Ordinance 927
ORDINANCE NO. 927
ORDINANCE OF THE CITY OF GILROY ADOPTING AS CHAPTER 26B
OF THE GILROY CITY CODE A TELEPHONE, GAS, ELECTRICITY
AND TELEVISION CABLE USERS TAX, TO BE KNOWN AS A
UTILITY USERS TAX, ESTABLISHING THE RATES OF SAID TAX,
PROVIDING FOR THE ADMINISTRATION AND COLLECTION
THEREOF AND PROVIDING PENALTIES FOR VIOLATION.
THE CITY COUNCIL OF THE CITY OF GILROY DOES ORDAIN AS
FOLLOWS:
SECTION I:
ARTICLE I. GENERAL PROVISIONS.
Sec. 26B.l Title.
This Chapter shall be known as the "Utility Users Tax
Ordinance of the City of Gilroy. If
Sec. 26B.2 Adoption; Charter authority.
This Chapter is adopted pursuant to the powers of the City
of Gilroy as a charter city as provided in Article II,
Section 200, of the City Charter, and as authorized by
Section 6 of Article XI of the Constitution of the State
of California.
Sec. 26B.3 Definittons.
Except where the context otherwise requires, the
definitions contained in this Section shall govern the
construction of this Chapter. The word "may" is always
directory and discretionary and not mandatory; the word
"shall" is always mandatory and not directory or discretion-
ary.
City. "City" shall mean the City of Gilroy, California,
including all of the territory and jurisdiction thereof as
presently constituted, and any and all of the same which
shall later come into existence by any manner or means
whatsoever.
Collector. "Collector" shall mean the Director of Finance
ORDINANCE NO. 927
of the City of Gilroy.
Director. "Director" shall mean the Director of Finance
of the City of Gilroy.
Electrical Corporation, Gas Corporation and Telephone
Corporation.
"Electrical Corporation", "Gas Corporation" and "Telephone
CorporationU shall have the same meanings as defined in
Sections 218, 222, 234, respectively, of the Public Utilties
Code of the State of California.
Month. ''Month'' shall mean a calendar month.
Person. tfperson" shall mean all domestic and foreign
corporations, associations, syndicates, joint stock companies,
partnerships of every kind, joint ventures, clubs,
Massachusetts business or common law trusts, societies, and
individuals, and shall include a municipal corporation.
Service Supplier. "Service Supplieru shall mean a person
required to collect and remit a tax under the provisions of
this Chapter.
Service User. "Service User" shall mean a person required
to pay a tax imposed under the provisions of this Chapter.
Sec. 26B.4. Exemptions.
Nothing contained in this Chapter shall be construed as
imposing a tax upon any person when imposition of such tax
upon that person would be in violqtion of the Constitution
of the United States or that of the State of California.
Sec. 26B.5. Conflicts.
Nothing contained in this Chapter is intended to conflict
with applicable rules, regulations and tariffs of any
service supplier subject to the jurisdiction of the California
Public Utilities Commission. In the event of any conflict,
the provisions of said rules, regulations and tariffs shall
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control.
Sec. 26B.6. Tax; effective date.
The taxes imposed by this Chapter shall become operative
November 1, 1971.
ARTICLE II. TELEPHONE USERS TAX.
Sec. 26B.7. Tax imposed.
There is hereby imposed a tax upon every person in the
City, other than a telephone corporation, using intrastate
telephone communication services in the City. The tax
imposed by this Article shall be at the rate of five (5)
percent of the charges made for such services, and shall
be paid by the person paying for such services.
Sec. 26B.8. Exemptions.
Notwithstanding the provisions of Section 26B.7 the tax
imposed under this Article shall not be imposed upon any
person for using intrastate telephone communication
services to the extent that the amounts paid for such
services are exempt from or not subject to the tax imposed
under Section 4251 of Title 26 of the United States Code, as
said section existed on November 1, 1967.
Sec. 26B.9. Exclusions.
As used in this Article, the term "charges" shall not
include charges for services paid for by inserting coins
in coin-operated telephones except that where such coin-
operated telephone service is furnished for a guaranteed
amount, the amounts paid under such guarantee plus any fixed
monthly or other periodic charge shall be included in the
base for computing the amount of tax due. The words
"telephone Communication services" shall not include land
mobile services or maritime mobile services as defined in
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Section 2.1 of Title 47 of the Code of Federal Regulations,
as said section existed on October 1, 1967.
Sec. 26B. 10.
Tax. collection.
,
The tax imposed in this Article shall be collected from
the service user by the person providing the intrastate
telephone communication services. The amount of tax collected
in one month shall be remitted to the Collector on or before
the last day of the following month.
ARTICLE III. ELECTRICITY USERS TAX.
Sec. 26B.ll. Tax imposed.
There is hereby imposed a tax upon every person in the
City, other than an electrical corporqtion or a gas corporation,
using electrical energy in the City. The tax imposed by this
Article shall be at the rate of five (5) percent of the charges
made for such energy, including minimum charges for service,
and shall be paid by the person paying for such energy.
Sec. 26B.12. Exclusions.
As used in this Article, the words "using electrical
energy" shall not be construed to mean:
(a) The storage of such energy by a person in a battery
owned or possessed by him for use in an automobile or other
machinery or device apart fromthe premises upon which the
energy was received; provided, however, that the term shall
include the receiving of such energy for the purpose of
using it in the charging of batteries; or
(b) the mere receiving of such energy by an electrical
corporation or a government agency at a point within the
City for resale.
Sec. 26B.13. Tax; collection.
The tax imposed in this Article shall be collected from the
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service user by the person selling such electrical energy.
The amount of tax collected in one month shall be remitted to
the Collector on or before the last day of the following
month.
ARTICLE IV. GAS USERS TAX.
Sec. 26B.14. Tax imposed.
There is hereby imposed a tax upon every person in the
City, other than a gas corporation or an electric corporation,
using gas in the City which is delivered through mains or
pipeso The tax imposed by this Article shall be at the rate
of five (5) percent of the charges made for such gas,
including minimum charges for service, and shall be paid
by the person paying for such gas.
Sec. 26B.15. Exclusions.
As used in this Article, the term "charges" shall not
include charges made for gas used in the generation of
electrical energy by a public utility or a governmental
agency, and the term "using gas" shall not be construed to
mean the mere receiving of such gas by a gas corporation or
governmental agency at a point within the City for resale.
Sec. 26B.16. Tax; collection.
The tax imposed in this Article shall be collected from
the service user by the person selling the gas. The amount
collected in one month shall be remitted to the Collector
on or before the last day of the following month.
ARTICLE Vo CABLE: TELEVISION USERS TAX
Seco 26B.17. Tax imposed.
There is hereby imposed a tax upon every person in the
City using cable television service in the City. The tax
imposed by this Article shall be at the rate of five (5)
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percent of the charges made for such service and shall be
paid by the person paying for such service.
Sec. 26B.18.
Tax. collection.
,
The tax imposed in this Article shall be collected from
the service user by the person providing such cable television
service. The amount of tax collected in one month shall be
remitted to the Collector on or before the last day of the
following month.
ARTICLE VI. COLLECTION OF TAX.
Sec. 26B.19. Suit by City.
Any tax required to be paid by a service user under the
provisions of this Chapter shall be deemed a debt owed by
the service user to the City. Any such tax collected from
a service user which has not been remitted to the Collector
shall be deemed a debt owed to the City by the person
required to collect and remit. Any person owing money to
the City under the provisions of this Chapter shall be liable
to an action brought in the name of the City for the recovery
of such amount.
Sec. 26B.20. Duty to collect; procedures.
The duty to collect and remit the taxes imposed by this
Chapter shall be performed as follows:
(a) The tax shall be collected insofar as practicable
at the same time as and along with the charges made in
accordance with regular billing practice of the service
supplier. Except in those cases where a service user pays
the full amount of said charges but does not pay any portion
of a tax imposed by this Chapter, or where a service user
has notified a service supplier that he is refusing to pay
a tax imposed by this Chapter which said service supplier is
required to collect, if the amount paid by a service user
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is less than the full amount of the charge and tax which
has accrued for the billing period, a proportionate share
of both the charge and the tax shall be deemed to have been
paid.
(b) The duty to collect tax from a service user shall
commence with the beginning of the first regular billing
period applicable to that person which starts on or after
the operative date of this Chapter. Where a person receives
more than one billing, one or more being for different
periods than another, the duty to collect shall arise
separately for each billing period.
Sec. 26B.2l. Administrative agreements.
The Director may make administrative agreements to vary the
strict requirements of this Chapter so that collection of
any tax imposed herein may be made in conformance with the
billing procedures of a particular service supplier so long
as the overall result of said agreements results in
collection of tax in conformance with the general purpose
and scope of this Chapter. A copy of each such agreement
shall be on file and available for public examination in the
Director's office.
ARTICLE VII. DELINQUENT TAXES
Sec. 26B.22. Taxes; when delinquent.
Taxes collected from a service user which are not remitted
to the Collector on or before the due dates provided in this
Chapter are delinquent.
Sec. 26B.23. Service supplier; penalty.
In addition to remitting the amount of the tax, any service
supplier who fails to remit any tax imposed by this Chapter
within the time required and upon five (5) days written
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notice ID the service supplier of its failure to remit,
shall pay a penalty of ten percent (10%) of the amount
of the tax which shall be added on the last day of each
month following the date on which remittance was due until
the tax and penalties are remitted.
Sec. 26B.24. Service supplier; fraud; penalty.
If the Collector determines that the non-payment by any
service supplier of any remittance due under this Chapter
is due to fraud, a penalty of twenty-five percent (25%)
of the amount of the tax shall be added thereto in addition
to the penqlty imposed by Section 26B.23.
Sec. 26B.25. Service supplier; interest.
In addition to the penalties imposed by Section 26:6.23.
and 26B.24., any service supplier who fails to remit any tax
imposed by this Chapter shall pay interest at the rate of
one percent (1%) per month, or fraction thereof, on the
amount of the tax, exclusive of penalties, from the date on
which the remittance first became delinquent until paid.
Sec. 26B.26. Service supplier; penalty and interest part of
tax.
Every penalty imposed upon a service supplier and such
interest as accrues, under the provisions of Section 26B.23.
to 26B.25., inclusive, shall become a part of the tax
required to be remitted.
Sec. 26B.27. Service user; penalty.
In addition to paying the amount of the tax, any service
user who fails to pay any tax imposed by this Chapter within
sixty (60) days of the date of the receipt of notice of the
amount of tax due from the service supplier shall pay a
penalty of ten percent (10%) of the amount of the tax which
shall be added on the last day of each month following the
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date on which payment was due until the tax and penalties
are paid.
Sec. 26B.28. Service user; fraud; penalty.
If the Collector determines that the non-payment by any
service user of any tax imposed by this Chapter is due to
fraud, a penalty of twenty-five percent (25%) of the amount
of the tax shall be added thereto in addition to the
penalty imposed by Section 26B.27.
Sec. 26B.29. Service user; interest.
In addition to the penalties imposed by Sections 26B.27.
and 26B.28., any service user who fails to pay any tax imposed
by this Chapter, shall pay interest at the rate of one
percent (1%) per month, or fraction thereof, exclusive of
penalties, from the date on which the remittance first became
delinquent until paid, and a collection charge of ten
dollars ($10.00) for each delinquent account.
Sec. 26B.30. Service user; penalty and interest part of tax.
Every penalty imposed upon a service user, and such interest
as accrues, under the provisions of Sections 26B.27. to
26B.29., inclusive, shall became a part of the tax required
to be paid.
Sec. 26B.3l. Service user; penalties and interest collected
by City.
The penalties, interest, and collection charges imposed in
Sections 26B.27. to 26B.29., inclusive, shall not be
collected by the service supplier, but by the City.
ARTICLE VII. FAILURE TO COLLECT AND REPORT TAX.
Sec. 26B.32. Determination of tax by collector; notice.
If any service supplier shall fail to make, within the time
provided in this Chapter, any report and remittance of said
tax or any portion thereof required by this Chapter, the
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Collector shall proceed in such manner as he may deem best
to obtain facts and information on which to base his esti-
mate of the tax due. As soon as the Collector shall procure
such facts and information as he is able to obtain upon
which to base the assessment of any tax imposed by this
Chapter and payable by any service supplier who has failed
or refused to make such report and remittance, he shall
proceed to determine and assess against such service supplier
the tax, interest and penalties provided for by this Chapter.
In case such determination is made, the Collector shall give
a notice of the amount so assessed by serving it personally
or by depositing it in the United States mail, postage prepaid,
addressed to the service supplier so assessed at his last
known place of address.
Sec. 26B.33. Hearing on determination of tax; application;
notice.
The service supplier may within ten (10) days after the
serving or mailing of the notice referred to in Section
26B.32. make application in writing to the Collector for a
hearing on the amount assessed. If application by the
service supplier for a hearing is not made within the time
prescribed, the tax, interest and penalties, if any,
determined by the Collector shall become final and conslusive
and immediately due and payable. If such application is
made, the Collector shall give not less than five (5) days
written notice in the manner prescribed herein to the
service supplier to show cause at a time and place fixed in
said notice why said amount specified therein should not be
fixed for such tax, interest and penalties. At such hearing,
the service supplier may appear and offer evidence why such
specified tax, interest and penalties should not be so fixed.
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Sec. 26B.34. Determination of tax following hearing; notice;
when due.
After a hearing on the amount of tax assessed, the Collector
shall determine the proper tax to be remitted, and shall
thereafter give written notice to the service supplier in the
manner prescribed above of such determination and the amount
of such tax, interest and penalties. The amount determined
to be due shall be payable after fifteen (15) days unless
an appeal is taken as provided in this Chapter.
Sec. 26B.35. Collection of taxes from service user by City;
Conditions; notice.
Whenever the Collector determines that a service user has
deliberately withheld the amount of any tax imposed on him
by the provisions of this Chapter from the amounts remitted
to a service supplier required to collect the tax, or that
a service user has failed to pay the amount of the tax to
such service s~pplier for a period of four (4) or more
billing periods, or whenever the Collector deems it in the
best interest of the City, he may relieve such service
supplier of the obligation to collect taxes due under this
Chapter from certain named service users for specified
billing periods. The Collector shall notify the service
user that he has assumed responsibility to collect the taxes
due for the stated periods and demand payment of such taxes,
plus any penalty imposed and such interest as may be due
pursuant to the provisions of Article VII of this Chapter.
The notice shall be served on the service user by handing
it to him personally or by deposit of the notice in the
United States mail, postage prepaid thereon, addressed to
the service user at the address to which billing was made by
the service supplier required to collect the tax; or, should
the service user have changed his address, to his last known
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address.
ARTICLE IX. AfPEALS.
Sec. 26B.36. Who may appeal.
Any person aggrieved by any decision of the Collector
pursuant to this Chapter may appeal to the Director by
filing a notice of appeal with the Director within fifteen
(15) days of the serving or mailing of the decision.
Sec. 26B.37. Hearing; notice.
The Director shall fix a time and place for hearing such
appeal. The Director shall give notice thereof in writing
to such person by serving it personally or by depositing
it in the United States Mail, postage prepaid, addressed to
such person at his last known place of address.
Sec. 26B.38. Hearing; determination.
The Director shall have authority to determine all
questions raised on such appeal at the time of the hearing.
No determination so made by the Director shall conflict with
any substantive provision of this Chapter.
Sec. 26B.39. Hearing; penalties suspended.
No penalty provided for in this Chapter shall be imposed
after the filing of an appeal or prior to the completion of
the hearing on the appeal and the making of a determination
on the subject of the appeal by the Director.
ARTICLE X. RECORDS
Seco 26B.40. Retention J?eriod; access.
It shall be the duty of every service supplier required to
collect and remit to the City any tax imposed by this Chapter
to keep and preserve, for a period of three (3) years, all
records as may be necessary to determine the amount of such
tax that such service supplier may have been required to
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collect and remit to the City, which records the Collector
shall have the right to inspect at all reasonable times.
ARTICLE Xlo REFUNDS.
Sec. 26B.4l. Claim; filing period.
Whenever the amount of any tax, interest or penalty has
been overpaid or paid more than once, or has been
erroneously or illegally collected or received by the City
under this Chapter, it may be refunded as provided in this
Article provided a claim in writing therefor, stating
under penalty of perjury the specific grounds upon whkh
the claim is founded, is filed with the Collector within
three (3) years of the date of paYment. The claim shall be
on forms furnished by the Collector.
Sec. 26B.42. Service supplier; refund.
A service supplier may claim a refund or take as credit
against taxes collected and remitted an amount overpaid,
paid more than once, or erroneously or illegally collected
or received, when it is established in a manner prescribed
by the Collector that the person from whom the tax has been
collected was not a service user.
Sec. 26B.43. Service user; refund.
Any service user may obtain a refund of taxes overpaid,
or paid more than once, or erroneously or illegally collected
or received by the City by filing a claim in the manner
provided in Section 26B.4l., but only when the service user
having paid the tax to the service supplier establishes to
the satisfaction of the Collector that the service user has
been unable to obtain a refund from the service supplier who
collected the tax.
Sec. 26B.44. Claim; proof requiredo
No refund shall be paid under the provisions of this
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Article unless the claimant establishes his right thereto
by written records showing entitlement thereto.
SECTION II: All ordinances and parts of ordinances in
conflict herewith are hereby repealed.
SECTION III: This ordinance shall take effect and be in
full force thirty (30) days from and after its adoption and
approval.
PASSED AND ADOPTED this 19th day of
July, 1971, by
the following vote:
AYES: COUNCILMEMBERS: BATREZ, DUFFIN, HUGHAN, PATE, SILVA
and GOODRICH
NOES: COUNCILMEMBERS: STOUT
ABSENT: COUNCILMEMBERS: None
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ORDINANCE NO. 927
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I, SUSANNE E. STEINMETZ, City Clerk of the City of Gilroy, do
hereby certify that the attached Ordinance No. 927 is an original
ordinance, duly adopted by the Council of the City of Gilroy at a
regular meeting of said Council held on the 19th day of July
, 19~, at which meeting a quorum was present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
official seal of the City of Gilroy. this 22nd day of July
, 19 l..!...
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,City Clerk of the City of Gilroy
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