HomeMy WebLinkAbout4895 o mI cE NO. q qS'
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, amending Chapter 3.86 of the Bremerton
Municipal Code entitled "Administrative Provisions for Taxes" to
clarify provisions relating to apportionment of taxes and Chapter
3.50 of the Bremerton Municipal Code entitled "Utility Taxes" to
amend the definition of gross income relating to utility taxes and to
add a provision to clarify when the tax is due.
WHEREAS, the current provisions of Chapter 3.86 of the Bremerton Municipal
Code relating to apportionment of taxes of multiple taxing jurisdictions are vague as to how
taxes are to be apportioned; and
WHEREAS, the current definition of "gross income" contained in Chapter 3.50 of
the Bremerton Municipal Code relating to utility taxes is not consistent with the definition of
"gross income" as set forth in the Washington Administrative Code for utility taxes; and
WHEREAS, the current provisions of Chapter 3.50 of the Bremerton Municipal
Code needs to be clarified as to when the tax imposed in that chapter is due; and
WHEREAS, the City Council desires to update the provisions of Chapter 3.86
relating to apportionment of taxes and to further update the provisions of Chapter 3.50 relating to
the definition of "gross income" and when the tax imposed pursuant to Chapter 3.50 is due
relating to utility taxes; NOW THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Section 3.86.170 of the Bremerton Municipal Code entitled
"Ancillary Allocation Authority of Director" relating to administrative provisions for taxes is
hereby amended to read as follows:
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 in a manner that fairly reflects gross receipts
earned from activities conducted within the respective cities.
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Utility Taxes
(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.
SECTION2. Chapter 3.50 of the Bremerton Municipal Code entitled "Utility
Taxes" is hereby amended 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.
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" _o ,h .... 1 ....... d.. ........ 1__ c.~ ,h~ ~1~ ^C,~-Mkl~
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Utility Taxes
means the value proceeding or accruing by reason of the business activity engaged in and
operations incidental thereto, and includes gross proceeds of sales, compensation for the
rendition of services and other emoluments, but without any deduction on account of the cost of
the commodity furnished or 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 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
trucking 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
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:
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Utili02 Taxes
(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 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 cartier 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 pumhased 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
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Utility Tares
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 fi.om 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
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 fi.om 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 TAX - WHEN DUE.
The tax imposed by this Chapter shall be due and payable in monthly installments.
3.50 ....080 RULES AND REGULATIONS.
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.
3.50.~9990 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.
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Utility Taxes
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~z~ day of _ct~t~ ,2004
PASSED by the City Council the~f.a(rd_2~ day of t/~_~ ~ ,2004
DAREN NYGRE~nt
Approved this ~ day of ~ · ,2004
CARY OZEMAN, Mayor
PA~~nte'~fim City Clerk
PUBLISHED the.~d- day of , ~ ,2004
EFFECTIVE the.~__~day of
2004
ORDINANCE NO.
R:\LEGAL\OrdinanceskAdmlnistration\Utility Taxes Amend.doc
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Utility Taxes
AFFIDAVIT OF PUBLICATION
No. Ad# 100103751
STATE OF WASHINGTON
COUNTY OF KITSAP
I, Robin Alexander, being first duly sworn on oath, deposes and says: That she is now, and at all times
embraced in the publication herein mentioned was the principal clerk of the printers and publishers of THE
SUN; that said newspaper has been approved as a legal newspaper by order of the Superior Court of the
County of Kitsap, in which County it is published and is now and has been for more than six months prior
to the date of the publication hereinafter referred to, published in the English language continually as a
daily newspaper in Bremerton, Kitsap County, Washington, and is now and during all of said time, was
printed in an office maintained in the aforesaid place of publication of said newspaper; May 4, 2004 and
that such newspaper was regularly distributed to its subscribers during all of said period. That the full
amount of the fee charged for the foregoing publication is the stun of $39.83 which amount has not been
paid in full.
(Signature of Principal Clerk)
Subscribed and sworn tobeforeme this day of May 19,2004.
Notary Public in and for the State of Washington, Kitsap County.
ORDINANCE 4895'
AN ORDINANCE of the City Council of the City of Bremerton, Washington, amending Chapter 3.86 of
the Bremerton Municipal Code entitled "Administrative Provisions for Taxes" to clarify provisions relating
to apportionment of taxes and Chapter 350 of the Bremerton Municipal Code entitled "Utility Taxes" to
amend the definition of gross income relating to utility taxes and to add a provision to clarify when the tax
is due.-
APPROVED by the City Council the 21 st day of April, 2004-
PASSED by the City Council the 28th day of April, 2004-
The full text of this ordinance is available from the City Clerk's Office, 239 Fourth Street, Bremerton, WA
98337.-
May 4, 2004-#100103751-