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HomeMy WebLinkAbout639ORDINANCE NO. 639 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF IRWINDALE, CALIFORNIA, AMENDING CHAPTER 3.16 OF THE IRWINDALE MUNICIPAL CODE PERTAINING TO UTILITY USER TAXES WHEREAS, California Constitution Article XIIIC, Section 2, provides that no local government may extend any general tax unless and until that tax is submitted to the electorate and approved by a majority vote; and WHEREAS, the City Council has determined that maintaining a general tax on utility users within the City of Irwindale at the rate of 7.5% of all charges for the use of electric, gas, water, video services, and telecommunication utilities is the most reliable source of funds for the City and will provide ongoing revenue to avoid reductions in City staff, public safety and vital services to the community; and WHEREAS, the City desires to update the definitions of telecommunication and video (cable -like) services in the City's Municipal Code Chapter 3.16 pertaining to the utility users' tax in order that taxpayers be treated the same regardless of the technology used; and WHEREAS, the City desires to clarify those charges that are subject to the utility user tax with current definitions that reflect current technology; and WHEREAS, the City Council seeks to expand the existing UUT to include all telecommunications services including interstate and international services; and WHEREAS, the City Council further seeks to clarify the existing UUT on water, electrical and gas services to assure that all recipients of such utility services are treated equally, irrespective of the nature or makeup of the utility provider. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF IRWINDALE DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Chapter 3.16 of the Irwindale Municipal Code is hereby deleted and replaced with the following Chapter to read in its entirety as follows: 3.16.005 Findings. 3.16.010 Definitions. 3.16.020 Telecommunications. 3.16.030 Electricity. Ordinance No. 639 Page 1 3.16.040 Gas. eek 3.16.050 Water. 3.16.051 Video Services. 3.16.060 Constitutional and statutory Exemption. 3.16.070 Low Volume User Exemption. 3.16.080 Duty to Collect - Procuders. 3.16.090 Collection Penalties – Service Suppliers. 3.16.100 Actions to Collect 3.16.110 Deficiency Determination and Assessment – Tax Application Errors. 3.16.120 —Administrative Remedy – Non -Paying Service Users. 3.16.130 Additional Powers and Duties of the Tax Administrator. 3.16.140 Records. 3.16.150 Refunds. 3.16.160 Appeals. 3.16.170 No Injunction/Writ of Mandate. 3.16.180 Notice of Changes to Ordinance. 3.16.005 Findings. It is the intention and understanding of the people that this measure shall be deemed a "general tax" and that it is not a "special tax" within the meaning of Section 4 of Article XIII A of the California Constitution by virtue of the fact that the proceeds of this tax are to be deposited in the general fund of the City and are to be available to be used for any general governmental purpose that the City Council shall determine. 3.16.010 Definitions. The definitions set forth in this section govern the construction of this chapter. A. "Ancillary telecommunication 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: Ordinance No. 639 Page 2 �.� 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. B. "Ancillary video services" means 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, or other interactive services or communications that are associated with or incidental to the provision, use or enjoyment of video services. C. "Billing Address" shall mean the mailing address of the service user where the service supplier submits invoices or bills for payment by the customer. D. "City" means the city of Irwindale. E. "Gas" shall mean natural or manufactured gas or any alternate hydrocarbon fuel which may be substituted therefore. F. "Mobile Telecommunications Service' has the meaning and usage as set forth in the Mobile Telecommunications Sourcing Act (4 U.S.C. Section 124) and the regulations hereunder. G. "Month" shall mean a calendar month. H. "Non -Utility Service 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, cogenerator, distributed generation provider, exempt Ordinance No. 639 Page 3 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 I. "Paging service" means a "telecommunications service" that provides transmission of coded radio signals for the purpose of activating specific pagers; such transmissions may include messages and/or sounds. J. "Person" shall mean, without limitation, any natural individual, firm, trust, common law trust, estate, partnership of any kind, association, syndicate, club, society joint stock company, joint venture, limited liability company, business, corporation (including foreign, domestic, and nonprofit),municipal district or municipal corporation (other than the City), cooperative, receiver, trustee, guardian, or other representative appointed by order of any court. K. "Place of Primary Use' means the street address representative of where the customer's use of the telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer. 10) L. "Post-paid telecommunication service" means 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. M. "Prepaid telecommunication service means 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. N. "Private telecommunication service" means 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). Ordinance No. 639 Page 4 O. "Service Address" shall mean the residential street address or the business street address of the service user. For a telecommunication or video service user, "service address" means either: 1. The location of the service user's telecommunication or video 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 service or VoIP service), the service address shall mean the location of the service user's place of primary use. 3. For prepaid telecommunication service, "service address" shall mean the location associated with the service number. P. "Service Supplier" shall mean a person required to collect and remit a tax imposed by this chapter. Q. "Service User" shall mean a person required to pay a tax imposed under the provisions of this Article. R. "State" shall mean the State of California. S. "Tax Administrator' means the Finance Director of the City or his or her designee. T. "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 tows 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; 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). U. "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 Ordinance No. 639 Page 5 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. V. "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 Internet Protocol, 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, and includes ancillary video services, data services, "telecommunication services", or interactive communication services that are functionally integrated with "video services." W. "Video Service Supplier" means any person, company, or service which provides or sells one or more channels of video programming, or provides or sells the capability to receive one or more channels of video programming, including any telecommunications that are ancillary, necessary or common to the provision, use or enjoyment of the video programming, to or from a business or residential 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 telecommunications. A "video service supplier" includes, but is not limited to, multichannel video programming distributors [as defined in 47 U.S.C. Section 522(13)]; open video systems (OVS) suppliers; and suppliers of cable television; master antenna television; satellite master antenna television; multichannel multipoint distribution services (MMDS); video services using internet protocol (e.g., IP -TV and IP - Video, which provide, among other things, broadcasting and video on demand), direct broadcast satellite to the extent federal law permits taxation of its video services, now or in the future; and other suppliers of video services (including two-way communications), whatever their technology. X. VoIP (voice over internet protocol) means the digital process of making and receiving real-time voice transmissions over any Internet Protocol network. Y. "800 service' means a "telecommunications service" that allows a caller to dial toll-free number without incurring a charge for the call. The service is typically marketed under the name "800", "855", "866", "877", and "888" toll-free calling, and any subsequent numbers designated by the Federal Communications Commission. Z. "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. Ordinance No. 639 Page 6 3.16.020 Telecommunication Users' Tax. A. There is hereby imposed a tax upon every person in the City using telecommunication services. The tax imposed by this section shall be at the rate of seven and half percent (7.5%) of the charges made for such services and shall be collected from the service user by the telecommunication services supplier or its billing agent. There is a rebuttable presumption that telecommunication 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 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 for purposes of imposing the tax. As used in this section, the term "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 telecommunication services. 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 telecommunication service suppliers which are subject to the tax collection requirements of this Chapter, sourcing rules for the taxation of other telecommunication services, including but not limited to post-paid telecommunication services, and prepaid telecommunication services consistent with federal and state constitutional provisions. In promulgating any sourcing rules hereunder, the Tax Administrator shall take into account but shall not be legally bound by custom and common practice that furthers administrative efficiency and minimizes taxation by more than one state of the same service usage, commonly referred to as multi jurisdictional taxation. In so doing, the Tax Administrator may refer to and/or rely upon the Streamline Sales and Use Tax Agreement, and/or any other reasonable precedent or resource. C. As used in this section, the term "telecommunication services' shall include, but are not limited to charges for: connection, reconnection, termination, movement, or change of telecommunication 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; and local number portability charges. "Telecommunication services" shall not include digital downloads that are not "ancillary telecommunications services", such as books, music, ringtones, games, and similar digital products. D. To prevent actual multi -jurisdictional taxation of telecommunication services subject to tax under this section, any service user, upon proof to the Tax Administrator rpw, that the service user has previously paid the same tax in another state or local jurisdiction on such telecommunication services, shall be allowed a credit against the Ordinance No. 639 Page 7 tax imposed to the extent of the amount of such tax legally imposed in such other state or local jurisdiction; provided, however, the amount of credit shall not exceed the tax owed to the City under this section. 3.16.030 Electricity. A. There is 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 seven and one-half percent (7.5%) of the charges made for such energy and shall be paid by the person paying for such energy. B. "Charges," as used in this section, includes charges made for: 1. Energy charges; 2. Distribution or transmission charges; 3. Metering charges; 4. Stand-by, reserves, firming, ramping, voltage support, regulation, emergency, or other similar charges for supplemental services to self -generation service users; 5. Customer charges, late charges, service establishment or reestablishment charges, demand charges, fuel or other cost adjustments, power exchange 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 fees, franchise surcharges, annual and monthly charges, and other charges, fees or surcharges which are necessary for or common to the receipt, use or enjoyment of electric service; and, 6. Charges, fees, or surcharges for electricity services or programs which are authorized 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. 7. As used in this section, the term '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 electricity or services related to the provision of such electricity. C. The tax applicable to electrical energy provided by a non-utility supplier shall be determined by applying the tax rate to the equivalent charge the service user would have incurred if the energy used had been provided by the electrical service supplier serving the residents of the City. Rate schedules for this purpose shall be available from the City. Non-utility suppliers shall install, maintain and use an appropriate utility -type metering system which will enable compliance with this subsection. Ordinance No. 639 Page 8 D. As used in this section the term "using electrical energy" does not 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 includes the receiving of such energy for the purpose of using it in the charging of batteries. The term does not include electricity used in water pumping by water service supplier, nor does the term include the mere receiving of such energy by an electrical service supplier at a point within the City for resale. 3.16.040 Gas. A. There is imposed a tax upon every person in the City using gas in the City which is delivered through mains or pipes. The tax imposed by this section shall be at the rate of seven and one-half percent (7.5%) of the charges made for such gas and shall be paid by the person using such gas. B. "Charges" as used in this subsection shall include any charge authorized by the California Public Utilities Commission or the Federal Energy Regulatory Commission and shall apply to all services, components and items for gas service that are: i) necessary for or common to the receipt, use or enjoyment of gas service; or, ii) currently are 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; 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, late charges, service establishment or reestablishment charges, transition charges, customer charges, minimum charges, annual and monthly charges, and any other charges which are necessary for or common to the receipt, use or 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 Ordinance No. 639 Page 9 Regulatory Commission, whether or not such charges, fees, or surcharges appear on a bundled or line item basis on the customer billing. 6. As used in this section, the term "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 gas or services related to the delivery of such gas. C. 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 to be used in the generation of electrical energy by an electrical corporation; and 3. Charges made by a gas public utility for gas used and consumed in the conduct of the business of gas public utilities. 3.16.050 Water. A. There is imposed a tax upon every person in the City using water in the City which is delivered through mains or pipes. The tax imposed by this section shall be at the rate of seven and one-half percent (7.5%) of the charges made for such water and shall be paid by the person paying for such water. 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 10) customer billing. Ordinance No. 639 Page 10 6. As used in this section, the term "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 water services. 3.16.051 Video Services. A. There is hereby imposed a tax upon every person in the City using video services. The tax imposed by this section shall be at the rate of seven and one-half percent (7.5%) of the charges made for such services and shall be collected from the service user by the video service supplier or its billing agent. 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 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 for purposes of imposing the tax. B. As used in this section, the term "charges" shall include, but is not limited to, charges for the following: 1. Regulatory fees and surcharges, franchise fees and access fees (PEG); 2. Initial installation of equipment necessary for provision and receipt of telecommunication services; 3. Late fees, collection fees, bad debt recoveries, and return check fees; 4. Activation fees, reactivation fees, and reconnection fees; 5. Video programming and video services; 6. Ancillary video programming services (e.g., electronic program guide services, search functions, recording functions, or other interactive services or communications that are ancillary, necessary or common to the use or enjoyment of the video services); 7. Equipment leases (e.g., remote, recording and/or search devises; converters); and, 8. Service calls, service protection plans, name changes, changes of services, and special services. 9. As used in this section, the term "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 video services. Ordinance No. 639 Page 11 Fh 3.16.060 Constitutional and statutory Exemption A. Nothing in this Chapter shall be construed as imposing a tax upon any person if imposition of such tax upon that person would be in violation of the Constitution of the United States or the constitution of the state or in violation of any federal or state statute. B. Any service user that is exempt from the tax imposed by this Chapter pursuant to subsection A of this section shall file an application with the Tax Administrator for an exemption; 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 for such service. 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, and shall include the names of all utility service suppliers serving that service user. If deemed exempt 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 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 noncompliance. C. The decision of the Tax Administrator may be appealed pursuant to Section 3.16.160 of this Chapter. Filing an application with the Tax Administrator and appeal to the City Manager pursuant to Section 3.16.160 of this Chapter is a prerequisite to a suit thereon. 3.16.070 Low Volume User Exemption. A. The tax imposed by this Chapter shall not apply to any billing or to any charge of less than two hundred dollars per month per meter or other connection or service provided the service user provides to the Tax Administrator an application for exemption and reasonable proof of qualification for the exemption. Said amount may be adjusted by resolution from time -to -time in a manner deemed appropriate by the City to exempt low-volume users of utility services from the taxes imposed under this Chapter. B. The tax administrator shall, within 60 days of receipt of an application for exemption, determine whether the exemption is granted, and if so, notify the service supplier. The exemption shall apply from the date of the Tax Administrator's determination that the household so qualifies. C. The exemption granted to a person pursuant to this section shall become effective on the beginning of the first regular billing period which commences after the tax administrator has notified the service supplier that an exemption has been granted. Upon a showing of hardship by a service supplier, including the City, the Tax Ordinance No. 639 Page 12 Administrator may, as an alternative, implement this section by requiring the exempt person to pay the tax and seek a refund under section 3.16.150. The Tax Administrator shall provide a refund claim form for this purpose. D. The decision of the Tax Administrator may be appealed pursuant to Section 3.16.160 of this Chapter. Filing an application with the Tax Administrator and appeal to the City Manager pursuant to Section 3.16.160 of this Chapter is a prerequisite to a suit thereon. 3.16.080 Duty to Collect --Procedures. A. Collection by Service Suppliers. The duty of service suppliers to collect and remit the taxes imposed by the provisions of this Chapter shall be performed as follows: 1. The tax shall be collected by service suppliers insofar as practicable at the same time as, and along with, the collection of the charges made in accordance with the regular billing practice 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 was 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 3.16.120 shall apply. 2. The duty of a service supplier to collect the tax from a service user shall commence with the beginning of the first 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 service user 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. B. 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 or 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 that is exempt from the disclosure provisions of the Public Records Act. Ordinance No. 639 Page 13 3.16.090 Collection Penalties — Service Suppliers. A. Taxes collected by service supplier from a service user 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 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 the following business day. B. If the person required to collect and/or remit the utility users' tax fails to collect the tax (by failing to properly assess the tax on one or more services or charges on the customer's billing) or fails to remit the tax collected on or before the due date, the Tax Administrator shall attach a penalty for such delinquencies or deficiencies at the rate of fifteen (15%) percent of the total tax that is delinquent or deficient in the remittance. C. The Tax Administrator shall have the power to impose additional penalties upon persons required to collect and remit taxes pursuant to the provisions of this Chapter for fraud or gross negligence in reporting or remitting at the rate of fifteen (15%) percent 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 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. 3.16.100 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 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. Any tax required to be Ordinance No. 639 Page 14 Fh collected by a service supplier or owed by a service user is an unsecured priority excise tax obligation under 11 U.S. C.A. Section 507(a)(8)(C). 3.16.110 Deficiency Determination and Assessment — Tax Application Errors. A. The Tax Administrator shall make a deficiency determination if he or she determines that any service supplier or service user required to pay, collect, and/or remit taxes pursuant to the provisions of this Chapter has failed to pay, collect, and/or 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 that the Tax Administrator institute proceedings under this section 3.16.110 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 or entity allegedly owing the tax, which notice shall refer briefly to the amount of the taxes owed. Within fourteen (14) calendar days after the date of mailing of such notice, the person or entity allegedly owing the tax may file a request in writing with the Tax Administrator for a hearing on the matter. C. If the person or entity allegedly owing the tax 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. If the person requests a hearing, the Tax Administrator shall cause the matter to be set for hearing, which shall be scheduled 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 or entity at least ten (10) calendar days prior to the hearing, and, if the Tax Administrator desires said person or entity 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 person or entity owing the tax. The decision of the Tax Administrator may be appealed pursuant to section 3.16.160 of this Chapter. Filing an application with the Tax Administrator and appeal to the City Manager pursuant to section 3.16.160 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) day following the date of receipt of Ordinance No. 639 Page 15 the notice of final assessment. The penalty for delinquency shall be fifteen percent (15%) on the total amount of the assessment. The applicable statute of limitations regarding a claim by the City seeking payment of a tax assessed under this Chapter 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 calendar day following the date of mailing, as established by a proof of mailing. 3.16.120 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. To the extent 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 that the Tax Administrator 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 of fifteen percent (15%) of the total tax that is owed. 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. 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) days from the date of the service of the notice upon him or her, the Tax Administrator may impose an additional penalty of fifteen percent (15%) of the amount of the total tax that is owed. Ordinance No. 639 Page 16 3.16.130 Additional Powers and Duties of the Tax Administrator. A. The Tax Administrator shall have the power and duty to enforce each and all of the provisions of this Chapter. B. The Tax Administrator may adopt administrative rules and regulations consistent with provisions of this Chapter for the purpose of interpreting, clarifying, 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 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: (1) conform to the billing procedures of a particular service supplier so long as said agreements result in the collection of the tax in conformance with the general purpose and scope of this Chapter; or, (2) 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 3.16.110 of this Chapter for all taxes (and applicable penalties) 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 Ordinance No. 639 Page 17 Chapter for a period of not to exceed forty-five (45) days, provided that the time for filing 10) 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 75/100ths (0.75%) percent per month, prorated for any portion thereof. F. The Tax Administrator shall determine the eligibility of any person who asserts a right to exemption from, or a refund of, the tax imposed by this Chapter. G. 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 precedence. H. The Tax Administrator may issue and disseminate to service suppliers, which are subject to the tax collection requirements of this Chapter, an administrative ruling identifying those services, or charges therefore, that are subject to or not subject to the tax of this Chapter. I. The tax administrator shall have the right to make minor technical changes to this chapter consistent with the provisions of this Chapter in accordance with state and federal law. 3.16.140 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, which records the Tax Administrator shall have the right to inspect at a reasonable time. B. The City, through the City Council, 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. Ordinance No. 639 Page 18 C. The Tax Administrator is authorized to execute a non -disclosure agreement approved by the City Council to protect the confidentiality of customer information pursuant to California Revenue and Tax Code Sections 7284.6 and 7284.7. 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 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 $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. 3.16.150 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 from a service user or service supplier, it may be refunded as provided in this section: A. The Tax Administrator may refund any tax that has been overpaid or paid more than once or has been erroneously or illegally collected or received by the Tax Administrator under this Chapter from a service user or service supplier, 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 to the Tax Administrator within one year of the overpayment or erroneous or illegal collection of said tax. Such claim must clearly establish claimant's right to the refund by written records showing entitlement thereto. Nothing herein shall permit the filing of a 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. B. The Tax Administrator, where the claim is within his or her settlement authority as established by ordinance or by resolution of the City Council from time to time, or the City Council where the claim is in excess of that amount, shall act upon the refund claim within forty-five (45) calendar days of the initial receipt of the refund claim. Said decision shall be final. If the Tax Administrator or City Council fails or refuses to act on a refund claim within the forty-five (45) calendar day period, the claim shall be deemed to have been rejected by the Tax Administrator or City Council on the forty-fifth (45th) day. The Ordinance No. 639 Page 19 Tax Administrator shall give notice of the action in a form which substantially complies with that set forth in Government Code Section 913. C. 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. D. Notwithstanding the notice provisions of subsection (a) of this section, the Tax Administrator may, at his or her discretion, give written permission to a service supplier, who has collected and remitted any amount of tax in excess of the amount of tax imposed by this Chapter, to claim credit for such overpayment against the amount of tax which is due the City upon a subsequent monthly return(s) to the Tax Administrator, provided that: i) such credit is claimed in a return dated no later than one year from the date of overpayment or erroneous collection of said tax; ii) the Tax Administrator is satisfied that the underlying basis and amount of such credit has been reasonably established; and, iii) in the case of an overpayment by a service user to the service supplier that has been remitted to the City, the Tax Administrator has received proof, to his or her satisfaction, that the overpayment has been refunded by the service supplier to the service user in an amount equal to the requested credit. E. Notwithstanding subsections (a) though (d) above, a service supplier shall be entitled to take any overpayment as a credit against an underpayment whenever such overpayment has been received by the City within the three (3) years next preceding a deficiency determination or assessment by the Tax Administrator in connection with an audit instituted by the Tax Administrator pursuant to section 3.16.130(d). A service supplier shall not be entitled to said credit unless it first clearly establishes, to the satisfaction of the Tax Administrator, the right to the credit by written records showing entitlement thereto. Under no circumstances shall an overpayment taken as a credit against an underpayment pursuant to this subsection qualify a service supplier for a refund to which it would not otherwise be entitled under the one-year written claim requirement of this section. 3.16.160 Appeals. A. The provisions of this section apply to any decision (other than a decision relating to a refund pursuant to section 3.16.150 of this Chapter), deficiency determination, assessment, or administrative ruling of the Tax Administrator. Any person aggrieved by any decision (other than a decision relating to a refund pursuant to section 3.16.150 of this Chapter), 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)]. Nothing herein shall permit the filing of a claim or action on behalf of a class or group of taxpayers. Ordinance No. 639 Page 20 B. If any person is aggrieved by any decision (other than a decision relating to refund pursuant to section 3.16.150 of this Chapter), 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 scheduled for hearing before an independent hearing officer selected by the City Manager, no more than thirty (30) calendar days from the receipt of the appeal. The appellant shall be mailed 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 determin,atiQn fromwhich the appeal is taken. D. edupon the submission of such evidence and the review of the City's files, the hearing officer 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) calendar days from the date of the decision in accordance with Code of Civil Procedure Section 1094.6. E. All notices under this section may be sent by regular mail, postage prepaid, and shall be deemed received on the third calendar day following the date of mailing, as established by a proof of mailing. 3.16.170 No InjunctionlWrit 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. 3.16.180 Notice of changes to ordinance. If a tax under this Chapter is added repealed, increased, reduced, or the tax base is changed, the Tax Administrator shall follow the notice requirements of California Public Utilities Code Section 799. 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 Ordinance No. 639 Page 21 remaining portions of this ordinance. The City Council hereby declares that it would have adopted this ordinance, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion or the ordinance would be subsequently declared invalid or unconstitutional. SECTION 3. The Deputy City Clerk shall certify as to the passage of this Ordinance and shall cause the same to be posted at the designated locations in the City of Irwindale. PASSED, APPROVED AND ADOPTED by the People of the City of Irwindale on the 3rd day of November 2009. 44U mo, MC Deputy City Cle ,City of Irwindale Ordinance No. 639 Page 22