1.5 of Division 2 of the Revenue and Taxation Code;

To adopt a sales and use tax ordinance which 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 1.5 of Division 2 of the Revenue and Taxation Code;

To adopt a sales and use tax ordinance 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 California State Sales and Use Taxes;

To adopt a sales and use tax ordinance which can be administered in a manner that will, to the degree possible consistent with the provisions of Part 1.5 of Division 2 of the Revenue and Taxation Code, minimize the cost of collecting city sales and use taxes and at the same time minimize the burden of record keeping upon persons subject to taxation under the provisions of this section.

(Ord. No. 574, § 4)

16-3.5 Contract with State. Prior to the operative date this city shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of this sales and use tax ordinance; provided, that if this 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 rather than the first day of the first calendar quarter following the adoption of this section.

(Ord. No. 574, § 5)

16-3.6 Sales Tax. For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the city at the rate stated in subsection 16-3.2 of the gross receipts of the retailer from the sale of all tangible personal property sold at retail in this city on and after the operative date.

(Ord. No. 574, § 6)

16-3.7 Place of Sale. For the purposes of this section 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. No. 574, § 7)

16-3.8 Use Tax. An excise tax is hereby imposed on the storage, use or other consumption in this city of tangible personal property purchased from any retailer on and after the operative date for storage, use or other consumption in this city at the rate stated in subsection 16-3.2 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. No. 574, § 8)

16-3.9 Adoption of Provisions of State Law. Except as otherwise provided in this section and except insofar as they are inconsistent with the provisions of Part 1.5 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this section as though fully set forth herein.

(Ord. No. 574, § 9)

16-3.10 Limitations on Adoption of State Law. In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code, wherever the State of California is named or referred to as the taxing agency, the name of this city shall be substituted therefor. The substitution, however, shall not be made when the word "State" is used as part of the title of the State Controller, the State Treasurer, the State Board of Control, the State Board of Equalization, the State Treasury, or the Constitution of the State of California; the substitution shall not be made when the result of that substitution would require action to be taken by or against the city, or any agency thereof rather than by or against the State Board of Equalization, in performing the functions incident to the

administration or operation of this section; the substitution shall not be made 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 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 Division 2 of the Revenue and Taxation Code, or to 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 provisions of that code; the substitution shall not be made in Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code; and the substitution shall not be made for the word "State" in the phrase "retailer engaged in business in this State" in Section 6203 or in the definition of that phrase in Section 6203.

(Ord. No. 574, § 10)

16-3.11 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 seller's permit shall not be required by this section.

(Ord. No. 574, § 11)

16-3.12 Exclusions and Exemptions. There shall be excluded from the measure of tax:

The amount subject to tax shall not include any sales or use tax imposed by the State of California upon a retailer or consumer.

The storage, use or other consumption of tangible personal property, the gross receipts from the sale of which have been subject to tax under a sales and use tax ordinance enacted in accordance with Part 1.5 of Division 2 of the Revenue and Taxation Code by any city and county, county, or city, in this State shall be exempt from the tax due under this section.

There are exempted from the computation of the amount of the sales tax the gross receipts from the sale of tangible personal property to operators of aircraft to be used or consumed principally outside the city 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.

In addition to the exemptions provided in Sections 6366 and 6366.1 of the Revenue and Taxation Code the storage, use, or other consumption of tangible personal property 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 is exempted from the use tax.

(Ord. No. 1047, § 1)

16-3.13 Exclusions and Exemptions. Subsection 16-3.13 shall be operative on the operative date of any act of the Legislature of the State of California which amends Section 7202 of the Revenue and Taxation Code or which repeals and reenacts Section 7202 of the Revenue and Taxation Code to provide an exemption from the sales and use taxes for operators of waterborne vessels in the same, or substantially the same, language as that existing in subdivisions (i)(7) and (i)(8) of Section 7202 as those subdivisions read on October 1, 1983.

There shall be excluded from the measure of tax:

The amount subject to tax shall not include any sales or use tax imposed by the State of California upon a retailer or consumer.

The storage, use, or other consumption of tangible personal property, the gross receipts from the sale of which have been subject to tax under a sales and use tax ordinance enacted in accordance with Part 1.5 of Division 2 of the Revenue and Taxation Code by any city and county, county, or city in this State shall be exempt from the tax due under this section.

There are exempted from the computation of the amount of the sales tax the gross receipts from the sale of tangible personal property to operators of waterborne vessels to be used or consumed principally outside the city in which the sale is made and directly and exclusively in the carriage of persons or property in such vessels for commercial purposes.

The storage, use, or other consumption of tangible personal property purchased by operators of waterborne vessels and used or consumed by such operators directly and exclusively in the carriage of persons or property of such vessels for commercial purposes is exempted from the use tax.

(Ord. No. 574, § 13; Ord. No. 1042, § 1; Ord. No. 1047, § 2)

16-3.14 Reserved.

16-3.15 Amendments. All subsequent amendments of the Revenue and Taxation Code which relate to the sales and use tax and which are not inconsistent with Part 1.5 of Division 2 of the Revenue and Taxation Code shall automatically become a part of this section.

(Ord. No. 574, § 15)

16-3.16 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 this city, or against any officer of the State or this city, to prevent or enjoin the collection under this section or Part 1.5 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.

(Ord. No. 574, § 16)

16-3.17 Penalties. Any person violating any of the provisions of this section shall be deemed guilty of a misdemeanor, and upon conviction thereof shall be liable to the penalty stated in Chapter I, section 1-5.

(Ord. No. 574, § 17)

16-4 - Residential Development Tax.

16-4.1 Title. This tax shall be known as the "Residential Development Tax".

(Ord. No. 462, § 1)

16-4.2 Purpose. The city council hereby declares that the tax required to be paid is assessed pursuant to the taxing power of the City of Novato solely for the purpose of producing revenue.

(Ord. No. 462, § 2; Ord. No. 1125, § 1)

16-4.3 Definitions. As used in this section:

"Bedroom" shall mean any room which may lawfully be used, in whole or in part, for sleeping (except as otherwise determined under subsection 16-4.5).

"City" shall mean the City of Novato, California.

"Dwelling unit" shall mean each single-family dwelling unit and each unit of a duplex, multiple dwelling structure, townhouse or condominium designed as a separate habitation for one or more persons.

"Family" shall mean one or more persons occupying a premises and living as a single nonprofit domestic housekeeping unit.

"Mobile home space" shall mean each space in a mobile home park designed to be used for parking a mobile home on a temporary, semi-permanent or permanent basis,

"Person" shall mean every person, firm, or corporation constructing a dwelling unit or mobile home space directly or through the service of an employee, agent or independent contractor.

(Ord. No. 462, § 3; Ord. No. 1125, § 2)

16-4.4 Tax; Imposition and Application. A tax is hereby imposed by this section in amounts herein set forth and shall be applicable to every dwelling unit and mobile home space, as herein defined for which a building permit is issued or precise development plans approved after the effective date of this section. The tax shall be known as the residential development tax.

(Ord. No. 462, § 4)

16-4.5 Tax; Amount.

Every person constructing a dwelling unit, adding bedrooms to an existing dwelling unit, or providing a mobile home space within the City of Novato shall pay to the city the following tax:

The sum of two hundred ($200.00) dollars for each dwelling unit containing not more than one bedroom, plus the sum of one hundred ($100.00) dollars for a second bedroom, plus the sum of seventy ($70.00) dollars for each additional bedroom in excess of two.

The sum of seventy ($70.00) dollars for each bedroom added to an existing dwelling unit, provided that when an added bedroom replaces an existing bedroom that is converted to a use other than a bedroom, there shall be no charge.

The sum of two hundred ($200.00) dollars for each mobile home space.

The chief building official may exclude from the bedroom count any room which because of size, shape, location, adaptation to a different use or other factor, is not in his judgment reasonably likely to be used for sleeping purposes.

On July 1 of each year, commencing July 1, 1983, the above tax amounts and maximum tax shall be adjusted upward or downward in proportion to percentage increases or decreases in residential building costs after the effective date of this section. For purposes of this paragraph, "residential building costs," shall mean the following: a figure derived from the most recent "Building Valuation Data" published in Building Standards by

the International Conference of Building Officials. The figure shall be one-half the combined cost per square foot of any "good" Type V wood-frame apartment houses and "good" Type V wood-frame dwellings. As of the date of this section, such figure is forty-seven dollars and eighty ($47.80) cents. The fee schedule derived from this computation shall be filed as of July 1 of each year with the city clerk.

(Ord. No. 804, § 1; Ord. No. 992, § 1)

16-4.6 Tax; When Payable. The tax imposed by subsection 16-4.4 shall be due and payable upon issuance of the building permit for the construction of any such dwelling unit or upon request for final approval and granting of a certificate of occupancy for a mobile home park. For all dwelling units, the tax shall be in addition to the fee required to be paid for the building permit and no such building permit shall be issued until the tax is paid. For all mobile home spaces, the tax shall be in addition to all inspection fees required to be paid in the construction of a mobile home park and no final approval or occupancy permit shall be granted until the tax is paid on all mobile home spaces. Such tax shall be refunded only if the building permit issued has expired and no construction is commenced. No refund shall be granted for mobile home spaces upon final approval of the mobile home park.

(Ord. No. 462, § 6)

16-4.7 Waiver of Required Tax. The city council may, upon receipt of a written request from the building permit applicant, waive the required tax for those dwelling units which are to be built as below market rate (BMR) units as defined by the Novato General Plan.

(Ord. No. 992, § 2; Ord. No. 1125, § 3)

16-4.8 Applicability. This section shall apply to all dwelling units on parcels in existence prior to December 18, 1986 or for which a tentative map was approved prior to December 18, 1986.

(Ord. No. 1125, § 4)

16-4.9 Reserved.

16-4.10 Disposition and Use of Tax Receipts. All of the sums collected pursuant to this section shall be deposited in the general fund.

(Ord. No. 462, § 10; Ord. No. 1125, § 5)

16-4.11 Refund Claims. Claims for the refund of taxes imposed pursuant to this chapter shall be governed by the provisions and procedures contained in section 2-17.3 of this code.

(Ord. No. 1466 § 4)

16-5 - Reserved.*

* Editor's Note: Former Section 16-5, Brookside Meadows Open Space Excise Tax, previously codified herein as adopted by the voters of Novato, 11-6-90, and containing portions of Ordinance Nos. 1239 and 1246 was repealed in its entirety by Ordinance No. 1274.

16-6 - Transactions and Use Tax—.25% (2015).

16-6.1 Title. This section shall be known as the City of Novato transactions and use tax ordinance. The City of Novato hereinafter shall be called "city." This section shall be applicable in the incorporated territory of the city.

16-6.2 Operative Date. "Operative date" means the first day of the first calendar quarter commencing more than 110 days after the adoption of this section, the date of such adoption being as set forth below.

16-6.3 Purpose. This section is adopted to achieve the following, among other purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:

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 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.

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.

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.

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 recordkeeping upon persons subject to taxation under the provisions of this section.

16-6.4 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.

16-6.5 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 0.25% 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 section.

16-6.6 Place of Sale. For the purposes of this section, 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/her 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 prescribed and adopted by the state board of equalization.

16-6.7 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 section for storage, use or other consumption in said territory at the rate of 0.25% 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.

16-6.8 Adoption of Provisions of State Law. Except as otherwise provided in this section 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 section as though fully set forth herein.

16-6.9 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:

Wherever the State of California 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 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.

When 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 section.

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.

In sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code.

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.

16-6.10 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 section.

16-6.11 Exemptions and Exclusions.

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- Bums Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax.

There are exempted from the computation of the amount of transactions tax the gross receipt from:

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.

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/her 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 2 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.

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 section.

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 section.

For the purposes of subparagraphs (3) and (4) of this subsection b., 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 section, the storage, use or other consumption in this city of tangible personal property:

The gross receipts from the sale of which have been subject to a transactions tax under any state-administered transactions and use tax ordinance.

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.

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 section.

If the possession 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 section.

For the purposes of subparagraphs (3) and (4) of this subsection c., 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.

Except as provided in subparagraph c.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.

"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.

Any person subject to use tax under this section 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.

16-6.12 Amendments. All amendments subsequent to the effective date of this section 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 section, provided, however, that no such amendment shall operate so as to affect the rate of tax imposed by this section.

16-6.13 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 section, 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.

16-6.14 Citizens Oversight Committee. Prior to the operative date, the city council shall (a) adopt a resolution establishing the composition of a committee of no more than seven residents of Novato to review and report on the revenue and expenditure of funds from the tax adopted by this section, (b) define the scope of the committee's responsibilities, and (c) appoint at least a quorum of the members of the committee. City employees, consultants, or vendors are expressly precluded from serving as members of the citizens oversight committee. The committee's reports shall be made available to the council and public.

16-6.15: Review of the tax by the city council shall take place 20 years after the operative date of this section and every five years thereafter. At the time of said review periods, the city council may repeal the tax imposed by this section by a four-fifths vote of the city council.

(Ord. No. 1601, § 2, 11-3-2015)

Editor's note— Ord. No. 1601, § 2, adopted November 3, 2015, set out provisions to be titled, Transactions and Use Tax. For purposes of clarity, and at the editor's discretion, the title has been amended to read as herein set out.

16-7 - Transactions and Use Tax—.75% (2024).

16-7.1. Title. This section shall be known as the 2024 Novato transactions and use tax ordinance. The City of Novato hereinafter shall be called "city." This section shall be applicable in the incorporated territory of the city.

16-7.2. Operative Date. "Operative date" means the first day of the first calendar quarter commencing more than 110 days after the adoption of this section.

16-7.3. Purpose. This section is adopted to achieve the following, among other purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:

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 section 7285.9 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.

To adopt a retail transactions and use tax ordinance that imposes a tax and provides a measure therefor 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.

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 section.

16-7.4. 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.

16-7.5. 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 0.75% 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 section.

16-7.6. Place of Sale. For the purposes of this section, 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.

16-7.7. 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 section for storage, use or other consumption in said territory at the rate of 0.75% 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.

16-7.8. Adoption of Provisions of State Law. Except as otherwise provided in this section 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 section as though fully set forth herein.

16-7.9. 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:

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:

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;

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 section.

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)

(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.

In sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code.

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.

"A retailer engaged in business in the district" shall also include any retailer that, in the preceding calendar year or the current calendar year, has total combined sales of tangible personal property in this state or for delivery in the state by the retailer and all persons related to the retailer that exceeds five hundred thousand ($500,000) dollars. For purposes of this section, a person is related to another person if both persons are related to each other pursuant to section 267(b) of title 26 of the United States Code and the regulations thereunder.

16-7.10. 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 section.

16-7.11. Exemptions and Exclusions.

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.

There are exempted from the computation of the amount of transactions tax the gross receipts from:

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.

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)

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 section.

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 section, the storage, use or other consumption in this city of tangible personal property:

The gross receipts from the sale of which have been subject to a transactions tax under any state-administered transactions and use tax ordinance.

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 section.

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 section.

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.

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.

Any person subject to use tax under this section 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.

16-7.12. Amendments. All amendments subsequent to the effective date of this section 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 section, provided however, that no such amendment shall operate so as to affect the rate of tax imposed by this section.

16-7.13. Term. The tax imposed by this section shall be effective until repealed by voters.

16-7.14. Citizens' Oversight. A five-member citizens' oversight committee will be created and shall meet annually to review the expenditure of revenues generated by the tax increase imposed under this section and to make recommendations to the city council regarding those expenditures. The minutes of the meetings of the citizens' oversight committee shall be provided to the city council and placed on the next available regular city council meeting agenda for informational purposes.

ted and shall meet annually to review the expenditure of revenues generated by the tax increase imposed under this section and to make recommendations to the city council regarding those expenditures. The minutes of the meetings of the citizens' oversight committee shall be provided to the city council and placed on the next available regular city council meeting agenda for informational purposes.

16-7.15. Audit and Review. The proceeds of the tax imposed by this section, as well as the expenditure thereof, shall be audited annually by an independent accounting firm. The city council shall discuss the results of such audit at a meeting of the city council that is open to the public. The report of such audit shall be posted on the city's website.

16-7.16. 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 section, 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.

(Ord. No. 1717, § 1, 11-5-2024)

Editor's note— Ord. No. 1717, § 1, adopted November 5, 2024, set out provisions to be titled, Transactions and Use Tax. For purposes of clarity, and at the editor's discretion, the title has been amended to read as herein set out.