HomeMy WebLinkAbout3133 Nov 8 General Eelection Amending F&B Tax
ORDINANCE NO.
AN ORDINANCE AMENDING AMC CHAPTER 4.34, FOOD
AND BEVERAGE TAX, AND REFERRING THE ORDINANCE
TO THE VOTERS OF ASHLAND IN THE NOVEMBER 8, 2016
GENERAL ELECTION
Annotated to show deletions and additions to the code sections being modified. Deletions are bold tined
through and additions are bold underlined.
WHEREAS, Article 2, Section 1 of the Ashland City Charter provides:
Powers of the City. The City shall have all powers which the constitutions, statutes and
common law of the United States and this State expressly or impliedly grant or allow
municipalities, as fully as though this Charter specifically enumerated each of those
powers, as well as all powers not inconsistent with the foregoing and, in addition thereto,
shall possess all powers hereinafter specifically granted. All the authority thereof shall
have perpetual succession.
WHEREAS, the City desires to re-direct a portion of the food and beverage tax to street
maintenance activities and to increase the share of food and beverage tax that is directed to the
Ashland Parks and Recreation Commission.
THE PEOPLE OF THE CITY OF ASHLAND DO ORDAIN AS FOLLOWS:
SECTION 1. Title 4 Revenue and Finance of the Ashland Municipal Code, "Food and Beverage
Tax," is hereby amended as follows:
SECTION 4.34.010 Definitions
The following words and phrases whenever used in this chapter shall be construed as defined in
this section unless from the context a different meaning is intended.
A. "Caterer" means a person who prepares food at a business site, for compensation, for
consumption on or off the business premises but within the corporate limits of the city.
B. "Combination facility" has the same meaning as defined in Oregon Administrative 333-
150-0000(4)(1) which the State of Oregon Department of Agriculture licenses or inspects
under Oregon Administrative Rule 333-158-0000.
C. "Director" means the Director of Finance of the City of Ashland, or his/her designee.
D. "Food" includes all prepared food items and beverages, excluding alcoholic beverages,
served in a restaurant including "takeout", "to go" or delivered orders.
E. "Open Space Park Program" and "Open Space lands or easements" have the same meaning
as used in Article XIX A of the Ashland City Charter.
F. "Operator" means the person who is proprietor of the restaurant, whether in the capacity of
owner, lessee, sub-lessee, mortgagee in possession, licensee or any other capacity. Where the
operator is a corporation, the term operator shall also include each and every member of the
Board of Directors of such corporation for the time involved.
Ordinance No. Page 1 of 9
G. "Restaurant" means any establishment required to be licensed as a restaurant, mobile unit
or pushcart by the State of Oregon Health Division and includes any establishment where
food or beverage is prepared for consumption by the public or any establishment where the
public obtains food or beverage so prepared in form or quantity consumable then and there,
whether or not it is consumed within the confines of the premises where prepared, and also
includes establishments which prepare food or beverage in consumable form for service
outside the premises where prepared. The term restaurant includes, but is not limited to
grocery store delis, coffee shops, and caterers; it also includes establishments where such
food or beverage is prepared in a combination facility. The term restaurant does not include a
restaurant licensed by the State of Oregon Health Division as a limited service restaurant.
(Ord 2991, amended, 12/01/2009)
SECTION 4.34.020 Tax Imposed
A. Except for exempt or tax-capped activities specified in AMC 4.34.030, the city imposes
and levies, in addition to all other taxes, fees and charges of every kind, a tax upon:
1. All food and beverages sold by restaurants located within the city to the public,
except for whole cakes, pies, and loaves of bread if purchased for consumption off
premises, and for alcoholic beverages;
2. All food and beverages sold by a caterer for an event located within the city, except
alcoholic beverages and exempt events as defined in AMC 4.34.030K;
3. The following items sold by combination facilities:
a. Salads from salad bars;
b. Dispensed soft drinks and coffee;
c. Sandwiches or hot prepared foods ready for immediate consumption;
d. The following items, including toppings or additions, scooped or otherwise placed
into a cone, bowl or other container for immediate consumption whether or not
they are consumed within the confines of the premises where scooped or placed:
Any frozen dessert regulated by the Oregon State Department of Agriculture
under ORS 621.311 and any ice cream, ice milk, sherbet or frozen yogurt. No tax
shall be imposed under this subsection, however, on any item whose volume
exceeds one-half gallon or more.
e. Any other food mixed, cooked or processed on the premises in form or quantity
for immediate consumption whether or not it is consumed within the confines of
the premises where prepared; and
4. The following items sold by combination facilities that are bakeries:
a. All those items listed in Section 4.34.020.A.3.a-d;
b. All bakery products sold for consumption on the premises; and
c. All "takeout" or "to go" orders of bakery products prepared on the premises
except for whole cakes, pies, and loaves of bread and any order consisting of six
or more bakery products.
5. Use of a delivery service for any activity under this Section, whether an independent
delivery service or operator provided delivery service, does not excuse the operator
from the requirement to collect and remit the tax on the food and beverages sold.
Ordinance No. Page 2 of 9
B. Such tax shall be imposed at a rate of five percent 5~ on the total amount charged by
the seller for the food and beverages, or for the meal. In the computation of this tax any
fraction of one-half cent or more shall be treated as one cent.
C. Twenty per-cent 0
paid into a Par-ks Amount for- purposes of acquisition, planning, development and
r rehabilitation of City pajdrs per- the City of Ashland's Capital Improvement
pin
0 of the amount colleeted must be used for- Open Sp . 4 sition.
i
D. Eighty per-eent O
of paying for- wastewater- eapital impFovement pFojeets, per- the City of Ashland'--s
Capital improvement Man, whieh ineludes, but is not limited to, the wftste-Wate
treatment plant debt. The eouneil may deer-ease the rate of the tax or- eliminate the
tax deser-ibed in subseetion 4.34.020.A after- a publie hearing. Notiee of the hearing
shall be given by publiention in a newspaper- of general eir-eulation in the City a
least 10 days prior- to the date of the public hearing.-
administration and colleetion.
C. The taxes collected by the City under this chapter shall be used as follows:
1. Twenty-five percent (25%) shall be paid into a parks account for purposes of
acquisition, planning, development, repair and rehabilitation of City parks per
adopted plans of the Ashland Parks and Recreation Commission.
2. The City may retain up to two percent (2%) of the tax collected for costs of
administration and collection.
3. The following amounts for fiscal years 2017 through 2022 must be used to pay
for wastewater treatment plant debt and wastewater capital improvement
projects, per the City of Ashland's Capital Improvement Plan.
a. In fiscal year 2017: $1,868,290
b. In fiscal year 2018: $1,608,600
c. In fiscal year 2019: $1,600,600
d. In fiscal year 2020: $1,600,000
e. In fiscal year 2021: $1,650,000
L In fiscal year 2022: $1,650,000
4. Any taxes collected by the City under this chapter and not used as described in
subsections 4.34.020C.1-3 shall be paid into the Street Fund and used for street
maintenance and reconstruction.
5. Beginning in fiscal year 2023, the council may, through the statutory budget
process, appropriate taxes under this chapter as follows:
a. Not less than twenty-five percent (25%) for the acquisition, planning,
development, repair and rehabilitation of City parks.
b. Not less than an amount necessary to pay for debt service on any borrowing
for street repair and rehabilitation per the City of Ashland Pavement
Management Program.
c. Up to two percent (2%) for the collection and administration of the tax.
Ordinance No. Page 3 of 9
d. Except as provided in subsection 4.34.020.D, any remaining amounts shall be
appropriated for purposes consistent with this chapter unless other purposes
are approved by a Council-adopted ordinance enacted by a vote of the
Ashland electorate.
D. The council may decrease the rate of the tax or eliminate the tax described in
subsection 4.34.020.A. and B. after a public hearing. Notice of the hearing shall be
given by publication in a newspaper of general circulation in the City at least 10
days prior to the date of the public hearing.
(Ord 2991, amended, 12/01/2009)
SECTION 4.34.030 Exemptions
The tax levied by Section 4.34.020 shall be capped, at the amount specified, or shall not be
collected or assessed on food or beverages:
A. Sold by public or private schools or colleges except that food sold by independent
contractor operators at such schools or colleges shall be subject to the tax imposed by this
chapter;
B. Sold on hospital grounds;
C. Provided by bed and breakfast establishments to their guests;
D. Sold in vending machines;
E. Sold in temporary restaurants including food stands, booths, street concessions and
similar type operations, operated by non-profit organizations or service clubs.
F. Served in connection with overnight or residential facilities--including, but not limited to,
convalescent homes, nursing homes, retirement homes and motels--if the food and
beverage are provided as part of the cost of sleeping accommodations.
G. Provided by nonprofit tax-exempt organizations to citizens over 60 years of age as a part
of a recognized senior citizen nutritional program.
H. Sold for resale to the public.
1. Sold in bulk to the public for non-immediate consumption off the premises including but
not limited to ice cream packed in a container of one-half gallon or more.
J. Which are candy, popcorn, nuts, chips, gum or other confections but not including ice
cream, frozen yogurt, cakes, pies or other desserts.
K. Sold by an operator at a single food service event located within the city in which
restaurant or catering services, (exclusive of alcohol) exceed $5000.00, in which case, the
applicable food and beverage tax shall not be excused but shall be capped at two-hundred
fifty dollars ($250.00).
(Ord 2991, amended, 12/01/2009)
SECTION 4.34.040 Operator's Duties
Each operator shall collect the tax imposed by this chapter, to the same extent and at the same
time as the amount for the food or beverage is collected from every purchaser. The amount of tax
need not be separately stated from the amount of the food or beverage. Every operator required
to collect the tax imposed in this chapter shall be entitled to retain five percent of all taxes
collected to defray the costs of collections and remittance.
(Ord 2991, amended, 12/01/2009)
Ordinance No. Page 4 of 9
SECTION 4.34.050 Reporting and remitting
A. Reporting. Every operator shall, on or before the last day of the month following the end of
each calendar quarter (in the months of April, July, October and January), make a return to
the director, on forms provided by the City, specifying the total sales subject to this chapter
and the amount of tax collected under this chapter. The operator may request or the director
may establish shorter reporting periods for any operator if the operator or director deems it
necessary in order to insure collection of the tax and the director may require further
information in the return relevant to payment of the liability. A return shall not be considered
filed until it is actually received by the director.
B. Remitting. At the time the return is filed, the full amount of the tax collected shall be
remitted to the director. Payments received by the director for application against existing
liabilities will be credited toward the period designated by the taxpayer under conditions
which are not prejudicial to the interest of the City. A condition which is considered
prejudicial is the imminent expiration of the statute of limitations for a period or periods.
C. Order of Payments. Non-designated payments shall be applied in the order of the oldest
liability first, with the payment credited first toward any accrued penalty, then to interest,
then to the underlying tax until the payment is exhausted. Crediting of a payment toward a
specific reporting period will be first applied against any accrued penalty, then to interest,
then to the underlying tax. The director, when in the director's discretion determines that it
will be in the best interest of the City, may specify that a different order of payment credit
should be followed with regard to a particular tax or factual situation. The director may
establish shorter reporting periods for any operator if the director deems it necessary in order
to insure collection of the tax and the director may require further information in the return
relevant to payment of the liability. When a shorter return period is required, penalties and
interest shall be computed according to the shorter return period. Returns and payments are
due immediately upon cessation of business for any reason. All taxes collected by operators
pursuant to this chapter shall be held in trust for the account of the City until payment is
made to the director. A separate trust bank account is not required in order to comply with
this provision.
(Ord 2991, amended, 12/01/2009; Ord 2903, Amended, 01/06/2004; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.060 Penalties and Interest
A. Any operator, who fails to remit any portion of any tax imposed by this chapter within the
time required, shall pay a penalty of ten percent of the amount of the tax, in addition to the
amount of the tax.
B. Any operator who fails to remit any delinquent remittance on or before a period of 60 days
following the date on which the remittance first became delinquent, shall pay a second
delinquency penalty of ten percent of the amount of the tax in addition to the amount of the
tax and the penalty first imposed.
C. If the director determines that the nonpayment of any remittance due under this chapter is
due to fraud, a penalty of 25% percent of the amount of the tax shall be added thereto in
addition to the penalties stated in subparagraphs A and B of this section.
D. In addition to the penalties imposed, any operator who fails to remit any tax imposed by this
chapter shall pay interest at the rate of one percent per month or fraction thereof on the
Ordinance No. Page 5 of 9
amount of the tax, exclusive of penalties, from the date on which the remittance first became
delinquent until paid.
E. Every penalty imposed and such interest as accrues under the provisions of this section shall
become a part of the tax required to be paid.
F. Notwithstanding subsection 4.34.020.C, all sums collected pursuant to the penalty provisions
in paragraphs A, B and C of this section shall be distributed to the City of Ashland Central
Service Fund to offset the costs of auditing and enforcement of this tax.
G. Waiver of Penalties. Penalties and interest for certain late tax payments may be waived
pursuant to AMC 2.28.045 D.
(Ord 2991, amended, 12/01/2009; Ord 2983, Amended, 06/05/2009)
SECTION 4.34.070 Failure to Collect and Report Tax--Determination of Tax by Director
If any operator should fail to make, within the time provided in this chapter, any report of the tax
required by this chapter, the director shall proceed in such manner as deemed best to obtain facts
and information on which to base the estimate of tax due. As soon as the director shall procure
such facts and information as is able to be obtained, upon which to base the assessment of any
tax imposed by this chapter and payable by any operator, the director shall proceed to determine
and assess against such operator the tax, interest and penalties provided for by this chapter. In
case such determination is made, the director shall give a notice of the amount so assessed by
having it served personally or by depositing it in the United States mail, postage prepaid,
addressed to the operator so assessed at the last known place of address. Such operator may
make an appeal of such determination as provided in section 4.34.080. If no appeal is filed, the
director's determination is final and the amount thereby is immediately due and payable.
(Ord 2991, amended, 12/01/2009; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.080 Appeal
Any operator aggrieved by any decision of the director with respect to the amount of such tax,
interest and penalties, if any, may appeal pursuant to the Administrative Appeals Process in
AMC 2.30.020, except that the appeal shall be filed within 30 days of the serving or mailing of
the determination of tax due. The hearings officer shall hear and consider any records and
evidence presented bearing upon the director's determination of amount due, and makes findings
affirming, reversing or modifying the determination. The findings of the hearings officer shall be
final and conclusive, and shall be served upon the appellant in the manner prescribed above for
service of notice of hearing. Any amount found to be due shall be immediately due and payable
upon the service of notice.
(Ord 2991, amended, 12/01/2009; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.090 Records
It shall be the duty of every operator liable for the collection and payment to the city of any tax
imposed by this chapter to keep and preserve, for a period of three years, all such records as
may be necessary to determine the amount of such tax. The director shall have the right to
inspect all records at all reasonable times.
(Ord 2991, amended, 12/01/2009)
SECTION 4.34.100 Refunds
Ordinance No. Page 6 of 9
A. 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 subparagraph B of this section, provided a claim in writing,
stating under penalty of perjury the specific grounds upon which the claim is founded, is filed
with the director within one year of the date of payment. The claim shall be on forms
furnished by the director.
B. The director shall have 20 calendar days from the date of receipt of a claim to review the
claim and make a determination in writing as to the validity of the claim. The director shall
notify the claimant in writing of the director's determination. Such notice shall be mailed to
the address provided by claimant on the claim form. In the event a claim is determined by the
director to be a valid claim, an operator may claim a refund, or take as credit against taxes
collected and remitted, the amount overpaid, paid more than once or erroneously or illegally
collected or received in a manner prescribed by the director. The operator shall notify
director of claimant's choice no later than 15 days following the date director mailed the
determination. In the event claimant has not notified the director of claimant's choice within
the 15 day period and the operator is still in business, a credit will be granted against the tax
liability for the next reporting period, if the operator is no longer in business, a refund check
will be mailed to claimant at the address provided in the claim form.
C. No refund shall be paid under the provisions of this section unless the claimant established
the right by written records showing entitlement to such refund and the director
acknowledged the validity of the claim.
(Ord 2991, amended, 12/01/2009; Ord 2903, Amended, 01/06/2004)
SECTION 4.34.110 Actions to Collect
Any tax required to be paid by any operator under the provisions of this chapter shall be deemed
a debt owed by the operator to the city. Any such tax collected by an operator which has not been
paid to the city shall be deemed a debt owed by the operator to the city. 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 Of Ashland for the recovery of such amount. In lieu of filing an action for the
recovery, the City of Ashland, when taxes due are more than 30 days delinquent, can submit any
outstanding tax to a collection agency. So long as the City of Ashland has complied with the
provisions set forth in ORS 697.105, in the event the City turns over a delinquent tax account to
a collection agency, it may add to the amount owing an amount equal to the collection agency
fees, not to exceed the greater of fifty dollars or fifty percent of the outstanding tax, penalties and
interest owning.
(Ord 2991, amended, 12/01/2009; Ord 2931, Amended, 09/19/2006- Ord 2885, Amended, 08/06/2002)
SECTION 4.34.120 Violations
All violations of this chapter are punishable as set forth in AMC 1.08.020. It is a violation of this
chapter for any operator or other person to:
A. Fail or refuses to comply as required herein;
B. Fail or refuse to furnish any return required to be made;
C. Fail or refuse to permit inspection of records;
D. Fail or refuse to furnish a supplemental return or other data required by the director;
E. Render a false or fraudulent return or claim;
F. Fail, refuse or neglect to remit the tax to the city by the due date.
Ordinance No. Page 7 of 9
Violation of subsections A-D and F above shall be considered a Class I violation. Filing a false
or fraudulent return shall be considered a Class C misdemeanor, subject to AMC 1.08. The
remedies provided by this section are not exclusive and shall not prevent the City from
exercising any other remedy available under the law, nor shall the provisions of this ordinance
prohibit or restrict the City or other appropriate prosecutor from pursuing criminal charges under
state law or city ordinance.
(Ord 3023, amended, 08/03/2010; Ord 2991, amended, 12/01/2009; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.130 Confidentiality
Except as otherwise required by law, it shall be unlawful for the city, any officer, employee or
agent to divulge, release or make known in any manner any financial information submitted or
disclosed to the city under the terms of this chapter. Nothing in this section shall prohibit:
A. The disclosure of the names and addresses of any person who are operating a restaurant;
or
B. The disclosure of general statistics in a form which would prevent the identification of
financial information regarding an individual operator; or
C. Presentation of evidence to the court, or other tribunal having jurisdiction in the
prosecution of any criminal or civil claim or an appeal for amount due the city under this
chapter.
D. The disclosure of information when such disclosure of conditionally exempt information
is ordered under public records law procedures.
E. The disclosure of records related to a business's failure to report and remit the tax when
the report or tax is in arrears for over six months or the tax exceeds $5,000.00. The City
Council expressly finds and determines that the public interest in disclosure of such
records clearly outweighs the interest in confidentiality under ORS 192.501(5).
(Ord 2991, amended, 12/01/2009; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.140 Examining Books, Records, or Persons
The city, for the purpose of determining the correctness of any tax return, or for the purpose of
an estimate of taxes due, may examine or may cause to be examined by an agent or
representative designated by it for that purpose, any books, papers, records, or memoranda,
including copies of operator's state and federal income tax return, bearing upon the matter of the
operator's tax return.
(Ord 2991, amended, 12/01/2009; Ord 2885, Amended, 08/06/2002)
SECTION 4.34.160 Termination of tax
This chapter shall expire on December 31, 2030, unless extended by a vote of the electorate.
(Ord 2991, amended, 12/01/2009)
SECTION 2. Severability. The sections, subsections, paragraphs and clauses of this ordinance
are severable. The invalidity of one section, subsection, paragraph, or clause shall not affect the
validity of the remaining sections, subsections, paragraphs and clauses.
SECTION 3. Savings. Notwithstanding any amendment/repeal, the City ordinances in existence
at the time any criminal or civil enforcement actions were commenced, shall remain valid and in
Ordinance No. Page 8 of 9
full force and effect for purposes of all cases filed or commenced during the times said ordinance(s)
or portions thereof were operative. This section simply clarifies the existing situation that nothing
in this Ordinance affects the validity of prosecutions commenced and continued under the laws in
effect at the time the matters were originally filed.
SECTION 4. Codification. Provisions of this Ordinance shall be incorporated in the City Code
and the word "ordinance" may be changed to "code", "article", "section", "chapter" or another
word, and the sections of this Ordinance may be renumbered, or re-lettered, provided however that
any Whereas clauses and boilerplate provisions (i.e. Sections 2-4) need not be codified and the
City Recorder is authorized to correct any cross-references and any typographical errors.
SECTION 5. Pursuant to Resolution No. 2016- , the Ashland City Council has referred this
ordinance to the voters for approval at the general election of November 8, 2016. Accordingly
this ordinance shall not be effective unless and until approved by the voters of the City of Ashland
and following the official acceptance of the canvas of votes.
The foregoing ordinance was first read by title only in a dance with Article X,
Section 2(C) of the City Charter on the day of 46~:~~,2016,
AdyP ASSE D and ADOPTED this day of , 2016.
P
Barbara M. Christensen, City Recorder
SIGNED and APPROVED this 7day of , 2016.
1, r
A
oh Stro berg, Mayor
Review~d as to form:
t ~"7
Davi H. Lohman, City Attorney
Ordinance No. Page 9 of 9