Ordinance 3231CITY OF ALAMEDA ORDINANCE NO. 3231
New Series
AMENDING THE ALAMEDA MUNICIPAL CODE BY ADDING
SECTION 3-63 (TRANSACTIONS AND USE TAX) TO DIVISION IX
(TAXES) OF ARTICLE II (TAXATION) OF CHAPTER Ill (FINANCE
AND TAXATION) IMPOSING A TRANSACTIONS AND USE TAX TO
BE ADMINISTERED BY THE CALIFORNIA DEPARTMENT OF TAX
AND FEE ADMINISTRATION
WHEREAS, the City of Alameda (the "City") is a desirable place to live, raise a
family and start a business, with a strong quality of life, unique character and historic,
small-town charm; and
WHEREAS, the City has a strong track record of maintaining a low crime rate and
keeping Alameda a safe place to live; and
WHEREAS, Alameda's Police and Fire Department maintain rapid emergency
response times for 9-1-1 calls for crimes, fires, and medical emergencies; and
WHEREAS, the City's 21 community and neighborhood parks are an important
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part of what makes living here special, and our City takes pride in keeping our parks, . · 1
beaches and waters safe and clean for residents to enjoy; and
WHEREAS, many of Alameda's aging streets and sidewalks require repairs to
potholes, cracks and other deterioration to maintain safety for drivers, pedestrians, and
bicyclists; and
WHEREAS, Alameda's unique position as an island within the San Francisco Bay
requires the City to maintain infrastructure that protects the Bay from pollution and runoff;
and
WHEREAS, the City has been a responsible steward of limited funds, proactively
planning for long-term financial stability and maintaining an adequate emergency reserve;
and
WHEREAS, even with these proactive steps, our City faces a structural deficit of
several million dollars in the coming fiscal years; and
WHEREAS, a deficit of this magnitude will require cuts to essential city services,
including police, fire, and paramedics, leading to slower 9-1-1 emergency response times;
and
n WHEREAS, a deficit of this magnitude will also prevent ongoing investments in
critical infrastructure like maintenance of neighborhood parks, pothole and street repairs,
and other improvements; and
WHEREAS , in order to maintain the City's financial stability and protect general
city services, the City Council is placing a 0.5% transactions and use tax, commonly
referred to as a sales tax, ("Measure") on the ballot at the statewide general election on
November 6, 2018; and
WHEREAS, if enacted , the Measure would provide a local revenue source to
protect public safety, including police response to violent crimes and burglaries, and 9-1-
1 emergency medical and fire response; and
WHEREAS, if enacted, the Measure would also protect Alameda's strong
neighborhood character and quality of life by maintaining neighborhood parks , keeping
our streets safe, repairing potholes and protecting the Bay from pollution; and
WHEREAS, the Measure would apply to visitors who shop in our City, ensuring
that they pay their fair share for their impact on our streets and roads and utilization of
other services; and
WHEREAS, the Measure will maintain the City's comm itment to transparency and
fiscal accountability with all funds raised by the measure being subject to independent
audits and public review of all expenditures ; and
WHEREAS, the state cannot take one penny of the Measure, giving Alamedans
local control over local funds for local needs.
NOW, THEREFORE, BE IT ORDAINED by the People of the City of Alameda that:
Section 1. Ordinance
The Alameda Municipal Code is hereby amended to add Sections 3-63.1 through
3 -63.14, inclusive, (Transactions and Use Tax) of Division IX (Taxes) of Article II
(Taxation) of Chapter Ill (Finance and Taxation) to read as follows :
3-63 TRANSACTIONS AND USE TAX
3-63.1 Title.
This ordinance shall be known as the City of Alameda Transactions and Use Tax
Ordinance. The City of Alameda hereinafter shall be called "City." This ordinance shall
be applicable in the incorporated territory of the City.
3-63.2 Operative Date.
"Operative Date" means the first day of the first calendar quarter commencing
more than 11 0 days after the adoption of this ordinance, the date of such adoption being
as set forth below.
3-63.3 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, except for section 7251.1, and pursuant to
Section 7292.5 of Part 1 . 7 of Division 2 which authorizes 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
California Department of Tax and Fee Administration 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 California Department of Tax and Fee Administration 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.
3-63.4 Contract with State.
Prior to the operative date, the City shall contract with the California Department
of Tax and Fee Administration 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 California Department of Tax and Fee Administration 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.
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3-63.5 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 0.50
percent 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.
3-63.6 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 California Department of Tax and Fee Administration.
3-63.7 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
0.50 percent of the sales price of the property. The sales price shall include delivery
charges when such charges are subject to state sales or use tax regardless of the place
to which delivery is made.
3-63.8 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.
3-63.9 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 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 California Department of Tax and Fee Administration, 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.
3-63.10 Permit Not Required.
If a seller's permit has been issued to a retailer under Section 6067 of the Revenue
and Taxation Code, an additional transactor's permit shall not be required by this
ordinance.
3-63.11 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.
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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.
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 tang ible 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
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any purchaser who registers or licenses the vehicle, vessel, or
aircraft at an address in the City.
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.
3-63.12 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.
3-63.13 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.
3-63.14 Annual Audit.
By no later than March 30 of each year after the operative date, the City's
independent auditors shall complete a report reviewing the collection, management and
expenditure of revenue from the tax levied by this chapter. The report shall be reviewed
by the City Council as part of its review of the annual audit.
Section 2. Voters' Power.
By approving this ordinance, the voters authorize the City Council to amend this
tax without subsequent voter approval so long as such amendment does not increase the
rate of the tax paid by any taxpayer. This tax shall remain in effect until repealed or
amended by the voters.
Section 3. Environmental Compliance.
The tax approved by this Ordinance is not a project for the purposes of the
California Environmental Quality Act (CEQA), pursuant to Guidelines Section
15378(b)(4), which states that a project does not include the creation of government
funding mechanisms or government fiscal activities which do not involve any commitment
to any specific project which may result in a potentially significant physical impact on the
environment. Accordingly, no CEQA review is required.
Section 4. 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 5. Effective Date.
This ordinance relates to the levy and collection of the City's transactions and use
tax and, if approved by the voters, shall take effect on April 1, 2019.
APPROVED by the following vote of the People of the City of Alameda on
November 6, 2018:
YESES-20,320
NOES-12,722
ADOPTED by Declaration of the vote at the November 6, 2018, election by the City
Council of the City of Alameda on this 18th day of December 2018.
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Presiding OffiCefOftt18council
Attest:
La~er,~k
City of Alameda
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I, the undersigned, hereby certify that the foregoing Ordinance was duly and
regularly adopted and passed by Council of the City of Alameda in regular meeting
assembled on the 18th day of December, 2018, by the following vote to wit:
AYES: Councilmembers Ezzy Ashcraft, Matarrese, Oddie, Vella and
Mayor Spencer-5.
NOES: None.
ABSENT: None.
ABSTENTIONS: None.
IN WITNESS, WHEREOF, I have hereunto set my hand and affixed the official
seal of said City this 19th day of December, 2018.
Approved as to Form:
J1JvLlWW Pi /1;(;\.{w(
Michael H. Roush
Interim City Attorney
f4vvcA ~VA
Lara Weisiger, cl# Clerk
City of Alameda