HomeMy WebLinkAboutOrd. 1503-2015 ORDINANCE NO. 1503-2015
CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA
AN ORDINANCE OF THE CITY OF SOUTH SAN
FRANCISCO ADOPTING CHAPTER 4.36 OF THE
MUNICIPAL CODE TO ENACT A ONE-HALF CENT RATE
TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY
THE STATE BOARD OF EQUALIZATION.
WHEREAS, the City of South San Francisco ("City") has a proud tradition of fiscal
responsibility, including balanced budgets during the recession that maintain services important
to our community; and
WHEREAS, in these recovering economic times the City must maintain current levels of
public safety and other essential services without worrying about future budget cuts; and
WHEREAS, residents want to maintain public safety services, including emergency
response times for police, neighborhood police patrols, crime prevention and gang suppression
programs; and
WHEREAS, residents also want to provide programs for seniors and disabled residents;
and
WHEREAS, residents want to maintain streets and fix potholes to prevent our roads from
falling into further disrepair and address at least $18 million in street maintenance and pothole
repair; and
WHEREAS, the proposed local revenue measure will be spent entirely on local services
and projects that benefit our community with no money for Sacramento and all funds for South
San Francisco; and
WHEREAS, while the City has been effectively addressing gang activities in South San
Francisco, we must continue to ensure that we have adequate local funds to address crime and
keep our city safe; and
WHEREAS, further budget cuts could jeopardize important public safety programs, such
as gang and crime prevention services, neighborhood police patrols and emergency response
times from police; and
WHEREAS, we need a reliable source of local revenue to maintain current levels of
police protection and gang prevention services now and in the future, without worrying about
public safety budget cuts; and
WHEREAS, we must exercise local control over funding in order to maintain firefighter
and paramedic services, neighborhood police patrols, and ensure rapid 9-1-1 emergency response
among other city services; and
WHEREAS, the ordinance includes comprehensive fiscal accountability provisions, such
as annual Independent Financial Audits and Citizens' Oversight of all expenditures, which will
enhance fiscal accountability and transparency; and
WHEREAS, the fiscal accountability safeguards will ensure funds are used efficiently,
effectively and as promised to voters; and
WHEREAS, under the provisions of the laws relating to general law cities in the State of
California, an election shall be held on November 3, 2015, for the submission to the voters of a
question relating to a local one-half cent (0.50%) sales tax; and
WHEREAS, it is desirable that the election be consolidated with the statewide election
to be held on the same date, and that within the City, the precincts, polling places, and election
officers of the two elections be the same; and
WHEREAS, in 2014 the California Legislature and Governor approved Assembly Bill
2028 ("AB 2028"), which is a pilot program permitting certain elections in San Mateo County to
be conducted wholly by mail if specific conditions are met; and
WHEREAS, pursuant to AB 2028, each jurisdiction may determine whether to
participate in this pilot program and whether to authorize its election on a given date to be
conducted by mail, provided, however, that election in question shall not be conducted by mail
pursuant to the pilot program unless all overlapping jurisdictions with elections on that same date
so request; and
WHEREAS, if the election is authorized by all affected jurisdictions to be conducted
pursuant to the AB 2028 pilot program, various actions shall be taken to ensure that voter access
and turnout is protected, including but not limited to the following:
• At least one ballot drop-off location shall be provided in each city;
• A ballot drop-off location shall be open during business hours to receive ballots
beginning 28 days prior to the election through 8 p.m. on the night of the election;
• At least one polling place shall be provided per city between 7 a.m. and 8 p.m. on
election day for voters to request a ballot who did not receive a ballot or who need
a replacement ballot for any reason;
• At the request of any city, county, or district, the Chief Elections Officer may
provide additional ballot drop-off locations and polling places;
• All elections materials, including a prepaid return envelope for the ballot, shall be
provided to each voter;
• A list of ballot drop-off locations and polling places shall be delivered to each
voter; and,
• Polling places shall be located at an accessible location and equipped with voting
machines that are accessible to individuals with disabilities; and
WHEREAS, in general, the cost of conducting an election pursuant to the pilot program
described above is expected to be significantly less overall than a typical election, and this cost
reduction should translate to lower costs to each jurisdiction that participates in the pilot program
election compared to the typical election costs borne by each jurisdiction; and
WHEREAS, the San Mateo County Chief Elections Officer has reported that in San
Mateo County, 57% of registered voters are permanently registered to vote by mail, in the
November 2013 Consolidated Municipal, School, and Special District Election over 76% of the
ballots were cast by mail, and in the June 2014 Primary Election over 77% of the ballots were
cast by mail; and
WHEREAS, the Chief Elections Officer has stated an intention to have the November 3,
2015 Consolidated Municipal, School, and Special District Election be the first mail election
conducted pursuant to the AB 2028 pilot program in San Mateo County; and
WHEREAS, the South San Francisco City Council has considered the merits of the
proposed pilot election program and desires to participate in the pilot program given the
protections for voter access and participation in the election and anticipated cost savings to the
City of South San Francisco provided that at least two (2) Polling Places operate within the City
on Election Day; and
WHEREAS, it is desirable that the County Election Department of the County of San
Mateo canvass the returns of the election and that the election be handled in all respects as if
there were only one election; and
WHEREAS, based on all of the information presented at the July 29, 2015 meeting, both
written and oral, including the staff reports, minutes, and other relevant materials, the City
Council finds that under CEQA Guidelines 15060(c)(2) and 15378, subdivisions (2) and (4) of
subdivision (b), this tax does not constitute a project under CEQA and therefore review under
CEQA is not required.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF SOUTH SAN
FRANCISCO, SUBJECT TO VOTER APPROVAL, DOES HEREBY ORDAIN AS
FOLLOWS:
SECTION 1. Incorporation of Recitals. The City Council of South San Francisco, subject to
voter approval, finds that all Recitals are true and correct and are incorporated herein by
reference.
SECTION 2. Amendment of Municipal Code. Chapter 4.36 of the South San Francisco
Municipal Code is hereby added to read as follows:
4.36.010-Title.
This ordinance shall be known as the "South San Francisco Fiscal Stability and Essential
Services Ordinance." The City of South San Francisco hereinafter shall be called "City." This
ordinance shall be applicable in the incorporated territory of the City.
4.36.020 - Operative Date.
"Operative Date" means the first day of the first calendar quarter commencing more than
-�- 110 days after the adoption of this ordinance, the date of such adoption being as set forth below.
4.36.030 - Purpose.
This ordinance is adopted to achieve the following, among other purposes, and directs
that the provisions hereof be interpreted in order to accomplish those purposes:
A. To impose a retail transactions and use tax in accordance with the provisions of
Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and
Taxation Code and Sections 7285.9, 7293, and 7294 of Part 1.7 of Division 2
which authorize the City to adopt this tax ordinance which shall be operative if a
majority of the electors voting on the measure vote to approve the imposition of
the tax at an election called for that purpose.
B. To adopt a retail transactions and use tax ordinance that incorporates provisions
identical to those of the Sales and Use Tax Law of the State of California insofar
as those provisions are not inconsistent with the requirements and limitations
contained in Part 1.6 of Division 2 of the Revenue and Taxation Code.
C. To adopt a retail transactions and use tax ordinance that imposes a tax and
provides a measure therefore that can be administered and collected by the State
Board of Equalization in a manner that adapts itself as fully as practicable to, and
requires the least possible deviation from, the existing statutory and
administrative procedures followed by the State Board of Equalization in
administering and collecting the California State Sales and Use Taxes.
D. To adopt a retail transactions and use tax ordinance that can be administered in a
manner that will be, to the greatest degree possible, consistent with the provisions
of Part 1.6 of Division 2 of the Revenue and Taxation Code, minimize the cost of
collecting the transactions and use taxes, and at the same time, minimize the
burden of record keeping upon persons subject to taxation under the provisions of
this ordinance.
4.36.040 - Contract With State.
Prior to the operative date, the City shall contract with the State Board of Equalization to
perform all functions incident to the administration and operation of this transactions and use tax
ordinance; provided, that if the City shall not have contracted with the State Board of
Equalization prior to the operative date, it shall nevertheless so contract and in such a case the
operative date shall be the first day of the first calendar quarter following the execution of such a
contract.
4.36.050- Transactions Tax Rate.
For the privilege of selling tangible personal property at retail, a tax is hereby imposed
upon all retailers in the incorporated territory of the City at the rate of one-half percent (0.5%) of
the gross receipts of any retailer from the sale of all tangible personal property sold at retail in
said territory on and after the operative date of this ordinance.
4.36.060 -Place of Sale.
For the purposes of this ordinance, all retail sales are consummated at the place of
business of the retailer unless the tangible personal property sold is delivered by the retailer or
his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state
destination. The gross receipts from such sales shall include delivery charges, when such
charges are subject to the state sales and use tax, regardless of the place to which delivery is
made. In the event a retailer has no permanent place of business in the State or has more than
one place of business, the place or places at which the retail sales are consummated shall be
determined under rules and regulations to be prescribed and adopted by the State Board of
Equalization.
4.36.070- Use Tax Rate.
An excise tax is hereby imposed on the storage, use or other consumption in the City of
tangible personal property purchased from any retailer on and after the operative date of this
ordinance for storage, use or other consumption in said territory at the rate of one-half percent
(0.5%) of the sales price of the property. The sales price shall include delivery charges when
such charges are subject to state sales or use tax regardless of the place to which delivery is
made.
4.36.080 -Adoption of Provisions of State Law.
Except as otherwise provided in this ordinance and except insofar as they are inconsistent
with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the
provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation
Code are hereby adopted and made a part of this ordinance as though fully set forth herein.
4.36.090 - Limitations on Adoption of State Law and Collection of Use Taxes.
In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:
A. Wherever the State of California is named or referred to as the taxing agency, the
name of this City shall be substituted therefor. However, the substitution shall not
be made when:
1. The word "State" is used as a part of the title of the State Controller, State
Treasurer, State Board of Control, State Board of Equalization, State
Treasury, or the Constitution of the State of California;
2. The result of that substitution would require action to be taken by or
against this City or any agency, officer, or employee thereof rather than by
or against the State Board of Equalization, in performing the functions
incident to the administration or operation of this Ordinance.
3. In those sections, including, but not necessarily limited to sections
referring to the exterior boundaries of the State of California, where the
result of the substitution would be to:
a. Provide an exemption from this tax with respect to certain sales,
storage, use or other consumption of tangible personal property
which would not otherwise be exempt from this tax while such
sales, storage, use or other consumption remain subject to tax by
the State under the provisions of Part 1 of Division 2 of the
Revenue and Taxation Code, or;
b. Impose this tax with respect to certain sales, storage, use or other
consumption of tangible personal property which would not be
subject to tax by the state under the said provision of that code.
4. In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715,
6737, 6797 or 6828 of the Revenue and Taxation Code.
B. The word "City" shall be substituted for the word "State" in the phrase "retailer
engaged in business in this State" in Section 6203 and in the definition of that
phrase in Section 6203.
4.36.100- Permit Not Required.
If a seller's permit has been issued to a retailer under Section 6067 of the Revenue and
Taxation Code, an additional transactors permit shall not be required by this ordinance.
4.36.110 -Exemptions and Exclusions.
A. There shall be excluded from the measure of the transactions tax and the use tax the
amount of any sales tax or use tax imposed by the State of California or by any city, city
and county, or county pursuant to the Bradley-Burns Uniform Local Sales and Use Tax
Law or the amount of any state-administered transactions or use tax.
B. There are exempted from the computation of the amount of transactions tax the gross
receipts from:
1. Sales of tangible personal property, other than fuel or petroleum products, to
operators of aircraft to be used or consumed principally outside the county in
which the sale is made and directly and exclusively in the use of such aircraft as
common carriers of persons or property under the authority of the laws of this
State, the United States, or any foreign government.
2. Sales of property to be used outside the City which is shipped to a point outside
the City, pursuant to the contract of sale, by delivery to such point by the retailer
or his agent, or by delivery by the retailer to a carrier for shipment to a consignee
at such point. For the purposes of this paragraph, delivery to a point outside the
City shall be satisfied:
a. With respect to vehicles (other than commercial vehicles) subject to
registration pursuant to Chapter 1 (commencing with Section 4000) of
Division 3 of the Vehicle Code, aircraft licensed in compliance with
Section 21411 of the Public Utilities Code, and undocumented vessels
registered under Division 3.5 (commencing with Section 9840) of the
Vehicle Code by registration to an out-of-City address and by a
declaration under penalty of perjury, signed by the buyer, stating that such
address is, in fact,his or her principal place of residence; and
b. With respect to commercial vehicles, by registration to a place of business
out-of-City and declaration under penalty of perjury, signed by the buyer,
that the vehicle will be operated from that address.
3. The sale of tangible personal property if the seller is obligated to furnish the
property for a fixed price pursuant to a contract entered into prior to the operative
date of this ordinance.
4. A lease of tangible personal property which is a continuing sale of such property,
for any period of time for which the lessor is obligated to lease the property for an
amount fixed by the lease prior to the operative date of this ordinance.
5. For the purposes of subparagraphs (3) and (4) of this section, the sale or lease of
tangible personal property shall be deemed not to be obligated pursuant to a
contract or lease for any period of time for which any party to the contract or lease
has the unconditional right to terminate the contract or lease upon notice, whether
or not such right is exercised.
C. There are exempted from the use tax imposed by this ordinance, the storage, use or other
consumption in this City of tangible personal property:
1. The gross receipts from the sale of which have been subject to a transactions tax
under any state-administered transactions and use tax ordinance.
2. Other than fuel or petroleum products purchased by operators of aircraft and used
or consumed by such operators directly and exclusively in the use of such aircraft
as common carriers of persons or property for hire or compensation under a
certificate of public convenience and necessity issued pursuant to the laws of this
State, the United States, or any foreign government. This exemption is in addition
to the exemptions provided in Sections 6366 and 6366.1 of the Revenue and
Taxation Code of the State of California.
3. If the purchaser is obligated to purchase the property for a fixed price pursuant to
a contract entered into prior to the operative date of this ordinance.
4. If the possession of, or the exercise of any right or power over, the tangible
personal property arises under a lease which is a continuing purchase of such
property for any period of time for which the lessee is obligated to lease the
property for an amount fixed by a lease prior to the operative date of this
ordinance.
5. For the purposes of subparagraphs (3) and (4) of this section, storage, use, or
other consumption, or possession of, or exercise of any right or power over,
tangible personal property shall be deemed not to be obligated pursuant to a
contract or lease for any period of time for which any party to the contract or lease
has the unconditional right to terminate the contract or lease upon notice, whether
or not such right is exercised.
6. Except as provided in subparagraph (7), a retailer engaged in business in the City
shall not be required to collect use tax from the purchaser of tangible personal
property, unless the retailer ships or delivers the property into the City or
participates within the City in making the sale of the property, including, but not
limited to, soliciting or receiving the order, either directly or indirectly, at a place
of business of the retailer in the City or through any representative, agent,
canvasser, solicitor, subsidiary, or person in the City under the authority of the
retailer.
7. "A retailer engaged in business in the City" shall also include any retailer of any
of the following: vehicles subject to registration pursuant to Chapter 1
(commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft
licensed in compliance with Section 21411 of the Public Utilities Code, or
undocumented vessels registered under Division 3.5 (commencing with Section
9840) of the Vehicle Code. That retailer shall be required to collect use tax from
any purchaser who registers or licenses the vehicle, vessel, or aircraft at an
address in the City.
D. Any person subject to use tax under this ordinance may credit against that tax any
transactions tax or reimbursement for transactions tax paid to a district imposing, or
retailer liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and
Taxation Code with respect to the sale to the person of the property the storage, use or
other consumption of which is subject to the use tax.
4.36.120 -Amendments.
All amendments subsequent to the effective date of this ordinance to Part 1 of Division 2
of the Revenue and Taxation Code relating to sales and use taxes and which are not inconsistent
with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all amendments
to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically
become a part of this ordinance, provided however, that no such amendment shall operate so as
to affect the rate of tax imposed by this ordinance.
4.36.130 -Enjoining Collection Forbidden.
No injunction or writ of mandate or other legal or equitable process shall issue in any
suit, action or proceeding in any court against the State or the City, or against any officer of the
State or the City, to prevent or enjoin the collection under this ordinance, or Part 1.6 of Division
2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.
4.36.140 - Citizens' Oversight and Annual Audit.
A. There shall be a five-person committee appointed by the City Council to review and
report on the receipt of revenue and expenditure of funds from the tax authorized by this
Section ("revenues and expenditures"). Members of the Committee shall be residents of
the City or representatives of businesses located in the City.
B. Beginning with the fiscal year that ends June 30, 2016, the City's independent auditors
shall, as part of their annual audit of the City's financial statements, review the collection
and expenditure of revenue from the tax authorized by this Chapter. The auditors' review
shall be a public document. The committee shall annually review the auditors' findings
and report in writing to the City Council regarding the accuracy of the auditors' findings
regarding the revenues and expenditures. The committee's statement shall be transmitted
through the City Manager's Office to the City Council for consideration at a public
meeting.
C. By July 1, 2016, the City Council shall adopt a resolution establishing the composition of
the committee and defining the scope of its responsibilities consistent with this section.
Provisions defining the scope of committee responsibilities and reporting requirements
shall address bond oversight, in the event that a decision is made at a later time to sell
bonds that are in part backed by the revenues referenced in this section. The City Council
shall appoint the initial members of the committee no later than December 31, 2016.
4.36.150—Amendments by City Council.
The following amendments to this Chapter must be approved by the voters of the City:
increasing the tax rate or revising the methodology for calculating the tax such that a tax increase
would result; imposing the tax on transactions and uses not previously subject to the tax (unless
such amendment occurs automatically by operation of Section 12); or extending the tax. The
City Council may otherwise amend this Chapter without submitting the amendment to the voters
for approval.
4.36.160 -Termination Date.
The authority to levy the tax imposed by this ordinance shall expire on the thirtieth anniversary
of the operative date (with the last operative day anticipated to be March 31, 2046).
SECTION 3. Adjustment of Appropriations Limit. Pursuant to Article XIIIB of the
Constitution of the State of California and applicable laws, the appropriations limit for the City is
hereby increased by the aggregate sum authorized to be levied by this tax for fiscal year 2015-16
and each year thereafter.
SECTION 4. Compliance with the California Environmental Quality Act. The approval of this
ordinance is exempt from the California Environmental Quality Act (Public Resources Code §§
21000 et seq., "CEQA," and 14 Cal. Code Reg. §§ 15000 et seq., "CEQA Guidelines"). This
ordinance imposes a general tax that can be used for any legitimate governmental purpose; it is
not a commitment to any particular action. As such, under CEQA Guidelines section
15378(b)(4), the ordinance is not a project within the meaning of CEQA because it creates a
government funding mechanism that does not involve any commitment to any specific project
that may result in a potentially significant physical impact on the environment. If revenue from
the tax were used for a purpose that would have either such effect, the city would undertake the
required CEQA review for that particular project. Therefore, pursuant to CEQA Guidelines
section 15060, CEQA analysis is not required.
SECTION 5. Severability.
If any provision of this ordinance or the application thereof to any person or circumstance
is held invalid, the remainder of the ordinance and the application of such provision to other
persons or circumstances shall not be affected thereby.
SECTION 6. Effective Date.
This ordinance relates to the levying and collecting of the City transactions and use taxes
and shall take effect immediately.
SECTION 7. Voter Approval Required.
This ordinance shall only become operative if the tax imposed is approved by a simple
majority of voters voting on the question at the November 3, 2015 election.
Introduced and adopted at a regular meeting of the City Council of the City of South San
Francisco, held the 22nd day of July, 2015.
Subject to voter approval, adopted as an Ordinance of the City of South San Francisco at
an Adjourned regular meeting of the City Council held the 29th day of July, 2015 by the
following vote:
AYES: Councilmembers Karyl Matsumoto, Pradeep Gupta, and Liza Normandy
Vice Mayor Mark N. Addiego and Mayor Richard A. Garbarino
NOES: None
ABSTAIN: None
ABSENT: None
ATTE\';„ A/.L
rene Soto, Acting City Clerk
As Mayor of the City of South San Francisco, I do hereby approve the foregoing
Ordinance this 29th day of July, 2015.
i f
Richard . Garbarino, Mayor
AGREEMENT FOR STATE ADMINISTRATION
OF CITY TRANSACTIONS AND USE TAXES
The City Council of the City of SOUTH SAN FRANCISCO has adopted, and the voters of the
City of SOUTH SAN FRANCISCO (hereafter called "City" or "District") have approved by the
required majority vote, the City of SOUTH SAN FRANCISCO Transactions and Use Tax Ordinance
(hereafter called "Ordinance"), a copy of which is attached hereto. To carry out the provisions of Part
1.6 of Division 2 of the Revenue and Taxation Code and the Ordinance, the State Board of
Equalization, (hereinafter called the "Board") and the City do agree as follows:
ARTICLE I
DEFINITIONS
Unless the context requires otherwise, wherever the following terms appear in the Agreement,
they shall be interpreted to mean the following:
1. "District taxes" shall mean the transactions and use taxes, penalties, and interest imposed
under an ordinance specifically authorized by Revenue and Taxation code Section 7285.9, and in
compliance with Part 1.6, Division 2 of the Revenue and Taxation Code.
2. "City Ordinance" shall mean the City's Transactions and Use Tax Ordinance referred to
above and attached hereto, Ordinance No.1503-2015, as amended from time to time, or as deemed to
be amended from time to time pursuant to Revenue and Taxation Code Section 7262.2.
ARTICLE II
ADMINISTRATION AND COLLECTION
OF CITY TAXES
A. Administration. The Board and City agree that the Board shall perform exclusively all
functions incident to the administration and operation of the City Ordinance.
B. Other Applicable Laws. City agrees that all provisions of law applicable to the
administration and operation of the State Sales and Use Tax Law which are not inconsistent with Part
1.6 of Division 2 of the Revenue and Taxation Code shall be applicable to the administration and
operation of the City Ordinance. City agrees that money collected pursuant to the City Ordinance may
be deposited into the State Treasury to the credit of the Retail Sales Tax Fund and may be drawn from
that Fund for any authorized purpose, including making refunds, compensating and reimbursing the
Board pursuant to Article IV of this Agreement, and transmitting to City the amount to which City is
entitled.
C. Transmittal of money.
1. For the period during which the tax is in effect, and except as otherwise provided herein, all
district taxes collected under the provisions of the City Ordinance shall be transmitted to City
periodically as promptly as feasible, but not less often than twice in each calendar quarter.
2. For periods subsequent to the expiration date of the tax whether by City's self-imposed
limits or by final judgment of any court of the State of California holding that City's ordinance is
invalid or void, all district taxes collected under the provisions of the City Ordinance shall be
transmitted to City not less than once in each calendar quarter.
3. Transmittals may be made by mail or electronic funds transfer to an account of the City
designated and authorized by the City. A statement shall be furnished at least quarterly indicating the
amounts withheld pursuant to Article IV of this Agreement.
D. Rules. The Board shall prescribe and adopt such rules and regulations as in its judgment
are necessary or desirable for the administration and operation of the City Ordinance and the
distribution of the district taxes collected thereunder.
E. Preference. Unless the payor instructs otherwise, and except as otherwise provided in this
Agreement, the Board shall give no preference in applying money received for state sales and use
taxes, state-administered local sales and use taxes, and district transactions and use taxes owed by a
taxpayer, but shall apply moneys collected to the satisfaction of the claims of the State, cities, counties,
cities and counties, redevelopment agencies, other districts, and City as their interests appear.
(Rev. 11/15) 2
F. Security. The Board agrees that any security which it hereafter requires to be furnished by
taxpayers under the State Sales and Use Tax Law will be upon such terms that it also will be available
for the payment of the claims of City for district taxes owing to it as its interest appears. The Board
shall not be required to change the terms of any security now held by it, and City shall not participate in
any security now held by the Board.
G. Records of the Board.
When requested by resolution of the legislative body of the City under section 7056 of the
Revenue and Taxation Code, the Board agrees to permit authorized personnel of the City to examine
the records of the Board, including the name, address, and account number of each seller holding a
seller's permit with a registered business location in the City, pertaining to the ascertainment of
transactions and use taxes collected for the City. Information obtained by the City from examination of
the Board's records shall be used by the City only for purposes related to the collection of transactions
and use taxes by the Board pursuant to this Agreement.
H. Annexation. City agrees that the Board shall not be required to give effect to an
annexation, for the purpose of collecting, allocating, and distributing District transactions and use
taxes, earlier than the first day of the calendar quarter which commences not less than two months after
notice to the Board. The notice shall include the name of the county or counties annexed to the
extended City boundary. In the event the City shall annex an area, the boundaries of which are not
coterminous with a county or counties, the notice shall include a description of the area annexed and
two maps of the City showing the area annexed and the location address of the property nearest to the
extended City boundary on each side of every street or road crossing the boundary.
ARTICLE III
ALLOCATION OF TAX
A. Allocation. In the administration of the Board's contracts with all districts that impose
transactions and use taxes imposed under ordinances, which comply with Part 1.6 of Division 2 of the
Revenue and Taxation Code:
(Rev. 11/15) 3
1. Any payment not identified as being in payment of liability owing to a designated
district or districts may be apportioned among the districts as their interest appear, or, in the discretion
of the Board, to all districts with which the Board has contracted using ratios reflected by the
distribution of district taxes collected from all taxpayers.
2. All district taxes collected as a result of determinations or billings made by the Board,
and all amounts refunded or credited may be distributed or charged to the respective districts in the
same ratio as the taxpayer's self-declared district taxes for the period for which the determination,
billing, refund or credit applies.
B. Vehicles, Vessels, and Aircraft. For the purpose of allocating use tax with respect to
vehicles, vessels, or aircraft, the address of the registered owner appearing on the application for
registration or on the certificate of ownership may be used by the Board in determining the place of
use.
ARTICLE IV
COMPENSATION
The City agrees to pay to the Board as the Board's cost of administering the City Ordinance
such amount as is provided for by law. Such amounts shall be deducted from the taxes collected by the
Board for the City.
ARTICLE V
MISCELLANEOUS PROVISIONS
A. Communications. Communications and notices may be sent by first class United States
mail to the addresses listed below, or to such other addresses as the parties may from time to time
designate. A notification is complete when deposited in the mail.
(Rev. 11/15) 4
Communications and notices to be sent to the Board shall be addressed to:
State Board of Equalization
P.O. Box 942879
Sacramento, California 94279-0032
Attention: Supervisor,
Local Revenue Allocation Unit
Communications and notices to be sent to the City shall be addressed to:
City of South San Francisco
Attention: Director of Finance
PO Box 711
South San Francisco, CA 94083
Unless otherwise directed, transmittals of payment of District transactions and use taxes
will be sent to the address above.
B. Term. The date of this Agreement is the date on which it is approved by the Department of
General Services. The Agreement shall take effect on April 1, 2016. This Agreement shall continue
until December 31 next following the expiration date of the City Ordinance, and shall thereafter be
renewed automatically from year to year until the Board completes all work necessary to the
administration of the City Ordinance and has received and disbursed all payments due under that
Ordinance.
C. Notice of Repeal of Ordinance. City shall give the Board written notice of the repeal of
the City Ordinance not less than 110 days prior to the operative date of the repeal.
(Rev. 11/1 5) 5
ARTICLE VI
ADMINISTRATION OF TAXES IF THE
ORDINANCE IS CHALLENGED AS BEING INVALID
A. Impoundment of funds.
1. When a legal action is begun challenging the validity of the imposition of the tax, the
City shall deposit in an interest-bearing escrow account, any proceeds transmitted to it under
Article II. C., until a court of competent jurisdiction renders a final and non-appealable judgment that
the tax is valid.
2. If the tax is determined to be unconstitutional or otherwise invalid, the City shall
transmit to the Board the moneys retained in escrow, including any accumulated interest, within ten
days of the judgment of the trial court in the litigation awarding costs and fees becoming final and non-
appealable.
B. Costs of administration. Should a final judgment be entered in any court of the State of
California, holding that City's Ordinance is invalid or void, and requiring a rebate or refund to
taxpayers of any taxes collected under the terms of this Agreement, the parties mutually agree that:
1. Board may retain all payments made by City to Board to prepare to administer the City
Ordinance.
2. City will pay to Board and allow Board to retain Board's cost of administering the City
Ordinance in the amounts set forth in Article IV of this Agreement.
3. City will pay to Board or to the State of California the amount of any taxes plus interest
and penalties, if any, that Board or the State of California may be required to rebate or refund to
taxpayers.
(Rev. 11/15) 6
4. City will pay to Board its costs for rebating or refunding such taxes, interest, or
penalties. Board's costs shall include its additional cost for developing procedures for processing the
rebates or refunds, its costs of actually making these refunds, designing and printing forms, and
developing instructions for Board's staff for use in making these rebates or refunds and any other costs
incurred by Board which are reasonably appropriate or necessary to make those rebates or refunds.
These costs shall include Board's direct and indirect costs as specified by Section 11256 of the
Government Code.
5. Costs may be accounted for in a manner, which conforms to the internal accounting, and
personnel records currently maintained by the Board. The billings for such costs may be presented in
summary form. Detailed records will be retained for audit and verification by City.
6. Any dispute as to the amount of costs incurred by Board in refunding taxes shall be
referred to the State Director of Finance for resolution and the Director's decision shall be final.
7. Costs incurred by Board in connection with such refunds shall be billed by Board on or
before the 25th day of the second month following the month in which the judgment of a court of the
State of California holding City's Ordinance invalid or void becomes final. Thereafter Board shall bill
City on or before the 25th of each month for all costs incurred by Board for the preceding calendar
month. City shall pay to Board the amount of such costs on or before the last day of the succeeding
month and shall pay to Board the total amount of taxes, interest, and penalties refunded or paid to
taxpayers, together with Board costs incurred in making those refunds.
CITY OF STATE BOARD OF EQUALIZATION
By B ice'
(Signa re) Adminisifator,
Return Analysis and Allocation Section
Mike Futrell
(Typed Name)
City Manager APPROVED
(Title) i4 2016
A �[
DEPT C
(Rev. 11/15) 7 _
AGREEMENT FOR PREPARATION TO ADMINISTER AND OPERATE
CITY'S TRANSACTIONS AND USE TAX ORDINANCE
In order to prepare to administer a transactions and use tax ordinance adopted in accordance
with the provision of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and
Taxation Code, the City of SOUTH SAN FRANCISCO, hereinafter called City, and the STATE
BOARD OF EQUALIZATION, hereinafter called Board, do agree as follows:
1. The Board agrees to enter into work to prepare to administer and operate a transactions and
use tax in conformity with Part 1.6 of Division 2 of the Revenue and Taxation Code which has been
approved by a majority of the electors of the City and whose ordinance has been adopted by the City.
2. City agrees to pay to the Board at the times and in the amounts hereinafter specified all of
the Board's costs for preparatory work necessary to administer the City's transactions and use tax
ordinance. The Board's costs for preparatory work include costs of developing procedures,
programming for data processing, developing and adopting appropriate regulations, designing and
printing forms, developing instructions for the Board's staff and for taxpayers, and other appropriate
and necessary preparatory costs to administer a transactions and use tax ordinance. These costs shall
include both direct and indirect costs as specified in Section 11256 of the Government Code.
3. Preparatory costs may be accounted for in a manner which conforms to the internal
accounting and personnel records currently maintained by the Board. The billings for costs may be
presented in summary form. Detailed records of preparatory costs will be retained for audit and
verification by the City.
4. Any dispute as to the amount of preparatory costs incurred by the Board shall be referred to
the State Director of Finance for resolution, and the Director's decision shall be final.
5. Preparatory costs incurred by the Board shall be billed by the Board periodically, with the
final billing within a reasonable time after the operative date of the ordinance. City shall pay to the
Board the amount of such costs on or before the last day of the next succeeding month following the
month when the billing is received.
6. The amount to be paid by City for the Board's preparatory costs shall not exceed one
hundred seventy-five thousand dollars ($175,000) (Revenue and Taxation Code Section 7272.)
1
7. Communications and notices may be sent by first class United States mail.
Communications and notices to be sent to the Board shall be addressed to:
State Board of Equalization
P.O. Box 942879 MIC: 27
Sacramento, California 94279-0027
Attention: Supervisor,
Local Revenue Allocation Unit
Communications and notices to be sent to City shall be addressed to:
City of South San Francisco
PO Box 711
South San Francisco, CA 94083
8. The date of this agreement is the date on which it is approved by the Department of General
Services. This agreement shall continue in effect until the preparatory work necessary to administer
City's transactions and use tax ordinance has been completed and the Board has received all payments
due from City under the terms of this agreement.
CITY OF SOUTH SAN FRANCISCO STATE BOARD OF EQUALIZATION
By Al% -r.
(Sign.ture) Aammist?ator,
Return Analysis and Allocation Section
Mike Futrell
(Typed Name)
APPROVED
City Manager
(Title) MAR 1.4 2016
(Rev. H/15)
(; F 7 ,-G'AL
GS
2