ORDINANCE 1243ORDINANCE NO. 1243
AN URGENCY ORDINANCE OF THE CITY COUNCIL OF
THE CITY OF EL SEGUNDO AMENDING THE EL
SEGUNDO MUNICIPAL CODE IN CONNECTION VVITH THE
CLAIMS PERIODS RELATING TO THE BUSINESS LICENSE
TAX, TRANSIENT OCCUPANCY TAX AND THE
COMMERCIAL AND INDUSTRIAL UTILITY USERS TAX
AND RELATING TO TAX REDUCTIONS AND
SUSPENSIONS.
WHEREAS, Proposition 62 was adopted as an initiative measure at the 1986
general election. Proposition 62 states, among other matters, that the imposition of
general taxes be approved by a majority vote of the people; and
WHEREAS, several California Court of Appeal opinions, including City&Kbodlake
v. Logan (1991) 230 Cal.App.3d 1058, subsequently declared Proposition 62
unconstitutional insofar as it purported to apply to cities; and
WHEREAS, in good faith belief that Proposition 62 was invalid, the City Council
adopted Ordinance No. 1216 increasing the Transient Occupancy Tax, Ordinance Nos.
1133, 1134 and 1135 imposing a Utility Users Tax on electrical corporations using gas
to generate electricity, commercial and industrial users of telephone communication
services and commercial and industrial users of co- generated electrical energy,
respectively, and Ordinance No. 1164, increasing the Utility Users Tax; and
WHEREAS, the recent California Supreme Court decision in Santa Clara County
Local Transportation Authority v. Carl Guardino ( "Guardind') held Proposition 62 to be
constitutional in some instances; and
WHEREAS, the eventual application of the Guarrino decision to city taxes will
create significant potential liability relating to the collection of taxes pursuant to Ordinance
Nos. 1133, 1134, 1135 and 1216; and
WHEREAS, the City desires to take proactive steps to maintain the fiscal integrity
of the City and to ensure that the City continues to meet its obligations to the community
in the provision of vital public services.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF EL SEGUNDO,
CALIFORNIA, DOES ORDAIN AS FOLLOWS:
SECTION 1. Section 3.12.120(a) of the El Segundo Municipal Code shall be
amended to read as follows:
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 subsection (b) and (c)
of this section, provided (i) the tax was paid under protest and, (ii) 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 one year of the date
of payment. The claim shall be on forms furnished by the tax administrator.
SECTION 2. Section 3.24.130(a) of the El Segundo Municipal Code shall be
amended to read as follows:
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 city under this
chapter it may be refunded as provided in subsection (b) and (c) of this section,
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provided (i) the tax was paid under protest and (ii) 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 one year of the date of payment.
The claim shall be on forms furnished by the tax administrator.
SECTION 3. Section 5.04.110 is hereby amended to read as follows:
5.04.110 APPEAL PROCEDURE. BUSINESS CLASSIFICATION METHOD
Any applicant for a Business License under this title, or any licensee
hereunder, may appeal the amount of any tax, interest or penalty that has been
overpaid or paid more than once or has been erroneously or illegally collected or
received by the city under this Title 5, in the manner provided herein. Within 10
days of the provision of an interpretation of this Title 5, or of an opinion concerning
Title 5 from a license inspector, auditor, or designated City official, any party
affected thereby may pay the tax so assessed under protest and request a hearing
before the Finance Director or his/her designee. Said hearing shall be held within
30 days from the date of the appeal, and a final decision shall be rendered at the
hearing. Within 10 days from the date of the hearing, an appeal of the Finance
Director's decision may be filed with the City Council. Within 30 days from the
date of the filing of the second appeal, the matter shall be scheduled for hearing
with the City Council. However, appeal to the City Council may only be made
when the dispute concerns the accuracy of calculation of the amounts due, or the
facts upon which a tax assessment is based.
A claim appealing the final decision of the Finance Director or of the City
Council may be filed in writing, stating under penalty of perjury the specific grounds
upon which the claim is founded, provided such claim is filed with the Finance
Director within one year of the date of payment.
If the full amount of the tax and any penalty and interest due is not paid,
there shall be no rights of appeal, and penalty and interest shall continue to run.
Any appeal rights provided for herein are lost if the procedures set forth
herein are not fully complied with and if the appeal is not made in writing with the
Finance Department within the time specified herein.
SECTION 4. The preceding Section 3 shall be effective as of January 1, 1995.
SECTION 5. A new section 3.06.080 is hereby added to the El Segundo Municipal
Code to read as follows:
3.06.080 TAX REDUCTIONS AND SUSPENSIONS
The City Council of the City of El Segundo has the authority to (i) provide
for the suspension of taxes collected under Title 3 and Title 5 hereof and, (ii)
provide for a reduction in the tax rates assessed under Title 3 and Title 5 hereof.
SECTION 6. This Ordinance shall be adopted as an urgency ordinance pursuant
to Government Code Section 36934 and shall be effective immediately upon adoption
pursuant to Government Code Section 36937(d). The City Council finds and determines
that the facts of the urgency are these: (i) the Guardino decision, if it applies to the City,
creates significant potential liability exposure for the City with respect to refund claims
relating to the Transient Occupancy Tax and the Utility Users Tax, (ii) the potential for
such claims threatens the fiscal integrity of the City, and (iii) immediate action is
necessary to protect the fiscal integrity of the City to ensure the maintenance of essential
municipal services, including police and fire services and to preserve the public peace,
health and safety.
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SECTION 7. 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.
SECTION 8. The City Clerk shall certify to the adoption of this Ordinance and shall
cause the same to be posted as required by law.
PASSED, APPROVED AND ADOPTED this 2nd day of January 1996.
j.
ATTEST:
CI CLE
APPROVED AS TO FORM:
"TYATTORNEY
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF EL SEGUNDO )
I, Cindy Mortesen, City Clerk of the City of El Segundo, do hereby certify that the
foregoing Ordinance No. 1243 was duly adopted and passed at a regular meeting of the
City Council on the 2nd day of January, 1996, by the following four - fifths vote, to wit:
AYES: COUNCILMEMBERS: Carl Jacobson, Liam Weston, Michael Robbins,
Richard Switz, Jane Friedkin
NOES: COUNCILMEMBERS: None
ABSENT: COUNCI LMEMBERS: None
CITY CLERK
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