Chapter 6 — TRANSACTIONS AND USE TAX (1998)

This chapter shall be known as the "Transactions and Use Tax Law" of the city. This chapter shall be applicable in the incorporated territory of the city.

(Ord. 682 C.S., passed 3-4-98)

OPERATIVE DATE means the first day of the first calendar quarter commencing more than 110 days after the adoption of this chapter, the date of such adoption being as set forth below.

(Ord. 682 C.S., passed 3-4-98)

This chapter 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 Cal. Rev. & Tax Code, Part 1.6 (commencing with § 7251) of Division 2, and § 7286.65 of Part 1.7 of Division 2 which authorizes the city to adopt this tax law which shall be operative if a two-thirds 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 law which incorporates provisions identical to those of the State Sales and Use Tax Law insofar as those provisions are not inconsistent with the requirements and limitations contained in Cal. Rev. & Tax Code, Part 1.6 of Division 2.

(C) To adopt a retail transactions and use tax law which imposes a tax and provides a measure therefor that can be administered and collected by the State Board of Equalization in a manner that adapts itself as fully as practicable to, and requires the least possible deviation from the existing statutory and administrative procedures followed by the State Board of Equalization in administering and collecting the state sales and use taxes.

(D) To adopt a retail transactions and use tax law which can be administered in a manner which will be, to the greatest degree possible, consistent with the provisions of Cal. Rev. & Tax Code, Part 1.6 of Division 2, minimize the cost of collecting the transactions and use taxes and at the same time minimize the burden of record keeping upon persons subject to taxation under the provisions of this chapter.

(Ord. 682 C.S., passed 3-4-98)

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 law, 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.

(Ord. 682 C.S., passed 3-4-98)

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-quarter of one (.25) 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 chapter. This amount is in addition to any existing or future authorized state or local sales tax or transactions and use tax. (Ord. 682 C.S., passed 3-4-98)

All net revenues when received and all interest on said revenues shall be placed in an account separate and apart from the general fund and shall be designated for use and used in the providing of Public Safety Services as defined herein consistent with Cal. Gov't Code § 30052 and the net revenues derived herefrom shall be used in addition to, and not to supplant, the level of funding for public safety services that was provided from other revenue sources by the city for the 1996-1997 fiscal year.

(A) Annually, commencing the first Wednesday in November 1999, a report detailing the use of all funds collected pursuant to this chapter shall be presented for review to the City Council at a public meeting.

(B) PUBLIC SAFETY SERVICES includes only the following services administered by the Police Department under the direction of the Chief of Police:

• (1) Gang prevention programs.

• (2) Expanding neighborhood watch programs.

• (3) Supervising offending youths and cleaning up graffiti.

• (4) Police officer training and retention.

• (5) School patrols and gang activity surveillance.

• (6) Additional police officers for neighborhood patrols.

• (7) Providing improved police officer equipment.

• (8) Acquiring and using specially trained dogs to assist in tracking and building and drug searches.

• (Ord. 682 C.S., passed 3-4-98)

For the purposes of this chapter, all retail sales are consummated at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination. The gross receipts from such sales shall include delivery charges, when such charges are subject to the state sales and use tax, regardless of the place to which delivery is made. In the event a retailer has no permanent place of business in the state or has more than one place of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the State Board of Equalization.

(Ord. 682 C.S., passed 3-4-98)

An excise tax is hereby imposed on the storage, use or other consumption in the city of tangible personal property purchased from any retailer on and after the operative date of this chapter for storage, use or other consumption in said territory at the rate of one-quarter of one (.25) 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.

(Ord. 682 C.S., passed 3-4-98)

Except as otherwise provided in this chapter and except insofar as they are inconsistent with the provisions of Cal. Rev. & Tax Code, Part 1.6 of Division 2, all of the provisions of Cal. Rev. & Tax. Code, Part 1 (commencing with § 6001) of Division 2 are hereby adopted and made a part of this chapter as though fully set forth herein. (Ord. 682 C.S., passed 3-4-98)

In adopting the provisions of Cal. Rev. & Tax Code, Part 1 of Division 2:

(A) Wherever the state is named or referred to as the taxing agency, the name of the 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;

(2) The result of that substitution would require action to be taken by or against the city or any agency, officer, or employee thereof rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation of this chapter.

(3) In those sections, including but not necessarily limited to sections referring to the exterior boundaries of the state, 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 remains subject to tax by the state under the provisions of Cal. Rev. & Tax. Code, Part 1 of Division 2; 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 Cal. Rev. & Tax Code §§ 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828.

(B) The word CITY shall be substituted for the word STATE in the phrase "retailer engaged in business in this state" in § 6203 and in the definition of that phrase in § 6203.

(Ord. 682 C.S., passed 3-4-98)

If a seller's permit has been issued to a retailer under Cal. Rev. & Tax Code § 6067, an additional transactor's permit shall not be required by this chapter.

(Ord. 682 C.S., passed 3-4-98)

(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 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 Cal. Veh. Code, Chapter 1 (commencing with § 4000) of Division 3, aircraft licensed in compliance with Cal. Pub. Util. Code § 21411, and undocumented vessels registered under Cal. Veh. Code, Chapter 2 of Division 3.5 (commencing with § 9840) by registration to an out-of-city address and by a declaration under penalty of perjury, signed by the buyer, stating that such address is, in fact, his or her principal place of residence; and

(b) With respect to commercial vehicles, by registration to a place of business out-of-city and declaration under penalty of perjury, signed by the buyer, that the vehicle will be operated from that address.

(3) The sale of tangible personal property if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date of this chapter.

(4) A lease of tangible personal property which is a continuing sale of such property, for any period of time for which the lessor is obligated to lease the property for an amount fixed by the lease prior to the operative date of this chapter.

(5) For the purposes of subsections (3) and (4) of this section, the sale or lease of tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.

(C) There are exempted from the use tax imposed by this chapter the storage, use or other consumption in this city of tangible personal property:

(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 Cal. Rev. & Tax. Code §§ 6366 and 6366.1.

(3) If the purchaser is obligated to purchase the property for a fixed price pursuant to a contract entered into prior to the operative date of this chapter.

(4) If the possession of, or the exercise of any right or power over, the tangible personal property arises under a lease which is a continuing purchase of such property for any period of time for which the lessee is obligated to lease the property for an amount fixed by a lease prior to the operative date of this chapter.

(5) For the purposes of subsections (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 Cal. Veh. Code, Chapter 1 (commencing with § 4000) of Division 3, aircraft licensed in compliance with Cal. Pub. Util. Code § 21411, or undocumented vessels registered under Cal. Veh. Code, Chapter 2 of Division 3.5 (commencing with § 9840). That retailer shall be required to collect use tax from any purchaser who registers or licenses the vehicle, vessel, or aircraft at an address in the city.

(D) Any person subject to use tax under this chapter may credit against that tax any transactions tax or reimbursement for transactions tax paid to a district imposing or retailer liable for a transactions tax pursuant to Cal. Rev. & Tax. Code, Part 1.6 of Division 2, 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.

(Ord. 682 C.S., passed 3-4-98)

All amendments subsequent to the effective date of this chapter to Cal. Rev. & Tax Code, Part 1 of Division 2, relating to sales and use taxes and which are not inconsistent with Cal. Rev. & Tax. Code, Part 1.6 of Division 2, and all amendments to Cal. Rev. & Tax, Code, Part 1.6 of Division 2, shall automatically become a part of this chapter, provided, however, that no such amendment shall operate so as to effect the rate of tax imposed by this chapter. (Ord. 682 C.S., passed 3-4-98)

No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action or proceeding in any court against the state or the city, or against any officer of the state or the city, to prevent or enjoin the collection under this chapter or Cal. Rev. & Tax. Code, Part 1.6 of Division 2, of any tax or any amount of tax required to be collected.

(Ord. 682 C.S., passed 3-4-98)

(A) Upon approval of this chapter by a two-thirds majority of the voters, the city may adopt policies and take such other action as may be necessary for the implementation of the transactions and use tax authorized by this chapter. (B) This chapter shall become effective on June 2, 1998 only if a two-thirds majority of all electors voting on the tax imposed by this chapter at the June 2, 1998 election vote to approve the tax. This chapter shall no longer be effective on and after January 1, 2007.

(Ord. 682 C.S., passed 3-4-98)

Any person violating any of the provisions of this chapter shall be guilty of an infraction and, upon conviction thereof, shall be punished as provided in the State Government Code.

(Ord. 682 C.S., passed 3-4-98)