplier's customary practice. 3.24.150: (a) Special Refund. Senior Citizens and Persons Permanently Disabled. The tax imposed by this Article on charges made for utility services to the personal residence of any person who is 62 years of age or older or permanently disabled shall be subject to refund following payment; provided that: (1) The gross annual such taxes were paid of a husband and wife • their combined gross income of such person during the year was less than $12,750 or in the case living together in such residence, annual income was less than $12,750. 0- 8487.F (2) If applicant resides in a duplex or in a multiple dwelling and a utility billing involves service to more units than the one occupied by the applicant, then the refund shall be limited pro rata to the portion attrib- utable to such unit utilized as applicant's residence. (3) If applicant has shared a residence with parents or adult sons or daughters during the entire period subject to said utility users tax, applicant shall be eligible for a pro rata refund of the utility users tax levied on utility service to such residence computed upon the basis of the applicant's total income in relation to the total income of all such related persons. (4) A person shall be deemed permanently disabled if the person receives permanent disability insurance from the U.S. Social Security Administration, holds a valid certifi- cate from the Department of Motor Vehicles indicating a handicap, or furnishes a statement signed by a licensed physician attesting to the permanent disability. (b) Special Refund Procedure. Persons eligible for refund of utility users taxes pursuant to section 3.24.150 may make application for refund of such taxes paid during the immediately • preceding year by duly completing an application form provided by the Finance Department. Each application shall contain a decla- ration under penalty of perjury as to the truthfulness of the following. (1) Name and address of applicant and parent, adult son or daughter residing with applicant during the entire period subject to the utility users tax. (2) Birthdate of applicant. (3) Amount of utility users taxes paid each month of the calendar year period. (4) The source, amount of all income received by appli- cant, parents, adult sons or daughters during the entire period for which refund is claimed. (5) Such other information or data (including income tax returns) as may be required by the Tax Administrator. • (6) Documentation attesting to the persons permanently disabled. (c) Filing Time Period. Effective July 1, 1988, refunds shall be made on a fiscal year basis on applications duly submitted to the Tax Administrator after July lst of each year and before June 30th of the next preceding year. (d) Determination on Application. The Tax Administrator shall either grant, grant in part, or deny the application based upon eligibility for refund pursuant to section 3.24.150 (a) and (b). 3.24.160: Reduction of Utility Users Tax Based on Sales Tax Receipts. Whenever in this Title a utility users tax is imposed on any person subject to the utility users tax, the amount of the utility users tax shall be reduced proportionately whenever the amount of sales tax receipts from the state in the immediately preceeding fiscal year exceeds the limit determined by the formula in subsection (a) of this section. (a) The sales tax the utility users tax shall tax revenue received in the appropriations limit establ provisions of Article XIIIB limit which will trigger a reduction in be equal to eighty percent of the sales 1979 -80 fiscal year multiplied by the ished annually since 1980 -81 under the of the California constitution. -7- 0- 8487.F (b) In any year in which sales tax revenue exceeds the limit established in subsection (a) of this section, the utility users tax imposed the following July 1, shall be reduced by the percentage that revenue exceeds the limit. 3.24.170: Utility Users Account. The Tax Administrator shall establish a "Utility Users Tax Account" within the General Fund and shall place therein any and all taxes collected under this ordinance which are in excess of the amounts needed to balance the adopted General Fund budget during any one fiscal year. 3.24.180: Annual Review. (a) Each year in conjunction with the annual budget deliberations and prior to September 30, the City Council shall reconsider the provisions and rate of the utility users tax as well as any taxes that may have been placed in the utility users tax account as provided in 3.24.170 during the preceding and current fiscal years. Notwithstanding the provisions of section 3.24.160, the Council may reduce or suspend all or a part of the tax rate for the current fiscal year; or may provide no tax on one or more utilities for the current fiscal year. (b) The City will give the service supplier at least one • month's notification prior to any requested change in the utility users tax percentage." SECTION 2: Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this ordinance or any part thereof is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portion of this ordinance or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdi- vision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more sections, subsections, subdivi- sions, paragraphs, sentences, clauses or phrases be declared • unconstitutional. SECTION 3: Operative Date. This ordinance shall become effective the day it is adopted by the electorate. The tax imposed under this ordinance shall apply to services furnished from the beginning of the first regular billing period commencing on or after the day this ordinance is adopted by the electorate or as soon thereafter as the respective utilities are physically and mechani- cally able to get "on line" for the imposition of charges (not less than 60 days). Adopted by the Electorate at a Special Municipal Election • held , 198_. City Clerk -8- 0- 8487.F u 0 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS CITY OF EL SEGUNDO ) I, Ronald L. Hart, City Clerk of the City of E1 Segundo, California, DO HEREBY CERTIFY that the whole number of members of the City Council of the said City is five; that the foregoing resolution, being Resolution No. 3484 was duly passed and adopted by the said City Council, approved and signed by the Mayor of said City, and attested by the City Clerk of said City, all at a regular meeting of the said Council held on the 4th day of August, 1987, and that the same was so passed and adopted by the following vote: is AYES: Councilmembers Anderson, Jacobson, Schuldt, West, NOES: Mayor Siadek ABSENT: None WITNESS MY HAND AND THE OFFICIAL SEAL OF SAID CITY this 12th day of August, 1987. City Clerk of the City of El Segundo, California (SEAL)