HomeMy WebLinkAboutAgenda Report - August 4, 2004 I-06 ERAGENDA ITEM I ow 6
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA TITLE: Consider 1) Adoption of an Urgency Ordinance Imposing a %-cent sales tax
subject to approval of a majority of the Lodi electorate; 2) adoption of a Resolution
Submitting a V4 -cent Sales Tax Initiative and Companion Advisory Measure to a
vote of the Electorate of the City of Lodi on November 2, 2004, Setting Priorities for
Filing Written Arguments, and Directing the City Attorney to prepare an Impartial
Analysis; and 3) Approval of a Special Allocation of $10,000 to the Elections Fund.
MEETINGDATE: Wednesday, August 4,2004
PREPARED BY: D. Stephen Schwabauer, City Attorney
RECOMMENDED ACTION: Consider: 1) Adoption of an Urgency Ordinance Imposing a %-cent
sales tax subject to approval of a majority of the Lodi electorate; 2) Adoption of a Resolution Submitting a
%-cent Sales Tax Initiative and Companion Advisory Measure to a Vote of the Electorate of the City of
Lodi on November 2, 2004, Setting Priorities for Filing Written Arguments, and Directing the City Attorney
to prepare an Impartial Analysis; and 3) Approval of a Special Allocation of $10,000 to the Elections
Fund.
BACKGROUND INFORMATION: This item comes before Council at the request of Mayor Pro
Tempore Beckman. As Council is aware, a local citizens group has
been considering a signature drive to put a Y4 -cent sales tax
initiative on the ballot with a companion advisory measure prioritizing a list of City projects that could be
funded with the revenue derived therefrom. The Initiative has a 10 -year sunset clause. Mayor Pro
Tempore Beckman proposes that the Council consider using its own initiative power to place the sales
tax measure on the ballot for the November 2, 2004 election. This would obviate the need for a signature
drive.
In order to pursue the Council sponsored initiative route, Council must first adopt an urgency ordinance
imposing the tax subject to approval by a majority of the Lodi electorate. Proposition 82 (Government
Code Section 53724(a)) requires that a general tax be proposed by a 2/3's vote of the council, in our
case, four votes. An urgency ordinance requires approval by 2/3's vote as well. The proposed initiative
calls for the assessment of a general tax, i.e. once levied it can be used for any general governmental
purpose and therefore must pass by a simple majority vote of the electorate. The enactment of a general
tax must be consolidated with a regularly scheduled general election unless the Council finds an
emergency by unanimous vote. (Cal. Const. art. XIIIC § 2(b) "No local government may impose ... any
general tax unless and until the tax is submitted to the electorate and approved by a majority vote....
The election required by this subdivision shall be consolidated with a regularly scheduled general election
... except in cases of emergency declared by a unanimous vote of the governing body." ). However, if
the citizens group itself collects signatures to put the initiative on the ballot, it may be able to proceed via
special election, since the tax is not imposed by the local government.
APPROVED:
H. Dixon Flynn, City Manager
The sales tax initiative would be accompanied by an advisory measure that would give Lodi Citizens the
opportunity to voice their opinion on how the revenue should be spent. The advisory measure would list
a group of projects that are currently on hold such as placing paramedics on Lodi fire trucks, building an
indoor sports center, building an aquatics center and developing Debenedetti Park, and constructing and
operating a new Animal Shelter. The companion measure is advisory only and would not be binding on
the City.
Finance Director James Krueger estimates the proposed initiative would raise approximately 2.2 million
dollars per year. Because this election was not in the clerk's budget, it would require a special allocation
of $10,000 (the high estimate provided by the San Joaquin County Registrar) to the Elections Fund to
pay the cost of placing the measure on the ballot.
I have prepared this staff report and agenda title. However, the proposed resolution has been paid for
and drafted by the Citizens group's counsel at a well-respected municipal law firm, Best Best and
Krieger. I have reviewed and approved their resolution.
FUNDING: up to $10,000, Elections Fund 100102
2NAW
Approved:
Olf
i Krueger, Finance birector'
DRAFT
ORDINANCE NO. 1751
AN URGENCY ORDINANCE OF THE CITY OF LODI IMPOSING
A TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY
THE STATE BOARD OF EQUALIZATION AND ADDING
CHAPTER 3.09 TO THE LODI MUNICIPAL CODE
WHEREAS, the City of Lodi's Revised Budget for 2004-2005 shows an approximately
$1.9 million shortfall in the amount of revenue relative to the amount of expenditures; and
WHEREAS, the State budget will likely involve significant funding cuts for cities, and
there are currently insufficient alternative sources for funding local governments; and
WHEREAS, the City's 2004-2005 Financial Plan and Budget states that "the City will
seek to maintain a diversified and stable revenue base to protect it from short-term fluctuations
in any one revenue source" and that "the City will make all current expenditures with current
revenues, avoiding procedures that balance current budgets by accruing future revenues,
rolling over short-term debt or borrowing reserves of one fund to another"; and
WHEREAS, in light of the budget shortfall and decreasing funding from the State, the
City cannot currently fund many important capital projects and thus has a vital need to increase
its revenue to finance critical public projects, facilities, and services; and
WHEREAS, the City's Finance Director has estimated that a one quarter cent increase
in the City's transactions and use tax would result in $2.2 million dollars in revenue annually;
and
WHEREAS, Government Code Section 36937 permits cities to enact urgency
ordinances for the immediate preservation of the public peace, health, and safety; and
WHEREAS, the City Council hereby finds that, because of the inability to fund critical
public projects, facilities, and services, an increase in the transactions and use tax is necessary
for the immediate preservation of the public peace, health, and safety.
THE CITY COUNCIL OF THE CITY OF LODI DOES ORDAIN AS FOLLOWS:
SECTION 1. The Lodi Municipal Code is hereby amended by the addition of Chapter
3.09, which shall read as follows:
"3.09.010. Title and Effect.
This chapter shall be known as the Lodi Transactions and Use Tax Ordinance. This
chapter shall be applicable in the incorporated territory of the City of Lodi ("City"). This chapter
shall complement, and not replace or supersede, the City's existing sales and use tax, as such
tax is described in Chapter 3.08 of the Municipal Code.
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3.09.020. Operative Date
As used in Chapter 3.019, "Operative Date" means the first day of the first calendar
quarter commencing more than 110 days after the adoption of this chapter. If this chapter is
approved by the City Council, and subsequently approved by the voters at the November 2004
election, the operative date shall be April 1, 2005.
3.09.030. Purpose
This chapter is adopted to achieve the following, among other purposes, and the City
Council directs that the provisions hereof be interpreted in order to accomplish those purposes:
A. To impose retail transactions and use tax regulations in accordance with the
provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and
Taxation Code and Section 7285.9 of Part 1.7 of Division 2 which authorizes the City to adopt
this chapter, which shall be operative if a majority of the electors voting on the measure vote to
approve the imposition of the tax at an election called for that purpose.
B. To adopt retail transactions and use tax regulations that incorporates provisions
identical to those of the Sales and Use Tax Law of the State of California insofar as those
provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of
Division 2 of the Revenue and Taxation Code.
C. To adopt retail transactions and use tax regulations that impose a tax and
provide a measure therefor that can be administered and collected by the State Board of
Equalization in a manner that adapts itself as fully as practicable to, and requires the least
possible deviation from, the existing statutory and administrative procedures followed by the
State Board of Equalization in administering and collecting the California State Sales and Use
Taxes.
D. To adopt retail transactions and use tax regulations that can be administered in a
manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of
Division 2 of the Revenue and Taxation Code, minimize the cost of collecting the transactions
and use taxes, and at the same time, minimize the burden of record keeping upon persons
subject to taxation under the provisions of this chapter.
3.09.040. Contract with State.
Prior to the Operative Date of April 1, 2005, the City shall contract with the State Board
of Equalization to perform all functions incident to the administration and operation of these
transactions and use tax regulations; provided, that if the City shall not have contracted with the
State Board of Equalization prior to the Operative Date, it shall nevertheless so contract and in
such a case the Operative Date shall be the first day of the first calendar quarter following the
execution of such a contract.
3.09-050. Transactions Tax Rate.
For the privilege of selling tangible personal property at retail, a tax is hereby imposed
upon all retailers in the incorporated territory of the City at the rate of .25% of the gross receipts
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of any retailer from the sale of all tangible personal property sold at retail in said territory on and
after the Operative Date of this chapter.
3.09.060. Place of Sale.
For the purposes of this chapter, all retail sales are consummated at the place of
business of the retailer unless the tangible personal property sold is delivered by the retailer or
his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state
destination. The gross receipts from such sales shall include delivery charges, when such
charges are subject to the state sales and use tax, regardless of the place to which delivery is
made. In the event a retailer has no permanent place of business in the State or has more than
one place of business, the place or places at which the retail sales are consummated shall be
determined under rules and regulations to be prescribed and adopted by the State Board of
Equalization.
3.09.070. Use Tax Rate.
An excise tax is hereby imposed on the storage, use or other consumption in the City of
tangible personal property purchased from any retailer on and after the Operative Date of this
chapter for storage, use or other consumption in said territory at the rate of .25% of the sales
price of the property. The sales price shall include delivery charges when such charges are
subject to state sales or use tax regardless of the place to which delivery is made.
3.09.080, Adoption of Provisions of State Law.
Except as otherwise provided in this chapter and except insofar as they are inconsistent
with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the
provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation
Code are hereby adopted and made a part of this chapter as though fully set forth herein.
3.09-090. Limitations on Adoption of State Law and Collection of Use Taxes.
In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:
A. Wherever the State of California is named or referred to as the taxing agency,
the name of this City shall be substituted therefor. However, the substitution shall not be made
when:
The word "State" is used as a part of the title of the State Controller,
State Treasurer, State Board of Control, State Board of Equalization,
State Treasury, or the Constitution of the State of California;
2. The result of that substitution would require action to be taken by or
against this City or any agency, officer, or employee thereof rather than
by or against the State Board of Equalization, in performing the functions
incident to the administration or operation of this Chapter.
3. In those sections, including, but not necessarily limited to sections
referring to the exterior boundaries of the State of California, where the
result of the substitution would be to:
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a. Provide an exemption from this tax with respect to certain sales,
storage, use or other consumption of tangible personal property
which would not otherwise be exempt from this tax while such
sales, storage, use or other consumption remain subject to tax by
the State under the provisions of Part I of Division 2 of the
Revenue and Taxation Code, or;
b. Impose this tax with respect to certain sales, storage, use or other
consumption of tangible personal property which would not be
subject to tax by the state under the said provision of that code.
4. In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715,
6737, 6797 or 6828 of the Revenue and Taxation Code.
B. The word "City" shall be substituted for the word "State" in the phrase "retailer
engaged in business in this State" in Section 6203 and in the definition of that phrase in Section
6203.
3.09-100, Permit not Required.
If a seller's permit has been issued to a retailer under Section 6067 of the Revenue and
Taxation Code, an additional transactor's permit shall not be required by this chapter.
3.09.110. Exemptions and Exclusions.
A. There shall be excluded from the measure of the transactions tax and the use
tax the amount of any sales tax or use tax imposed by the State of California or by any city, city
and county, or county pursuant to the Bradley -Burns Uniform Local Sales and Use Tax Law or
the amount of any state -administered transactions or use tax.
B. There are exempted from the computation of the amount of transactions tax the
gross receipts from:
Sales of tangible personal property, other than fuel or petroleum
products, to operators of aircraft to be used or consumed principally
outside the county in which the sale is made and directly and exclusively
in the use of such aircraft as common carriers of persons or property
under the authority of the laws of this State, the United States, or any
foreign government.
2. Sales of property to be used outside the City which is shipped to a point
outside the City, pursuant to the contract of sale, by delivery to such point
by the retailer or his agent, or by delivery by the retailer to a carrier for
shipment to a consignee at such point. For the purposes of this
paragraph, delivery to a point outside the City shall be satisfied:
a. With respect to vehicles (other than commercial vehicles) subject
to registration pursuant to Chapter 1 (commencing with Section
4000) of Division 3 of the Vehicle Code, aircraft licensed in
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compliance with Section 21411 of the Public Utilities Code, and
undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code by
registration to an out -of -City address and by a declaration under
penalty of perjury, signed by the buyer, stating that such address
is, in fact, his or her principal place of residence; and
b. With respect to commercial vehicles, by registration to a place of
business out -of -City and declaration under penalty of perjury,
signed by the buyer, that the vehicle will be operated from that
address.
3. The sale of tangible personal property if the seller is obligated to furnish
the property for a fixed price pursuant to a contract entered into prior to
the Operative Date of this chapter.
4. A lease of tangible personal property which is a continuing sale of such
property, for any period of time for which the lessor is obligated to lease
the property for an amount fixed by the lease prior to the Operative Date
of this chapter.
5. For the purposes of subparagraphs (3) and (4) of this section, the sale or
lease of tangible personal property shall be deemed not to be obligated
pursuant to a contract or lease for any period of time for which any party
to the contract or lease has the unconditional right to terminate the
contract or lease upon notice, whether or not such right is exercised.
C. There are exempted from the use tax imposed by this chapter, the storage, use
or other consumption in this City of tangible personal property:
The gross receipts from the sale of which have been subject to a
transactions tax under any state -administered transactions and use tax
regulations.
2. Other than fuel or petroleum products purchased by operators of aircraft
and used or consumed by such operators directly and exclusively in the
use of such aircraft as common carriers of persons or property for hire or
compensation under a certificate of public convenience and necessity
issued pursuant to the laws of this State, the United States, or any
foreign government. This exemption is in addition to the exemptions
provided in Sections 6366 and 6366.1 of the Revenue and Taxation Code
of the State of California.
3. If the purchaser is obligated to purchase the property for a fixed price
pursuant to a contract entered into prior to the Operative Date of this
chapter.
4. If the possession of, or the exercise of any right or power over, the
tangible personal property arises under a lease which is a continuing
purchase of such property for any period of time for which the lessee is
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obligated to lease the property for an amount fixed by a lease prior to the
Operative Date of this chapter.
5. For the purposes of subparagraphs (3) and (4) of this section, storage,
use, or other consumption, or possession of, or exercise of any right or
power over, tangible personal property shall be deemed not to be
obligated pursuant to a contract or lease for any period of time for which
any party to the contract or lease has the unconditional right to terminate
the contract or lease upon notice, whether or not such right is exercised.
6. Except as provided in subparagraph (7), a retailer engaged in business in
the City shall not be required to collect use tax from the purchaser of
tangible personal property, unless the retailer ships or delivers the
property into the City or participates within the City in making the sale of
the property, including, but not limited to, soliciting or receiving the order,
either directly or indirectly, at a place of business of the retailer in the City
or through any representative, agent, canvasser, solicitor, subsidiary, or
person in the City under the authority of the retailer.
7. "A retailer engaged in business in the City" shall also include any retailer
of any of the following: vehicles subject to registration pursuant to
Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle
Code, aircraft licensed in compliance with Section 21411 of the Public
Utilities Code, or undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code. That retailer shall
be required to collect use tax from any purchaser who registers or
licenses the vehicle, vessel, or aircraft at an address in the City.
D. Any person subject to use tax under this chapter may credit against that tax any
transactions tax or reimbursement for transactions tax paid to a district imposing, or retailer
liable for a transactions tax pursuant to Part 1,6 of Division 2 of the Revenue and Taxation
Code with respect to the sale to the person of the property the storage, use or other
consumption of which is subject to the use tax.
3.09.120. Amendments.
All amendments subsequent to the effective date of this chapter to Part 1 of Division 2
of the Revenue and Taxation Code relating to sales and use taxes and which are not
inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all
amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, sh2ll
automatically become a part of this chapter, provided however, that no such amendment shall
operate so as to affect the rate of tax imposed by this chapter. Except as provided above and
in Section 3.40.140, this chapter may be amended only by the voters pursuant to the provisions
of Elections Code section 9217 and as provided by law.
3.09-130. Termination of Tax.
The transactions and use tax imposed by this Chapter shall terminate ten years from the
Operative Date.
3.09,140. Enjoining Collection Forbidden.
No injunction or writ of mandate or other legal or equitable process shall issue in any
suit, action or proceeding in any court against the State or the City, or against any officer of the
State or the City, to prevent or enjoin the collection under this chapter, or Part 1.6 of Division 2
of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected."
SECTION 2..Severability. If any provision of this chapter or the application thereof to
any person or circumstance is held invalid, such invalidity shall not affect other provisions or
applications of the chapter which can be given effect without the invalid provision or application,
and to this end the provisions of this chapter are severable. The City Council hereby declares
that it would have adopted this chapter irrespective of the invalidity of any particular portion
thereof.
SECTION 3. Effective Date. After its adoption by the voters, this chapter shall be in
full force and effect ten (10) days after the vote is declared by the legislative body, pursuant to
the provisions of Elections Code sections 9217 and 15400 and as provided by law.
SECTION 4. Publication. The City Clerk shall certify to the adoption of this chapter and
cause it, or a summary of it, to be published once in a newspaper of general circulation printed
and published within the City of Lodi.
Attest:
SUSAN J. BLACKSTON
City Clerk
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Approved this 4 1h day of August, 2004
LARRY D. HANSEN
Mayor
State of California
County of San Joaquin, ss.
1, Susan J. Blackston, City Clerk of the City of Lodi, do hereby certify that Ordinance No. 1751
was adopted as an urgency ordinance at a regular meeting of the City Council of the City of
Lodi held August 4, 2004 and was thereafter passed, adopted and ordered to print by the
following vote:
AYES: COUNCIL MEMBERS —
NOES; COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
I further certify that Ordinance No. 1751 was approved and signed by the Mayor on the date of
its passage and the same has been published pursuant to law.
SUSAN J. BLACKSTON
City Clerk
Approved as to Form:
D. STEPHEN SCHWABAUER
City Attorney
RESOLUTION NO. DRAFT
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LODI CALLING AN
ELECTION TO SUBMIT TO THE VOTERS A BALLOT MEASURE TO LEVY A
ONE QUARTER GENT TRANSACTIONS AND USE TAX AND AN ADVISORY
BALLOT MEASURE, REQUESTING THE SAN JOAQUIN COUNTY BOARD OF
SUPERVISORS TO CONSOLIDATE THE ELECTION WITH THE STATEWIDE
GENERAL ELECTION TO BE HELD ON NOVEMBER 2, 2004 AND TO
CONDUCT THE ELECTION, PROVIDING FOR THE SUBMISSION OF BALLOT
ARGUMENTS FOR AND AGAINST THE MEASURE, AND DIRECTING THE
CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS
WHEREAS, Section 2(b) of Article XIIIC of the California Constitution requires that a
ballot measure proposing a general tax be submitted to the voters at an election consolidated
with a regularly scheduled general election for members of the governing body of the City; and
WHEREAS, the California State Legislature has enacted Revenue and Taxation Code
Section 7285.9, which section authorizes the City, subject to the approval of a majority of the
qualified voters of the City in an election on the issue, to levy a .25% transactions and use tax
for general revenue purposes; and
WHEREAS, pursuant to Section 7285.9, the City Council has approved by a two-thirds
majority Ordinance No. 1751, levying a .25% transactions and use tax, subject to the approval
of a majority of the qualified voters at the next regularly scheduled general election; and
WHEREAS, it is desirable that the election on the transactions and use tax ballot
measure be consolidated with the statewide general election to be held on November 2. 2004;
and
WHEREAS, Elections Code Section 9603 permits the submission of advisory measures
to the voters.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LODI DOES HEREBY
RESOLVE THAT:
SECTION 1. Pursuant to the requirements of Revenue and Taxation Code Section
7285.9 and Elections Code Section 9222, an election is hereby called on the following ballot
measure to enact an ordinance establishing a transactions and use tax, and the ballot forms
shall have printed on them the following words with regard to the measure:
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Shall Ordinance No. 1751, which would enact a one quarter cent
transactions and use tax for general government purposes, be adopted?
A true and correct copy of Ordinance No. 1751 is attached hereto as Exhibit 1 and is expressly
incorporated herein.
SECTION 2. Pursuant to the requirements of Revenue and Taxation Code Section
7285.9 and Elections Code Section 9222, an election is hereby called on the following ballot
measure to submit to the voters an advisory measure concerning the uses to which the
proceeds from the proposed transactions and use tax would be put, and the ballot forms shall
have printed on them the following words with regard to the measure:
Should the proceeds from the one quarter cent transactions and use tax, if
adopted, first be spent on the following City projects, in no order of
priority:
(1) A new animal shelter;
(2) A new aquatic center;
(3) A new downtown indoor athletic center;
(4) Remodeling Fire Station #2;
(5) A new fire station in the southeast portion of Lodi; and
(6) Placing paramedics in each fire station?
SECTION 3. The San Joaquin County Board of Supervisors is requested to
consolidate the election on these two ballot measures with the statewide general election to be
held on November 2, 2004 and to direct the San Joaquin County Registrar of Voters to take any
and all necessary steps to conduct the consolidated election.
SECTION 4. Arguments in favor of and in opposition to the two ballot measures and
rebuttal arguments shall be permitted. The City hereby adopts the provisions of Elections Code
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Sections 9220(a), 9282, and 9285(a), regarding the acceptance of arguments relating to ballot
measures. The City Clerk shall fix the dates for submittal of arguments and rebuttals as
provided for in the Elections Code and in conjunction with the San Joaquin County Registrar of
Voters.
SECTION 5. The City Clerk is hereby authorized and directed to transmit to the City
Attorney copies of the two measures to be submitted to the voters by this resolution, and the
City Attorney shall prepare an impartial analysis of the two measures pursuant to Elections
Code Section 9280.
Approved this 4 1h day of August, 2004
LARRY D. HANSEN
Mayor
Attest:
SUSAN J. BLACKSTON
City Clerk
State of California
County of San Joaquin, ss.
I hereby certify that Resolution No. 2004- was passed and adopted by the City Council of
the City of Lodi in a regular meeting held August 4, 2004, by the following vote:
AYES: COUNCIL MEMBERS —
NOES; COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
A roved as to Form,
D. STEPHEN SCHWABAUER
City Attomey
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SUSAN J. BLACKSTON
City Clerk
EXHIBIT 1
ORDINANCE NO. 1751
AN URGENCY ORDINANCE OF THE CITY OF LODI IMPOSING
A TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY
THE STATE BOARD OF EQUALIZATION AND ADDING
CHAPTER 3.09 TO THE LODI MUNICIPAL CODE
WHEREAS, the City of Lodi's Revised Budget for 2004-2005 shows an approximately
$1.9 million shortfall in the amount of revenue relative to the amount of expenditures; and
WHEREAS, the State budget will likely involve significant funding cuts for cities, and
there are currently insufficient alternative sources for funding local governments; and
WHEREAS, the City's 2004-2005 Financial Plan and Budget states that "the City will
seek to maintain a diversified and stable revenue base to protect it from short-term fluctuations
in any one revenue source" and that "the City will make all current expenditures with current
revenues, avoiding procedures that balance current budgets by accruing future revenues,
rolling over short-term debt or borrowing reserves of one fund to another"; and
WHEREAS, in light of the budget shortfall and decreasing funding from the State, the
City cannot currently fund many important capital projects and thus has a vital need to increase
its revenue to finance critical public projects, facilities, and services; and
WHEREAS, the City's Finance Director has estimated that a one quarter cent increase
in the City's transactions and use tax would result in $2.2 million dollars in revenue annually;
and
WHEREAS, Government Code Section 36937 permits cities to enact urgency
ordinances for the immediate preservation of the public peace, health, and safety; and
WHEREAS, the City Council hereby finds that, because of the inability to fund critical
public projects, facilities, and services, an increase in the transactions and use tax is necessary
for the immediate preservation of the public peace, health, and safety.
THE CITY COUNCIL OF THE CITY OF LODI DOES ORDAIN AS FOLLOWS:
SECTION 1. The Lodi Municipal Code is hereby amended by the addition of Chapter
3.09, which shall read as follows:
"3.09.010. Title and Effect.
This chapter shall be known as the Lodi Transactions and Use Tax Ordinance. This
chapter shall be applicable in the incorporated territory of the City of Lodi ("City"). This chapter
shall complement, and not replace or supersede, the City's existing sales and use tax, as such
tax is described in Chapter 3.08 of the Municipal Code.
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3.09-020. Operative Date
As used in Chapter 3.09, "Operative Date" means the first day of the first calendar
quarter commencing more than 110 days after the adoption of this chapter. If this chapter is
approved by the City Council, and subsequently approved by the voters at the November 2004
election, the operative date shall be April 1, 2005.
3.09,030. Purpose
This chapter is adopted to achieve the following, among other purposes, and the City
Council directs that the provisions hereof be interpreted in order to accomplish those purposes:
A. To impose retail transactions and use tax regulations in accordance with the
provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and
Taxation Code and Section 7285.9 of Part 1.7 of Division 2 which authorizes the City to adopt
this chapter, which shall be operative if a majority of the electors voting on the measure vote to
approve the imposition of the tax at an election called for that purpose.
B. To adopt retail transactions and use tax regulations that incorporates provisions
identical to those of the Sales and Use Tax Law of the State of California insofar as those
provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of
Division 2 of the Revenue and Taxation Code.
C. To adopt retail transactions and use tax regulations that impose a tax and
provide a measure therefor that can be administered and collected by the State Board of
Equalization in a manner that adapts itself as fully as practicable to, and requires the least
possible deviation from, the existing statutory and administrative procedures followed by the
State Board of Equalization in administering and collecting the California State Sales and Use
Taxes.
D. To adopt retail transactions and use tax regulations that can be administered in a
manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of
Division 2 of the Revenue and Taxation Code, minimize the cost of collecting the transactions
and use taxes, and at the same time, minimize the burden of record keeping upon persons
subject to taxation under the provisions of this chapter.
3.09.040. Contract with State.
Prior to the Operative Date of April 1, 2005, the City shall contract with the State Board
of Equalization to perform all functions incident to the administration and operation of these
transactions and use tax regulations; provided, that if the City shall not have contracted with the
State Board of Equalization prior to the Operative Date, it shall nevertheless so contract and in
such a case the Operative Date shall be the first day of the first calendar quarter following the
execution of such a contract.
3.09.050. Transactions Tax Rate.
For the privilege of selling tangible personal property at retail, a tax is hereby imposed
upon all retailers in the incorporated territory of the City at the rate of .25% of the gross receipts
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of any retailer from the sale of all tangible personal property sold at retail in said territory on and
after the Operative Date of this chapter.
3.09.060. Place of Sale.
For the purposes of this chapter, all retail sales are consummated at the place of
business of the retailer unless the tangible personal property sold is delivered by the retailer or
his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state
destination. The gross receipts from such sales shall include delivery charges, when such
charges are subject to the state sales and use tax, regardless of the place to which delivery is
made. In the event a retailer has no permanent place of business in the State or has more than
one place of business, the place or places at which the retail sales are consummated shall be
determined under rules and regulations to be prescr�ibed and adopted by the State Board of
Equalization.
3.09.070. Use Tax Rate.
An excise tax is hereby imposed on the storage, use or other consumption in the City of
tangible personal property purchased from any retailer on and after the Operative Date of this
chapter for storage, use or other consumption in said territory at the rate of .25% of the sales
price of the property. The sales price shall include delivery charges when such charges are
subject to state sales or use tax regardless of the place to which delivery is made.
3.09.080. Adoption of Provisions of State Law.
Except as otherwise provided in this chapter and except insofar as they are inconsistent
with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the
provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation
Code are hereby adopted and made a part of this chapter as though fully set forth herein.
3.09.090. Limitations on Adoption of State Law and Collection of Use Taxes.
In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:
A. Wherever the State of California is named or referred to as the taxing agency,
the name of this City shall be substituted therefor. However, the substitution shall not be made
whan,
The word "State" is used as a part of the title of the State Controller,
State Treasurer, State Board of Control, State Board of Equalization,
State Treasury, or the Constitution of the State of California;
2. The result of that substitution would require action to be taken by or
against this City or any agency, officer, or employee thereof rather than
by or against the State Board of Equalization, in performing the functions
incident to the administration or operation of this Chapter.
3. In those sections, including, but
referring to the exterior boundaries
result of the substitution would be to:
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not necessarily limited to sections
of the State of California, where the
a. Provide an exemption from this tax with respect to certain sales,
storage, use or other consumption of tangible personal property
which would not otherwise be exempt from this tax while such
sales, storage, use or other consumption remain subject to tax by
the State under the provisions of Part 1 of Division 2 of the
Revenue and Taxation Code, or;
b. Impose this tax with respect to certain sales, storage, use or other
consumption of tangible personal property which would not be
subject to tax by the state under the said provision of that code.
4. In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715,
6737, 6797 or 6828 of the Revenue and Taxation Code.
B. The word "City" shall be substituted for the word "State" in the phrase "retailer
engaged in business in this State" in Section 6203 and in the definition of that phrase in Section
6203.
3,09-100. Permit not Required.
If a seller's permit has been issued to a retailer under Section 6067 of the Revenue and
Taxation Code, an additional transactor's permit shall not be required by this chapter.
3.09.110. Exemptions and Exclusions.
A. There shall be excluded from the measure of the transactions tax and the use
tax the amount of any sales tax or use tax imposed by the State of California or by any city, city
and county, or county pursuant to the Bradley -Burns Uniform Local Sales and Use Tax Law or
the amount of any state -ad ministered transactions or use tax.
B, There are exempted from the computation of the amount of transactions tax the
gross receipts from:
Sales of tangible personal property, other than fuel or petroleum
products, to oper2tors of 2ircr2ft to be used or consumed princip2lly
outside the county in which the sale is made and directly and exclu5ively
in the use of such aircraft as common carriers of persons or property
under the authority of the laws of this State, the United States, or any
foreign government.
2. Sales of property to be used outside the City which is shipped to a point
outside the City, pursuant to the contract of sale, by delivery to such point
by the retailer or his agent, or by delivery by the retailer to a carrier for
shipment to a consignee at such point. For the purposes of this
paragraph, delivery to a point outside the City shall be satisfied:
a. With respect to vehicles (other than commercial vehicles) subject
to registration pursuant to Chapter 1 (commencing with Section
4000) of Division 3 of the Vehicle Code, aircraft licensed in
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compliance with Section 21411 of the Public Utilities Code, and
undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code by
registration to an out -of -City address and by a declaration under
penalty of perjury, signed by the buyer, stating that such address
is, in fact, his or her principal place of residence; and
b. With respect to commercial vehicles, by registration to a place of
business out -of -City and declaration under penalty of perjury,
signed by the buyer, that the vehicle will be operated from that
address.
3. The sale of tangible personal property if the seller is obligated to furnish
the property for a fixed price pursuant to a contract entered into prior to
the Operative Date of this chapter.
4. A lease of tangible personal property which is a continuing sale of such
property, for any period of time for which the lessor is obligated to lease
the property for an amount fixed by the lease prior to the Operative Date
of this chapter.
5. For the purposes of subparagraphs (3) and (4) of this section, the sale or
lease of tangible personal property shall be deemed not to be obligated
pursuant to a contract or lease for any period of time for which any party
to the contract or lease has the unconditional right to terminate the
contract or lease upon notice, whether or not such right is exercised.
C. There are exempted from the use tax imposed by this chapter, the storage, use
or other consumption in this City of tangible personal property:
The gross receipts from the sale of which have been subject to a
transactions tax under any state -ad ministered transactions and use tax
regulations.
2. Other than fuel or petroleum products purchased by operators of aircraft
and used or consumed by such operators directly and exclusively in the
use of such aircraft as common carriers of persons or property for hire or
compensation under a certificate of public convenience and necessity
issued pursuant to the laws of this State, the United States, or any
foreign government. This exemption is in addition to the exemptions
provided in Sections 6366 and 6366.1 of the Revenue and Taxation Code
of the State of California.
3. If the purchaser is obligated to purchase the property for a fixed price
pursuant to a contract entered into prior to the Operative Date of this
chapter.
4. If the possession of, or the exercise of any right or power over, the
tangible personal property arises under a lease which is a continuing
purchase of such property for any period of time for which the lessee is
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obligated to lease the property for an amount fixed by a lease prior to the
Operative Date of this chapter.
5. For the purposes of subparagraphs (3) and (4) of this section, storage,
use, or other consumption, or possession of, or exercise of any right or
power over, tangible personal property shall be deemed not to be
obligated pursuant to a contract or lease for any period of time for which
any party to the contract or lease has the unconditional right to terminate
the contract or lease upon notice, whether or not such right is exercised.
6. Except as provided in subparagraph (7), a retailer engaged in business in
the City shall not be required to collect use tax from the purchaser of
tangible personal property, unless the retailer ships or delivers the
property into the City or participates within the City in making the sale of
the property, including, but not limited to, soliciting or receiving the order,
either directly or indirectly, at a place of business of the retailer in the City
or through any representative, agent, canvasser, solicitor, subsidiary, or
person in the City under the authority of the retailer.
7. "A retailer engaged in business in the City" shall also include any retailer
of any of the following: vehicles subject to registration pursuant to
Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle
Code, aircraft licensed in compliance with Section 21411 of the Public
Utilities Code, or undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code. That retailer shall
be required to collect use tax from any purchaser who registers or
licenses the vehicle, vessel, or aircraft at an address in the City.
D. Any person subject to use tax under this chapter may credit against that tax any
transactions tax or reimbursement for transactions tax paid to a district imposing, or retailer
liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and Taxation
Code with respect to the sale to the person of the property the storage, use or other
consumption of which is subject to the use tax.
3.09-120. Amendments.
All amendments subsequent to the effective date of this chapter to Part 1 of Division 2
of the Revenue and Taxation Code relating to sales and use taxes and which are not
inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all
amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall
automatically become a part of this chapter, provided however, that no such amendment shall
operate so as to affect the rate of tax imposed by this chapter. Except as provided above and
in Section 3.40.140, this chapter may be amended only by the voters pursuant to the provisions
of Elections Code section 9217 and as provided by law.
3,09-130. Termination of Tax.
The transactions and use tax imposed by this Chapter shall terminate ten years from the
Operative Date.
WON!
3.09.140. Enjoining Collection Forbidden.
No injunction or writ of mandate or other legal or equitable process shall issue in any
suit, action or proceeding in any court against the State or the City, or against any officer of the
State or the City, to prevent or enjoin the collection under this chapter, or Part 1.6 of Division 2
of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected."
SECTION 2. Severabilily. If any provision of this chapter or the application thereof to
any person or circumstance is held invalid, such invalidity shall not affect other provisions or
applications of the chapter which can be given effect without the invalid provision or application,
and to this end the provisions of this chapter are severable. The City Council hereby declares
that it would have adopted this chapter irrespective of the invalidity of any particular portion
thereof.
SECTION 3. Effective Date. After its adoption by the voters, this chapter shall be in
full force and effect ten (10) days after the vote is declared by the legislative body, pursuant to
the provisions of Elections Code sections 9217 and 15400 and as provided by law.
SECTION 4. Publication. The City Clerk shall certify to the adoption of this chapter and
cause it, or a summary of it, to be published once in a newspaper of general circulation printed
and published within the City of Lodi.
Attest:
SUSAN J. BLACKSTON
City Clark
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Approved this 4th day of August, 2004
LARRY D. HANSEN
Mayor
State of California
County of San Joaquin, ss.
1, Susan J. Blackston, City Clerk of the City of Lodi, do hereby certify that Ordinance No.
1751was adopted as an urgency ordinance at a regular meeting of the City Council of the City
of Lodi held August 4, 2004 and was thereafter passed, adopted and ordered to print by the
following vote:
AYES: COUNCIL MEMBERS —
NOES; COUNCIL MEMBERS —
ABSENT' COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
I further certify that Ordinance No. 1751 was approved and signed by the Mayor on the date of
its passage and the same has been published pursuant to law.
Approved as to Form.
D. STEPHEN SCHWABAUIER
City Attorney
SUSAN J. BLACKSTON
City Clerk
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RESOLUTION NO. 1751
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LODI CALLING AN
ELECTION TO SUBMIT TO THE VOTERS A BALLOT MEASURE TO LEVY A
ONE QUARTER CENT TRANSACTIONS AND USE TAX AND AN ADVISORY
BALLOT MEASURE, REQUESTING THE SAN JOAQUIN COUNTY BOARD OF
SUPERVISORS TO CONSOLIDATE THE ELECTION WITH THE STATEWIDE
GENERAL ELECTION TO BE HELD ON NOVEMBER 2, 2004 AND TO
CONDUCT THE ELECTION, PROVIDING FOR THE SUBMISSION OF BALLOT
ARGUMENTS FOR AND AGAINST THE MEASURE, AND DIRECTING THE
CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS
WHEREAS, Section 2(b) of Article XIIIC of the California Constitution requires that a
ballot measure proposing a general tax be submitted to the voters at an election consolidated
with a regularly scheduled general election for members of the governing body of the City; and
WHEREAS, the California State Legislature has enacted Revenue and Taxation Code
Section 7285.9, which section authorizes the City, subject to the approval of a majority of the
qualified voters of the City in an election on the issue, to levy a .25% transactions and use tax
for general revenue purposes; and
WHEREAS, pursuant to Section 7285.9, the City Council has approved by a two-thirds
majority Ordinance No. 1751, levying a .25% transactions and use tax, subject to the approval
of a majority of the qualified voters at the next regularly scheduled general election; and
WHEREAS, it is desirable that the election on the transactions and use tax ballot
measure be consolidated with the statewide general election to be held on November 2, 2004;
and
WHEREAS, Elections Code Section 9603 permits the submission of advisory measures
to the voters.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LODI DOES HEREBY
RESOLVE THAT:
SECTION 1. Pursuant to the requirements of Revenue and Taxation Code Section
7285.9 and Elections Code Section 9222, an election is hereby called on the following ballot
measure to enact an ordinance establishing a transactions and use tax, and the ballot forms
shall have printed on them the following words with regard to the measure:
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Shall Ordinance No. 1751, which would enact a one quarter cent
transactions and use tax for general government purposes, be adopted?
A true and correct copy of Ordinance No. 1751 is attached hereto as Exhibit I and is expressly
incorporated herein.
SECTION 2. Pursuant to the requirements of Revenue and Taxation Code Section
7285.9 and Elections Code Section 9222, an election is hereby called on the following ballot
measure to submit to the voters an advisory measure concerning the uses to which the
proceeds from the proposed transactions and use tax would be put, and the ballot forms shall
have printed on them the following words with regard to the measure:
Should the proceeds from the one quarter cent transactions and use tax, if
adopted, first be spent on the following City projects, in no order of
priority:
(1) A new animal shelter;
(2) A new aquatic center;
(3) A new downtown indoor athletic center;
(4) Remodeling Fire Station #2;
(5) A new fire station in the southeast portion of Lodi; and
(6) Placing paramedics in each fire station?
SECTION 3. The San Joaquin County Board of Supervisors is requested to
consolidate the election on these two ballot measures with the statewide general election to be
held on November 2, 2004 and to direct the San Joaquin County Registrar of Voters to take any
and all necessary steps to conduct the consolidated election.
SECTION 4. Arguments in favor of and in opposition to the two ballot measures and
rebuttal arguments shall be permitted. The City hereby adopts the provisions of Elections Code
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Sections 9220(a), 9282, and 9285(a), regarding the acceptance of arguments relating to ballot
measures. The City Clerk shall fix the dates for submittal of arguments and rebuftals as
provided for in the Elections Code and in conjunction with the San Joaquin County Registrar of
Voters.
SECTION 5. The City Clerk is hereby authorized and directed to transmit to the City
Attorney copies of the two measures to be submitted to the voters by this resolution, and the
City Attorney shall prepare an impartial analysis of the two measures pursuant to Elections
Code Section 9280.
Approved this 4 th day of August, 2004
LARRY D. HANSEN
Mayor
Attest:
SUSAN J. BLACKSTON
City Clerk
State of California
County of San Joaquin, ss.
I hereby certify that Resolution No. 2004- was passed and adopted by the City Council of
the City of Lodi in a regular meeting held August 4, 2004, by the following vote:
AYES: COUNCIL MEMBERS —
NOES; COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
Approved as to Form:
D. STEPHEN SCHWABAUER
City Attorney
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SUSAN J. BLACKSTON
City Clerk