HomeMy WebLinkAbout12/18/02 AGENDAFILE
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239 4th Street · Bremerton, WA 98337 · Phone (360) 478-5280 · Fax (360) 478-5251
CITY COUNCIL MEETING AGENDA
DECEMBER 18, 2002
PRE-COUNCIL STUDY SESSION: 5:00 -5:30 P.M. in Council Conference Room
A. General Council Business
CALL TO ORDER: 5:30 P.M. in Council Chambers
A. Pledge of Allegiance
B. Invocation
CONSENT AGENDA
A. Minutes of Meeting - November 26, 2002 (#AB02-255)
B.
Amendment to Professional Services Agreement for Public Defender No W. DAVID ROVANG
ATTORNEY AT LAW (#AB02-256)
CLAIMS/CHECK REGISTERS
COUNCIL MEMBER REPORTS
MAYOR'S REPORT
PUBLIC RECOGNITION - Comments limited to 3-rninutes
NEW BUSINESS
A. Professional Services Agreement for Ed Faulk, Greens Superintendent at Gold Mountain Golf ii.,
Complex (#AB02-257)
I~'
PUBLIC HFr. ARINGS - RESOLUTIONS & ORDINANCES
Ordinance No. 4840 [Second Reading] relating to Commercial Parking Tax Rates (#AB02-248)
10.
11.
12.
Ordinance No. 4841 [Second Reading] relating to Residential Parking Permits (#AB02-249)
Ordinance No. 4842 [Second Reading] relating to General Business Licenses (#AB02-250)
Ordinance No. 4843 [Second Reading] relating to B&O Taxes (#AB02-251)
Ordinance No. 4844 [Second Reading] relating to Utility Taxes (#AB02-252)
Ordinance No. 4845 [Second Reading] relating to Administrative Provisions for Taxes
(#AB02-253)
EXECUTIVE SESSION
The Council will recess to the Council Conference Room for a 20-minute Executive Session
to "REVIEW LABOR NEGOTIATIONS" per R.C.W. Chapter 42.30.140(4)(b).
ADJOURNMENT OF CITY COUNCIL BUSINESS MEETING
STUDY SESSION
The Council will reconvene in the Council Conference Room to continue the Study Session on
"EXEMPT EMPLOYEE PERSONNEL POLICIES & PROCEDURES" with Carol Conley, Human Resources
Director
E-mail: citycouncil@ci.brernerton.wa.us · Web: www. ci.bremerton.wa.us
CITY COUNCIL MEETING
DECEMBER 18, 2002
SPEAKERS LIST
If you wish to make an announcement, inform the Council of an issue, or ask a general question... Please
provide information below so staff will be able to contact you.
Thank you.
NAME ADDRESS/TELEPHONE TOPIC
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT:
MINUTES OF MEETING -
NOVEMBER 26, 2002
FOR AGENDA OF: DECEMBER 18, 2002
ORIGINATING DEPT: CITY COUNCIL
ORIGINATOR: CAROL ARENDS, PRESIDENT
DATE SUBMITTED: DECEMBER 9, 2002
2. CLEARANCES: (Comment on back if necessary) 3. EXHIBITS:
ENDORSEMENT
MAYOR:
INFORMATION[-]
APPROVED FOR SUBMITTAL BY
COUN~CIL PRESIDENT:
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
5. RECOMMENDATION:
7. NOTICE OF ACTION:
PULLED [~ TABLED ~']
COUNCIL DIRECTIVE:
APPROVED
e
RESPONSIBLE OFFICIAL:
ENFORCEMENT OFFICIAL:
EXPIRATION DATE:
REVIEW DATE:
DISAPPROVED ~'~ AMENDED [] DATE:
3A
8. AGENDA BILL NO.:
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING, BUDGETS, FACILITIES, EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
TAPE #1865
CITY COUNCIL MEETING MINUTES
November 26, 2002
The weekly meeting of the City Council of the City of Bremerton was called to order in the City Council
Chambers, 239 4th Street, Bremerton, Washington, Wednesday, November 26, 2002, at 5:30 P.M., with
Council President Carol Arends presiding. Council members present were Mike Short, Will Maupin, Eric
Younger, Mike Shepherd, Daren Nygren, Cecil McConnell, and Wayne Olsen. Council member Ed
Rollman was absent. Aisc present were City Attorney Roger Lubovich; Deputy City Clerk Paula
Johnston; and Council Liaison Lcd Smith.
The meeting opened with the Pledge of Allegiance led by Council Member Cecil McConnell, followed
by the invocation provided by Pastor Gordon Gottfred, Associate Pastor with Sylvan Way Baptist
Church.
CONSENT AGENDA A. Minutes of Meeting - October 30, 2002 (#AB02-237)
B. Minutes of Meeting - November 6, 2002 (#AB02-238)
#0010 M/S/C/U (McConnell/Olsen) Move to approve Consent Agenda as presented.
CLAIIMS/CHE(~K REGISTERS
Vouchers audited and certified by the auditing officer as required by RCW 42.24.080, and those
expense reimbursement claims certified as required by RCW 42.24.090 have been recorded on a listing
that had been made available to the Council.
#0030 M/S/C/U (Younger/McConnell) On November 26, 2002 the Council approved payment for Check
Numbers 276637 through 276797 in the amount of $487,799.21; and Regular Payroll for the period
ending November 15, 2002 in the amount of $869,285.52 on the Master Check Register.
COUNCIL MEMBER REPORTS
Mike Shepherd provided a brief report on the discussions held at the District 5 meeting on Thursday,
November 21, 2002 regarding "Nuisance Properties" and "Chester Terrace"; and reported on his
attendance at the Association of Washington Cities (AWC) December Conference.
Daren Nv~ren reported on the goals of a "BUGS" (Bremerton Urban Garden Society) meeting he
attended last evening, and asked any citizens interested in gardening to please call the City Council
office at 478-5280. He also announced the next District 3 meeting would be held tonight at the Manette
Senior Center from 7:00 to 8:30 P.M. to provide citizens an opportunity to provide input and comments
on the City's 2003 Budget.
Carol Arends offered condolences to Ed & Pranvera Rollman upon hearing news of the death of
Pranvera's father in Albania.
MAYOR'S REPORT
On behalf of the Mayor, Sherril Huff-Menees thanked the employees from the City of Bremerton for
their efforts in collecting a total of 820 pounds to donate to the Food Bank, and also wished everyone a
very Happy Thanksgiving.
PUBLIC RECOGNITION
Allen Shute expressed his concern with the proposal to charge a residential parking fee.
James Greier also was not in favor of the proposal for residential parking permits.
TAPE #1865
City Council Reg. Mtg. Minutes
November 26, 2002
Page 2 of 2
Del Knauss summarized his views on how he believed the Mayor and City Council could cut costs (i.e.
not receiving pay raises and making cuts in the upper echelon of the Planning Department) to help
manage the City Budget.
Helen Miller was concerned that money from the Public Safety Bond would also be used to pay the
salary of a Project Manager when the money was intended for new police and fire equipment and
facilities.
9A - ORDINANCE [FIRST READING] CREATING UTILITY LOCAL IMPROVEMENT DISTRICT
(#A1~02-239): Mike M®cham, City Engineer, summarized that the proposed ordinance establishes Utility
Local Improvement District 2002-01 and orders the carrying out of the improvement of the West 650
Zone distribution water main and provides that payment for the improvement be made by City funds and
special assessments upon the property in the district. Robert Earl, Engineering Project Manager,
provided a power point presentation on the Project Profile, ULID Boundary & Improvements, Estimated
Construction Costs, Preliminary ULID Cost Estimate, Assessment Rate Development, and Preliminary
Assessments (full details of each subject are contained in a copy of the report which is included as part
of the Council Packet).
There were no comments from the public.
Following discussion from the Council, the vote was as follows:
#0785 M/S/C/U (Maupin/Younger) Move to approve the proposed ordinance on first reading.
With no further regular business, the meeting adjourned at 6:00 P.M.
Prepared and Submitted by:
Attest:
LORI SMITH
Council Liaison
PAULA JOHNSTON, Deputy City Clerk
CAROL ARENDS, City Council President
City of Bremerton
CAIP JIIslcge
c: Normal Distribution;
File
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT:
Amendment to Professional Services
Agreement - Public Defender
FOR AGENDA OF: 12/18/02
ORIGINATING DEPT: Admin. Srvs.
ORIGINATOR: K. McCluskey
DATE SUBMITTED: 11/15/02
2. CLEARANCES: 3. EXHIBITS:
City Attorn~-~-'~ ~Amendment to Agreement
Fiscal & Budge~~_, ~/~ ~,~.+ ~Current Agreement
Operations ?~~/F_~//~f ~'~ J
ENDORSEMENT INT~T~q~T~ APPROVED BY COUNCIL PRESIDENT FOR SUBMITTAL:
MAYOR -- COUNCIL PRESIDENT ~ ~
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The city is required by law to provide Public Defender Services.
Rovang has provided excellent services since 1995.
David
The attached amendment is for a three year period 1/1/03 through 12/31/05
at the rate of $8,750.00 per month for 2003. The rate has remained the
same for the prior three years (2000 through 2002). This is a 2.3%
increase over 2002.
8. RECOMMENDATION:
Motion to approve amendment to Public Defender contract.
RESPONSIBLE OFFICIAL: Admin Services
ENFORCEMENT OFFICIAL: Admin Services
EXPIRATION DATE:12/31/05
REVIEW DATE: Oct. each year
PULLED TABLED
COUNCIL DIRECTIVE:
APPROVED
10. NOTICE OF ACTION
DISAPPROVED
Date:
11. AGENDA BILL NO:
CLEARANCE COMMENTS (cont.):
4. SUMMARY STATEMENT (cont.):
5. IMPACT ON NON-PASSAGE:
6. IMPACT ON STAFFING, BUDGETS, FACILITIES, EQUIPMENT OR OTHER RESOURCES
$2,340.00 increase over 2002 included in 2003 budget.
7. RESEARCH SOURCES:
AMENDMENT TO
PROFESSIONAL SERVICES AGREEMENT
Legal Representation for Indigent Persons
WHEREAS, the CITY OF BREMERTON, a municipal corporation (hereinafter referred to as
"City"), and W. DAVID ROVANG, Attomey at Law (hereinafter referred to as "Attorney" entered into
an Agreement dated October 12, 1999, and
WHEREAS, the parties desire to extend the term of this Agreement and amend the compensation,
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties do
hereby agree:
Section 2. Term is amended to read as follows:
a. This contract shall cover a period of thirty-six (36) months commencing
January 1, 2003 and terminating December 31, 2005; and may be extended thereafter upon mutual
agreement of the parties.
Section 3. Compensation is amended to read as follows:
a. City shall pay Attorney a flat fee for indigent representation in the sum of Eight Thousand Seven
Hundred Fifty and No/100 Dollars ($8,750.00) monthly for the period beginning
January 1, 2003, through December 31, 2003. The aforementioned compensation is based upon an
estimated volume of seventy-eight (78) cases per month.
b. Compensation for 2004 and 2005 shall be negotiated by October of the preceding year for
increases or decreases in the contract amount. Negotiations should reflect economic indicators such as
cost of living factors and increase or decrease in caseload of five percent (5%) or more. If caseload
volume varies significantly from projections on a continuous basis, either party can request that
negotiations be reopened in good faith.
In the event the parties are unable to agree upon compensation for 2004 and 2005, either party may
terminate this contract which termination will be effective at the end of the then current year.
All payments on this Agreement by the Cit~ shall be paid on or before the fifth day of the month
following the delivery of service during the life of the Agreement, except in those months when the fifth
day of the month is before the first monthly Bremerton City Council meeting.
It is understood and agreed that this fee amount includes all expenses and costs incurred by Attorney
in any court in which he represents a person appointed to him by the terms of this Agreement, including
administrative and support services, except (a) fees and reasonable expenses for filing on appeal; (b)
expert witness fees and interpreter fees; and (c) other fees approved by the court on a case by case basis
upon motion.
Section 7. Insurance and Hold Harmless is amended by increasing the insurance requirements
from Three Hundred Thousand and No/100 Dollars ($300,000.00) to One Million and No/100 Dollars
($1,000,000).
The City and Attomey agree that all provisions of the original Agreement that are not in conflict with this
Amendment shall remain in full force and effect.
7
W. DAVlD ROVANG
Date
CITY OF BREMERTON
Date
CARY BOZEMAN, Mayor
DEPARTMENTAL APPROVAL:
APPROVED AS TO FORM:
KATHLEEN McCLUSKEY
Administrative Services Director
ROGER LUBOVICH
City Attorney
PROFESSIONAL SERVICES AGREEMENT
Legal Representation for Indigent Persons
THIS AGREEMENT is between the CITY OF BREMERTON, a municipal corporation
(hereinafter referred to as "City"), and W. DAVID ROVANG, Attorney at Law (hereinafter
referred to as "Attorney").
WITNESSETH:
1. Scope: Attorney agrees to provide legal representation for indigent persons as assigned
by the Bremerton Municipal Court.
Legal representation shall include, but not be limited to, appearance and pre-trial discovery
procedures, attendance at pre-trial discovery procedures, attendance at pre-trial and motion
calendars, chamber conferences, trials, and appeals in Superior Court from Bremerton Municipal
Court. For those persons held "in custody" for crimes punishable in Bremerton Municipal Court
telephone only representation shall be provided.
Not withstanding the requirements above, Attorney shall not be required to accept
appointments in which a conflict of interest exists as defined by the. Rules of Professional Conduct
promulgated by the Supreme Court of the State of Washington.
In the case of such conflict which precludes representation of an indigent person by Attorney,
Attorney shall notify the Bremerton Municipal Court, by written motion, as to the conflict as soon
as possible after appointment. Provided, in those cases where Attorney determines a conflict of
interest to exist, they shall not be deemed "assigned" cases for the purpose of compensation if the
conflict of interest is determined, or could have been determined by due diligence prior to or at
the time of the pre-trial hearing.
Attorney agrees that he will not accept private practice workloads that interfere with the
rendering of quality representation of indigent clients.
2. Term:
a. This contract shall cover a period of thirty-six (36) months commencing January 1, 2000
and terminating December 31, 2002; and may be extended thereafter upon mutual agreement of
the parties.
b. Attorney agrees that he will continue to represent indigent clients in cases where he is
appointed prior to the end of the term of this Agreement and which carry-over subsequent to the
end of this Agreement until such cases are completed, but not beyond one hundred twenty (120)
Professional Services - Rovang
Page 1 - Scplember 1999
days of termination of this Agreement. Such carry-over cases will be included in final accounting
and report provided to the Director of Administrative Services.
:
3. Compensation:
a. City shall pay Attorney a fiat fee for indigent representation in the sum of Eight Thousand
Five Hundred Fifty-five and No/100 Dollars ($8,555.00) monthly for the period beginning
January 1, 2000, through December 31, 2000. The aforementioned compensation is based upon
an estimated volume of 78 cases per month.
b. Compensation for 2001 and 2002 shall be negotiated by October of the preceding year for
increases or decreases in the contract amount. Negotiations should reflect economic indicators
such as cost of living factors and increase or decrease in case load of five percent (5%) or more.
If case load volume varies significantly fi.om projections on a continuous basis, either party can
request that negotiations be reopened in good faith.
In the event the parties are unable to agree upon compensation for 2001 and 2002, a mediator
shall be appointed to assist the parties in resolving their disagreements. The mediator shall be a
person agreed upon by the parties at the time the dispute arises. Any changes in compensation for
2001 and 2002 shall be based on the following factors:
(1) Cost of living factors;
(2) Past agreements of the parties for comparable work performed;
(3) Comparison to reasonable cost projections by the City of Bremerton for providing
these services in house; and
(4) Overhead and expense of Attorney in rendering the services, including reasonable
profit margin.
All payments on this Agreement by the City shall be paid on or before the filth day of the
month following the delivery of service during the life of the Agreement, except in those months
when the fffih day of the month is before the first monthly Bremerton City Council meeting.
It is understood and agreed that this fee amount includes all expenses and costs incurred by
Attorney in any court in which he represents a person appointed to him by the terms of this
Agreement, including administrative and support services, except (a) fees and reasonable expenses
for filing on appeal; (b) expert witness fees and interpreter fees; and (c) other fees approved by
the court on a case by case basis upon motion.
4. Assignments: An assigned case for purposes of case load volume may include multiple
counts per defendant including multiple citations so long as they arise out of a single event or
transaction and are transmitted under one assignment. If counts are severed upon motion, each
severed count(s) shall be counted as a separate assignment. All activity under the case number
Professional Services - Rovang
Page 2 - September 1999
/0
shall be considered part of the original assignment; e.g. revocation of probation or reappearance
after failure to appear.
Attorney shall submit a monthly statement describing the services rendered with a breakdown
for work completed as authorized under this Agreement upon the standard form attached to the
Agreement as Exhibit "A", and incorporated herein by reference.
5. Facilities: City shall provide Attorney independent confidential office facilities and
telephone to be used for client consultations and interviews.
Attorney shall also be provided a parking placard for use in designated spaces to be approved
by the Director of Administrative Services.
6. Relationship of Parties: The parties understand and agree that Attorney is a practitioner
skilled in matters pertaining to criminal law services and will perform independent functions and
responsibilities in the area of its particular field of expertise. Attorney and its personnel shall act
as independent contractors and not employees of the City. As such, Attorney has no authority to
bind the City nor control employees of the City, contractors, or other entities. Within the
performance of these duties, Attorney shall work under the direction of the Director of
Administrative Services.
7. Insurance and Hold Harmless: Prior to and during the performance of the work
covered by this Agreement, Attorney shall provide the Risk Manager of the City of Bremerton
with evidence that it has obtained and maintains in full force and effect during the term of this
Agreement a policy of professional liability insurance and/or errors and omissions insurance
providing coverage of at least Three Hundred Thousand and No/100 Dollars ($300,000.00)
aggregate against professional liability or errors and omissions in connection with the work to be
performed by Attorney under this Agreement. Attorney shall furnish a certificate of insurance to
the City for review by the City's Risk Manager. The Risk Manager shall be provided thirty (30)
days' written notice of any cancellation of said professional liability insurance.
Attorney agrees to defend, indemnify and save harnfless the City, its appointed and elected
officers and employees, from and against all liability, loss, costs, damage and .expense, including
costs and attorneys fees in defense thereof because of actions, claims or lawsuits for damages
resulting from personal or bodily injury, including death at any time resulting therefrom, sustained
or alleged to have been sustained by a person or persons and on account of damage to property,
arising or alleged to have arisen directly or indirectly out of or in consequence of or the
performance of this Agreement, whether such injuries to persons or damage to property is due to
the negligence of Attorney, its subcontractors, agents, successors or assigns. This provision shall
be inapplicable to the extent the City is judicially found negligent for such damage or injury.
8. General Conditions:
Professional Services - Rovang
Page 3 - September 1999
a. Attorney agrees that he will not accept subsequent representation in civil litigation for a
defendant, or other affected party, in a matter arising from a case or proceeding for which
Attorney has provided services pursuant to this contract. Attorney is in no way limited in making
recommendations to defendants, or other affected parties, to pursue litigation against the City for
any matter arising from a case or proceeding relevant to Attorney's services provided under this
contract. Attorney is free to institute litigation against the City in any matter not arising from
cases or proceedings for which Attorney has provided services under this contract. This provision
is subject to approval of the Washington State Bar Association, upon review requested by both
parties.
b. Reports and Information - Attorney, at such times and in such forms as the City may
require, shall furnish the CiW such reasonable periodic repons and documents as it may request
pertaining to the work or services undertaken pursuant to this Agreement, the costs and
obligations incurred or to be incurred in connection therewith, and any other matters covered by
this Agreement. Attorney will maintain accounting records in accordance with generally accepted
accounting principles and practices to substantiate all invoiced amounts.
c. Assignability - Attorney shall not assign any interest in this Agreement and shall not
transfer any interest in same (whether by assignment or novation), without the prior written
consent of the City thereto; Provided, however, That claims for payment under this Agreement
may be assigned and, Provided, further, That nothing herein shall prohibit Attorney from assigning
duties under this Agreement to an employee of Attorney qualified to provide the same.
d. Entire Agreement - This Agreement constitutes the entire Agreement between the parties
and both parties acknowledge that there are no other agreements, either written or oral, that have
not been fully set forth in the text of this Agreement.
e. Amendments - The parties hereby agree that this Agreement can not be amended or
modified without the written concurrence of both parties.
f. Notices - Any notices required to be given by the City to Attorney or by Attorney to the
Ciw shall be in writing and delivered to the following parties at the following addresses:
Administrative Services Director
City of Bremerton
239 4th Stre~
Bremerton, WA 98337
W. David Rovang
Attorney at Law
569 Division Street, Suite A
Port Orchard, WA 98366
g. Waiver - Failure to insist upon strict compliance with any terms, covenants or conditions
of this Agreement shall not be deemed a waiver of such, nor shall any waiver or relinquishment of
such right or power at any time be taken to be a waiver of any other breach.
Professional Services - Rovang
Page 4 - September 1999
h. Compliance with State, Local and Federal Laws - Attorney agrees to comply with
applicable local, state and federal laws in performance of all services under this Agreement.
9. Termination: This Agreement may be terminated for cause if either party fails
substantially to perform through no fault of the other and does not commence correction within
five (5) days of written notice and diligently completes the correction thereat~er. Attorney shall
continue to provide representation on cases assigned prior to the effective date of termination.
10. Nondiscrimination: Attorney shall not discriminate in employment or services to the
public on the basis of race, color, national origin, sex, religion, age, marital status or disability in
employment or the provision of services.
IN WITNESS WHEREOF the parties hereto have executed this Agreement the date and
year indicated.
W. DAVID ROVANG
CITY OF BREMERTON
Date
L~H ~OR~T~)N,~Ma~yor
DEPARTMENTAL APPROVAL:
KATffLEEN L. McCLUSKEY
Administrative Services Director
//
#
Professional Services - Rovang
Page 5 - Scptcmber 1999
/.3
APPROVED AS TO FORM:
GLENNA MALANCA, City Attorney
RECEIVED FOR FILING:
KATHLEEN L. ~, City Clerk
Professional Services - Rovang
Page 6 - September 1999
From:
To:
Subject:
Kathy McCluskey
Hill, Penny; Lubovich, Roger
Rovang - Public Defender
Attached is the agenda bill and contract amendment for Rovang.
Lod, please schedule for commitlee on 12/10 and council on 12/18.
Penny, due to a conflict in my schedule, I had to move it back a week from the dates we discussed.
CC: Smith, Lod
AGENDA BiLL
BREMERTON CITY COUNCIL
SUlglECT: Professional Services
Agreemmt Ed Faulk, Greens Superintendent
Gold Mmmmin Goff Complex
FOR AGENDA OF: 15 December 2002
ORIGINATING DEPT: Parks & Recreation
ORIGINATOR: Jim Spencer, Director
DATE SUBMITTED: 5 December 2002
2. ~L-'ES: 3. EXHIbit: PSA with Ed Faulk for Greens
(Commem o~ back if necessary) Superintendent position at the Gold Mou~aia
Golf Complex
Cty Attorn~y~:~
Fiscal & Budget (~mmittee:
gNDORSRM~N~ INI~O~TION
APP--ROVED BY COUNCIL PRESIDENT FOR SUBbffrrAL:
COUNCIL PRRS1DENT: ' '/~ ~ .r' ~ ~ ~_ ~ >: ~.~ .,.~. ....
4. SUMMARY STATgMRNT AND RgQ~!!RgMRNT FOR COUNCIL ACTION'
Mr. Ed Faulk has been the Greens Superintendent at the Gold Mountain Golf Complex since 1 October 1996.
During this time the course coati.ohs have been so exceptional that ~ have attracted national atmntion for their
playab/lity. Mr. Faulk brings over 25 years of experience to this pozition, including 13 years as the assistant
superimemtent at Gold Molmmin. in addition to his over 6 years as the Greens Superintendent This new contract was
necessitated by fiadings in a nxg~nt Depam~nt of Revenue AudiL Compensatiofl levels are consistent with p~,iously
agreed to levels and a review of actual expenditures.
$. RECOMblgN~ATION:
Approval of the atlached Prof~onal Sendce Agreement for Mr. Ed Fm~_!k.
RESPONSIBLE OFFICIAL: Jim Spencer
ENFORCEMENT OFFICIAL: Jim Spencer
EXPIRATION DATE: 12-31-03
REVIEW DATE: 10-1.03
PULLED ....... TABLED ,
COUNCIL ,D!REC'TWE:
10. NOTICE OF ACItON
APPROVED DISAPPROVED
DATE:
11. AGENDA BILL
2. CLZ,~aNCZ, COMMZ~TS:
IMI~,ACT O~ NON-P~A(~E:
The Gold Moun~an Golf Complex would not be ~ to the standards set by the Gold Mountain Board of
Directors and the Bremerton City Council.
7. RZS,ZAaC~, S0URCZS:
PROFESSIONAL SERVICES AGREEMENT
Greens Superintendent
THIS AGREEMENT is between the City
(hereinafter referred to as "City") and Edward
"Superintendent").
of Bremerton, a municipal corporation
G. Faulk, (hereinafter referred to as
WITNESSETH:
1. Seol~ of Work: The City hereby agrees to retain the Superintendem to maintain
and improve the Gold Mountain Golf Complex as follows:
a. The Superintendent shall maintain and improve the Gold Mountain Golf
Complex grounds, to include clubhouse grounds and surrounding areas, which will meet or
exceed the standard in the industry for public courses in the Puget Sound region, and as more
thoroughly specified in Exhibit P~
b. The Superintendent shall devote his attention and energy on a full time
basis to the performance of duties as Greens Superintendent for the City during the term of this
agreement. He shall conduct himself at all times and in all matters in accordance with the
standards accepted for Greens Superintendents. The Superintendent is required to be a member
of the GOlf Superintendent's of America, the Western Washington Golf Course Superintendent's
Association, and the Northwest Turf Grass Association.
c. The Superintendent shall report directly to the Director of Parks and
Recreation and work closely with the Golf Professionals. The Superintendent and Golf
Professionals shall mutually agree upon the open and start of play daily, with the Director
resolving any conflicts. In all instances, the start time will be set to maximize the Golf
Complex's availability to the public.
d. The Superintendent shall attend all meetings of the Golf Complex Board
of Directors. The Superintendent may recommend and submit changes in policies and proced~s
to the Golf Complex Board at any regular meeting.
e. The Superintendent shall maintain a good credit rating in all commercial
transactions so as to not discredit the reputation or name ofthe City of Bremerton.
f. The Superintendent shall supervise, direct, and train a staff to perform the
duties and meet the requirements specified in Exhibit A.
g. The Superintendent agrees to be available to attend regular and special
meetings of the Golf Complex Board, the Parks and Recreation Commission, and City Council,
and shall be prepared to discuss issues and ideas of interest to the Superintendent and City.
PROFESSIONAL SERVICES AGRI~MENT- 1
C,~eens S~erime~iem
h. The Superintendent will comply with all auditing and accounting
requirements set forth by the City. The Superintendent's books and records will be open to
inspection at any time during normal business hours.
2. Term: This Agreement will commence on January 1, 2003 and terminate on
December 31, 2003. This Agreement will automatically renew itself annually for one (1) year
terms with the same terms and conditions, subject to city council budgeting for the same, unless
written notice to the contrary is given by either party at least sixty (60) days prior to
December 21, 2003 or unless terminated pursuant to Section 13.
3. Performance: The Superintendent shall supervise and direct the work as
provided for in this Agreement, using his best skills and attention. From the perspective of
grounds safety and turf condition, the Superintendent shall have the sole authority to declare
when the courses are open for golf play and when golf carts will be allowed on the courses. Any
maintenance practices or renovation projects that would disrupt play will be mutually agreed
upon by the Superintendent, Golf Professional and Director of Parks and Recreation. The
Superintendent shall be solely responsible for the means, methods, techniques, sequences and
proced~es for coordinating all portions of the work contemplated by this Agreemem.
4. Compensation: The Superintendent will be paid seven hundred thousand dollars
($700,000) for the servi~ d~scribed herein for 2003. Payments will be made in 24 equal
installments totaling twenty-nine thousand one hundred sixty-six dollars and sixty-six cents
($29,166.66). These installments will be made twice monthly on a mutually agreed schedule.
The parties acknowledge and agree that, except as otherwise provided for in this contract, this
compensation covers all the Superintendent's costs of operations including:
Labor costs including, but not limited to, medical coverage for
Superintendent and employees, payroll, insurance, L&I, Board Expenses, due~, laundry,
and travel.
b. Taxes and fees including, but not limited to, retail sales, state and local
B&O, federal income, social security, and unemployment, and
c. OOber costs trod expenses related to Superintendem's operations under this
contact a~ the Gold Mountain GolF Complex.
5. Purchasing: All supplies, capital and equipment expenditures used by
superintendent in the maintenance of the facilities such as fertilizers, small tools and parts for
maintenance equipment, will be the responsibility of the Parks and Recreation Department. The
Superintendent agrees to coordinate all purchasing requests for such items through the Director
of Parks and Recreation.
6. Facilities and Equipment: The Superintendent will have the use of the City's
maintenance complex at Gold Mountain for the duration of this Agreement, at no cost to the
Superintendent, The Superintendent agrees to keep the building in a clean and orderly condition
throughout the term of this Agreement. The Superintendent agrees to make necessary minor
PROFESSIONAL SERVICES AGREEMENT- 2
Greeas s~
/?
repairs to the maintenance building. In the evem of major damage or destruction to the
maintenance building that is not the responsibility of the Superintendent, the City agrees to repair
or replace said building. City will indemnify and hold harmless Superintendent for any liability
for work violations resulting from inadequate building facilities. Superintendent will promptly
notify Parks and Recreation Department of any building defects.
The golf complex equipment including, but not limited to, the irrigation system, drainage,
benches, trash receptacles, flag sticks, ball washers and maintenance equipment shall be
provided by the City and be maintained in good working condition by the Superintendent, and
remains the property of the City. The Superintendent agrees to maintain the irrigation system in
good working condition. Repairs and maintenance of the pump station beyond the capabilities of
the Superintendent will be the responsibility of the City.
Unless specifically provided otherwise herein, all equipment for maintaining the golf
complex, as specified in this Agreement, shall be provided by the City. The City will provide a
vehicle to the Superintendent for course maintenance and commuting which may include
incidental personal stops.
7, Relationship of Parties: Superintendent is skilled in the matters addressed in the
Scope of Work and is performing independent functions and responsibilities within his field of
expertise. Superintendent and his employees are independent contractors and not employees of
the City. Superintendent and his employees have no authority to bind the City or to control the
City's employees and other contractors.
It is agreed and understood that the Superintendent shall be the only person responsible
for the hiring and firing of his employees. All employees retained by Superintendent to perform
services under this agreement shall be employees of Superintendent and not employees of the
City. Superintendent shall he responsible for payroll, payroll taxes, FICA, federal taxes, workers
compensation, Labor & Industry, and medical insurance premiums and alt other benefits
associated with employment with Superintendent.
As an independent contractor, Superintendent is responsible for his own management.
The City's administration and enforcement of this Agreement shall not be deemed an exercise of
managerial control over Superintendent or his employees.
8. lsuurance: Superintendent agrees to purchase a policy of liability insurance
which shall protect him and his employees from any loss caused by property damage or personal
injury at the golf complex. Said insurance policy shall be in the amount of One Million Dollars
($1,000,000.00) for each occurrence. The Superintendent agrees that said insurance shall name
the City of Bremerton as an additional insured. A copy of the certificate shall be required to be
kept on file with the City Risk Manager.
9. Supervision: Superintendent shall report directly to the Parks and Recreation
Director and shall cooperate and work closely with the Golf Professionals. In those situations
where conflict of interest arises, the situation will be brought immediately before the Parks and
Recreation Director for resolution.
PROFESSIONAL SERVICES AGREEMENT- 3
Greens Superintendent
10, Liens and Insolvency: The Superintendent shall not allow any property of the
City to become encmnbered with liens of any sort by reason of his action or omission.
11. Indemnity: The Superintendent agrees to defend, indemnify and save harmless
the City, its appointed and elected officers and employees, from and against any and all liability,
loss, costs, damage and expense, including costs and attorney fees in defense thereof because of
actions, claims or lawsuits for damages resulting from personal or bodily injury, including death
at any time resulting therefrom, sustained or alleged to have been sustained by any person or
persons and on account of damage to property, arising or alleged to have arisen directly or
indirectly out of or in consequence of the performance of Superimendent under this Agreement,
whether such injuries to persons or damage to property is due to the act, omission or negligence
of Superintendent, his employees, subcontractors, agents, successors or assigns. This provision
shall be inapplicable to the extent that the City is judicially found solely negligem for such
damage or injury.
12, Nondiscrimination: Superintendent shall not discriminate in the employment or
services to the public on the basis of race, color, national origin, sex, religion, age, marital st~s
or disability, except employnmnt actions based on a bona fide occupational qualification.
13. Termiaatioa: This Agreement will terminate upon the happening of any of the
following events:
a. Upon its normal termination if not renewed.
b. Upon the death of the Superintendent.
c. The physical disability of the Superimendent which substantially prevents
the Superintendent from performing his duties for a continuous period of one (1) month or for an
aggregate of three (3) months during each calendar year.
d, Conviction of a gross misdemeanor or felony.
e. Major damage or destruoion of the golf complex property, structures or
equipment that is the subject of this Agreement, when the City decides not to rebuild, and that
danmge or destruction will prevent Superintendent from substantially performing his obligations
under this Agreement.
f. Continuing inattention or neglect of duties.
g. Suspension from those associations listed under paragraph 1.B for more
tl~_n thirty (30) days.
h.. Substantial breach of any provision of this agreement.
PROFESSIONAL SERVICES AGREEI~NT- 4
In the evem of termination of this Agreement by reason of death or disability, the
Superimendent's estate shall be paid his compensation to and including the month of death, or in
the event of disability, the Superimendent shall be paid to the last day of the month in which
termination occurs.
14. Breach and Cure: In the event that either party claims that the other party is in
violation of subsection 13(0 (g) and/or (h) of this Agreement, the party claiming the violation
may give the other party a written notice of breach. The party in breach shall have thirty (30)
days af~ notice within which to correct any activity or conduct claimed by the other to have
constituted a breach of the Agreemem. Upon mutual agreement, a conference may be called
between the parties in which case every reasonable effort shall be made to reach an amicable
solution. At said conference, either party shall be entitled to have representatives present.
In the event that either party shall, within said thirty (30) day period, fail to either correct
the activity claimed to constitute a substantial breach of this Agreement or notify the other party
in writing of their denial of said substantial breach oft his Agreement, then, in such event, this
Agreement shall cease and terminate as of the expiration of the thirty (30) day period.
15. Notice: Any notice required or permitted to be given under this Agreement shall
be sufficient if in writing and personally served or sent by registered or certified mail. In the
case of the Superintendent, it may be mailed to his residence at: PO Box 4130, Bremerton,
Washington 98312, and in the case of the City: Bremerton City Clerk, 239 Fourth Street,
Bremerton, Washington 98337.
16, Applitable Law: This Agreement shall he controlled by the laws of the State of
Washington. Superintendent shall perform and comply with all applicable laws of the Untied
States and the State of Washington; the Charter, Municipal Code and Ordinances of the City of
Bremerton; and rules, regulations, order and directives of their administrative agencies and the
officers thereof.
17, Severability: The invalidity or unenforceability of any provision hereof shall, in
no way, affect the validity or enforceability of any other provision.
18. Waiver:. Failure to insist upon strict compliance with any terms, covermnts or
conditions of this Agreement shall not be deemed a waiver of such, nor shall any waiver or
relinquishment of such right or power at any time be taken to be a waiver of any other breach.
19, Modifitation: Any waiver, alteration or modification of any of the provisions of
this Agreement or cancellation or replacement of this Agreement shall not be valid unless in
writing and signed by the parties.
20. Entirety: This Agreement, including the exhibits attached hereto and forming a
part hereof, are aH of the covenants, promises, agreements and conditions, either oral or written,
between the parties.
PROFESSIONAL SERVICES AGREEMENT
Greens Superintendent
21. Remedies: Rights under this Agreement are cumulative; the failure to exercise
on any occasion any right shall not operate to forfeit such right on another occasion. The use of
one remedy shall not be taken to exclude or waive the right to use another.
22. Licenses and Fees: Superintendent shall secure and maintain, in full force and
effect during the term of this Agreement, all required licenses, permits and similar legal
authorizations and comply with all requirements thereof. Superintendent is responsible for
payment of all taxes and licensing fees necessary to perform his obligations under this
Agreement. These taxes and fees include but are not limited to State industrial insurance, B&O,
State professional licensing, and City business licensing. If any taxes or fees due the City have
been declared delinquent, the City may withhold the delinquent amount, plus any additional
charges arising from the delinquency, from any payments due Superintendent.
23. Use of FacflitiH and Equipment: The Superintendent and his employees shall
use the facilities herein descn'bed for those purposes and only for those purposes ~numerated
herein and other complex related maimenance items, and for no personal uses.
24. Fidtqity Bond: Superintendent shall enter into an honesty and fidelity bond in
the sum ofTen Thousand Dollars ($t0,000.00), naming the City as the insured thereunder.
IN WITNESS WHEREOF the parties hereto have executed this Agreement the date and
year indicated.
Date
EDWARD G. FAULK, Superintendent
CITY OF BREMERTON
Date
APPROVED AS TO FORM:
CARY BOZE AN, Mayor
ROGER A. LUBOVICH, City Attorney
R:XLEGAL~C. onlracts~PAR KS'ui3r~ns Su~doc
PROFESSIONAL SERVICES AGREEME~- 6
Greens-Sulmimmdmt
EXHIBIT A - DUTIES
The City hereby agrees to retain the Superintendent to maintain and improve the Gold Mountain Goff
Complex courses, to include clubhouse grounds and surrounding areas, and through his efforts will
strive to have the condition of the Gold Mountain Golf Complex in the best possible shape, subject to
budgetary and environmemal limitations within which the Superintendent must perform this work.
The Superintendent does agree to conform to the generally accepted standards and practices of
similar golf courses in tho Western Washington region.
MAINTENANCE STANDARDS:
The following are the parmneters of the maintenance practices and programs for the Cascade and
Olympic courses:
Maximum Mowing He.~ht~:
Cutting Height Settin~ Summer Winter
Tees 1/2" 1/2"
Fairways 1/2" 1/2"
Roughs 1-1/4" I-1/4"
Collars 1/2" 1/2"
Greens .125" .150"
Mowing Standards:
Freaueucv Per W~k Summer Winter
Tees 2 As Needed To
Fairways 3 Maintain Maximum
Roughs 2 Mowing Heights
Collars 3
Greens 7
Bunkers Raked: 3 As Needed
Aerif'~atioa:
Greons And Aprons~
All greens aerification will be coordinated with the pro staff to mitigate impact to
tournaments and special events, and timed to maximize revenues.
Sprin~: Aerification will be performed with a minimum
hollow tines
Fall: Airification will be performed with a minimum 5/8"
hollow tines
Tee~. Fairways A~ Greens Surroun~.~
These areas will be aerified a minimum of once per year with 3/4" hollow tines.
Capital Projects:
Capital projects that have been approved by the City that can be accompli~ed with the lmowiedge
and skills of the Golf Complex maintenance staffbut would require additional labor will be negotiated
as a separate co~ or an addendum to the current contract.
Cons~uction of new tees on Cascade Course will continue ns manpower and conditions allow.
Upgrading irrigation system on Cascade Course, i.e. new satellites and sprinkler heads will continue
as budget allows,
Regular Maintenance Practices
Lil~J~t sand top-dressing of the greens will be done monthly during the [gowin~ season
Cup location and tee markers will be changed daily during the growing season
Fairway divots will be filled with sand and seed monthly
Divots on tees will be filled with sand and seed daily
Divots on driving range tee will be filled with sand and seed a minimum of 4 days per
week
Both courses will be kept free of storm blow-down and branches. Encroaching brash
and Scotch Broom with he cut back yearly.
Cart paths and bunkers will be edged a minimum of once per year.
All restrooms will be cleaned and sanitized daily.
Clubhouse lawns and landscaping will be maintained regularly.
Parking lot and entry road will be kept clean and debris free.
Equipment Mahtenanee
Regularly scheduled maintenance will be performed on all equipment to minimize
costly repairs and equipment down time
All repairs and parts will be documented to help identify problem equipment and
determine cost effectiveness of repair vs. replacement
All cutting unit blades will be sharpened regularly to ensure a precise clean cut in
order to keep the tuff healthy and the playing surface smooth
Irrigation
The Superintendent will maintain the irrigation system to the best of his abilities. The City will
contracl with an outside agent for preventive maintenance of the irrigation pump stations on both the
Olympic course and the Cascade Course. The Superintendent will work with the City's Water
Resource Manager to coordinate water usage and water pressure concerns.
Chemical Use
The Superintendent will work closely with the Water Resource Division of the City in the use of
chemicals and their application at the Gold Mountain Golf Complex. A list of all pesticides and other
chemicals must be maintain~ by the Superintendent including the MSDS information sheets, dates
and time applied, the person who applied the chemical and other information that may be required by
OSHA, WISHA, Department of Labor and Industry, EPA and any other city, county, state, or federal
agency that would have enforcement authority.
Fertilintlon
The Superintendent will set up a fertiliTation program for the Golf Complex and work closely
with the Director of Parks and Recreation to determine a yearly budget for fertilizer.
Tree Removal
Hazardous trees will be removed by the Gold Mountain maintenance crew as required for safety. The
Superintendent will work with the City Forestry Manager for removal of any trees that are not related
to safety.
R:~LEGAL~Contra~PARKS~xhibit A - C,r~ns Sup~rint~nd~t.do~
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO COMMERCIAL
PARKING TAX RATES
ZL~ARANCES: (Comment on back if necess~y)
~THL~.M~S~Y, Director of Administrative Semices
"~0~}' C~BOVICH, City Attorney
FISCAL & B~m~ ~&~~
O ffRATtO eHA M N
ENDORSEMENT ['"]
MAYOR ~--~
ATION F--[
FOR AGENDA: ~ Dec. 18, 2002
ORIGINATING DEPT: Administrative Services
ORIGINATOR: Kathleen McCluskey
DATE SUBMITTED: Nov. 20, 2002
3. EXHIBITS:
PROPOSED ORDINANCE
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance amends Section 3.82.020 BMC to increase the commercial parking tax rate to 8%.
5. RECOMMENDATION:
Move to pass Ordin~ce No. ~q0on second readin
7. NOTICE OF ACTION:
PULLED ['-] TABLED [-']
COUNCIL DIRECTIVE:
APPROVED [--]
RESPONSIBLE OFFICIAL:
ENFORCEMENT OFFICIAL:
EXPIRATION DATE:
REVIEW DATE:
DISAPPROVED ~-] AMENDED
8. AGENDA BILL NO.:
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING~ BUDGETS, FACILITIES~ EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
ORDINANCE NO.,
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, amending Section 3.82.020 of the
Bremerton Municipal Code establishing a new Commercial
Parking Tax Rate.
WHEREAS, the City Council desires to amend the Bremerton Municipal Code to
establish a new commercial parking tax rate; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Section 3.82.020 of the Bremerton Municipal Code entitled "Tax
Rate - Who Must Pay" is hereby amended to read as follows:
3.82.020 TAX RATE. WHO MUST PAY.
r~,.... ,.,.,~n~'~ ...,.~c*~ ~,.,.,....,.,~.r~ .... ~.~ -.~,~ ~ ~----,~ acm tThere_ is levied upon and shall be collected from every
person engaged in a commercial parking business within the City a commercial parking tax in an
amount equal to s~;xeight percent t~:~ ~
~.~ ,,,(8%) of the gross proceeds of the commercial parking
business.
SECTION2. The rate set forth in Section 3.82.020 of Section 1 of this
Ordinance shall be effective January 1, 2003 and the rate in effect as set forth in Section 3.82.020
immediately prior to this amendment shall remain in effect until January 1, 2003.
SECTION 3. Severabili~_. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
(1 O) days from and after its passage, approval and publication as provided by law.
APPROVED by the City Council the
day of ,2002
PASSED by the City Council the
day of ,2002
Approved this day of
CAROL ARENDS, Council President
,2002
1
CARY BOZEMAN, Mayor
Commercial Parking Tax Rate
ATTEST:
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
PUBLISHED the
EFFECTIVE the
ORDINANCE NO.
day of
day of
,2002
,2002
RSLEGAL\Ordinances~dministmtion\Commercial Parking Tax.doc
2
Commercial Parking Tax Rate
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO RESIDENTIAL
PARKING PERMITS
2. CLEARANCES: (Comment on back if necessary)
KATHLEEN McCLUSKEY, Administrative Services
FOR AGENDA'~I~e~ct- and Dec. 18, 2002
ORIGINATING DEPT: Administrative Services
ORIGINATOR: Kathleen McCluskey
DATE SUBMITTED: November 20, 2002
3. EXHIBITS:
PROPOSED ORDINANCE
:OVICH, Cit~y_~-~2-~
FIgGAL & L"~IA~AN
O p~--,t( A~T I6~'N~h~(iRM AN
ENDORSE~ ,~ION2
-
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT ~
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance amends Chapter 10.09 BMC to establish permit fees for the issuance of parking
permits, makes minor amendments, and updates Chapter 3.01 Rate Tables A and B relating to parking fees and
fines.
5. RECOMMENDATION:
.-M_evel~01~gt° apprpvc~ t~~~.~d nrrlinanc¢l~~,on first readin~,_~
7. NOTICE OF ACTION:
PULLED ['-] TABLED [--]
COUNCIL DIRECTIVE:
APPROVED [-'-]
6. RESPONSIBLE OFFICIAL:
Administrative Services Director
ENFORCEMENT OFFICIAL:
Administrative Services Director
EXPIRATION DATE: n/a
REVIEW qD~
DATE: n/a
DISAPPROVED [-'] AMENDED
Se
AGENDA BILL NO.:
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING~ BUDGETS, FACILITIES, EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, amending Chapter 10.09 of the
Bremerton Municipal Code relating to Residential Parking Permits
establishing permit fees for the issuance of parking permits and
making minor amendments to said chapter; and further amending
Rate Tables A and B of Chapter 3.01 of the Bremerton Municipal
Code updating Administrative Services and Municipal Court Rate
Tables relating to residential parking permits fees and fines.
WHEREAS, the current provisions of Chapter 10.09 of the Bremerton Municipal
Code entitled "Residential Parking Permits" do not provide for the imposition of fees for the
issuance of parking permits; and
WHEREAS, the City Council desires to provide for the imposition of fees to help
defray the cost of administering the residential parking permit program and establishes a fine for
parking with an expired permit; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION1. Chapter 10.09 of the Bremerton Municipal Code entitled
"Residential Parking Permits" is hereby amended to read as follows:
Chapter 10.09
RESIDENTIAL PARKING PERMITS
10.09.010 Purpose.
Residential parking permits are established as an exemption to posted parking time limits
in those areas impacted by commuter parking to preserve the character of residential districts,
preserve access to residences and reduce traffic.
10.09.020 Definitions.
For the purpose of this chapter, the words and phrases set forth in this section are defined
as follows:
(a) "Resident vehicle" means a motor vehicle parked in a residential by a person who is a
resident thereof.
1
Residential Parking Permit
(b) "Visitor vehicle" means a motor vehicle parked by a person who is visiting a resident
within a residential parking permit area.
(c) "Commuter vehicle" means a motor vehicle parked in a residential area by a person
not a resident thereof.
(d) "Director" means Director of Public Works or his/her designee.
(~d) "Residential area" means a contiguous area containing public streets and highways
or parts thereof primarily abutted by residential property or residential and non-business property
(including, but not limited to schools, parks, churches, hospitals, and nursing homes).
(_re) "Residential parking permit area" means a residential area designated as provided in
this section wherein resident vehicles displaying a valid permit as described in this chapter shall
be exempt from posted parking.
10.09.030 Designation - Process.
(a) Creation, deletion or boundary changes of residential parking permit areas may be
initiated by the ~irector or upon the verified petition of at least two-thirds of the
residents of a residential area.
The ~Director and Chief of Police or their-designee shall undertake or cause
to be undertaken such surveys or studies as are deemed necessary to determine whether a
residential area is eligible for permit parking.
(b) Upon administrative determination that a particular residential area is eligible for
residential permit parking by the ~Director and Police Chief with approval of the Mayor,
the City Clerk shall post notice in the particular residential area advising the residents of the
location and boundaries of the residential parking area, the permit fee to be charged and the right
to appeal the designation within ten (10) days. A timely appeal to the Parking Board, filed with
the City Clerk, by a resident or business owner within the designated permit area will stay the
action until the Board's review and decision. The decision of the Parking Board may be appealed
to the City Council.
10.09.040 Posting Area.
Upon the final designation of a residential parking permit area, the ~Director
shall cause signs to be erected in the area, indicating thereon the parking time limit for such area
if not already posted.
10.09.050 Eligibility Criteria.
Parking permits may be issued for motor vehicles not in excess often thousand pounds
only upon application of the following persons:
(a) A legal resident of the residential parking permit area who has a motor vehicle
registered in his name, or who has a motor vehicle for his exclusive use and under his control.
2
Residential Parking Permit
(b) A person who owns or leases commercial property and actively engages in business
activity within a residential parking permit area.
There shall be a limit of two (2) residential permits issued per dwelling unit, unless
parking availability allows a greater number, but in no event shall more than four (4) permits be
issued per dwelling unit. No more than one parking permit may be issued for each business
establishment for a motor vehicle registered to or under the control of such person.
10.09.060 Permit - Proof of Residency.
Residency shall be established by ~,o'arq~s-ogdocumentation which may include such
items as a property deed, rental agreement, utility billing, drivers license or vehicle registration.
10.09.070 Permit - Proof of Ownership, Use, Control.
Proof of motor vehicle ownership or vehicle use and control shall be demonstrated in any
of the following ways:
(a) Possession of valid vehicle registration or other indication of title listing thereon the
applicant as owner; or
(b) A valid vehicle registration or other indication of title in the name of a person other
than the applicant, plus a statement provided by the owner that the vehicle is for the applicant's
continuous use for a period of fourteen (14) days or more.
10.09.080 Permit - Visitor.
Visitor parking permits are authorized for residents of a residential parking permit area
for use by a bona fide transient or use of a borrowed or rented vehicle by the resident. Such a
visitor permit shall have all the rights of a regular permit. No residence of a residential parking
permit area shall be issued more than two visitor permits at any one time. These permits shall be
in the form of a placard and contain the address of the residence. It shall be the responsibility of
the resident to control the use of the permit. These permits can be used for guests as well as
home health care specialists, babysitters, repair persons and other similar visitors.
10.09.100 Permit - Issuance - General Procedure.
(a) Parking permits may be issued upon payment of the residential parking permit fee set
forth in chapter 3.01 BMC. The permit shall be issued on a calendar year basis. If the
application is made within six (6) months of the date fixed for expiration, the fee shall be one-
half of the annual fee.
(b) A change of residence location or vehicle registration requires a new permit and
payment of a residential parking permit change fee as set forth in chapter 3.01 BMC. The re-
issuance of a lost residential parking permit or visitor parking permit is subject to payment of the
residential parking permit change fee set forth in chapter 3.01 BMC.
3
Residential Parking Permit
(c) Parking permits shall state thereon the particular residential parking permit area, the
.~;. ,,,~_~.,, .......... . ~.~ ..,,,~.~'~- ,,~'v a,~,_,~ ...,,,,,.~^' ...... ,~,.,~,,u;~ ~,,.c ...... .~u;~u~. ~....~? :~.,, .~,.,,,.; ....... ~ ,..,~o"a the ex"~ra*;onv.- date .
10.09.110 Permit - Display - Scope.
(a) Permits shall be displayed so as to be clearly visible through the rear window of the
vehicle on the left side thereof.
(b) A residential parking permit shall not guarantee or reserve to the holder thereof an on-
street parking space within the designated residential parking area.
10.09.120 Permit- Renewa!
Permits may be renewed annually upon payment of the residential parking permit fee set forth in
chapter 3 01 BMC ~--~:~"~ .~a
· ..-e}, ..... :,,n ..................v ................~ ..........;'e?2clu
· ., ........ ,, "*' °'"l"l~; ...... ~ --,~.~.....~,.,~'1;~'4 :_... ,u:~,...,, '~----r,-'-~u~-"~'- Parking in a residential parking permit area with an expired
permit is subject to a fine as set forth in chapter 3.01 BMC.
10.09.130 Service Vehicles.
Clearly marked service or delivery vehicles are exempt from the time zone requirements
while providing service or making deliveries to dwellings within a residential parking permit
area. Service vehicles shall comply with time limits for parking in commercial zones.
SECTION 2. Rate Tables A and B of Chapter 3.01 of the Bremerton Municipal
Code are hereby amended to read as set forth in Exhibits A and B, respectively, attached hereto.
SECTION 3. Severabilitv. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
(10) days from and after its passage, approval and publication as provided by law.
APPROVED by the City Council the
PASSED by the City Council the
day of ., 2002
day of ,2002
Approved this day of
CAROL ARENDS, Council President
,2002
CARY BOZEMAN, Mayor
4
Residential Parking Permit
ATTEST:
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
PUBLISHED the
EFFECTIVE the
ORDINANCE NO.
day of
day of
., 2002
., 2002
R:\LEGAL\Ordinances\AdministrationkResidential Parking Permits.doc
5
Residential Parking Permit
ADMINISTRATIVE SERVICES - RATE TABLE A
All Rates Listed Are "Not To Exceed" Fees
ADMINISTRATIVE SERVICES
REGULATORY LICENSE FEES
BMC 5.76 Advertising
BMC 5.50 Ambulance Co.
Ambulance Inspections
BMC 5.17 Charitable Solicitation
Non-Profit
Professional Fundraiser
BMC 5.25 Christmas Tree Lots
BMC 5.22 Dance/Public
BMC 5.96 Erotic Dance Studios
Dancers
BMC 5.30 Farmers Market
BMC 9.48 Fireworks Stands
BMC 5.42 Hotel/Motel
BMC 10.24 Housemoving/Oversize Loads
BMC 5.98 Limousine Service
BMC 5.16 Mobile Food Vendor
BMC 5.10 Pawnbroker
BMC 5.16 Peddlers
BMC 5.04 Petshops
Grooming Parlors
Animal Welfare Facilities
BMC 5.10 Secondhand Dealer
BMC 5.98 Shuttlebus
BMC 5.36 Special Events: Profit
2003 RATE
$200/yr or
$50/30 days
$60/veh/semi-
annual
$25/60 days
$675/60 days
$70/Iot/yr
$265/yr or
$70/30 days
$700/yr
$100/yr
$500/yr
$100/stand/yr
$35+$3/rm
$600+$65/mile
to .10 of a mile
$150/veh/yr
$150/ve h/yr
$675/yr
$75/yr or
$25/30days
$150/yr
$50/yr
$50/yr
$135/yr
$135/veh/yr
$675/event
Table A - A1
EXHIBIT A
38
ADMINISTRATIVE SERVICES - RATE TABLE A
All Rates Listed Are "Not To Exceed" Fees
REGULATORY LICENSE FEES
Non-Profit
BMC 5.20 Street/Sidewalk Vendors
BMC 5.54 Taxicabs
Taxi Drivers
BMC 5.16 Temporary Merchant
BMC 5.38 Theatre
BUSINESS LICENSE FEE
BMC 5.02
PARKING
One-Street Locations
Off-Street Location
Parking Garage
Residential Parkin.q Permit
Residential Parkin.q Permit Loss/Chanqe Fee
DOCUMENT REPRODUCTION FEES
Per Page
Audio or Video Tapes
Computer Disks
Certification
Blue Prints- Aerial Photos, Drawings, Maps
Documents:
*Medical Records
20O3 RATE
$70/event
$250/yr
$315/veh/yr
$67/yr
$400/30 days
$275~r
2O03 RATE
$55 r
2003 RATE
Not to Exceed
$20/3 hrs
$30/10 hrs
Not to Exceed
$20/3 hrs
$30/10 hrs
Not to Exceed
$100/mo
$12/veh/¥r
$10
2003 RATE
$. 15/pg
Cost of Tape
+$8.50
$8.5o
$3.5o
$8/pg
$19/1st 5 pages
$.83/Pgs 6-31
Table A - A2
EXHIBIT A
ADMINISTRATIVE SERVICES - RATE TABLE A
All Rates Listed Are "Not To Exceed" Fees
DOCUMENT REPRODUCTION FEES
Fire Reports
Budget
Annual Report
2OO3 RATE
$.631Pgs 31+
$. 15/pg
$25
$25
CHECK HANDLING FEE
$40
ADMINISTRATIVE HEARING EXAMINER
APPLICATION OR APPEAL
$150
Table A - A3
EXHIBIT A
MUNICIPAL COURT- RATE TABLE B
All Rates Listed Are "Not To Exceed" Fees
Municipal Court
HEARING EXAMINER APPEAL
PARKING FINES
Overtime or Non-Payment in Collection Devices:
1 st Violation in 30 Days
2nd Violation in 30 Days
3r~ Violation in 30 Days
Loading Zones
No Parking
Wrong Way
Parked on Sidewalk
Fire Hydrant
12" From Curb
Physically Disabled (Public and Private)
Counterfeiting or User of Counterfeit Permits,
Tokens or Script
Unauthorized Use of Permits
Expired Residential Parking Permit
All Other Infractions Not Specified Above
2O03 RATE
$65
$17
$27
$56
$17
$22
$17
$56
$27
$1o
$250
$500
$150
$27
$27
Table B - B1
EXHIBIT B
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO GENERAL
BUSINESS LICENSES
2. CLEARANCES: (Comment on back it' necessary)
~~~'~~r of Administrative Services
R~. A~BOVICH, City om~Mt~'"'~ey
F~IRMAN
OPERATIONS CHAIRMAN
ENDORSE~
MAYOR /___~..t7 ~[--]
FOR AGENDA:~2~'I'~t Dec. 18, 2002
ORIGINATING DEPT: City Attorney's Office
ORIGINATOR: Roger A. Lubovich
DATE SUBMITTED: Nov. 22, 2002
3. EXHIBITS:
PROPOSED ORDINANCE
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance repeals Chapter 5.02 BMC relating to business licenses, business and occupation taxes
and utility taxes and creates a new chapter 5.02 relating to the issuance, denial, and revocation of general
business licenses and establishes provisions relating to the renting and leasing of real property.
5. RECOMMENDATION:
__M_nvo to approve thc, prcpesed ordinance old first reading.
Move to pass Ordinance No. ~g¢~l'~on second reading.
7. NOTICE OF ACTION:
PULLED [---] TABLED [--]
COUNCIL DIRECTIVE:
APPROVED[--]
DISAPPROVED [--]
RESPONSIBLE OFFICIAL: City Clerk
ENFORCEMENT OFFICIAL: City Clerk
EXPIRATION DATE: fda
REVIEW DATE: n/a
AMENDEq ~
8. AGENDA BILL NO.:
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING~ BUDGETS, FACILITIES~ EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, repealing Chapter 5.02 of the Bremerton
Municipal Code relating to business licenses, business and
occupation taxes and utility taxes and creating a new Chapter 5.02
relating to the issuance, denial, and revocation of general business
licenses in the City of Bremerton.
WHEREAS, the current provisions of the Bremerton Municipal Code
relating to business licenses, business and occupation taxes and utility taxes are currently
contained in one chapter of the City Code; and
WHEREAS, separating business license, business and occupation taxes and utility
taxes into separate chapters and creating another chapter relating to the administration of said
codes in this ordinance and in companion ordinances considered concurrently with this
ordinance, would assist in the interpretation and administration of the various provisions related
to each code; and
WHEREAS; the City Council desires to create a new chapter relating to business
licenses and further update the provisions relating to the issuance and administration of business
licenses in the City; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Chapter 5.02 of the Bremerton Municipal Code entitled "Business
Licenses and Occupations Taxes" is hereby repealed in its entirety.
SECTION 2. A new chapter, Chapter 5.02, entitled "General Business Licenses"
is hereby added to the Bremerton Municipal Code to read as follows:
CHAPTER 5.02
GENERAL BUSINESS LICENSES
5.02.010 Title. This chapter shall constitute the business license code of the city and may
be cited as such.
5.02.020 Power to license for regulation and/or revenue. This chapter is adopted by
the city, exercising its power authorized under general law to license for the privilege of
engaging in business in the City and revoke the license for cause, to regulate, make inspections
and to impose excises for revenue or regulation in regard to all places and kinds of businesses,
1
General Business Licenses
occupations, trades, professions and any other lawful activity, as such power is described in the
RCW 35.22.280(32). The provisions of this chapter shall be liberally construed for the
accomplishment of such purposes.
5.02.030 Administrative Provisions. The provisions contained in Chapter 3.86 BMC
shall be fully applicable to the provisions of this chapter except as expressly stated to the
contrary herein.
5.02.040 Definitions. For the purposes of this chapter, the definitions set forth in
Chapter 3.48 BMC shall apply to this chapter as applicable. In addition, the following
definitions will apply:
"Ancillary rental" means 1) the renting and/or leasing of real property by a person as secondary
to the primary business use by said person for which a business license is issued pursuant to this
chapter, or 2) the renting and/or leasing of no more than one residential unit within the structure
of the primary residence of the landlord, or 3) the renting and/or leasing of no more than one
auxiliary dwelling unit located on the same tax parcel as the primary residence of the landlord.
"Casual rental" means the renting of the primary residence of the landlord for a period of four
months or less in any given calendar year.
"Engaging in business" shall also include the renting and/or leasing real property except for
casual rentals or ancillary rentals.
"License to use" means a personal privilege to do some particular act or series of acts on real
property without possessing any estate or interest therein.
"Possessory interest" means the right to exert control over specific real property, or a portion
thereof, to the exclusion of others.
"Renting and/or leasing of real property" means the creation of a possessory interest in
residential, commercial and/or industrial real property in another party by lease, sublease,
expressed or implied rental agreement, or tenancy from period to period, for the purpose of gain,
and includes leases or rentals in mixed use structures. The renting and/or leasing of real property
does not include the license to use real property.
5.02.050 Administration and enforcement.
(a) The Director of Finance, or designee, shall have general charge of, and
supervision over, the administration and enforcement of this chapter and shall exercise such
power and perform all the duties imposed upon him or her.
(b) Applicant shall, upon reasonable request, provide or allow the Director to inspect
relevant documentation of any licensee for verification of the information provided by
applicant/licensee on the business license application.
(c) The Director may establish administrative rules and regulations as deemed
appropriate, consistent with this chapter for the purpose of enforcing and carrying out its
provisions.
5.02.060 General business license required. Any person who "engages in business"
activities in the City as this term is defined in Chapter 3.48 BMC and this chapter shall first
2
General Business Licenses
obtain a general business license for the current calendar year or unexpired portion thereof, and
pay the fees prescribed in this chapter.
5.02.070 Separate general business license required. A separate license shall be
obtained for each branch, establishment or location at which the business related activity is
carried on, and each license shall authorize the licensee to carry on, pursue or conduct only that
business, or business enterprise at that location. A separate license shall not be required for a
business activity determined by the Director to be an accessory activity to a branch,
establishment or location for which a license is issued. A separate license shall not be required
for the renting and/or leasing of real property in multiple locations which shall be considered a
single business encompassing all rental or leased units in the city by a single owner.
5.02.080 Licenses not transferable. No license issued under the provisions of this
chapter shall be transferable or assignable unless otherwise specifically provided for herein. A
license may be transferred 1) when a business changes its structure which does not result in a
substantial change of ownership or, 2) when there is no substantial change in the type of business
operated. A new license shall be required when the place of a business location is changed, there
is a substantial change of ownership of a business or there is a substantial change in the type of
business operated.
5.02.090 License to be posted. All licenses issued pursuant to this chapter shall be
posted in a conspicuous place at such location. No person to whom a license has been issued
pursuant to this chapter shall allow any person for whom a separate license is required, to operate
under or to display such license, nor shall such other person operate under or display such
license.
5.02.100 Disclaimer of city liability. Issuance of a license pursuant to this chapter does
not constitute the creation of a duty by the city to indemnify the licensee for any wrongful acts
against the public, or to guarantee the quality of goods, services or expertise of a licensee. The
issuance of a license does not shift responsibility from the licensee to the city for proper training,
conduct or equipment of the licensee or his agents, employees or representatives, even if specific
regulations require standards of training, conduct or inspection.
5.02.110 General qualifications of licensees.
(a) No license shall be issued, nor shall any license be renewed, pursuant to the
provisions of this chapter to:
(1)
An applicant who is not eighteen (18) years of age at the time of
application;
(2)
BMC 5.02.180;
An applicant who has had a similar license denied or revoked pursuant to
(3)
An applicant who shall not first comply with the general laws of the state;
or
3
General Business Licenses
(4) An applicant who seeks such a license in order to practice some illegal act
or some act injurious to the public health or safety.
5.02.120 Application procedure, license fee.
(a) The business owner shall make application for any business license required
under this chapter to the Director on a form prepared by the department, which application shall
be accompanied by a receipt from the department showing payment of the required fee. Business
licenses shall be granted annually. The license application fee is prorated per month as applicable
and is nonrefundable whether or not the license application is later denied.
(b) The fee for a business licensee shall be as set forth in Chapter 3.01 BMC as
currently enacted and as hereinafter amended.
5.02.130 Approval and issuance of business license. All licenses approved for issuance
by the Director shall be conditioned upon compliance at all times with all applicable ordinances,
regulations and statutes of the city and the state. Upon issuance, the license shall be valid as long
as licensee continues in business and pays the license fee and occupation tax due pursuant to the
provisions of this chapter and chapters 3.48 BMC and 3.86 BMC and shall continue to be valid
until the expiration date, which will be December 31st of any given year. The license shall be in
addition to any license required under any law or ordinance of the City. Issuance of a business
license does not imply compliance with other City codes.
5.02.140 Renewal. The Director shall mail the forms for business license renewals to
business enterprises in the city to the last address provided to the Director by the licensee.
Failure of the business enterprise to receive any such form shall not excuse the business
enterprise from making application for and securing the required license or renewal, or for
payment of the license fee when and as due hereunder.
5.02.150 Application as public record. General business license applications made to
the Director pursuant to this chapter shall be public information subject to inspection by all
persons except to the extent those records may be deemed to be private or would result in unfair
competitive disadvantage to such business enterprise if disclosed, all as more particularly
described in Chapter 42.17 RCW.
5.02.160 Nonpayment of business license fee. All license fees unpaid under this
chapter when due and all interest and penalties thereon, shall constitute a debt to the City and
may be collected with any taxes owed and in the same manner as unpaid taxes under chapters
3.48 BMC and 3.86 BMC.
5.02.170 Grounds for denial or revocation of license.
(a) In addition to the other penalties provided by law, any business license issued
under the provisions of this chapter may be denied or revoked pursuant to the provisions of this
chapter at any time, where:
(1) The license was procured by fraud, false representation or material
omission of fact, or for the violation of or failure to comply with any of the provisions of this
4
General Business Licenses
chapter by the person holding such license, or any of his servants, agents or employees, while
acting within the scope of their employment; or
(2) The licensee or employee of the licensee violates any of the provisions of
this chapter or any applicable city, state or federal law, including, but not limited to Chapters
3.48, 3.50 and 3.86 BMC, or the purpose for which the license was issued is being abused to the
detriment of the public, or such license is being used for a purpose different from that for which
it was issued.
(3) The licensee submits a false or fraudulent City tax return or makes a false
statement on any City tax return.
(4) The licensee fails to pay any license fee or tax to the city when due
including, but not limited to any taxes pursuant to Title 3 BMC.
(5) The licensee or employee has been convicted of a crime involving the
business.
5.02.180 Denial and Revocation-procedure.
(a) Any application for the issuance or renewal of a license issued under this chapter
may be denied, or any license issued under this chapter may be revoked based on one or more of
the grounds set forth in BMC 5.02.170.
(b) The Director shall have the power and authority to deny the issuance of or revoke
any license issued under the provisions of this chapter. The Director shall notify such licensee in
writing by certified mail or personal service of the denial or revocation of his or her license
application or license and the grounds therefore.
(c) Any applicant or licensee may, within fourteen (14) calendar days from the date
that the denial or revocation notice was mailed to the applicant or licensee, appeal from such
denial or revocation by filing a written notice of appeal setting forth the grounds therefore with
the Administrative Hearing Examiner pursuant to Chapter 2.13 BMC. A filing fee as set forth in
chapter 3.01 BMC shall be submitted with the appeal, which filing fee is required to process the
appeal. The hearing shall be conducted in accordance with the procedures for hearing contested
cases set out in Chapter 2.13 BMC. After the hearing thereon the Administrative Hearing
Examiner shall, after appropriate findings of fact, and conclusions of law, affirm, modify, or
overrule the denial or revocation and order issuance or reinstatement of the license, and may
impose any terms thereupon..
(d) No renewal or revocation of a license issued pursuant to the provisions of this
chapter shall take effect until fourteen (14) calendar days after service of the notice thereof by
the Director, and if the appeal is timely filed, the renewal or revocation shall be stayed pending
final action by the Administrative Hearing Examiner. All licenses which are revoked shall be
surrendered to the City on the effective date of such revocation.
5
General Business Licenses
(e) The decision of the Administrative Hearing Examiner shall be final. The
applicant or licensee and/or the City may seek review of the decision by the Superior Court of
Washington in and for Kitsap County within twenty-one (21) calendar days from the date of the
decision. If review is sought as herein prescribed the renewal or revocation shall be stayed
pending final action by the Superior Court.
(f) When revoked, the license shall be canceled and immediately surrendered to the
Director. Upon revocation of any license as provided in this chapter no portion of the license fee
shall be returned to the licensee.
(g) Upon denial or revocation, the person whose application was den/ed or license
revoked shall not be granted a license for a business, upon any new application that may be
made, for a period of ninety (90) calendar days from date of denial or revocation and further, no
license shall be issued until such person cures any defaults that resulted in the denial or
revocation.
5.02.190 Unlawful- Violations and Penalties.
(a) It shall be unlawful:
(1) For any person to engage in business without having obtained a business
license or for a person to engage in business after denial of a business license application or
renewal or after revocation of a business license.
(2) For the president, vice-president, secretary, treasurer, or other officer of any
company to engage in business without having obtained a business license or for a person to
engage in business after denial of a business license application or renewal or after revocation of
a business license.
(3) For any person to violate any provision of this chapter.
(b) Non-payment penalty. Failure to pay the license fee within ninety (90) days after the
date of expiration, pursuant to BMC 5.02.120, shall subject the licensee to a monetary penalty in
the amount of fifty dollars ($50) to reinstate the license, in addition to the required license fee.
(c) Civil penalties. In addition to any violation set forth in Chapter 3.86 relating to the
administration of this chapter, any violation of BMC 5.02.190(a) constitutes a civil violation
under chapter 1.04 BMC for which a monetary penalty may be assessed and enforcement may be
required as provided therein.
(d) Criminal penalties. In addition to the foregoing penalties or any violation set forth in
Chapter 3.86 relating to the administration of this chapter, any person who violates or fails to
comply with BMC 5.02.190(a) shall, upon conviction, be punished as described in the general
criminal penalty provisions of BMC 1.12.020(2). Such person will be guilty of this violation for
each day, or portion thereof, during which the business is so engaged or carried on.
6
General Business Licenses
SECTION 3. Severabili~_. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
(10) days from and after its passage, approval and publication as provided by law.
APPROVED by the City Council the.
day of ,2002
PASSED by the City Council the
day of ,2002
CAROL ARENDS, Council President
Approved this day of ,2002
CARY BOZEMAN, Mayor
ATTEST:
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
PUBLISHED the
EFFECTIVE the
ORDINANCE NO.
day of ,2002
day of ,2002
R:~LEGAL\Ordinances~Administration~B&O and Utility Tax~BMC 5.02 Business Licenses.doc
7
General Business Licenses
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO BUSINESS AND
OCCUPATION TAXES
too.
2. CLEARANCES: (Comment on back if necessary)
~ , cCLUSKEY, Director of Administrative Services
[~. A/~. OVICH, City Atto~~
'IS~LIBUDO~T CHAIRMAN
OPERATIONS CHAIRMAN
FOR AGENDA: ~d Dec. 18, 2002
ORIGINATING DEPT: City Attorney's Office
ORIGINATOR: Roger A. Lubovich
DATE SUBMITTED: Nov. 22, 2002
3. EXHIBITS:
ENDORSEM/~~ ,~-----t~NFORJ3gATION [~
MAYOR t-.---~'~Z.D ~~~-'--'~Z..
PROPOSED ORDINANCE ~J0t q~/f.3
Nov. 15, 2002 Correspondence from
Association of Washington Cities
Model B&O Tax Legislative Intent
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance updates the BMC provisions relating to business and occupation taxes; separates the
provisions of the BMC related to business and occupation taxes from those related to business licenses and
utility taxes; and establishes provisions relating to the administration of same.
5. RECOMMENDATION:
Move to pass Ordinance No. /'/{~ ~ on second reading.
7. NOTICE OF ACTION:
PULLED ['-] TABLED ~]
COUNCIL DIRECTIVE:
APPROVED [--]
6. RESPONSIBLE OFFICIAL: City Clerk
ENFORCEMENT OFFICIAL: City Clerk
EXPIRATION DATE: n/a
REVIEW DATE: n/a ~ ~
DISAPPROVED [--] AMENDED
8. AGENDA BILL NO.: ~o~-'"' ~'Q,-5 t
51
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING~ BUDGETS~ FACILITIES~ EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
November 15, 2002
ASSOCIATION OF
WASHINGTON CITIES
II
1076 Franklin St. SE
Olympia, WA 98501-1346
Phone: 360-753-4137
Toll Free: lr'800-$62'8981
Fax: 360-753-0149
Website: www. awcnet.org
Mayor Cary Bozeman
City of Bremerton
239 - 4th St
Bremerton, WA 98337
Dear ~n:
Many of you have assisted AWC's efforts over the last few years to fight
back legislation that would have seriously impaired city tax and licensing
authority. Each year it has been increasingly difficult to defeat these bills.
We expect that city B&O taxes will be under significant attack again in
2003. There is a very real threat that these efforts will be successful
unless cities address perceived problems with our current business tax
structure by adopting the Model City B&O Tax Ordinance. Governor Locke
has already commented in a speech to business interests that a city B&O
tax reform bill almost passed in 2002 and that he was confident a reform
bill was needed and would be approved in the 2003 session. We have
contacted the Governor's office and hope to meet with him on this issue
soon.
AWC and B&O tax cities worked together over the past several years to
develop the Model Ordinance to make city B&O taxes simpler and more
uniform, and to eliminate any possibility of multiple taxation. The group
also developed a "streamlined" version of the ordinance for smaller cities.
Many B&O tax cities have already begun the process of adopting the
Model Ordinance. Everett and Seattle already have adopted the Model
Ordinance, and Bellevue, Tacoma, and Bellingham plan to adopt it by the
end of the year or shortly thereafter. This means that the five jurisdictions
collecting more than 90% of municipal B&O taxes in this state will have it
on their books before the start of the 2003 Legislature. However, it is
essential that as many of the 37 B&O tax cities as possible enact the
ordinance prior to the start of the 2003 session in order to counter
ar,quments about statewide uniformity.
Attached are copies of the Model Ordinance, the streamlined version, and
the accompanying administrative rules. Once your city has adopted the
Model Ordinance, please inform AWC so that we can keep track of the
statewide progress on this important issue.
Mayor Cary Bozeman
Page 2
November 15, 2002
Again, AWC strongly urges your city to review and adopt the Model
Ordinance so that cities can protect their local authority over business
taxes and license fees. Please feel free to contact me, Jim Justin, or
Sheila Gall at (360) 753-4137 if you have any questions on this issue.
Sincerely,
Stan Finkelstein
AWC Executive Director
SF/sg:jb
EnClosures: City B&O Model Ordinance
cc: Rich Hanna
G:~JEN~B&O~2002~I 11502 B&O LETI'ER.DOC
Office of the City Attorney
Roger A. Lubovich, City Attorney
City Council
B&O Tax Ordin~R°ger A. Lubovlc?:
December 5, 2002
AWC has strongly recommended that cities, large and small, adopt a minimum taxable gross
income threshold of $20,000 as part of the Model City B&O Tax Ordinance. This threshold
would exempt the first $20,000 of gross income from B&O taxes. Realizing that this may not be
revenue neutral for smaller cities whose tax base is made up of small businesses, AWC is
encouraging those cities, who do not adopt the threshold immediately as part of the new tax
code, study this issue and consider implementation of the threshold phased in over three to five
years. Since our proposed ordinance does not include the threshold, I recommend that, in the
near future, we study and consider AWC's recommendation of implementation of a minimum
taxable gross income threshold.
R:\LEGALhMemos~B&O memq.doc
MODEL B&O TAX LEGISLATIVE INTENT
3.48.020 Exercise of revenue license power.
Legislative intent information.
This section implements Washington Constitution Article XI, Sec. 12 and RCW 35A.82.020 and
35A.11.020 (code cities); 35.22.280(32) (first class cities); RCW 35.23.440(8) (second class
cities); 35.27.370(9) (fourth class cities and towns), which give municipalities the authority to
license for revenue. In the absence of a legal or constitutional prohibition, municipalities have the
power to define taxation categories as they see fit in order to respond to the unique concerns and
responsibilities of local government. See Enterprise Leasing v. Cit~, of Tacoma, 139 Wn.2d 546
(1999). It is intended that this model ordinance be uniform among the various municipalities
adopting it. Uniformity with provisions of State tax laws should not be presumed, and references
in this section to statutory or administrative roles changes do not mean state tax statutes or rules
promulgated by the Department of Revenue.
3.48.028 Administrative Provisions.
Legislative intent information.
Some of the definitions in this model ordinance are similar or identical to the definitions in the
State taxing statutes; some are not. It is intended that the similar or identical language be
understood and interpreted in accordance with published case law governing its meaning, if any,
existing at the time the ordinance is adopted. The municipalities do not intend to adopt or
incorporate administrative interpretations of similar language by the Department of Revenue,
whether now existing or later promulgated, unless specifically required by the RCW.
3.48.030 Definitions
"Software", "canned software," "custom software," "customization of canned software,"
"master copies," "retained rights."
Legislative intent information
A software program is intangible property that may be delivered to consumers via tangible or
intangible media. It is intended that the taxation of the development, production, and licensing of
software programs not be determined by the method by which they are delivered, whether by
tangible media or electronically. The model ordinance classifies software development,
production, and licensing for tax purposes on the basis of whether the program was developed for
the mass market or at the behest of a particular customer. Software is defined as either "custom"
or "canned" regardless of the method of delivery.
3.48.040 Agency - sales and services by agent, consignee, bailee, factor or auctioneer.
Legislative intent information.
A person is taxable on all gross income it receives unless it can prove that the gross income does
not belong to the person, or a specific deduction or exemption is provided. A taxpayer that
receives gross income as an agent is not liable to pay tax on those gross receipts only if it ..meets
the criteria of this section. This section is specifically designed to set out criteria that is
somewhat different than the criteria established by the Washington State Department of Revenue
Rule 111 and the cases interpreting that rule.
1
MODEL B&O TAX LEGISLATIVE INTENT
3.48.070 Multiple activities credit when activities take place in one or more cities with
eligible gross receipt taxes.
Legislative intent information.
This section provides a tax credit for taxpayers engaged in multiple taxable activities. The
section provides a credit against eligible selling or manufacturing taxes imposed by the City for
extracting or manufacturing taxes paid to the City or to any other local jurisdiction with respect to
the same products. The tax credit does not depend upon whether a person that sells in the City
extracts or manufactures in the City or in another jurisdiction to which it has paid an eligible
gross receipts tax. The tax credit does not depend on whether a person that manufactures in the
City extracts in the City or in another jurisdiction to which it has paid an eligible gross receipts
tax. The credit is available to any person that pays an eligible gross receipts tax on the applicable
activities, regardless of where it conducts business. The result of this section is that a city in
which selling takes place gives up the tax to the manufacturing jurisdiction and the manufacturing
jurisdiction gives up the tax to the extracting jurisdiction, whether those jurisdictions are inside or
outside the State of Washington.
3.48.075 Deductions to prevent multiple taxation of transactions involving more than one
city with an eligible gross receipts tax.
Legislative intent information.
This section establishes deductions to be applied when a single taxable activity is taxable by more
than one jurisdiction that imposes an eligible gross receipts tax. Under Washington State Law,
more than one city that has established nexus can include 100% of the gross receipts from that
transaction in its tax base. However to eliminate the possibility of the same sale or service being
taxed more than once by cities that maintain nexus and an eligible gross receipts tax, the cities
have provided this deduction to taxpayers.
Sales. A taxpayer that has paid an eligible gross receipts tax on the sale to the jurisdiction where
the product is delivered may deduct the gross receipts used to measure that tax from the measure
of the tax owed to another jurisdiction on the sale. If a taxpayer has not paid tax to the
jurisdiction where the product is delivered, then no deduction is allowed. The sale shall be taxed
by the city where the office or place of business that generated the sale is located.
Service. A taxpayer that has paid an eligible gross receipts tax on services to the jurisdiction
where the service is performed may deduct the gross receipts used to measure that tax from the
measure of the tax owed to another jurisdiction on that service. If a taxpayer has not paid tax to
the jurisdiction where the service is performed, then no deduction is allowed. The service income
shall be taxed by the city where the office or place of business that generated the sale is located.
For both sales and services, the order of taxing rights is delivery city, first; and business office
location, second.
General Business Activities Other Than Services. The eligible gross receipts tax on income
derived from intangibles such as royalties, licenses, trademarks, patents and goodwill, and
reportable under the general business classification BMC 3.48.050(1)(g), shall be assigned to the
headquarter's office or business location. A taxpayer that has paid an eligible gross receipts tax on
such activities to the jurisdiction where the taxpayer maintains a headquarters office, may deduct
the gross receipts used to measure that tax from the measure of the tax owed to other jurisdictions
on the same activity.
Business Conducted With Other Cities. A taxpayer that has paid an eligible gross receipts tax on
the privilege of accepting or executing a contract with a city may deduct the contract price used to
measure the tax from the measure of the tax owed to another city on the same activity.
2
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, creating a new chapter of the Bremerton
Municipal Code, Chapter 3.48 entitled "Business and Occupation
Taxes" separating the provisions relating to business and
occupation taxes from those related to business licenses and utility
taxes and further updating the provisions relating to business and
occupation taxes and providing for new provisions relating to the
administration of same.
WHEREAS, the provisions relating to business licenses, business and occupation
taxes, and utility taxes are contained in one chapter of the Bremerton Municipal Code; and
WHEREAS, separating business license, business and occupation taxes and utility
taxes into separate chapters and creating another chapter relating to the administration of said
codes in this ordinance and in companion ordinances considered concurrently with this
ordinance, would assist in the interpretation and administration of the various provisions related
to each code; and
WHEREAS, the City Council desires to create a new chapter relating to business
and occupation taxes based on the model tax code established through the Association of
Washington Cities for the purpose of creating a uniform system for application of the business
and occupation taxes and the administration of the same; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. A new chapter, Chapter 3.48 is hereby added to the Bremerton
Municipal Code entitled "Business and Occupation Taxes" to read as follows:
CHAPTER 3.48
BUSINESS AND OCCUPATION TAXES
3.48.020 Exercise Of Revenue License Power. The provisions of this chapter shall be
deemed an exercise of the power of the City to license and/or tax for revenue. The provisions of
this chapter are subject to periodic statutory or administrative rule changes or judicial
interpretations of the ordinances or rules. The responsibility rests with the licensee or taxpayer to
reconfirm tax computation procedures and remain in compliance with the City code.
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3.48.025 Business License - Required. It is unlawful for any person to engage in
business in the City without having first obtained a business license pursuant to Chapter 5.02
BMC.
3.48.028 Administrative Provisions. The provisions contained in chapter 3.86 BMC
shall be fully applicable to the provisions of this chapter except as expressly stated to the
contrary herein.
3.48.030 Definitions. In construing the provisions of this chapter, the following
definitions shall be applied. Words in the singular number shall include the plural, and the plural
shall include the singular.
"Advance," "reimbursement."
(1) "Advance" means money or credits received by a taxpayer from a customer or client with
which the taxpayer is to pay costs or fees on behalf of the customer or client.
(2) "Reimbursement" means money or credits received from a customer or client to repay the
taxpayer for money or credits expended by the taxpayer in payment of costs or fees of the
customer or client.
"Agricultural product," "farmer."
(1) "Agricultural product" means any product of plant cultivation or animal husbandry including,
but not limited to: A product of horticulture, grain cultivation, vermiculture, viticulture, or
aquaculture as defined in RCW 15.83.480; plantation Christmas trees; turf; or any animal
including but not limited to an animal that is a private sector cultured aquatic product as defined
in RCW 15.83.480, or a bird, or insect, or the substances obtained from such an animal.
"Agricultural product" does not include animals intended to be pets.
(2) "Farmer" means any person engaged in the business of growing or producing, upon the
person's own lands or upon the lands in which the person has a present right of possession, any
agricultural product whatsoever for sale. "Farmer" does not include a person using such products
as ingredients in a manufacturing process, or a person growing or producing such products for
the person's own consumption. "Farmer" does not include a person selling any animal or
substance obtained therefrom in connection with the person's business of operating a stockyard
or a slaughter or packing house. "Farmer" does not include any person in respect to the business
of taking, cultivating, or raising timber.
"Artistic or cultural organization". As used in this chapter:
(1) The term "artistic or cultural organization" means an organization which is organized and
operated exclusively for the purpose of providing artistic or cultural exhibitions, presentations, or
performances or cultural or art education programs, as defined in subsection (10) of this section,
for viewing or attendance by the general public.
(2) The organization must be a not-for-profit corporation under chapter 24.03 RCW.
(3) The organization must be managed by a governing board of not less than eight (8) individuals
none of whom is a paid employee of the organization or by a corporation sole under chapter
24.12 RCW.
(4) No part of its income may be paid directly or indirectly to its members, stockholders,
officers, directors, or trustees except in the form of services rendered by the corporation in
accordance with its purposes and bylaws.
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(5) Salary or compensation paid to its officers and executives must be only for actual services
rendered, and at levels comparable to the salary or compensation of like positions within the
state.
(6) Assets of the corporation must be irrevocably dedicated to the activities for which the
exemption is granted and, on the liquidation, dissolution, or abandonment by the corporation,
may not inure directly or indirectly to the benefit of any member or individual except a non-
profit organization, association, or corporation which also would be entitled to the exemption.
(7) The corporation must be duly licensed or certified when licensing or certification is required
by law or regulation.
(8) The amounts received that qualify for exemption must be used for the activities for which the
exemption is granted.
(9) Services must be available regardless of race, color, national origin, ancestry, religion, age,
sex, marital status, sexual orientation, Vietnam or disabled veteran status, or the presence of any
mental or physical disability.
(10) The term "artistic or cultural exhibitions, presentations, or performances or cultural or art
education programs" is limited to:
(a) An exhibition or presentation of works of art or objects of cultural or historical
significance, such as those commonly displayed in art or history museums;
(b) A musical or dramatic performance or series of performances; or
(c) An educational seminar or program, or series of such programs, offered by the
organization to the general public on an artistic, cultural, or historical subject.
"Business." "Business" includes all activities engaged in with the object of gain, benefit, or
advantage to the taxpayer or to another person or class, directly or indirectly.
"Cash discount." "Cash discount" means a deduction from the invoiced amount allowed by the
seller if the bill is paid within a certain time period or before a specified date.
"City." "City" means City of Bremerton, Washington.
"Commercial or industrial use." "Commercial or industrial use" means the following uses of
products, including by-products, by the extractor or manufacturer thereof:
(1) Any use as a consumer;
(2) Any use in the manufacturing of products including articles, substances or commodities; or
(3) Consigning, shipping or transferring extracted or manufactured products to another either
without consideration or in the performance of contracts.
"Competitive telephone service." "Competitive telephone service" means the providing by any
person of telecommunications equipment or apparatus, or service related to that equipment or
apparatus such as repair or maintenance service, if the equipment or apparatus is of a type which
can be provided by persons that are not subject to regulation as telephone companies under Title
80 RCW and for which a separate charge is made.
"Consumer." "Consumer" means the following:
(1) Any person who purchases, acquires, owns, holds, or uses any tangible or intangible personal
property irrespective of the nature of the person's business and including, among others, without
limiting the scope hereof, persons who install, repair, clean, alter, improve, construct, or decorate
real or personal property of or for a consumer other than for the purpose of:
(a) resale as tangible or intangible personal property in the regular course of business;
(b) incorporating such property as an ingredient or component of real or personal
property when installing, repairing, cleaning, altering, imprinting, improving, constructing, or
decorating such real or personal property of or for consumers;
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(c) incorporating such property as an ingredient or component of a new product or as a
chemical used in processing a new product when the primary purpose of such chemical is to
create a chemical reaction directly through contact with an ingredient of a new product; or
(d) consuming the property in producing ferrosilicon which is subsequently used in
producing magnesium for sale, if the primary purpose of such property is to create a chemical
reaction directly through contact with an ingredient of ferrosilicon;
(2) Any person engaged in any business activity taxable under BMC 3.48.050(1)(g);
(3) Any person who purchases, acquires, or uses any competitive telephone service as herein
defined, other than for resale in the regular course of business;
(4) Any person who purchases, acquires, or uses any personal, business, or professional service
defined as a retail sale or retail service in BMC 3.48.030 other than for resale in the regular
course of business;
(5) Any person who is an end user of software;
(6) Any person engaged in the business of "public road construction" in respect to tangible
personal property when that person incorporates the tangible personal property as an ingredient
or component of a publicly-owned street, place, road, highway, easement, right-of-way, mass
public transportation terminal or parking facility, bridge, tunnel, or trestle by installing, placing
or spreading the property in or upon the right-of-way of a publicly-owned street, place, road,
highway, easement, bridge, tunnel, or trestle or in or upon the site of a publicly-owned mass
public transportation terminal or parking facility;
(7) Any person who is an owner, lessee or has the right of possession to or an easement in real
property which is being constructed, repaired, decorated, improved, or otherwise altered by a
person engaged in business;
(8) Any person who is an owner, lessee, or has the right of possession to personal property which
is being constructed, repaired, improved, cleaned, imprinted, or otherwise altered by a person
engaged in business;
(9) Any person engaged in "government contracting." Any such person shall be a consumer
within the meaning of this subsection in respect to tangible personal property incorporated into,
installed in, or attached to such building or other structure by such person;
Nothing contained in this or any other subsection of this section shall be construed to modify any
other definition of "consumer."
"Deficiency." "Deficiency" means the amount of tax imposed by law less any tax reported by
the taxpayer on a tax return.
"Director." "Director" means the Director of Finance of the City or any officer, agent or
employee of the City designated to act on the Director's behalf.
"Eligible gross receipts tax." The term "eligible gross receipts tax" means a tax which:
(1) Is imposed on the act or privilege of engaging in business activities within section .050; and
(2) Is measured by the gross volume of business, in terms of gross receipts and is not an income
tax or value added tax; and
(3) Is not, pursuant to law or custom, separately stated from the sales price; and
(4) Is not a sales or use tax, business license fee, franchise fee, royalty or severance tax measured
by volume or weight, or concession charge, or payment for the use and enjoyment of property,
property right or a privilege; and
(5) Is a tax imposed by a local jurisdiction, whether within or without the State of Washington,
and not by a Country, State, Province, or any other non-local jurisdiction above the County level.
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"Engaging in business" - "nexus"
(1) The term "engaging in business" means commencing, conducting, or continuing in business,
and also the exercise of corporate or franchise powers, as well as liquidating a business when the
liquidators thereof hold themselves out to the public as conducting such business.
(2) This section sets forth examples of activities that constitute engaging in business in the City,
and establishes safe harbors for certain of those activities so that a person who meets the criteria
may engage in de minimus business activities in the City without having to register and obtain a
business license or pay City business and occupation taxes. The activities listed in this section
are illustrative only and are not intended to narrow the definition of "engaging in business" in
subsection (1). If an activity is not listed, whether it constitutes engaging in business in the City
shall be determined by considering all the facts and circumstances and applicable law.
(3) Without being all inclusive, any one of the following activities conducted within the City by
a person, or its employee, agent, representative, independent contractor, broker or another acting
on its behalf constitutes engaging in business and requires a person to register and obtain a
business license.
(a) Owning, renting, leasing, maintaining, or having the right to use, or using, tangible
personal property, intangible personal property, or real property permanently or temporarily
located in the City.
(b) Owning, renting, leasing, using, or maintaining, an office, place of business, or other
establishment in the City.
(c) Soliciting sales.
(d) Making repairs or providing maintenance or service to real or tangible personal
property, including warranty work and property maintenance.
(e) Providing technical assistance or service, including quality control, product
inspections, warranty work, or similar services on or in connection with tangible personal
property sold by the person or on its behalf.
(f) Installing, constructing, or supervising installation or construction of, real or tangible
personal property.
(g) Soliciting, negotiating, or approving franchise, license, or other similar agreements.
(h) Collecting current or delinquent accounts.
(i) Picking up and transporting tangible personal property, solid waste, construction
debris, or excavated materials.
(j) Providing disinfecting and pest control services, employment and labor pool services,
home nursing care, janitorial services, appraising, landscape architectural services, security
system services, surveying, and real estate services including the listing of homes and managing
real property.
(k) Rendering professional services such as those provided by accountants, architects,
attorneys, auctioneers, consultants, engineers, professional athletes, barbers, baseball clubs and
other sports organizations, chemists, consultants, psychologists, court reporters, dentists, doctors,
detectives, laboratory operators, teachers, veterinarians.
(1) Meeting with customers or potential customers, even when no sales or orders are
solicited at the meetings.
(m) Training or recruiting employees, agents, representatives, independent contractors,
brokers or others, domiciled or operating on a job in the City, acting on its behalf, or for
customers or potential customers.
(n) Investigating, resolving, or otherwise assisting in resolving customer complaints.
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(o) In-store stocking or manipulating products or goods, sold to and owned by a
customer, regardless of where sale and delivery of the goods took place.
(p) Delivering goods in vehicles owned, rented, leased, used, or maintained by the person
or another acting on its behalf.
(q) Accepting or executing a contract with the City, irrespective of whether goods or
services are delivered within or without the City, or whether the person's office or place of
business is within or without the City.
(4) If a person, or its employee, agent, representative, independent contractor, broker or another
acting on the person's behalf, engages in no other activities in or with the City but the following,
it need not register and obtain a business license and pay tax.
(a) Meeting with suppliers of goods and services as a customer.
(b) Meeting with government representatives in their official capacity, other than those
performing contracting or purchasing functions.
(c) Attending meetings, such as board meetings, retreats, seminars, and conferences, or
other meetings wherein the person does not provide training in connection with tangible personal
property sold by the person or on its behalf.
(d) Renting tangible or intangible property as a customer when the property is not used in
the City.
(e) Attending, but not participating in a "trade show" or "multiple vendor events".
Persons participating at a trade show shall review the City's trade show or multiple vendor event
ordinances.
(f) Mere delivery of goods via common carrier.
(5) A seller located outside the City merely delivering goods into the City by means of common
carrier is not required to register and obtain a business license provided that it engages in no
other business activities in the City.
(6) "Nexus" A person has created nexus with the City if, whether itself or by its employees,
agents, representative, independent contractors, brokers or others acting on its behalf, it: (a) is physically present in the City;
(b) endeavors to maintain a share of the market within the City; or
(c) avails itself of the economic benefits of the City.
The City expressly intends that engaging in business include any activity sufficient to
establish nexus for purposes of applying the tax under the law and the constitutions of the United
States and the State of Washington. Nexus is presumed to continue as long as the taxpayer
benefits from the activity that constituted the original nexus generating contact or subsequent
contacts.
"Extractor." "Extractor" means every person who from the person's own land or from the land
of another under a right or license granted by lease or contract, either directly or by contracting
with others for the necessary labor or mechanical services, for sale or for commercial or
industrial use, mines, quarries, takes or produces coal, oil, natural gas, ore, stone, sand, gravel,
clay, mineral or other natural resource product; or fells, cuts or takes timber, Christmas trees,
other than plantation Christmas trees, or other natural products; or takes fish, or takes, cultivates,
or raises shellfish, or other sea or inland water foods or products. "Extractor" does not include
persons performing under contract the necessary labor or mechanical services for others; persons
cultivating or raising fish entirely within confined rearing areas on the person's own land or on
land in which the person has a present right of possession; or persons who fell, cut, or take
6
plantation Christmas trees from the person's own land or from land in which the person has a
present right of possession.
"Extractor for Hire" "Extractor for hire" means a person who performs under contract
necessary labor or mechanical services for an extractor.
"Government contracting." "Government contracting" means the constructing, repairing,
decorating, or improving of new or existing buildings or other structures under, upon, or above
real property of or for the United States, any instrumentality thereof, or a county or city housing
authority created pursuant to RCW Chapter 35.82, including the installing or attaching of any
article of tangible personal property therein or thereto, whether or not such personal property
becomes a part of the realty by virtue of installation. The term shall include the clearing of land
and the moving of earth of or for the Untied States, any instrumentality, thereof, or a county of
city housing authority.
"Gross income of the business." "Gross income of the business" means the value proceeding or
accruing by reason of the of the business activity engaged in and includes gross proceeds of
sales, compensation for the rendition of services, gains realized from trading in stocks, bonds, or
other evidences of indebtedness, interest, discount, rents, royalties, fees, commissions, dividends,
and other emoluments however designated, all without any deduction on account of the cost of
tangible property sold, the cost of materials used, labor costs, interest, discount, delivery costs,
taxes, or any other expense whatsoever paid or accrued and without any deduction on account of
losses.
"Gross proceeds of sales." "Gross proceeds of sales" means the value proceeding or accruing
from the sale of tangible personal property or for services rendered, without any deduction on
account of the cost of property sold, the cost of materials used, labor costs, interest, discount
paid, delivery costs, taxes, or any other expense whatsoever paid or accrued and without any
deduction on account of losses.
"In this City," "within this City." "In this City" or "within this City" includes all federal areas
lying within the corporate city limits of the City.
"Janitorial Services." The term "Janitorial Services" shall mean those cleaning and care taking
services ordinarily performed by commercial janitor service businesses including, but not limited
to, wall and window washing, floor cleaning and waxing, and the cleaning in place of rugs,
drapes and upholstery. The term does not include painting, papering, repairing, furnace or septic
tank cleaning, snow removal, sandblasting, or cleanup related to construction activities.
"Manufacturer," "to manufacture."
(1) "Manufacturer" means every person who, either directly or by contracting with others for the
necessary labor or mechanical services, manufactures for sale or for commercial or industrial use
from the person's own materials or ingredients any products. When the owner of equipment or
facilities furnishes, or sells to the customer prior to manufacture, materials or ingredients equal to
less than twenty percent (20%) of the total value of all materials or ingredients that become a
part of the finished product, the owner of the equipment or facilities will be deemed to be a
processor for hire and not a manufacturer. A business not located in this City that is the owner of
materials or ingredients processed for it in this City by a processor for hire shall be deemed to be
engaged in business as a manufacturer in this City.
(2) "To manufacture" means all activities of a commercial or industrial nature wherein labor or
skill is applied, by hand or machinery, to materials or ingredients so that as a result thereof a
new, different or useful product is produced for sale or commercial or industrial use, and shall
include:
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(a) the production of special made or custom made articles;
(b) the production of dental appliances, devices, restorations, substitutes, or other dental
laboratory products by a dental laboratory or dental technician;
(c) crashing and/or blending of rock, sand, stone, gravel, or ore; and
(d) the producing of articles for sale, or for commercial or industrial use from raw
materials or prepared materials by giving such materials, articles, and substances of trade or
commerce new forms, qualities, properties or combinations including, but not limited to, such
activities as making, fabricating, processing, refining, mixing, slaughtering, packing, aging,
curing, mild curing, preserving, canning, and the preparing and freezing of fresh fruits and
vegetables.
"Newspaper," "magazine," "periodical." "Newspaper" means a publication offered for sale
regularly at stated intervals at least once a week and printed on newsprint in tabloid or
broadsheet format folded loosely together without stapling, glue, or any other binding of any
kind.
"Magazine, or periodical" means any printed publication, other than a newspaper, issued and
offered for sale regularly at stated intervals at least once every three (3) months, including any
supplement or special edition of the publication. Any publication meeting this definition
qualifies regardless of its content.
"Non-profit corporation or non-profit organization." "Non-profit corporation or non-profit
organization" means a corporation or organization in which no part of the income can be
distributed to its members, directors, or officers and that holds a current tax exempt status as
provided under Sec. 501(c)(3) of the Internal Revenue Code, as hereafter amended, or is
specifically exempted from the requirement to apply for its tax exempt status under Sec.
501 (c)(3) of the Internal Revenue Code, as hereafter amended. Where the term non-profit
organization is used, it is meant to include a non-profit corporation.
"Office", "place of business." "Office" or "place of business" means a fixed location or
permanent facility where the regular business of the person is conducted and which is either
owned by the person or over which the person exercises legal dominion and control. The regular
business of the person is presumed conducted at a location:
(1) Whose address the person uses as its business mailing address,
(2) Containing a telephone line listed in a public telephone directory or other similar publication
under the business name; and
(3) Where the person holds itself out to the general public as conducting its regular business
through signage or other means; and
(4) Where the person is required to obtain any appropriate state and local business license or
registration unless they are exempted by law from such requirement.
A vehicle such as a pick-up, van, truck, boat or other motor vehicle is not an office or
place of business. A post office box is not an office or place of business.
If a person has an office or place of business, the person's home is not an office or place of
business unless it meets the criteria for office or place of business above. If a person has no
office or place of business, the person's home or apartment within the City will be deemed the
place of business.
"Person." "Person" means any individual, receiver, administrator, executor, assignee, trustee in
bankruptcy, trust, estate, firm, co-partnership, joint venture, club, company, joint stock company,
business trust, municipal corporation, political subdivision of the State of Washington,
corporation, limited liability company, association, society, or any group of individuals acting as
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a unit, whether mutual, cooperative, fraternal, non-profit, or otherwise and the United States or
any instrumentality thereof.
"Precious metal bullion or monetized bullion." "Precious metal bullion" means any precious
metal which has been put through a process of smelting or refining, including, but not limited to,
gold, silver, platinum, rhodium, and palladium, and which is in such state or condition that its
value depends upon its contents and not upon its form. For purposes of this section, "monetized
bullion" means coins or other forms of money manufactured from gold, silver, or other metals
and heretofore, now, or hereafter used as a medium of exchange under the laws of this state, the
United States, or any foreign nation, but does not include coins or money sold to be
manufactured into jewelry or works of art.
"Processing for hire." "Processing for hire" means the performance of labor and mechanical
services upon materials or ingredients belonging to others so that as a result a new, different or
useful product is produced for sale, or commercial or industrial use. A processor for hire is any
person who would be a manufacturer if that person were performing the labor and mechanical
services upon that person's own materials or ingredients. If a person furnishes, or sells to the
customer prior to manufacture, materials or ingredients equal to twenty percent (20%) or more of
the total value of all materials or ingredients that become a part of the finished product the
person will be deemed to be a manufacturer and not a processor for hire.
"Product", "Byproduct." "Product" means tangible personal property, including articles,
substances, or commodities created, brought forth, extracted, or manufactured by human or
mechanical effort.
"Byproduct" means any additional product, other than the principal or intended product, which
results from extracting or manufacturing activities and which has a market value, without regard
to whether or not such additional product was an expected or intended result of the extracting or
manufacturing activities.
"Public road construction." "Public road construction" means the building, repairing, or
improving of any street, place, road, highway, easement, right-of-way, mass public
transportation terminal or parking facility, bridge, tunnel, or trestle which is owned by a
municipal corporation or a political subdivision of the state or by the United States and which is
used or to be used primarily for foot or vehicular traffic including mass transportation vehicles of
any kind.
"Reporting period." "Reporting period" means:
(1) A one-month period beginning the first day of each calendar month (monthly); or
(2) A three-month period beginning the first day of January, April, July or October of each year
(quarterly); or
(3) A twelve-month period beginning the first day of January of each year (annual).
Retail Service. "Retail service" shall include the sale of or charge made for personal,-business,
or professional services including amounts designated as interest, rents, fees, admission, and
other service emoluments however designated, received by persons engaging in the following
business activities:
(1) Amusement and recreation services including but not limited to golf, pool, billiards, skating,
bowling, swimming, bungee jumping, ski lifts and tows, basketball, racquet ball, handball,
squash, tennis, batting cages, day trips for sightseeing purposes, and others, when provided to
consumers. "Amusement and recreation services" also include the provision of related facilities
such as basketball courts, tennis courts, handball courts, swimming pools, and charges made for
providing the opportunity to dance. The term "amusement and recreation services" does not
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include instructional lessons to learn a particular activity such as tennis lessons, swimming
lessons, or archery lessons.
(2) Abstract, title insurance, and escrow services;
(3) Credit bureau services;
(4) Service charges associated with tickets to professional sporting events; and
(5) The following personal services: Physical fitness services, tanning salon services, tattoo
parlor services, steam bath services, turkish bath services, escort services, and dating services.
(6) The term shall also include the renting or leasing of tangible personal property to consumers
and the rental of equipment with an operator.
"Return." "Retum" means any document a person is required by the City to file to satisfy or
establish a tax or fee obligation that is administered or collected by the City and that has a
statutorily defined due date.
"Royalties." "Royalties" means compensation for the use of intangible property, such as
copyrights, patents, licenses, franchises, trademarks, tradenames, and similar items.
"Sale," "casual or isolated sale."
(1) "Sale" means any transfer of the ownership of, title to, or possession of, property for a
valuable consideration and includes any activity classified as a "sale at retail," "retail sale, or
"retail service." It includes renting or leasing, conditional sale contracts, leases with option to
purchase, and any contract under which possession of the property is given to the purchaser but
title is retained by the vendor as security for the payment of thc purchase price. It also includes
thc furnishing of food, drink, or meals for compensation whether consumed upon the premises or
not.
(2) "Casual or isolated sale" means a sale made by a person who is not engaged in the business
of selling the type of property involved on a routine or continuous basis.
"Sale at retail," "retail sale."
(1) "Sale at retail" or "retail sale" means every sale of tangible personal property (including
articles produced, fabricated, or imprinted) to all persons irrespective of the nature of their
business and including, among others, without limiting thc scope hereof, persons who install,
repair, clean, alter, improve, construct, or decorate real or personal property of or for consumers,
other than a sale to a person who presents a resale certificate under RCW 82.04.470 and who:
(a) Purchases for thc purpose of resale as tangible personal property in the regular course
of business without intervening use by such person; or
(b) Installs, repairs, cleans, alters, imprints, improves, constructs, or decorates real or
personal property of or for consumers, if such tangible personal property becomes an ingredient
or component of such real or personal property without intervening use by such person; or
(c) Purchases for the purpose of consuming thc property purchased in producing for sale
a new article of tangible personal property or substance, of which such property becomes an
ingredient or component or is a chemical used in processing, when the primary purpose of such
chemical is to create a chemical reaction directly through contact with an ingredient of a new
article being produced for sale; or
(d) Purchases for the purpose of consuming the property purchased in producing
ferrosilicon which is subsequently used in producing magnesium for sade, if the primary purpose
of such property is to create a chemical reaction directly through contact with an ingredient of
ferrosilicon; or
(e) Purchases for the purpose of providing the property to consumers as part of
competitive telephone service, as defined in RCW 82.04.065. The term shall include every sale
10
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of tangible personal property which is used or consumed or to be used or consumed in the
performance of any activity classified as a "sale at retail" or "retail sale" even though such
property is resold or utilized as provided in (a), (b), (c), (d), or (e) of this subsection following
such use.
(2) "Sale at retail" or "retail sale" also means every sale of tangible personal property to persons
engaged in any business activity which is taxable under BMC 3.48.050(1)(g).
(3) "Sale at retail" or "retail sale" shall include the sale of or charge made for tangible personal
property consumed and/or for labor and services rendered in respect to the following:
(a) The installing, repairing, cleaning, altering, imprinting, or improving of tangible
personal property of or for consumers, including charges made for the mere use of facilities in
respect thereto, but excluding charges made for the use of coin-operated laundry facilities when
such facilities are situated in an apartment house, rooming house, or mobile home park for the
exclusive use of the tenants thereof, and also excluding sales of laundry service to nonprofit
health care facilities, and excluding services rendered in respect to live animals, birds and
insects;
(b) The constructing, repairing, decorating, or improving of new or existing buildings or
other structures under, upon, or above real property of or for consumers, including the installing
or attaching of any article of tangible personal property therein or thereto, whether or not such
personal property becomes a part of the realty by virtue of installation, and shall also include the
sale of services or charges made for the clearing of land and the moving of earth excepting the
mere leveling of land used in commercial farming or agriculture;
(c) The charge for labor and services rendered in respect to constructing, repairing, or
improving any structure upon, above, or under any real property owned by an owner who
conveys the property by title, possession, or any other means to the person performing such
construction, repair, or improvement for the purpose of performing such construction, repair, or
improvement and the property is then reconveyed by title, possession, or any other means to the
original owner;
(d) The sale of or charge made for labor and services rendered in respect to the cleaning,
fumigating, razing or moving of existing buildings or structures, but shall not include the charge
made for janitorial services, which is taxed as a service in this chapter;
(e) The sale of or charge made for labor and services rendered in respect to automobile
towing and similar automotive transportation services, but not in respect to those required to
report and pay taxes under chapter 82.16 RCW;
(f) The sale of and charge made for the furnishing of lodging and all other services,
except network telephone service and cable service, by a hotel, rooming house, tourist court,
motel, trailer camp, and the granting of any similar license to use real property, as distinguished
from the renting or leasing of real property, and it shall be presumed that the occupancy of real
property for a continuous period of one month or more constitutes a rental or lease of real
property and not a mere license to use or enjoy the same;
(g) The sale of or charge made for tangible personal property, labor and services to
persons taxable under (a), (b), (c), (d), (e), and (f) of this subsection when such sales or charges
are for property, labor and services which are used or consumed in whole or in part by such
persons in the performance of any activity defined as a "sale at retail" or "retail sale" even though
such property, labor and services may be resold after such use or consumption. Nothing
contained in this subsection shall be construed to modify subsection (1) of this section and
nothing contained in subsection (1) of this section shall be construed to modify this subsection.
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(4) "Sale at retail" or "retail sale" shall also include the providing of competitive telephone
service to consumers.
(5) "Sale at retail" or "retail sale" shall also include the sale of canned software other than a sale
to a person who presents a resale certificate under RCW 82.04.470, regardless of the method of
delivery to the end user, but shall not include custom software or the customization of canned
software.
(6) "Sale at retail" or "retail sale" shall also include the sale of or charge made for labor and
services rendered in respect to "public road construction."
(7) "Sale at retail" or "retail sale" shall also include the sale of or charge made for labor and
services rendered in respect to "government contracting."
(8) "Sale at retail" or "retail sale" shall also include automobile parking and storage garage
services;
(9) "Sale at retail" or "retail sale" shall also include landscape maintenance and horticultural
services but excluding (i) horticultural services provided to farmers and (ii) pruning, trimming,
repairing, removing, and clearing of trees and brush near electric transmission or distribution
lines or equipment, if performed by or at the direction of an electric utility;
(10) "Sale at retail" or "retail sale" shall not include the sale of services or charges made for the
clearing of land and the moving of earth of or for the United States, any instrumentality thereof,
or a county or city housing authority. Nor shall the term include the sale of services or charges
made for cleaning up for the United States, or its instrumentalities, radioactive waste and other
byproducts of weapons production and nuclear research and development. This is reported under
the service or other classification).
(11) "Sale at retail" or "retail sale" shall not include the sale of or charge made for labor and
services rendered for environmental remedial action as defined in RCW 82.04.2635(2) (This is
reported under the service and other classification).
"Sale at wholesale," "wholesale sale." "Sale at wholesale" or "wholesale sale" means any sale
of tangible personal property which is not a retail sale, and any charge made for labor and
services rendered for persons who are not consumers, in respect to real or personal property, if
such charge is expressly defined as a retail sale when rendered to or for consumers. Sale at
wholesale also includes the sale of network telephone service to a telecommunications company
as defined in RCW 80.04.010 for the purpose of resale, as contemplated by RCW 35.21.715.
"Software", "canned software," "custom software," "customization of canned software,"
"master copies," "retained rights."
(1) "Canned software" means software that is created for sale to more than one (1) person. For
purposes of this chapter, canned software is deemed to be tangible personal property regardless
of the method of delivery-tangible media (e.g., disk or installed on hardware) or intangible (e.g.,
electronically over telecommunications paths).
(2) "Custom software" means software created for a single person.
(3) "Customization of canned software" means any alteration, modification, or development of
applications using or incorporating canned software to specific individualized requirements of a
single person. Customization of canned software includes individualized configuration of
software to work with other software and computer hardware but does not include routine
installation. Customization of canned software does not change the underlying character or
taxability of the .original canned software.
(4) "Master copies" of software means copies of software from which a software developer,
author, inventor, publisher, licensor, sublicensor, or distributor makes copies for sale or license.
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Be, o taxes
The software encoded on a master copy and the media upon which the software resides are both
ingredients of the master copy.
(5) "Retained rights" means any and all rights, including intellectual property rights such as those
rights arising from copyrights, patents, and trade secret laws, that are owned or are held under
contract or license by a software developer, author, inventor, publisher, licensor, sublicensor, or
distributor.
(6) "Software" means any information, program, or routine, or any set of one (1) or more
programs, routines, or collections of information used, or intended for use, to convey information
that causes one or more computers or pieces of computer-related peripheral equipment, or any
combination thereof, to perform a task or set of tasks. "Software" includes the associated
documentation, materials, or ingredients reg~dless of the media upon which that documentation
is provided, that describes the code and its use, operation, and maintenance and that typically is
delivered with the code to the consumer. All software is classified as either canned or custom.
"Successor." "Successor" means any person to whom a taxpayer quitting, selling out,
exchanging, or disposing of a business sells or otherwise conveys, directly or indirectly, in bulk
and not in the ordinary course of the taxpayer's business, any part of the materials, supplies,
merchandise, inventory, fixtures, or equipment of the taxpayer. Any person obligated to fulfill
the terms of a contract shall be deemed a successor to any contractor defaulting in the
performance of any contract as to which such person is a surety or guarantor.
"Taxpayer." "Taxpayer" means any "person", as herein defined, required to have a business
license under this chapter or liable for the collection of any tax or fee under this chapter, or who
engages in any business or who performs any act for which a tax or fee is imposed by this
chapter.
"Tax year," "taxable year." "Tax year" or "taxable year" means the calendar year.
"Tuition fee." "Tuition fee" includes library, laboratory, health service and other special fees,
and amounts charged for room and board by an educational institution when the property or
service for which such charges are made is furnished exclusively to the students or faculty of
such institution. "Educational institution," as used in this section, means only those institutions
created or generally accredited as such by the state and includes educational programs that such
educational institution cosponsors with a non-profit organization, as defined by the Internal
Revenue Code Section 501(c)(3), as hereafter amended, if such educational institution grants
college credit for coursework successfully completed through the educational program, or an
approved branch campus of a foreign degree-granting institution in compliance with chapter
28B.90 RCW, and in accordance with RCW 82.04.4332 or defined as a degree-granting
institution under RCW 28B.85.010(3) and accredited by an accrediting association recognized by
the United States secretary of education, and offering to students an educational program of a
general academic nature or those institutions which are not operated for profit and which are
privately endowed under a deed of trust to offer instruction in trade, industry, and agriculture, but
not including specialty schools, business colleges, other trade schools, or similar institutions.
"Value proceeding or accruing." "Value proceeding or accruing" means the consideration,
whether money, credits, rights, or other property expressed in terms of money, a person is
entitled to receive or which is actually received or accrued. The term shall be applied, in each
case, on a cash receipts or accrual basis according to which method of accounting is regularly
employed in keeping the books of the taxpayer. The value proceeding or accruing from sales on
the installment plan under conditional contracts of sale shall be reported as of the dates when the
payments become due.
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70 B&O Taxes
"Value of products."
(1) The value of products, including by-products, extracted or manufactured, shall be determined
by the gross proceeds derived from the sale thereof whether such sale is at wholesale or at retail,
to which shall be added all subsidies and bonuses received from the purchaser or from any other
person with respect to the extraction, manufacture, or sale of such products or by-products by the
seller.
(2) Where such products, including by-products, are extracted or manufactured for commercial
or industrial use; and where such products, including by-products, are shipped, transported or
transferred out of the City, or to another person, without prior sale or are sold under
circumstances such that the gross proceeds from the sale are not indicative of the true value of
the subject matter of the sale; the value shall correspond as nearly as possible to the gross
proceeds from sales in this state of similar products of like quality and character, and in similar
quantities by other taxpayers, plus the amount of subsidies or bonuses ordinarily payable by the
purchaser or by any third person with respect to the extraction, manufacture, or sale of such
products. In the absence of sales of similar products as a guide to value, such value may be
determined upon a cost basis. In such cases, there shall be included every item of cost
attributable to the particular article or article extracted or manufactured, including direct and
indirect overhead costs. The Director may prescribe rules for the purpose of ascertaining such
values.
3.48.040 Agency - Sales And Services By Agent, Consignee, Bailee, Factor Or
Auctioneer.
(1) Sales in own name - sales or purchases as agent. Every person, including agents, consignees,
bailees, factors or auctioneers having either actual or constructive possession of tangible personal
property or having possession of the documents of title thereto, with power to sell such tangible
personal property in the person's own name and actually so selling shall be deemed the seller of
such tangible personal property within the meaning of this chapter.
The burden shall be upon the taxpayer in every case to establish the fact that such taxpayer is not
engaged in the business of selling tangible personal property but is acting merely as broker or
agent in promoting sales or making purchases for a principal. Such claim will be recognized
only when the contract or agreement between such persons clearly establishes the relationship of
principal and agent and when the following conditions are complied with:
(a) The books and records of the broker or agent show the transactions were made in the
name and for the account of the principal, and show the name of the actual owner of the property
for whom the sale was made, or the actual buyer for whom the purchase was made.
(b) The books and records show the amount of the principal's gross sales, the amount of
commissions and any other incidental income derived by the broker or agent from such sales.
The principal's gross sales must not be reflected as the agent's income on any of the agent's
books and records. Commissions must be computed according to a set percentage or amount,
which is agreed upon in the agency agreement.
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B&O Taxes
(c) No ownership rights may be conferred to the agent unless the principal refuses to pay,
or refuses to abide by the agency agreement. Sales or purchases of any goods by a person who
has any ownership rights in such goods shall be taxed as retail or wholesale sales.
(d) Bulk goods sold or purchased on behalf of a principal must not be co-mingled with
goods belonging to another principal or lose their identity as belonging to the particular
principal. Sales or purchases of any goods which have been co-mingled or lost their identity as
belonging to the principal shall be taxed as retail or wholesale sales.
(2) If the above requirements are not met the consignor, bailor, principal or other shall be
deemed a seller of such property to the agent, consignee, bailee, factor or auctioneer.
(3) Services in own name - procuring services as agent. For purposes of this subsection, an agent
is a person who acts under the direction and control of the principal in procuring services on
behalf of the principal that the person could not itself render or supply. Amounts received by an
agent for the account of its principal as advances or reimbursements are exempted from the
measure of the tax only when the agent is not primarily or secondarily liable to pay for the
services procured.
Any person who claims to be acting merely as agent in obtaining services for a principal
will have such claim recognized only when the contract or agreement between such persons
clearly establishes the relationship of principal and agent and when the following conditions are
complied with:
(a) The books and records of the agent show that the services were obtained in the name
and for the account of the principal, and show the actual principal for whom the purchase was
made.
(b) The books and records show the amount of the service that was obtained for the
principal, the amount of commissions and any other income derived by the agent for acting as
such. Amounts received from the principal as advances and reimbursements must not be
reflected as the agent's income on any of the agent's books and records. Commissions must be
computed according to a set percentage or amount, which is agreed upon in the agency
agreement.
3.48.050 Imposition Of The Tax - Tax Or Fee Levied.
(1) Tax Levied. There is hereby levied upon and shall be collected from every person a tax for
the act or privilege of engaging in business activities within the City, whether the person's office
or place of business be within or without the City. The tax shall be in amounts to be determined
by application of rates against gross proceeds of sale, gross income of business, or value of
products, including by-products, as the case may be, as follows:
(a) Extractor. Upon every person engaging within the City in business as an extractor; as
to such persons the amount of the tax with respect to such business shall be equal to the value of
the products, including by-products, extracted for sale or for commercial or industrial use,
multiplied by the rate of one and six-tenths of one percent (.0016). The measure of the tax is the
15
'7,,~- B&O Taxes
value of the products, including by-products, so extracted, regardless of the place of sale or the
fact that deliveries may be made to points outside the City.
(b) Manufacturer. Upon every person engaging within the City in business as a
manufacturer; as to such persons the amount of the tax with respect to such business shall be
equal to the value of the products, including by-products, manufactured, multiplied by the rate of
one and six-tenths of one percent (.0016). The measure of the tax is the value of the products,
including by-products, so manufactured, regardless of the place of sale or the fact that deliveries
may be made to points outside the City.
(c) Wholesale. Upon every person engaging within the City in the business of making
sales at wholesale, as to such persons, the amount of tax with respect to such business shall be
equal to the gross proceeds of such sales of the business without regard to the place of delivery
of articles, commodities or merchandise sold, multiplied by the rate of one and six-tenths of one
percent (.0016).
(d) Retail. Upon every person engaging within the City in the business of making sales at
retail; as to such persons, the amount of tax with respect to such business shall be equal to the
gross proceeds of such sales of the business without regard to the place of delivery of articles,
commodities or merchandise sold, multiplied by the rate of one and one quarter of one percent
(.00125).
(e) Printing and Publishing. Upon every person engaging within the City in the business
of (i) printing, (ii) both printing and publishing newspapers, magazines, periodicals, books,
music, and other printed items, (iii) publishing newspapers, magazines and periodicals, (iv)
extracting for hire, and (v) processing for hire; as to such persons, the amount of tax on such
business shall be equal to the gross income of the business multiplied by the rate of one and nine-
tenths of one percent (.0019).
(f) Retail service. Upon every person engaging within the City in the business of making
sales of retail services; as to such persons, the amount of tax with respect to such business shall
be equal to the gross proceeds of sales multiplied by the rate of two tenths of one percent (.002).
(g) Service. Upon every other person engaging within the City in any business activity
other than or in addition to those enumerated in the above subsections; as to such persons, the
amount of tax on account of such activities shall be equal to the gross income of the business
multiplied by the rate of two tenths of one percent (.002). This subsection includes, among
others, and without limiting the scope hereof (whether or not title to material used in the
performance of such business passes to another by accession, merger or other than by outright
sale), persons engaged in the business of developing, or producing custom software or of
customizing canned software, producing royalties or commissions, and persons engaged in the
business of rendering any type of service which does not constitute a sale at retail or a sale at
wholesale.
(2) Any person engaging in any business activity within the City shall pay, on a quarterly basis,
the greater of five ($5) dollars or the occupation tax, if any, imposed by this chapter, unless such
16
B&O Taxes
person makes an annual return with the approval of the Director. Any person making an annual
return shall pay, on an annual basis, the greater of twenty ($20) dollars or the occupation tax, if
any, imposed by this chapter. Exempt from this minimum quarterly occupation tax are nonprofit
organizations whose occupation tax liability is less than five ($5) dollars for any one quarter.
(3) The tax levied pursuant to this chapter shall be in addition to any other tax or fee that may be
imposed or levied by the City of Bremerton.
3.48.060 Doing Business With The City. Except where such a tax is otherwise levied
and collected by the City from such person, there is hereby levied a tax on the privilege of
accepting or executing a contract with the City. Such tax shall be levied and collected whether
goods or services are delivered within or without the City and whether or not such person has an
office or place of business within or without the City.
As to such persons the amount of tax shall be equal to the gross contract price multiplied
by the rate under BMC 3.48.050 that would otherwise apply if the sale or service were taxable
pursuant to that section.
3.48.070 Multiple Activities Credit When Activities Take Place In One Or More
Cities With Eligible Gross Receipt Taxes. This section provides a tax credit for taxpayers
engaged in multiple taxable activities. The section provides a credit against eligible selling or
manufacturing taxes imposed by the City for extracting or manufacturing taxes paid to the City
or to any other local jurisdiction with respect to the same products. The tax credit does not
depend upon whether a person that sells in the City extracts or manufactures in the City or in
another jurisdiction to which it has paid an eligible gross receipts tax. The tax credit does not
depend on whether a person that manufactures in the City extracts in the City or in another
jurisdiction to which it has paid an eligible gross receipts tax. The credit is available to any
person that pays an eligible gross receipts tax on the applicable activities, regardless of where it
conducts business. The result of this section is that a city in which selling takes place gives up
the tax to the manufacturing jurisdiction and the manufacturing jurisdiction gives up the tax to
the extracting jurisdiction, whether those jurisdictions are inside or outside the State of
Washington.
(1) Persons who engage in business activities that are within the purview of two (2) or more
subsections of BMC 3.48.050 shall be taxable under each applicable subsection.
(2) Notwithstanding anything to the contrary herein, if imposition of the City's tax would place
an undue burden upon interstate commerce or violate constitutional requirements, a taxpayer
shall be allowed a credit to the extent necessary to preserve the validity of the City's tax, and still
apply the City tax to as much of the taxpayer's activities as may be subject to the City's taxing
authority.
(3) To take the credit authorized by this section, a taxpayer must be able to document that the
amount of tax sought to be credited was paid upon the same gross receipts used in computing the
tax against which the credit is applied and that the taxpayer paid the amount of tax sought to be
credited.
17
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(4) Credit for persons that sell in the City products that they extract or manufacture. Persons
taxable under the retailing or wholesaling classification with respect to selling products in this
City shall be allowed a credit against those taxes for any eligible gross receipts taxes paid (a)
with respect to the manufacturing of the products sold in the City, and (b) with respect to the
extracting of the products, or the ingredients used in the products, sold in the City. The amount
of the credit shall not exceed the tax liability arising under this chapter with respect to the sale of
those products.
(5) Credit for persons that manufacture products in the City using ingredients they extract.
Persons taxable under the manufacturing classification with respect to manufacturing products in
this City shall be allowed a credit against those taxes for any eligible gross receipts tax paid with
respect to extracting the ingredients of the products manufactured in the City. The amount of the
credit shall not exceed the tax liability arising under this chapter with respect to the
manufacturing of those products.
(6) Credit for persons that sell within the City products that they print, or publish and print.
Persons taxable under the retailing or wholesaling classification with respect to selling products
in this City shall be allowed a credit against those taxes for any eligible gross receipts taxes paid
with respect to the printing, or the printing and publishing, of the products sold within the City.
The amount of the credit shall not exceed the tax liability arising under this chapter with respect
to the sale of those products.
3.48.075 Deductions To Prevent Multiple Taxation Of Transactions Involving More Than
One City With An Eligible Gross Receipts Tax. This section establishes deductions to be
applied when a single taxable activity is taxable by more than one jurisdiction that imposes an
eligible gross receipts tax. To eliminate the possibility of the same sale or service being taxed
more than once by cities that maintain nexus and an eligible gross receipts tax, the cities
deductions set forth in this section shall apply.
Sales. A taxpayer that has paid an eligible gross receipts tax on the sale to the jurisdiction where
the product is delivered may deduct the gross receipts used to measure that tax from the measure
of the tax owed to another jurisdiction on the sale. If a taxpayer has not paid tax to the
jurisdiction where the product is delivered, then no deduction is allowed. The sale shall be taxed
by the city where the office or place of business that generated the sale is located.
Service. A taxpayer that has paid an eligible gross receipts tax on services to the jurisdiction
where the service is performed may deduct the gross receipts used to measure that tax from the
measure of the tax owed to another jurisdiction on that service. If a taxpayer has not paid tax to
the jurisdiction where the service is performed, then no deduction is allowed. The service
income shall be taxed by the city where the office or place of business that generated the sale is
located. For both sales and services, the order of taxing rights is delivery city, first; and business
office location, second.
General Business Activities Other Than Services. The eligible gross receipts tax on income
derived from intangibles such as royalties, licenses, trademarks, patents and goodwill, and
reportable under the general business classification BMC 3.48.050(1)(g), shall be assigned to the
headquarter's office or business location. A taxpayer that has paid an eligible gross receipts tax
on such activities to the jurisdiction where the taxpayer maintains a headquarters office, may
18
'7~ B&O Taxes
deduct the gross receipts used to measure that tax from the measure of the tax owed to other
jurisdictions on the same activity.
Business Conducted With Other Cities. A taxpayer that has paid an eligible gross receipts tax on
the privilege of accepting or executing a contract with a city may deduct the contract price used
to measure the tax from the measure of the tax owed to another city on the same activity.
(1) Amounts subject to an eligible gross receipts tax in another city that also maintains nexus
over the same activity. A taxpayer that is subject to an eligible gross receipts tax on the same
activity in more than one jurisdiction may be entitled to a deduction as follows:
(a) A taxpayer that has paid an eligible gross receipts tax with respect to a sale of goods
or services to a jurisdiction in which the goods are delivered or the services are provided may
deduct an amount equal to the gross receipts used to measure that tax from the measure of the tax
owed to the City.
(b) Notwithstanding the above, a person that is subject to an eligible gross receipts tax in
more than one jurisdiction on the gross income derived from intangibles such as royalties,
trademarks, patents, or goodwill may deduct from the measure of the tax on those amounts the
gross income used in measuring the eligible gross receipts tax paid to the other jurisdiction
where the headquarters is located.
(c) A taxpayer that has paid an eligible gross receipts tax on the privilege of accepting or
executing a contract with another city may deduct an amount equal to the contract price used to
measure the tax due to the other city from the measure of the tax owed to the City.
(2) Person manufacturing products within and without. A person manufacturing products within
the City using products manufactured by the same person outside the City may deduct from the
measure of the manufacturing tax the value of products manufactured outside the City and
included in the measure of an eligible gross receipts tax paid with respect to manufacturing such
products.
3.48.090 Exemptions.
(1) Non-Profit Corporations Or Non-Profit Organizations. This section shall not apply to non-
profit organizations exempt from federal income tax under Section 501 (c)(3) of the Internal
Revenue Code, as hereafter amended, except with respect to retail sales of such persons.
(2) Health maintenance organization, health care service contractor, certified health plan.
Beginning on January 1, 2000 this chapter does not apply to any health maintenance
organization, health care service contractor, or certified health plan in respect to premiums or
prepayments that are taxable under RCW 48.14.0201.
(3) Public utilities. This chapter shall not apply to any person in respect to a business activity
with respect to which tax liability is specifically imposed under the provisions of Chapter 3.50
BMC.
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B&O Taxes
(4) Investments - dividends from subsidiary corporations. This chapter shall not apply to
amounts derived by persons, other than those engaging in banking, loan, security, or other
financial businesses, from investments or the use of money as such, and also amounts derived as
dividends by a parent from its subsidiary corporations.
(5) International banking facilities. This chapter shall not apply to the gross receipts of an
international banking facility. As used in this subsection, an "international banking facility"
means a facility represented by a set of asset and liability accounts segregated on the books and
records of a commercial bank, the principal office of which is located in this state, and which is
incorporated and doing business under the laws of the United States or of this state, a United
States branch or agency of a foreign bank, an Edge corporation organized under Section 25(a) of
the Federal Reserve Act, 12 United States Code 611-631, or an Agreement corporation having an
agreement or undertaking with the Board of Governors of the Federal Reserve System under
Section 25 of the Federal Reserve Act, 12 United States Code 601-604(a), that includes only
international banking facility time deposits (as defined in subsection (a)(2) of Section 204.8 of
Regulation D (12 CFR Part 204), as promulgated by the Board of Governors of the Federal
Reserve System), and international banking facility extensions of credit (as defined in subsection
(a)(3) of Section 204.8 of Regulation D).
(6) Insurance business. This chapter shall not apply to amounts received by any person or agent
who is an insurer upon which a tax based on gross premiums is paid to the state pursuant to
RCW 48.14.020; provided that the provisions of this subsection shall not exempt any person
engaging in the business of insurance as a broker as defined in RCW 48.17.020 or as a solicitor
as defined in RCW 48.17.030; and provided further, that the provisions of this subsection shall
not exempt any bonding company from tax with respect to gross income derived from the
completion of any contract as to which it is a surety, or as to any liability as successor to the
liability of the defaulting contractor.
(7) Farmers - agriculture. This chapter shall not apply to any farmer in respect to amounts
received from selling fruits, vegetables, berries, butter, eggs, fish, milk poultry, meats or any
other agricultural product that is raised, caught, produced, or manufactured by such persons.
(8) Athletic exhibitions. This chapter shall not apply to any person in respect to the business of
conducting boxing contests and sparring or wrestling matches and exhibitions for the conduct of
which a license must be secured from the State Boxing Commission.
(9) Racing. This chapter shall not apply to any person in respect to the business of conducting
race meets for the conduct of which a license must be secured from the Washington State Horse
Racing Commission.
(10) Ride sharing. This chapter does not apply to any funds received in the course of commuter
ride sharing or ride sharing for persons with special transportation needs in accordance with
RCW 46.74.010.
(11) Employees. This chapter shall not apply to:
20
B&O Taxes
(a) Any person in respect to the person's employment in the capacity as an
employee or servant as distinguished from that of an independent contractor. For the purposes of
this subsection, the definition of employee shall include those persons that are defined in the
Internal Revenue Code, as hereafter amended.
(b) A booth renter, as defined by RCW 18.16.020, is an independent
contractor for purposes of this chapter.
(12) Amounts derived from sale of real estate. This chapter shall not apply to gross proceeds
derived from the sale of real estate. This, however, shall not be construed to allow an exemption
of amounts received as commissions from the sale of real estate, nor as fees, handling charges,
discounts, interest or similar financial charges resulting from, or relating to, real estate
transactions.
(13) Mortgage brokers' third-party provider services trust accounts. This chapter shall not apply
to amounts received from trust accounts to mortgage brokers for the payment of third-party costs
if the accounts are operated in a manner consistent with RCW 19.146.050 and any rules adopted
by the director of financial institutions.
(14) Amounts derived from manufacturing, selling or distributing motor vehicle fuel. This
chapter shall not apply to the manufacturing, selling, or distributing motor vehicle fuel, as the
term "motor vehicle fuel" is defined in RCW 82.36.010 and exempt under RCW 82.36.440,
provided that any fuel not subjected to the state fuel excise tax, or any other applicable deduction
or exemption, will be taxable under this chapter.
(15) Amounts derived from liquor, and the sale or distribution of liquor. This chapter shall not
apply to liquor as defined in RCW 66.04.010 and exempt in RCW 66.08.120.
(16) Casual and isolated sales. This chapter shall not apply to the gross proceeds derived from
casual or isolated sales.
(17) Accommodation sales. This chapter shall not apply to sales for resale by persons regularly
engaged in the business of making retail sales of the type of property so sold to other persons
similarly engaged in the business of selling such property where (1) the amount paid by the
buyer does not exceed the amount paid by the seller to the vendor in the acquisition of the article
and (2) the sale is made as an accommodation to the buyer to enable the buyer to fill a bona fide
existing order of a customer or is made within fourteen days to reimburse in kind a previous
accommodation sale by the buyer to the seller.
(18) Taxes collected as trust funds. This chapter shall not apply to amounts collected by the
taxpayer from third parties to satisfy third party obligations to pay taxes such as the retail sales
tax, use tax, and admission tax.
(19) Renting and/or leasing property. This chapter shall not apply to renting and/or leasing of
real property as defined in Chapter 5.02 BMC.
21
B&O Taxes
3.48.100 Deductions. In computing the license fee or tax, there may be deducted from
the measure of tax the following items:
(1) Compensation from public entities for health or social welfare services - exception. In
computing tax, there may be deducted from the measure of tax amounts received from the United
States or any instrumentality thereof or from the State of Washington or any municipal
corporation or political subdivision thereof as compensation for, or to support, health or social
welfare services rendered by a health or social welfare organization (as defined in RCW
82.04.431) or by a municipal corporation or political subdivision, except deductions are not
allowed under this subsection for amounts that are received under an employee benefit plan. For
purposes of this subsection, "employee benefit plan" includes the military benefits program
authorized in 10 USC Sec. 1071 et seq., as amended, or amounts payable pursuant thereto.
(2) Interest on investments or loans secured by mortgages or deeds of trust. In computing tax,
there may be deducted from the measure of tax by those engaged in banking, loan, security or
other financial businesses, amounts derived from interest received on investments or loans
primarily secured by first mortgages or trust deeds on non-transient residential properties.
(3) Interest on obligations of the state, its political subdivisions, and municipal corporations. In
computing tax, there may be deducted from the measure of tax by those engaged in banking,
loan, security or other financial businesses, amounts derived from interest paid on all obligations
of the State of Washington, its political subdivisions, and municipal corporations organized
pursuant to the laws thereof.
(4) Interest on loans to farmers and ranchers, producers or harvesters of aquatic products, or their
cooperatives. In computing tax, there may be deducted from the measure of tax amounts derived
as interest on loans to bona fide farmers and ranchers, producers or harvesters of aquatic
products, or their cooperatives by a lending institution which is owned exclusively by its
borrowers or members and which is engaged solely in the business of making loans and
providing finance-related services to bona fide farmers and ranchers, producers or harvesters of
aquatic products, their cooperatives, rural residents for housing, or persons engaged in furnishing
farm-related or aquatic-related services to these individuals or entities.
(5) Receipts from tangible personal property delivered outside the State. In computing tax, there
may be deducted from the measure of tax under retailing or wholesaling amounts derived from
the sale of tangible personal property that is received by the purchaser or its agent outside the
State of Washington.
(6) Cash discount taken by purchaser. In computing tax, there may be deducted from the measure
of tax the cash discount amounts actually taken by the purchaser. This deduction is not allowed
in arriving at the taxable amount under the extracting or manufacturing classifications with
respect to articles produced or manufactured, the reported values of which, for the purposes of
this tax, have been computed according to the "value of product" provisions.
22
B&O Taxes
(7) Credit losses of accrual basis taxpayers. In computing tax, there may be deducted from the
measure of tax the amount of credit losses actually sustained by taxpayers whose regular books
of account are kept upon an accrual basis.
(8) Repair, maintenance, replacement, etc., of residential structures and commonly held property
- eligible organizations.
(a) In computing tax, there may be deducted from the measure of tax amounts used solely
for repair, maintenance, replacement, management, or improvement of the residential structures
and commonly held property, but excluding property where fees or charges are made for use by
the public who are not guests accompanied by a member, which are derived by:
(i) A cooperative housing association, corporation, or partnership from a person
who resides in a structure owned by the cooperative housing association, corporation, or
partnership;
(ii) An association of owners of property as defined in RCW 64.32.010, as now or
hereafter amended, from a person who is an apartment owner as defined in RCW 64.32.010; or
(iii) An association of owners of residential property from a person who is a
member of the association. "Association of owners of residential property" means any
organization of all the owners of residential property in a defined area who all hold the same
property in common within the area.
(b) For the purposes of this subsection "commonly held property" includes areas required
for common access such as reception areas, halls, stairways, parking, etc., and may include
recreation rooms, swimming pools and small parks or recreation areas; but is not intended to
include more grounds than are normally required in a residential area, or to include such
extensive areas as required for golf courses, campgrounds, hiking and riding areas, boating areas,
etc.
(c) To qualify for the deductions under this subsection:
(i) The salary or compensation paid to officers, managers, or employees must be
only for actual services rendered and at levels comparable to the salary or compensation of like
positions within the county wherein the property is located;
(ii) Dues, fees, or assessments in excess of amounts needed for the purposes for
which the deduction is allowed must be rebated to the members of the association;
(iii) Assets of the association or organization must be distributable to all members
and must not inure to the benefit of any single member or group of members.
(9) Sales at wholesale or retail of precious metal bullion and monetized bullion. In computing
tax, there may be deducted from the measure of the tax amounts derived from the sale at
wholesale or retail of precious metal bullion and monetized bullion. However, no deduction is
23
~0 B&O Taxes
allowed on amounts received as commissions upon transactions for the accounts of customers
over and above the amount paid to other dealers associated in such transactions, and no
deduction or offset is allowed against such commissions on account of salaries or commissions
paid to salesmen or other employees.
(10) Amounts representing rental of real estate for boarding homes. In computing tax, there may
be deducted from the measure of tax amounts representing the value of the rental of real estate
for "boarding homes." To qualify for the deduction, the boarding home must meet the definition
of "boarding home, and licensed by the State of Washington under RCW 18.20. The deduction
shall be in the amount of twenty-five percent (25%) of the gross monthly billing when the
boarder has resided within the boarding home for longer than thirty (30) days.
(11) Radio and television broadcasting - advertising agency fees - national, regional, and
network advertising - interstate allocations. In computing tax, there may be deducted from the
measure of tax by radio and television broadcasters amounts representing the following:
(a) advertising agencies' fees when such fees or allowances are shown as a discount or
price reduction in the billing or that the billing is on a net basis, i.e., less the discount;
(b) actual gross receipts from national network, and regional advertising or a "standard
deduction" as provided by RCW 82.04.280; and
(c) local advertising revenue that represent advertising which is intended to reach
potential customers of the advertiser who are located outside the State of Washington. The
Director may issue a role that provides detailed guidance as to how these deductions are to be
calculated.
(12) Constitutional prohibitions. In computing tax, there may be deducted from the measure of
the tax amounts derived from business which the City is prohibited from taxing under the
Constitution of the State of Washington or the Constitution of the United States.
3.48.120 Tax Part Of Overhead.
It is not the intention of this chapter that the taxes or fees herein levied upon persons
engaging in business be construed as taxes or fees upon the purchasers or customer, but that such
taxes or fees shall be levied upon, and collectible from, the person engaging in the business
activities herein designated and that such taxes or fees shall constitute a part of the cost of doing
business of such persons.
3.48.125 Rules and Regulations. The Director may establish administrative roles and
regulations as deemed appropriate, consistent with this chapter for the purpose of enforcing and
carrying out its provisions.
3.48.130 Severability Clause.
If any provision of this chapter or its application to any person or circumstance is held
invalid, the remainder of the chapter or the application of the provision to other persons or
circumstances shall not be affected.
24
B&O Taxes
SECTION 2. Section 1 of this ordinance shall take effect and be in force on
January 1, 2003.
SECTION 3. Severabili~_. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
(10) days from and after its passage, approval and publication as provided by law.
APPROVED by the City Council the
PASSED by the City Council the
day of ,2002
day of ,2002
Approved this day of
CAROL ARENDS, Council President
,2002
ATTEST:
CARY BOZEMAN, Mayor
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
PUBLISHED the day of ,2002
EFFECTIVE the day of ,2002
ORDINANCE NO.
RALEGAL\Ordinances\Administration~B&O and Utility Tax~BMC 3.48, B & O Tax .doc
25
B&O Taxes
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO UTILITY TAXES
2. CLEARANCES: (Comment on back if necessary)
~EEN McCLUS~Director of Administrative Se~ices
~ A. ~B VICH, City
FInaL ~A~MAN
OPE~TIONS CHAPMAN
ENDORSEMt~~] .~~M~ION,~ 'b/~ ....... ['~
FOR AGENDA:~,,,,.'-' .... l · and Dec. 18, 2002
ORIGINATING DEPT: City Attorney's Office
ORIGINATOR: Roger A. Lubovich
DATE SUBMITTED: Nov. 20, 2002
3. EXHIBITS:
PROPOSED ORDINANCE dO ,~
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance updates the BMC provisions relating to utility taxes; separates the provisions of the
BMC related to utility taxes from those related to business licenses and business and occupation taxes; and
establishes new tax rates for certain utilities.
5. RECOMMENDATION:
......--ri"' _V~ t.. ~l.,,vo....o. 'oltllllO. llt,,.~. ~.~ii .tiio[ · ~,~,..1..~. -
ove to pas O,'dinan e No. Sqq on second reading.
7. NOTICE OF ACTION:
PULLED [-'] TABLED [-]
COUNCIL DIRECTIVE:
APPROVED [-]
6. RESPONSIBLE OFFICIAL: City Clerk
ENFORCEMENT OFFICIAL: City Clerk
EXPIRATION DATE: n/a
REVIEW DATE: n/a
DISAPPROVED [-'] AMENDEq D~:
8. AGENDA BILL NO.: ~"- a~ 5~
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING, BUDGETS, FACILITIES~ EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
ORDINANCE NO.
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, creating a new chapter of the Bremerton
Municipal Code, Chapter 3.50 entitled "Utility Taxes," separating
the provisions related to utility taxes from those related to business
licenses and business and occupation taxes; updating the
provisions relating to utility taxes; providing for new provisions
relating to the administration of the same; and further establishing
new tax rates for certain utilities.
WHEREAS, the provisions relating to business licenses, business and occupation
taxes, and utility taxes are contained in one chapter of the Bremerton Municipal Code; and
WHEREAS, separating business license, business and occupation taxes and utility
taxes into separate chapters and creating another chapter relating to the administration of said
codes in this ordinance and in companion ordinances considered concurrently with this
ordinance, would assist in the interpretation and administration of the various provisions related
to each code; and
WHEREAS, the City Council desires to create a new chapter relating to utility
taxes; update provisions relating to utility taxes; provide new provisions for the administration of
the same; and establish new tax rates for certain utilities; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. A new chapter, Chapter 3.50, entitled "Utility Taxes" is hereby
added to the Bremerton Municipal Code to read as follows:
CHAPTER 3.50
UTILITY TAXES
3.50.010 Exercise of revenue license power. The provisions of this chapter shall be
deemed an exercise of the power of the City to license and/or tax for revenue. The provisions of
this chapter are subject to periodic statutory or administrative role changes or judicial
interpretations of the ordinances or rules. The responsibility rests with the licensee or taxpayer to
reconfirm tax computation procedures and remain in compliance with the City code.
3.50.020 Business License - Required. It is unlawful for any person to engage in
business in the City without having first obtained a business license pursuant to Chapter 5.02
BMC.
Utility Taxes
3.50.030 Administrative Provisions. The provisions contained in chapter 3.86 BMC
shall be fully applicable to the provisions of this chapter except as expressly stated to the
contrary herein.
3.50.040 Definitions. For the purposes of this chapter, the definitions contained in
chapter 3.48 BMC shall apply equally to the provisions of this chapter as applicable unless the
term is defined otherwise in this chapter. In addition, the following definitions will apply:
"Cellular telephone service" is a voice or data telephone/telecommunications system based in
whole or substantial part on wireless radio communications, whether or not the communications
are subject to regulation by the Washington Utilities and Transportation Commission (WUTC).
This includes cellular mobile service. Cellular mobile service includes other wireless radio
communications services such as specialized mobile radio (SMR), personal communications
services (PCS), and any other evolving wireless radio communications technology which
accomplishes the same purpose as cellular mobile service.
"Competitive telephone service" means the providing by any person of telephone
telecommunications equipment or apparatus, or service related to that equipment or apparatus
such as a repair and maintenance service, if the equipment or apparatus is of a type which can be
provided by persons who are not subject to regulation as telephone companies under Title 80
RCW, and for which a separate charge is made.
"Gross income" means the value proceeding or accruing from the sale of tangible property or
service, and receipts (including all sums earned or charged, whether received or not) by reason of
the investment of capital in the business engaged in, including rentals, royalties, fees, or other
emoluments, however designated (excluding receipts or proceeds from the use or sale of real
property or any interest therein, and proceeds from the sale of notes, bonds, mortgages, or other
evidences of indebtedness, or stocks and the like) and without any deduction on account of the
cost of the property sold, the cost of materials used, labor costs, interest or discount paid, or any
expense whatsoever, and without any deduction on account of losses.
"Gross income from timber sales" means "stumpage value of timber" as defined in Chapter
84.33 RCW minus the costs of production including, but not limited to logging and tracking
costs, fees and excise taxes.
"Page service" means service provided by means of an electronic device that has the ability to
send or receive voice or digital messages transmitted through the local telephone network, via
satellite or any other form of voice or data transmission.
"Reporting period" means a one-month period beginning the first day of each calendar month
(monthly).
"Solid waste collection service" means receiving solid waste from any facility or location
within the City for transfer, processing, treatment, storage, or disposal, including, but not limited
to, all collection services, public or private dumps or landfills, transfer stations, and other similar
operations.
"Solid waste," for purposes of this subsection, means garbage, trash, rubbish, or other material
discarded as worthless or not economically viable for further use, infectious, hazardous, or toxic
wastes, and recyclable or reusable materials collected, in whole or part, for recycling or salvage.
"Telephone business" means the providing by any person of access to a local telephone
network, local telephone network switching service, toll service, cellular or mobile telephone
service, coin telephone services, page service, or the providing of telephonic, video, data, or
2
~(o Utility Taxes
similar communication, or transmission for hire, via a local telephone network, toll line or
channel, cable, microwave, or similar communication or transmission system. The term includes
cooperative or farmer line telephone companies or associations operating exchanges. The term
also includes the provision of transmission to and from the site of an intemet provider via a local
telephone network, toll line or channel, cable, microwave, or similar communication or
transmission system. "Telephone business" does not include the providing of competitive
telephone service, or providing of cable television service, or other providing of broadcast
services by radio or television stations.
3.50.050 Persons subject to tax - Amount. In addition to other taxes or fees that may
be imposed or levied by the City, there is hereby levied upon all persons (including the City)
engaging in business within the City, a fee or tax to be collected as follows:
(a) Gas. Upon every person engaging in the business of transmitting, distributing or the
selling of manufactured or natural gas, a fee or tax equal to six (6) percent of the total gross
income from such business conducted within the City.
(b) Water. Upon every person engaging in the business of providing water utility service,
a fee or tax equal to seven (7) percent of the total gross income from such business conducted
within the City. The total gross income from the business of providing water utility service
includes the "gross income from timber sales" of the utility as that term is defined in this chapter.
(c) Wastewater. Upon every person engaging in the business of providing wastewater
utility service, a fee or tax equal to seven (7) percent of the total gross income from such
business conducted within the City.
(d) Stormwater. Upon every person engaging in the business of providing stormwater
utility service, a fee or tax equal to seven (7) percent of the total gross income from such
business conducted within the City.
(e) Cable. Upon every person engaging in the business of transmitting television signals
by means of a cable distribution system commonly known as television cable service, a fee or tax
equal to seven (7) percent of the total gross income from such business conducted within the
City.
(f) Solid waste. Upon every person engaging in the business of providing solid waste
collection service, a fee or tax equal eleven (11) percent of the total gross income from such
business conducted within the City.
(g) Electricity. Upon every person engaging in the business of producing, transmitting,
distributing or selling electricity, a fee or tax equal to six (6) percent of the total gross income
from such business conducted within the City.
(h) Telephone. Upon every person engaged in carrying on a telephone business for hire
or for sale of a commodity or a service within or partly within the corporate limits of the City, a
Utility Taxes
tax for the privilege of so doing business a tax equal to six percent (6%) of the total gross income
rendered within the City.
(1) "Deductions" In computing the telephone tax, there shall be deducted from the
gross operating revenues the following items:
(i) Amounts derived from transactions in interstate or foreign commerce or
from any business which the City is prohibited from taxing under the Constitutions of the United
States or the State of Washington.
(ii) Amounts derived from that portion of network telephone service, as
defined in RCW 82.04.065, which represents charges to another telecommunications company,
as defined in RCW 80.04.010, for connecting fees, switching charges or carrier access charges
relating to intrastate toll telephone services, or for access to, or charges for, interstate services or
charges for network telephone service that is purchased for the purpose of resale.
(iii) Adjustments made to a billing or to a customer account or to a
telecommunications company accrual account in order to reverse a billing or charge that had
been made as a result of third-party fraud or other crime and was not properly a debt of a
customer.
(iv) A complete deduction from gross income shall be allowed for credit
losses, only to cellular telephone service companies which keep their regular books of account
on an accrual basis, for cash discounts and credit losses actually sustained by a taxpayer as a
result of telephone service business.
(2) Allocation of Income - Cellular Telephone Service.
(i) Service address: Payments by a customer for the telephone service
from telephones without a fixed location shall be allocated among taxing jurisdictions to the
location of the customer's principal service address during the period for which the tax applies.
(ii) Roaming phones: When the service is provided while a subscriber is
roaming outside the subscriber's normal cellular network area, the gross income shall be assigned
consistent with the taxpayer's accounting system to the location of the originating cell site of the
call, or to the location of the main cellular switching office that switched the call.
3.50.060 Deductions.
(a) There may be deducted from the total gross income, upon which the license fee or tax
is computed, revenues derived from business which the City is prohibited from taxing under the
constitution or laws of the state of Washington or the United States or the Charter of the City.
(b) There may be deducted from the total gross income, upon which the license fee or tax
is computed, the amount of state excise taxes, pursuant to RCW 82.18, imposed directly upon
Utility Taxes
persons using the service of a solid waste collection business and collected for payment to the
state by the solid waste collection business.
(c) There may be deducted from the total gross income, upon which the license fee or tax
is imposed under Section 3.50.050, revenues derived from providing the service of collecting
recyclable materials, as follows:
(1) commercial recycling: revenues derived from the service of collecting
commercial recyclable materials. This exemption is limited to materials actually resold and
computed in proportion to weight, as follows:
(i) any weight added by processing or treatment after collection is
subtracted from the weight as sold to obtain the allowable weight as sold; and
(ii) revenues are multiplied by a fraction, the numerator of which is the
allowable weight as sold and the denominator of which is the weight as collected.
(2) This deduction does not apply to any energy recovery or fuel-use process, nor
in any case where materials collected have not been sold for commercial reuse within 100 days
from the date of collection. This period may be extended when a taxpayer shows to the
Department's satisfaction that market conditions necessitate a longer period for sale.
3.50.070 Rules and Regulations. The Director may establish administrative roles and
regulations as deemed appropriate, consistent with this chapter for the purpose of enforcing and
carrying out its provisions.
3.50.080 Severability. If any provision or section of this chapter shall be held void or
unconstitutional, all other parts, provisions, and sections of this chapter not expressly so held to
be void or unconstitutional shall continue in full force and effect.
SECTION2. The rates set forth in Section 3.50.050 of Section 1 of this
Ordinance shall be effective January 1, 2003 and the rates in effect as set forth in Section
5.02.070 immediately prior to its repeal and the adoption of this Ordinance shall remain in effect
until January 1, 2003.
SECTION 3. Severability. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
(10) days from and after its passage, approval and publication as provided by law.
Utility Taxes
APPROVED by the City Council the
PASSED by the City Council the
day of
day of
2002
2002
CAROL ARENDS, Council President
Approved this day of
,2002
CARY BOZEMAN, Mayor
ATTEST:
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
PUBLISHED the
EFFECTIVE the
ORDINANCE NO.
day of ,2002
day of ,2002
R:~EGAL\OrdinancesXAdministration~B&O and Utility Tax~,BMC 3.50, Utility Tax .doc
6
Utility Taxes
AGENDA BILL
BREMERTON CITY COUNCIL
1. SUBJECT: PUBLIC HEARING ON
ORDINANCE RELATING TO ADMINISTRATIVE
PROVISIONS FOR TAXES
2. CLEARANCES: (Comment on back if necessary)
~~S~, D~irector of Administrative Services
1~~ LU~OVIC~, City Attorney
F IRMAN
OPERA'"i~DN$; EI~AIRMAN
ENDORS~
'~ATION ['~
FOR AGENDA: ~ and Dec. 18, 2002
ORIGINATING DEPT: City Attorney's Office
ORIGINATOR: Roger A. Lubovich
DATE SUBMITTED: Nov. 22, 2002
3. EXHIBITS:
PROPOSED ORDINANCE
APPROVED FOR SUBMITTAL:
COUNCIL PRESIDENT
4. SUMMARY STATEMENT AND REQUIREMENT FOR COUNCIL ACTION:
The proposed ordinance creates a new BMC chapter, which establishes new provisions for the administration of
City codes relating to business licenses, business and occupation taxes, utility taxes, and other City codes
making reference to said chapter.
5. RECOMMENDATION:
Move to pass Ordin=ce No. ~ ~ on second reading.
7. NOTICE OF ACTION:
PULLED [--] TABLED [--[
COUNCIL DIRECTIVE:
APPROVED []
6. RESPONSIBLE OFFICIAL:
ENFORCEMENT OFFICIAL:
EXPIRATION DATE:
REVIEW DATE: ~D~~8~I~
DISAPPROVED ~] AMENDED
8. AGENDA BILL NO.:
ql
9. IMPACT OF NON-PASSAGE:
10. IMPACT ON STAFFING, BUDGETS, FACILITIES, EQUIPMENT OR OTHER RESOURCES:
11. RESEARCH SOURCES:
ORDINANCE NO.
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, creating a new chapter of the Bremerton
Municipal Code, Chapter 3.86 entitled "Administrative Provisions
for Taxes" establishing new provisions for the administration of
City codes relating to business licenses, business and occupation
taxes, utility taxes, and other City codes making reference to
Chapter 3.86 for the administration of said codes.
WHEREAS, the provisions relating to business licenses, business and occupation
taxes, and utility taxes are contained in one chapter of the Bremerton Municipal Code; and
WHEREAS, separating business license, business and occupation taxes and utility
taxes into separate chapters and creating another chapter relating to the administration of said
codes in this ordinance and in companion ordinances considered concurrently with this
ordinance, would assist in the interpretation and administration of the various provisions related
to each code; and
WHEREAS, the City Council desires to create a new chapter relating to the
administration of city codes relating to business licenses, business and occupation taxes, utility
taxes, and other city codes making reference to Chapter 3.86 based on a model code established
through the Association of Washington Cities for the purpose of creating a uniform system for
administration of said codes; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. A new chapter, Chapter 3.86 entitled "Administrative Provisions
for Taxes" is hereby created to read as follows:
CHAPTER 3.86
ADMINISTRATIVE
PROVISIONS FOR TAXES
3.86.015 Application of chapter stated. The provisions of this chapter shall apply with
respect to the licenses and taxes imposed under chapter 5.02 BMC "General Business Licenses",
chapter 3.48 BMC "Business and Occupation Taxes", chapter 3.50 BMC "Utility Taxes" and
under other titles, chapters, and sections in such manner and to such extent as indicated in each
such title, chapter or section.
3.86.020 Definitions. For purposes of this chapter:
1
Administrative Provisions for Taxes
The definitions contained in chapter 3.48 BMC shall apply equally to the provisions of this
chapter unless the term is defined otherwise in this chapter. In addition, the following definitions
will apply.
"Reporting period." "Reporting period" means:
(1) A one-month period beginning the first day of each calendar month (monthly); or
(2) A three-month period beginning the first day of January, April, July or October of each year
(quarterly); or
(3) A twelve-month period beginning the first day of January of each year (annual).
"Return." "Return" means any document a person is required by the City to file to satisfy or
establish a tax or fee obligation that is administered or collected by the City and that has a
statutorily defined due date.
"Successor." "Successor" means any person to whom a taxpayer quitting, selling out,
exchanging, or disposing of a business sells or otherwise conveys, directly or indirectly, in bulk
and not in the ordinary course of the taxpayer's business, any part of the materials, supplies,
merchandise, inventory, fixtures, or equipment of the taxpayer. Any person obligated to fulfill
the terms of a contract shall be deemed a successor to any contractor defaulting in the
performance of any contract as to which such person is a surety or guarantor.
"Tax year," "taxable year." "Tax year" or "taxable year" means the calendar year.
3.86.040 When due and payable - Reporting periods - Monthly, quarterly, and
annual returns. Threshold provisions or Relief from filing requirements - Computing time
periods - Failure to file returns.
(1) Other than any annual license fee or registration fee assessed under chapter 5.02 BMC, the
tax imposed by those chapters set forth in BMC 3.86.015 shall be due and payable in quarterly
installments unless otherwise specifically provided for therein. At the Director's discretion,
businesses may be assigned to a monthly or annual reporting period depending on the tax amount
owing or type of tax. Tax payments are due on or before the last day of the next month
following the end of the assigned reporting period covered by the return.
(2) Taxes shall be paid as provided in this chapter and accompanied by a return on forms as
prescribed by the Director. The return shall be signed by the taxpayer personally or by a
responsible officer or agent of the taxpayer. The individual signing the return shall swear or
affirm that the information in the return is complete and true.
(3) Tax returns must be filed and returned by the due date whether or not any tax is owed.
(4) A taxpayer that commences to engage in business activity shall file a return and pay the tax
or fee for the portion of the reporting period during which the taxpayer is engaged in business
activity.
(5) Except as otherwise specifically provided by any other provision of this chapter, in
computing any period of days prescribed by this chapter the day of the act or event from which
the designated period of time runs shall not be included. The last day of the period shall be
included unless it is a Saturday, Sunday, or City or Federal legal holiday, in which case the last
2
Administrative Provisions for Taxes
day of such period shall be the next succeeding day which is neither a Saturday, Sunday, or City
or Federal legal holiday.
(6) If any taxpayer fails, neglects or refuses to make a return as and when required in this
chapter, the Director is authorized to determine the amount of the tax or fees payable by
obtaining facts and information upon which to base the Director's estimate of the tax or fees due.
Such assessment shall be deemed prima facie correct and shall be the amount of tax owed to the
City by the taxpayer. The Director shall notify the taxpayer by mail of the amount of tax so
determined, together with any penalty, interest, and fees due; the total of such amounts shall
thereupon become immediately due and payable.
3.86.050 Payment methods - Mailing returns or remittances - Time extension -
Deposits - Recording payments - Payment must accompany return - NSF checks.
(1) Taxes shall be paid to the Director in United States currency by bank draft, certified check,
cashier's check, personal check, money order, cash, or by wire transfer or electronic payment if
such wire transfer or electronic payment is authorized by the Director. If payment so received is
not paid by the bank on which it is drawn, the taxpayer, by whom such payment is tendered,
shall remain liable for payment of the tax and for all legal penalties, the same as if such payment
had not been tendered. Acceptance of any sum by the Director shall not discharge the tax or fee
due unless the amount paid is the full amount due.
(2) A return or remittance that which is transmitted to the City by United States mail shall be
deemed filed or received on the date shown by the cancellation mark stamped by the Post Office
upon the envelope containing it. The Director may allow electronic filing of returns or
remittances from any taxpayer. A return or remittance which is transmitted to the City
electronically shall be deemed filed or received according to procedures set forth by the Director.
(3) If a written request is received prior to the due date, the Director, for good cause, may grant,
in writing, additional time within which to make and file returns.
(4) The Director shall keep full and accurate records of all funds received or refunded. The
Director shall apply payments first against all penalties and interest owing, and then upon the
tax, without regard to any direction of the taxpayer.
(5) For any return not accompanied by a remittance of the tax shown to be due thereon, the
taxpayer shall be deemed to have failed or refused to file a return and shall be subject to the
penalties and interest provided in this chapter.
(6) Any payment made that is returned for lack of sufficient funds or for any other reason will
not be considered received until payment by certified check, money order, or cash of the original
amount due, plus a "non-sufficient funds" (NSF) charge of forty dollars ($40.00) is received by
the Director. Any license issued upon payment with a NSF check will be considered void, and
shall be returned to the Director. No license shall be reissued until payment (including the forty
dollars ($40.00).NSF fee) is received.
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Administrative Provisions for Taxes
(7) The Director is authorized, but not required, to mail tax return forms to taxpayers, but failure
of the taxpayer to receive any such forms shall not excuse the taxpayer from filing returns and
making payment of the taxes or fees, when and as due under this chapter.
3.86.060 Records to be preserved - Examination - Estoppel to question assessment.
Every person liable for any fee or tax imposed by this chapter shall keep and preserve, for a
period of five (5) years after filing a tax return, such records as may be necessary to determine
the amount of any fee or tax for which the person may be liable; which records shall include
copies of all federal income tax and state tax returns and reports made by the person. All books,
records, papers, invoices, vendor lists, inventories, stocks of merchandise, and other data
including federal income tax and state tax returns and reports shall be open for examination at
any time by the Director or its duly authorized agent. Every person's business premises shall be
open for inspection or examination by the Director or a duly authorized agent.
(1) If a person does not keep the necessary books and records within the City, it shall be
sufficient if such person (a) produces within the City such books and records as may be required
by the Director, or (b) bears the cost of examination by the Director's agent at the place where
such books and records are kept; provided that the person electing to bear such cost shall pay in
advance to the Director the estimated amount thereof including round-trip fare, lodging, meals
and incidental expenses, subject to adjustment upon completion of the examination.
(2) Any person who fails, or refuses a Department request, to provide or make available records,
or to allow inspection or examination of the business premises, shall be forever barred from
questioning in any court action, the correctness of any assessment of taxes made by the City for
any period for which such records have not been provided, made available or kept and preserved,
or in respect of which inspection or examination of the business premises has been denied. The
Director is authorized to determine the amount of the tax or fees payable by obtaining facts and
information upon which to base the estimate of the tax or fees due. Such fee or tax assessment
shall be deemed prima facie correct and shall be the amount of tax owing the City by the
taxpayer. The Director shall notify the taxpayer by mail the amount of tax so determined,
together with any penalty, interest, and fees due; the total of such amounts shall thereupon
become immediately due and payable.
3.86.070 Accounting methods.
(1) A taxpayer may file tax returns in each reporting period with amounts based upon cash
receipts only if the taxpayer's books of account are kept on a cash receipts basis. A taxpayer that
does not regularly keep books of account on a cash receipts basis must file returns with amounts
based on the accrual method.
(2) The taxes imposed and the returns required, hereunder, shall be upon a calendar year basis.
3.86.080 Public work contracts - Payment of fee and tax before final payment for
work. The Director may, before issuing any final payment to any person performing any public
work contract for the City, require such person to pay in full all license fees or taxes due under
this title from such person on account of such contract or otherwise, and may require such
4
Administrative Provisions for Taxes
taxpayer to file with the Director a verified list of all subcontractors supplying labor and/or
materials to the person in connection with said public work.
3.86.090 Underpayment of tax, interest, or penalty - Interest - Limitations.
(1) If, upon examination of any returns, or fi'om other information obtained by the Director, it
appears that a tax or penalty less than that properly due has been paid, the Director shall assess
thc additional amount found to be duc and shall add thereto interest on thc tax only. The
Director shall notify the person by mail of the additional amount, which shall become due and
shall be paid within thirty (30) days from the date of the notice, or within such time as thc
Director may provide in writing.
(2) Interest calculation on underpayments.
(a) Interest on underpayments of taxes for periods prior to January 1, 2003, shall be
computed from the date of underpayment until paid at a rate of one percent for each month, or
portion thereof, compounded monthly.
(b) Interest imposed on or at, er January 1, 2003, shall be computed fi.om the last day of
the month following the end of the reporting period and will continue to accrue until payment is
made. In case of an audit the interest shall be computed from the first day of the month
following each calendar year or portion thereof included in the audit period. The rate of interest
to be charged to the taxpayer shall be an average of the federal short-term rate as defined in 26
U.S.C. Sec. 1274(d) plus two percentage points. The rate shall be computed by taking an
arithmetical average to the nearest percentage point of the federal short-term rate, compounded
annually, for the months of January, April, July, and October of the year immediately preceding
the calendar year as published by the United States Secretary of the Treasury. The rate shall be
adjusted on the first day of January of each year for use in computing interest for that calendar
year.
(3) The Director shall not assess, or correct an assessment for, additional taxes, penalties, or
interest due more than four years after the close of the calendar year in which they were incurred,
except that the Director may issue an assessment:
(a) Against a person who is not currently registered or licensed or has not filed a tax
return as required by this chapter for taxes due within the period commencing ten (10) years
prior to the close of the calendar year in which the person was contacted in writing by the
Director;
(b) Against a person that has committed fraud or who misrepresented a material fact; or
(c) Against a person that has executed a written waiver of such limitations.
3.86.100 Over payment of tax, penalty, or interest - Credit or refund - Interest rate -
Statute of limitations.
(1) If, upon receipt of an application for a refund, or during an audit or examination of the
taxpayer's records and tax returns, the Director determines that the amount of tax, penalty, or
5
,4dministrative Provisions for Taxes
interest paid is in excess of that properly due, the excess amount shall be credited to the
taxpayer's account or shall be refunded to the taxpayer. Except as provided in subsection (2) of
this section, no refund or credit shall be made for taxes, penalties, or interest paid more than four
(4) years prior to the beginning of the calendar year in which the refund application is made or
examination of records is completed.
(2) The execution of a written waiver shall extend the time for applying for, or making a refund
or credit of any taxes paid during, or attributable to, the years covered by the waiver if, prior to
the expiration of the waiver period, an application for refund of such taxes is made by the
taxpayer or the Director discovers that a refund or credit is due.
(3) Refunds shall be made by means of vouchers approved by the Director and by the issuance of
a City check or wan'ants drawn upon and payable from such funds as the City may provide.
(4) Any final judgment for which a recovery is granted by any court of competent jurisdiction for
tax, penalties, interest, or costs paid by any person shall be paid in the same manner, as provided
in subsection (3) of this section, upon the filing with the Director a certified copy of the order or
judgment of the court.
(5) Interest calculation on refunds or overpayments.
(a) Interest on overpayments of taxes for periods ending prior to January 1, 2003, shall
be computed at three (3) percent per annum.
(b) Interest on overpayments of taxes for periods beginning on or after January 1, 2003,
shall be an average of the federal short-term rate as defined in 26 U.S.C. Sec. 1274(d) less two
percentage points. The rate shall be computed by taking an arithmetical average to the nearest
percentage point of the federal short-term rate, compounded annually, for the months of January,
April, July, and October of the year immediately preceding the calendar year as published by the
United States Secretary of the Treasury. The rate shall be adjusted on the first day of January of
each year for use in computing interest for that calendar year.
3.86.110 Late payment - Disregard of written instructions - Evasion - Penalties.
(1) If the Director does not receive a return or payment of any tax due on a return by the due
date, the Director shall add a penalty equal to the greater of ten percent (10%) of the amount of
the tax, or ten dollars ($10.00); and if the tax is not received on or before the last day of the
month following the due date, the Director shall add a total penalty equal to the greater of fifteen
percent (15%) of the amount of the tax, or fifteen dollars ($15.00); and if the tax is not received
on or before the last day of the second month following the due date, the Director shall add a
total penalty eqUal to the greater of twenty percent (20%) of the amount of the tax, or twenty
dollars ($20.00).
(2) If payment of any tax assessed by the Director is not received by the due date specified in the
notice, or any extension thereof, the Director shall add a penalty equal to the greater of ten
percent (10%) of the amount of the additional tax found due, or ten dollars ($10.00).
6
Administrative Provisions for Taxes
(3) If the Director determines that all or any part of a deficiency resulted from the taxpayer's
failure to follow specific written tax reporting instructions, there shall be assessed a penalty of
twenty-five percent (25%) of the amount of the additional tax due.
(a) A taxpayer fails to follow specific written tax reporting instructions when the Director
has informed the taxpayer in writing of the taxpayer's tax obligations and the taxpayer fails to act
in accordance with those instructions. The Director shall not assess the penalty under this
subsection upon any taxpayer that has made a good faith effort to comply with the specific
written instructions provided by the Director to that taxpayer.
(b) Specific written instructions may be given as a part of a tax assessment, audit,
determination, or closing agreement, provided that such specific written instructions shall apply
only to the taxpayer addressed or referenced on such documents.
(c) Any specific written instructions by the Director shall be identified as such and shall
inform the taxpayer that failure to follow the instructions may subject the taxpayer to the
penalties imposed by this subsection.
(4) If the Director finds that all or any part of the deficiency resulted from an intent to evade the
tax payable, the Director shall assess a penalty of fifty percent (50%) of the additional tax found
to be due.
(5) The aggregate of penalties imposed under subsections (1) and (2) of this section shall not
exceed thirty percent (30%) of the tax due, and shall not be less than twenty dollars ($20.00).
This subsection does not prohibit or restrict the application of other penalties authorized by law.
(6) The penalties authorized by subsection (3) and (4) shall be assessed in accordance with the
provisions of this chapter governing assessment of tax. The Director shall not impose both the
evasion penalty and the penalty for disregarding specific written instructions on the same tax
found to be due.
3.86.120 Cancellation of penalties.
(1) The Director may cancel any penalties imposed under BMC 3.86.110(1) and (2) if the
taxpayer shows that its failure to timely file or pay the tax was due to reasonable cause and not
willful neglect. Willful neglect is presumed unless the taxpayer shows that it exercised ordinary
business care and prudence in making arrangements to file the return and pay the tax but was,
nevertheless, due to circumstances beyond the taxpayer's control, unable to file or pay by the due
date. The Director has no authority to cancel any other penalties or to cancel penalties for any
other reason except as provided in subsection (3).
(2) A request for cancellation of penalties must be received by the Director within 30 days after
the date the Department mails the notice that the penalties are due. The request must be in
writing and contain competent proof of all pertinent facts supporting a reasonable cause
determination. In all cases the burden of proving the facts rest upon the taxpayer.
7
Administrative Provisions for Taxes
(3) The Director may cancel the penalties in BMC 3.86.110(1) and (2) one time ifa person:
(a) Is not currently licensed, and filing retums,
(b) Was unaware of its responsibility to file and pay tax, and
(c) Obtained business licenses and filed past due tax returns within 30 days after being
notified by the Department.
(4) The Director shall not cancel any interest charged upon amounts due.
3.86.130 Taxpayer quitting business - Liability of successor.
(1) Whenever any taxpayer quits business, sells out, exchanges, or otherwise disposes of his
business or his stock of goods, any tax payable hereunder shall become immediately due and
payable. Such taxpayer shall, within ten (10) days thereafter, make a return and pay the tax due.
(2) Any person who becomes a successor shall become liable for the full amount of any tax
owing. The successor shall withhold from the purchase price a sum sufficient to pay any tax due
to the city from the taxpayer until such time as: a) the taxpayer shall produce a receipt from the
City showing payment in full of any tax due or a certificate that no tax is due, or b) more than six
(6) months has passed since the successor notified the Director of the acquisition and the
Director has not issued and notified the successor of an assessment.
(3) Payment of the tax by the successor shall, to the extent thereof, be deemed a payment upon
the purchase price. If such payment is greater in amount than the purchase price, the amount of
the difference shall become a debt due such successor from the taxpayer.
(4) Notwithstanding the above, if a successor gives written notice to the Director of the
acquisition, and the Department does not within six (6) months of the date it received the notice
issue an assessment against the taxpayer and mail a copy of that assessment to the successor, the
successor shall not be liable for the tax.
3.86.140 Administrative Appeal. Any person, except one who has failed to comply
with BMC 3.86.060 relating to the maintenance of records, aggrieved by the amount of the fee or
tax determined by the Director to be required under the provisions of this chapter may pay the
amount due and appeal from such determination by filing a written notice of appeal with the
Administrative Hearing Examiner within thirty (30) calendar days from the date written notice of
such amount was mailed to the taxpayer. A filing fee as set forth in chapter 3.01 BMC shall be
submitted with the appeal, which filing fee is required to process the appeal. The Administrative
Hearing Examiner shall, as soon as practical, fix a time and place for the hearing of such appeal,
and shall cause a notice of the time and place thereof to be delivered or mailed to the parties.
The hearing shall be conducted in accord with the provisions of chapter 2.13 BMC. The decision
of the Administrative Hearing Examiner shall indicate the correct amount of the fee or tax
owing.
8
~4dministrative Provisions for Taxes
3.86.160 Director to make rules. The Director shall have the power, from time to time,
to adopt, publish and enforce rules and regulations not inconsistent with this chapter or with law
for the purpose of carrying out the provisions of this chapter and it shall be unlawful to violate or
fail to comply with, any such rule or regulation.
3.86.170 Ancillary allocation authority of Director. The Director is authorized to enter
into agreements with other Washington cities which impose an "eligible gross receipts tax":
(1) To conduct an audit or joint audit of a taxpayer by using an auditor employed by the City of
Bremerton, another city, or a contract auditor, provided, that such contract auditor's pay is not in
any way based upon the amount of tax assessed;
(2) To allocate or apportion the gross proceeds of sales, gross receipts, or gross income of the
business, or taxes due from any person that is required to pay an eligible gross receipts tax to
more than one Washington city.
(3) To apply the City's tax prospectively where a taxpayer has no office or place of business
within the City and has paid tax on all gross income to another Washington city where the
taxpayer is located; provided that the other city maintains an eligible gross receipts tax, and the
income was not derived from contracts with the City.
3.86.180 Mailing of Notices. Any notice required by this chapter to be mailed to any
taxpayer or licensee shall be sent by ordinary mail, addressed to the address of the taxpayer or
licensee as shown by the records of the Director. Failure of the taxpayer or licensee to receive
any such mailed notice shall not release the taxpayer or licensee from any tax, fee, interest, or
any penalties thereon, nor shall such failure operate to extend any time limit set by the provisions
of this chapter. It is the responsibility of the taxpayer to inform the Director in writing about a
change in the taxpayer's address.
3.86.190 Tax declared additional. The license fee and tax herein levied shall be
additional to any license fee or tax imposed or levied under any law or any other ordinance of the
City of Bremerton except as herein otherwise expressly provided.
3.86.200 Public disclosure - Confidentiality - Information sharing.
(1) For purposes of this section, unless a different meaning is clearly established by context, the
following definitions apply:
(a) "Disclose" means to make known to any person in any manner.
(b) "Tax information" means:
(i) A taxpayer's identity;
(ii) The nature, source, or amount of the taxpayer' s income, payments, receipts,
deductions, exemption, credits, assets, liability, net worth, tax liability deficiencies, over
9
Administrative Provisions for Taxes
assessments, or tax payments, whether taken from the taxpayer's books and records or any other
source;
(iii) Whether the taxpayer's return was, is being, or will be examined or subject to
other investigation or processing; or
(iv) Other data received by, recorded by, prepared by, or provided to the Director
with respect to a taxpayer.
PROVIDED, That tax information shall not include data, material, or documents that do not
disclose information related to a specific or identifiable taxpayer.
(2) Tax returns and information are "public records" as that term is defined in RCW 42.17.020.
The Director shall not disclose tax information if disclosure would violate RCW Chapter 42.17
or any other law prohibiting disclosure.
(3) Tax information may be disclosed to the following:
(a) The Mayor, members of the City Council, City Attorney, City Clerk, or their
authorized designees, for official purposes;
(b) Any agency or officer of the United States of America, the State of Washington, or a
tax department of any state, county, city or town, provided that the agency or officer grants
substantially similar privileges to the City, and further provided that the agency or officer shall
not further disclose the tax information except as authorized in this section.
(4) Nothing in this section shall prevent the use of tax information by the Director or any other
agency in any civil or criminal action involving any license, tax, interest, or penalty.
(5) A person disclosing tax information to a person not entitled to receive that information under
this section is guilty of a misdemeanor, and if the person violating this privacy requirement is an
officer or employee of the City, such person may be required to forfeit their office or
employment.
3.86.210 Tax constitutes debt. Any license fee or tax due and unpaid under this chapter,
and all interest and penalties thereon, shall constitute a debt to the City of Bremerton and may be
collected in the same manner as any other debt in like amount, which remedy shall be in addition
to all other existing remedies.
3.86.220 Unlawful actions - Violation - Penalties.
(1) It shall be unlawful for any person liable for amounts due under this chapter or under other
chapters as referenced in section 3.86.015:
(a) To violate or fail to comply with any of the provisions of this or the referenced
chapters or any lawful rule or regulation adopted by the Director;
10
Administrative Provisions for Taxes
(b) To intentionally defraud the City or intentionally evade the payment of any tax or part
thereof.
(c) For any person to make any false or fraudulent tax return or false statement in any tax
return, with intent to defraud the City or evade the payment of any tax or part thereof.
(d) To aid or abet any person in any attempt to intentionally defraud the City or
intentionally evade payment of a license fee or tax or any part thereof;
(e) To fail to appear or testify in response to a subpoena issued pursuant to law;
(f) To testify falsely in any investigation, audit, or proceeding conducted pursuant to this
Chapter.
(g) To fail to keep and preserve books and records or for any person to fail or refuse to
permit the examination of any book, paper, record or other data by the City in accordance with
this Chapter; and/or
(h) to violate any of the provisions of this chapter.
(2) Violations-Penalties.
(a) Civil penalties. Any violation of BMC 3.86.220(1) constitutes a civil violation under
chapter 1.04 BMC for which a monetary penalty and costs may be assessed and enforcement of
this chapter may be required as provided for in this chapter and Chapter 1.04 BMC.
(b) Criminal penalties. In addition to the foregoing penalties, any person who violates or
fails to comply with BMC 3.86.220(1) shall, upon conviction, be punished as described in the
general criminal penalty provisions of BMC 1.12.020(2).. Such person will be guilty of this
violation for each day, or portion thereof, during which the business is so engaged or carried on.
(c) In lieu of and as an alternative to a hearing before the Administrative Hearing
Examiner pursuant to BMC 3.86.220(2)(a) above, the City may file an action in a court of
competent jurisdiction to seek enforcement of this chapter and assessment and collection of
penalties, costs and enforcement as provided for in this chapter. Additionally, the City may file
an action in a court of competent jurisdiction to seek enforcement of an order of the
Administrative Hearing Examiner issued pursuant to BMC 3.86.220(2)(a) above.
(d) Penalties or punishments provided in this section are not exclusive, and may be used
in addition to or in conjunction with other enforcement and penalty provisions authorized by the
Bremerton City Code or state law.
3.86.240 Closing agreement provisions. The Director may enter into an agreement in
writing with any person relating to the liability of such person in respect of any tax imposed by
any of the chapters within this title and administered by this chapter for any taxable period(s).
Upon approval of such agreement, evidenced by execution thereof by the Director and the person
11
Administrative Provisions for Taxes
so agreeing, the agreement shall be final and conclusive as to the tax liability or tax immunity
covered thereby, and, except upon a showing of fraud or malfeasance, or misrepresentation of a
material fact:
(1) The case shall not be reopened as to the matters agreed upon, or the agreement modified, by
the Director or the taxpayer, and
(2) In any suit, action or proceeding, such agreement, or any determination, assessment,
collection, payment, abatement, refund, or credit made in accordance therewith, shall not be
annulled, modified, set aside, or disregarded.
3.86.250 Charge-off of uncollectible taxes. The Director may charge off any tax,
penalty, or interest that is owed by a taxpayer, if the Director reasonably ascertains that the cost
of collecting such amounts would be greater than the total amount that is owed or likely to be
collected from the taxpayer. Charge-offs in excess of five thousand dollars $5,000 require City
Council approval.
3.86.260 Severability. If any provision of this chapter or its application to any person or
circumstance is held invalid, the remainder of the chapter or the application of the provision to
other persons or circumstances shall not be affected.
SECTION 2. Severability. If any one or more sections, subsections, or
sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not
affect the validity of the remaining portion of this Ordinance and the same shall remain in full
force and effect.
SECTION 3. Effective Date. This ordinance shall take effect and be in force ten
(10) days from and after its passage, approval and publication as provided by law.
APPROVED by the City Council the
PASSED by the City Council the
day of ,2002
day of ,2002
Approved this day of
CAROL ARENDS, Council President
,2002
ATTEST:
CARY BOZEMAN, Mayor
APPROVED AS TO FORM:
KATHLEEN MCCLUSKEY, City Clerk
ROGER A. LUBOVICH, City Attorney
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Administrative Provisions for Taxes
PUBLISHED the day of ,2002
EFFECTIVE the day of ,2002
ORDINANCE NO.
R:~LEGAL\Ordinances~dministration~B&O and Utility Tax~BMC 3.86, Administrative Provisions .doc
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Administrative Provisions for Taxes