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Home My WebLink AboutCity Council Committees - Operations and Public Safety Committee - 12/07/2021 Operations and Public Safety Committee Tuesday, December 7, 2021 4:00 PM Chambers Masks are required regardless of vaccination status. To listen to this meeting, call 1-888-475-4499 or 1-877-853-5257 and enter Meeting ID 828 3234 3327 Chair Toni Troutner Councilmember Bill Boyce Councilmember Brenda Fincher Councilmember Satwinder Kaur Councilmember Marli Larimer Councilmember Zandria Michaud Councilmember Les Thomas ************************************************************** Item Description Action Speaker Time 1. Call to Order Chair 01 MIN. 2. Roll Call Chair 01 MIN. 3. Agenda Approval Chair 01 MIN. 4. Approval of Minutes YES Chair 01 MIN. YES 1. Approval of November 16, Chair 05 MIN. 2021 Minutes 5. Business YES A. Payment of Bills - Approve Paula Painter 01 MIN. YES B. Non-Represented Salary Teri Smith 05 MIN. Study - Authorize NO C. INFO ONLY: New Chief Padilla 10 MIN. Conversations - Training YES D. Consolidating Budget Michelle Ferguson 05 MIN. Adjustment Ordinance for Adjustments between Unless otherwise noted, the Operations and Public Safety Committee meets at 4 p.m. on the first and third Tuesday of each month in Kent City Hall, Council Chambers East, 220 Fourth Avenue South, Kent, WA 98032. For additional information please contact Kim Komoto at 253-856-5728, or mail Kkomoto@kentwa.gov. 253-856-5725 in advance. For TDD relay service call Washington Telecommunications Relay Service at 7-1-1. Operations and Public Safety Committee CC Ops and December 7, 2021 PS Regular Meeting October 1, 2021 and November 30, 2021 - Adopt YES E. Ordinance Amending Paula Painter 05 MIN. Chapter 5.01 of the Kent City Code Relating to Business Licensing - Adopt YES F. Tax Code Amendments - Paula Painter 10 MIN. Ordinance - Adopt NO G. INFO ONLY: Third Quarter Joe Bartlemay 10 MIN. Investment Report NO H. INFO ONLY: October Michelle Ferguson 10 MIN. Financial Report 6. Adjournment Chair 01 MIN. 5/2 Pending Approval Operations and Public Safety Committee CC Ops and PS Regular Meeting Minutes November 16, 2021 Date: November 16, 2021 Time: 4:00 p.m. Place: Chambers Attending: Toni Troutner, Chair Bill Boyce, Councilmember Brenda Fincher, Councilmember Satwinder Kaur, Councilmember Marli Larimer, Councilmember Zandria Michaud, Councilmember Les Thomas Councilmember Agenda: 1. Call to Order 4:00 p.m. Council President Troutner called the meeting to order. 2. Roll Call Attendee Name Title Status Arrived Toni Troutner Chair Present Bill Boyce Councilmember Present Brenda Fincher Councilmember Present Satwinder Kaur Councilmember Present 4:02 PM Marli Larimer Councilmember Present Zandria Michaud Councilmember Present Les Thomas Councilmember Present 3. Agenda Approval No changes. 1. I move to approve the agenda as presented. Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* RESULT: MOTION PASSES \[UNANIMOUS\] MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Larimer, Michaud, Thomas 4. Approval of Minutes 1. Approval of Minutes dated November 2, 2021 I move to approve the minutes of the November 2, 2021, Operations and Public Safety Committee. Page 1 of 7 Qbdlfu!Qh/!4 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes MOTION: Move to approve the Minutes dated November 2, 2021 RESULT: APPROVED \[UNANIMOUS\] MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas 5. Business A. Payment of Bills - Authorize MOTION: I move to authorize the payment of bills. RESULT: MOTION PASSES \[UNANIMOUS\] Next: 12/14/2021 7:00 PM MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas B. INFO ONLY: September 2021 Financial Report Michelle Ferguson, Financial Planning Manager, presented the September 2021 Financial Report. Ferguson provided an overview of the general fund, year-to-date numbers and highlighted the general fund ending balance 10-year history - excluding annexation funds. Details were provided regarding revenue and expenditure variances, both favorable and unfavorable. Ferguson reviewed the general fund actuals from 2019 through 2021 (estimated actuals for 2021). Ferguson provided an overview of the Other Funds Overview for both revenues and expenditures. C. Revisions to Terms of Land Use and Planning Board Members - Authorize Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* Chief Administrative Officer Derek Matheson advised that on July 6, 2021, the Council confirmed the initial appointments for McDonough and Purewal for terms of a little more than three-years expiring on December 31, 2024. The motion was brought before the council on the same night as the ordinance amending Title 2 of the Kent City Code relating to appointive boards, commissions and committees. The imposition of term limits makes it important that terms are exactly three years in length. This motion will correct the expiration date of the terms. Page 2 of 7 Qbdlfu!Qh/!5 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes MOTION: I move to revise the term expirations of Land Use and Planning Board members Sally McDonough and Michael Purewal from December 31, 2024 to July 5, 2024. RESULT: MOTION PASSES \[UNANIMOUS\] Next: 12/14/2021 7:00 PM MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas D. 2022 Community Development Block Grant Annual Action Plan - Adopt Dinah Wilson, Senior Human Services Coordinator, advised that the City of Kent receives Community Development Block Grant funds from the U.S. Department of Housing and Urban Development as an Entitlement City. To receive this funding, the City is required to submit a Five-Year Consolidated in effect from 2020-2024. MOTION: I move to adopt the Community Development Block Grant 2022 Annual Action Plan (including funding allocations and contingency plans) and authorize the Mayor to execute the appropriate certifications and agreements. RESULT: MOTION PASSES \[UNANIMOUS\] Next: 12/14/2021 7:00 PM MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas E. Renew Small Government Enterprise Agreement with ESRI, Inc. - Authorize Somen Palit, Technology Innovation Manager informed the Council that Environmental Systems Research Institute, Inc. provides the software, support and services necessary for the GIS data and solutions utilized by the City of Kent (across the entire organization). By renewing its contract with ESRI, the City can continue accessing the latest GIS tools, software, and Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* support needed to collect, transform, manage, analyze, and visualize geospatial data across a multitude of dashboards, story maps, applications, and other deliverables. This centralized and shared technology is leveraged by staff in nearly every department in planning, asset management, and other strategic and operational activities. Many of the geospatial data layers are also integrated into other business systems and even made available to MOTION: I move to authorize the Mayor to sign a three-year contract renewal with Environmental Systems Research Institute, Inc., in an amount not to exceed $363,330.00, subject to final terms and Page 3 of 7 Qbdlfu!Qh/!6 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes conditions acceptable to the IT Director and City Attorney. RESULT: MOTION PASSES \[UNANIMOUS\] Next: 12/14/2021 7:00 PM MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas F. Amendments to Consultant Services Agreement for IT Temporary Staff - Authorize Brian Rambonga, Information Technology Project Management Office contracts with a number of employment agencies to retain temporary workers, on an as-needed basis, to support many of the projects and service needs. The City has current contracts with Protingent, Inc.; Viri Technology, LLC; Robert Half International, Inc.; and TEKsystems, Inc., which the IT Department intends to continue using through December 31, 2022. Additionally, the IT Department intends to contract with Affirma, LLC for additional temporary staffing services. The City will not be extending its contract with Scion Staffing, Inc. beyond December 31, 2021, but may contract with additional employment staffing agencies during 2022 and beyond. MOTION: Authorize the Mayor to sign contracts and contract amendments with temporary employment agencies, subject to final contract terms and conditions acceptable to the IT Director and City Attorney, and so long as the costs associated with those contracts can be paid for through the budget previously established and approved by Council for the current biennium. RESULT: MOTION PASSES \[UNANIMOUS\] Next: 12/14/2021 7:00 PM MOVER: Les Thomas, Councilmember SECONDER: Bill Boyce, Councilmember AYES: Troutner, Boyce, Fincher, Kaur, Larimer, Michaud, Thomas G. INFO ONLY: Red Light Camera Program Assistant Chief Eric Hemmen provided the Council with an update on the Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* City's Red Light Camera Program. The Police Department recently conducted a study of six intersections in the Traffic Sergeant and Public Works traffic engineering. The study reviewed all lanes of travel and direction for each intersection, for a total of 24 approaches. The intersections Reviewed were: Page 4 of 7 Qbdlfu!Qh/!7 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes thth 1. S.E. 208 Street and 108 Avenue S.E. thth 2. S.E. 240 Street and 116 Avenue S.E. 3. West Meeker Street and Washington Avenue North th 4. Kent-Kangley Road and 116 Avenue S.E. thth 5. South 228 Street and 68 Avenue South thth 6. South 212 Street and 68 Avenue South The study revealed that during an average month period, the violations at each approach would cover the cost to have the camera there. The Police Department recommends following the data from the study and place cameras on all approaches to each of the intersections. Red light cameras cost around $4,750 per camera per month to be monitored. If an intersection is large enough 2 cameras are needed per approach which adds another $1000 for that second camera to be monitored. The following data estimates the income and expenses for each of the studied intersections: SE 208 St and 108 Ave SE 16.32 infractions a day/489.6 a month Revenue for infractions per month $66,585 Cost for camera per month $21,000 Net Revenue per month $45,585 SE 240 St and 116 Ave SE 13.6 infractions a day/408 a month Revenue for infractions per month $55,488 Cost for camera per month $19,000 Net Revenue per month $36,488 W. Meeker St and Washington Ave N 17.11 infractions a day/ 513.3 a month Revenue for infractions per month $69,808 Cost for camera per month $19,000 Net Revenue per month $50,808 Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* Kent Kangley Road and 116 Ave SE 12.9 infractions a day/ 387 a month Revenue for infractions per month $52,632 Cost for camera per month $19,000 Net Revenue per month $33,632 S 228 St and 68 Ave. S. 15.99 infractions a day/ 479.7 a month Revenue for infractions per month $65,239 Cost for camera per month $19,000 Page 5 of 7 Qbdlfu!Qh/!8 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes Net Revenue per month $46,239 S 212 St and 68 Ave S. 19.93 infractions a day/ 597.9 a month Revenue for infractions per month $81,314 Cost for camera per month $21,000 Net Revenue per month $60,314 Total net revenue for the year would be estimated at $3,276,814 from 24 approaches at the 6 intersections. The costs for the additional police overtime to review the violations is estimated at $192,000 a year and the additional court costs are estimated at $143,640. There may be other costs associated with the additional cameras relating to the work of the The current contract with Verra Mobility will need to be amended with a new five year contract. It will take approximately 6 months to get the cameras installed. The Council requested Police compile historical data to see if intersections where cameras are installed have improvements to less accidents. There was consensus among all councilmembers for the Police Department to move forward with contracting for the installation of red light cameras at the six intersections. H. INFO ONLY: Race and Equity Strategic Plan Update Uriel Varela, the City's Race and Equity Manager, provided the Council with the Race and Equity Strategic Plan update. Varela advised of recent accomplishments that included completing the initial phase of engagement process and BIPOC community engagement. Varela advised the Core Team analyzed the Engagement Report and came up with the following areas of focus: · Communication · In Language Resources Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* · Equitable Representation · Training · Community Engagement After selecting the areas of focus, the team used the Targeted Universalism concept to create the actual goals. Varela detailed the goals for each of the areas of focus. Varela advised he is currently working on community vetting sessions - will present the Community Engagement Report, Areas of Focus and Preliminary Page 6 of 7 Qbdlfu!Qh/!9 5/2 Operations and Public Safety Committee CC Ops November 16, 2021 and PS Regular Meeting Kent, Washington Minutes goals. Next steps include: Core team will analyze vetting report Co-design element added to process of creating action items Recruiting Stakeholder group (5 CBOs, 5 Residents) Stakeholder group & Core Team Co-design action items Updating Council by area of focus Final goal, action items, measurable outcomes Varela provided an overview of the Preliminary Schedule for Co-designing Action Items: · Onboarding - Kent 101 (February) · Co-Creating Framework (February- March) · Co-designing Action Items ( March - July) · Council will receive an update after action items have been created · Community vetting sessions (July - August) · Plan revisions (August - September) · Bring full plan to council (October) I. INFO ONLY: Litter Signage - From Budget Workshop Public Works Director, Chad Bieren updated the Council on the litter signage topic that came out of a recent workshop. Bieren displayed map of existing litter signs throughout the City. Signs contain information relating to associated fines and advised the signs have not helped reduce litter and increasing the number of signs would not help reduce litter. Bieren is in discussions with the Law Department regarding installing video cameras to deter illegal dumping. Fincher suggested looking at what other cities are doing to deter illegal dumping. 6. Adjournment 4:48 p.m. Njovuft!Bddfqubodf;!Njovuft!pg!Opw!27-!3132!5;11!QN!!)Bqqspwbm!pg!Njovuft* Council President Toni Troutner adjourned the meeting. Kimberley Komoto Committee Secretary Page 7 of 7 Qbdlfu!Qh/!: 6/B FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: Payment of Bills - Approve MOTION: I move to approve the payment of bills. SUMMARY: BUDGET IMPACT: Qbdlfu!Qh/!21 6/C HUMAN RESOURCES DEPARTMENT Teri Smith, SHRM-CP, PHR 220 Fourth Avenue South Kent, WA 98032 253-856-5270 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: Non-Represented Salary Study - Authorize MOTION: I move to authorize a comprehensive salary study of approximately 250 non-represented employees. SUMMARY: Pursuant to Resolution 1775, the City Council must provide authorization prior to a comprehensive salary survey being conducted. This is reflected in Personnel Policy 2.20.11. If authorized, Human Resources intends to seek proposals for a salary study from a subject matter expert with significant experience in conducting classification reviews, salary surveys, and comparative analyses, involving jurisdictions with sizes similar to the City of Kent, and offering a set of programs and services that The study will focus on approximately 250 non-represented employees within 150 classification titles. The City has internally conducted numerous classification and compensation studies in the past. At this time, it is appropriate to have an external consultant conduct the study, validate our current process(es) and/or suggest improvements for future studies to be conducted internally. Any process required for seeking proposals and executing a contract for the study SUPPORTS STRATEGIC PLAN GOAL: Sustainable Services - Providing quality services through responsible financial management, economic growth, and partnerships. ATTACHMENTS: 1. Non-Rep Comp Study (PDF) Qbdlfu!Qh/!22 6/C/b Request for Proposal (RFP) Classification and Compensation Study For Non-Represented Employees City of Kent Human Resources Department th 220 4 Avenue South Kent, WA 98032 Phone: 253-856-5276 Fax: 253-856-6270 Email: HumanResources@kentwa.gov Buubdinfou;!Opo.Sfq!Dpnq!Tuvez!!)3:74!;!Opo.Sfqsftfoufe!Tbmbsz!Tuvez!.!Bvuipsj{f* Qbdlfu!Qh/!23 6/C/b R EQUEST FOR P ROPOSAL November 15, 2021 Advertised Date Classification & Compensation Study for Non-Represented Request for Proposal Title: Employees City of Kent Human Resources Department Requesting Dept./Div.: RFP Number: 21HR-001 December 17, 2021 Due Date: RFP Coordinator: Teri Smith, Human Resources Director a subject matter expert with significant experience in conducting classification reviews, salary surveys and comparative analyses, involving jurisdictions with sizes similar to the City of Kent, and offering a set of programs and services that Should the City elect to accept any proposal, the City anticipates entering into a consultant contract with the successful Proposer in the form provided for within the RFP. Proposals shall be delivered and received, regardless of the delivery method, through Friday, st December 31 , 2021, up to 2:00 p.m., Office. Vendors accept all risks of late delivery of mailed proposal regardless of fault. Costs for developing the proposal in response to the RFP are entirely the obligation of the vendor. Delivery information: By mail to: City of Kent Human Resources Department Attn: Teri Smith 220 Fourth Avenue South Kent, WA 98032 By hand-delivery to: City of Kent th 220 4 Avenue South Kent, WA 98032 By email to: HumanResources@kentwa.gov P ROPOSERS MUST COMPLETE AND SIGN THE FORM BELOW (T YPE OR P RINT) Company Name Address City/State /Postal Code Signature Authorized Representative/Title (Print name and title) Email Phone Fax Company Headquarters Located in State/Province of RFP Non-represented Employees Classification/Compensation Study Page 2 Qbdlfu!Qh/!24 6/C/b R EQUEST FOR P ROPOSAL City of Kent Human Resources Department N ON-R EPRESENTED E MPLOYEES C LASSIFICATION/C OMPENSATION S TUDY I. City Background unique community with a combination of residential, banking, warehousing, light manufacturing, retailing, wholesaling, and some farming. It is unique because it is in the geographical center of the are two interstate highways, three state freeways, two national rail lines, a regional transit light rail station, an international airport, and two international deep-water seaports. Because of our prime location, Kent is home to the fourth-largest manufacturing and distribution center in the country. From the first Lunar Rover developed at Boeing's Space Center to the creation of next-generation rockets at Blue Origin, it is these types of innovative companies that drive our local has a well-earned reputation as the economic barometer for the region. Home to over 8,000 cities in south King County. Kent is the sixth largest city in Washington State with a diverse population of 136,588, covering a Magazine, Kent is a culturally rich destination with well-established neighborhoods, award winning parks and great schools. It has attracted families who speak 138 different languages. Kent is located in the heart of the Green River Valley; its breathtaking setting features views of Mount Rainier and the Cascade and Olympic Mountains. The City provides a full range of municipal services including: Police Protection/Corrections Municipal Court Parks, Recreation and Human Services Public Works/Transportation/Utilities Economic and Community Development Internal services IT, Finance, Human Resources, Legal, Communications There are approximately 680 benefitted employees and approximately 225 temporary or seasonal employees; about 40% of the benefitted employees are non-represented. II. Objectives a subject matter expert with significant experience in conducting classification reviews, salary surveys and comparative analyses, involving jurisdictions with sizes similar to the City of Kent, and offering a set of programs and services that The study will focus on approximately 250 non-represented employees within 150 classification titles. The City has internally conducted numerous classification and compensation studies. At this time, we believe RFP Non-represented Employees Classification/Compensation Study Page 3 Qbdlfu!Qh/!25 6/C/b it is appropriate to have an external consultant conduct the study, validate our current process(es) and/or suggest improvements for future studies to be conducted internally. Project Scope and Specifications Summary See Exhibit D for more details. 1. Complete a Classification and Compensation Study of similarly situated public employers who are providing equitable services. 2. Determine if changes to existing position descriptions are needed, including standardized diversity, equity and inclusion language; and if so, provide suggested changes for the City to update into these descriptions. 3. Prepare a comparative analysis that identifies the City's competitive position in a comparative labor market, including comparative city employers. 4. Prepare recommendations for compensation to maintain competitiveness, ensure equity and position the organization for future development. 5. Prepare and implement a communication program that sets expectations, ensures communication to leadership and employees throughout the project and provides opportunities for meaningful engagement while utilizing alternatives to appeals process(es). 6. Provide recommendations for conducting future salary studies internally based on best practices. This would include out of cycle classification/compensation reviews, communicating expectations regarding financial implications (i.e. minimize large budgetary impacts); appeals processes. Scheduled Timeline The following timeline has been established to ensure that our project objective is achieved; however, the following project timeline shall be subject to change when deemed necessary by the Kent Human Resources Department in collaboration with the selected Proposer. The project is anticipated to start on February 15, 2022 and be completed six (6) months from the start date. By submitting a proposal in response to this RFP, Proposer(s) agrees in advance that if it is the successful PConsultant Services Agreement attached and incorporated as Exhibit B and will perform its services according to the terms and conditions outlined in that agreement. In no event is a Proposer to submit its own standard contract terms and conditions in response to this RFP. Proposers may submit exceptions as allowed in the Certifications and Assurances document attached and incorporated as Exhibit A. The City will review requested exceptions and accept or reject the same at its sole discretion. Be specific with any exception noted. The successful Proposer shall comply with and perform the services in accordance with all applicable federal, state, county and City laws including, without limitation, all City codes, ordinances, standards and policies, as now existing or hereafter adopted or amended. III. Proposals All proposals should be prepared simply, and provide straightforward and concise descriptions of the Proposer clarity of content. Efficiency is a critical component of this RFP and all Proposers are advised to propose a process that will make efficient use of limited City resources in executing any proposal that may be selected through this RFP process. Should a contract result from this RFP process, all work must be completed within six (6) months from the effective date of that resulting contract. RFP Non-represented Employees Classification/Compensation Study Page 4 Qbdlfu!Qh/!26 6/C/b If a Proposer intends to subcontract any work should it be awarded the RFP, the proposal must be accompanied by background materials and references for any proposed subcontractor. Proposals shall include a signature line, with name and title of signatory, in either PDF or Word document, -copy as opposed to electronically, it shall include three (3) copies. All proposals must include the following: 1. Summary of Proposerde: a. Organization name, address, telephone number, and email address; b. Name and telephone number of contact person; c. Legal formation of Proposer (e.g., sole proprietor, partnership, corporation); d. Date Proposer; e. Description of Proposer offered, and clientele; f. A list of Proposerprincipal officers, along with their respective experience and background as it pertains to classification and compensation experience (e.g., President, Chairman, Vice President, Secretary, Chief Operating Officer, Chief Financial Officer, General Managers); g. Details of who will perform the work, their qualifications including resumes, as well as a list of related work experience of each individual who will perform the work; h. ; i. Evidence of legal authority to conduct business in Washington (e.g., the number of Proposer; j. Evidence of an established track record for providing services and/or deliverables that are the subject of this RFP; and 2. Summary of Proposer a. A statement as to whether the Proposer or its parent company (if any) has ever filed for bankruptcy or any form of reorganization under the bankruptcy code; and b. A statement as to whether the Proposer or its parent company (if any) has ever received any sanctions or is currently under investigation by any regulatory or government entity. 3. scope of work that includes: a. Summary of timeline and work to be completed; b. Methodology of how the work will be performed; and c. Quality control measures that will be utilized to ensure accuracy of the work. RFP Non-represented Employees Classification/Compensation Study Page 5 Qbdlfu!Qh/!27 6/C/b 4. A statement of the fee proposed to compensate Proposer for implementing its proposal and supplying the City with the requested services and deliverables, which should incorporate the following: a. Brief summary of the total cost of the proposal; b. A detailed list of any and all expected costs or expenses related to the proposed project; and c. Summary and explanation of any other contributing expenses to the total cost. 5. A list of 4 professional references for similar or related work performed in the past 24 months, including names, addresses, and phone numbers, and identify how each reference will be able to comment upon ProposerProposer proposes in its response to this RFP. By submitting a proposal, Proposer agrees that City of Kent Human Resources Department may contact all submitted references to obtain any and all information regarding Proposer's performance history. 6. A statement that the Proposer can meet the insurance requirements contained in Exhibit C to the RFP. 7. Return of the signed Certifications and Assurances, attached as Exhibit A. All costs incurred to develop and prepare proposals, and to otherwise participate in this RFP process, are entirely the responsibility of the Proposer and shall not be chargeable to the City. All proposals become the property of the City and are subject to public disclosure laws. IV. Method of Selection Submittals will be evaluated using the following criteria. These criteria represent the primary factors for consideration. Selection of the proposal the City believes best fits its needs will be based on a number of factors including, but limited to: 1. Propo requested; 2. required to execute the requested services effectively and efficiently; 3. Overall cost anticipated to implement the proposal; 4. Information contained within the submitted proposal; and 5. an interview. In evaluating the proposals, cost will not be the sole factor, but it will have a significant impact on whether the City is able to proceed with any particular proposal. The City may consider any factors it deems necessary and proper for best value including, but not limited to, price, quality of service, response to this request, discretion, may select the Proposer The City reserves the right to determine the completeness of all proposals. Late or incomplete proposals may not be considered. The City reserves the right to reject any and all proposals submitted or to cancel RFP Non-represented Employees Classification/Compensation Study Page 6 Qbdlfu!Qh/!28 6/C/b this RFP at any time. The City reserves the right to waive any irregularities in the submittal and evaluation process. The City reserves the right to request additional information from each Proposer and to request additional oral interviews. V. Schedule w of the proposal submittals and final selection of the successful Proposer is as follows: December 8, 2021 RFP Packages are available on city Web page, Kent Reporter, mailed, emailed, or picked up. December 20, 2021 Deadline for submittal of written questions to the Human Resources Department via an email to HumanResources@kentwa.gov procurement website:https://www.kentwa.gov/doing-business/bids- procurement December 31, 2021 RFP submittal deadline: 2:00 pm January 3-12, 2021 RFP reviews January 19, 2021 Oral Interviews-if needed; interviews are optional and will be scheduled at the sole discretion of the City January 31, 2021 Consultant contract(s) awarded. All Proposera successful Proposer is selected. VI. Submittal The City prefers that proposals be submitted by email to HumanResources@kentwa.gov, but proposals may also be submitted by mail or other delivery service. Only one delivery method shall be utilized; duplicate proposals shall not be sent by other means. Regardless of the delivery method chosen, all proposals shall be delivered and must be received by 2:00 p.m. on December 31, 2021. Late proposals may result in a proposal being rejected. US Mail Delivery: If submitting a proposal by mail, a total of three copies of the entire proposal in printed form must be submitted in a sealed envelope or box with the following words clearly marked on the outside of the envelope: Classification & Compensation Study - RFP Proposal Due Date: December 31, 2021 The name of the Proposer and its address must also be clearly indicated on the envelope. Mailed proposals should be addressed as follows: City of Kent Human Resources Department Attention: Teri Smith, HR Director 220 Fourth Ave. S. Kent, WA 98032 Email Delivery: If submitting a proposal by email, emailed proposals must be in MS Word or PDF format. They must include Classification & Compensation Study RFP subject line and be sent to the following email address: HumanResources@kentwa.gov RFP Non-represented Employees Classification/Compensation Study Page 7 Qbdlfu!Qh/!29 6/C/b Hand-Delivery: Hand-delivered proposals shall be delivered to: City of Kent , City Hall Building 220 Fourth Avenue South Kent, WA 98032 Proposal Questions: Proposers should submit any questions regarding the RFP via e-mail directly to Human Resources at HumanResources@kentwa.gov. The cut off for all questions is December 20, 2021, at 4:00 p.m. VII. General RFP Provisions Revisions to RFP through Addenda. In the event it becomes necessary to revise any part of this RFP, addenda shall be created and distributed to all known potential Proposers providing an accurate e-mail address. City staff are prohibited from speaking with Proposers about the project during the solicitation. Please direct all questions to the Teri Smith, Human Resources Director. Costs to Propose. The City is not liable for any cost incurred by a Proposer in responding to this RFP or during the RFP review process. COVID-19 Pandemic. All proposals must be submitted with the current COVID-19 pandemic in mind and include the costs the successful Proposer, as the selected consultant, will incur in timely performing the work while complying with all federal, state, and local job site requirements, including social distancing, sanitation measures, and required personal protective equipment. Once a contract is executed, the successful Proposer will not be excused for delay, and no change order will be issued for increased costs or additional time, due to the Proposer-19 mitigation measures established by any federal or state agency or official and required as of the date of RFP opening. Should a federal or state agency or official impose subsequent mitigation measures that are not reasonably foreseeable, the City will agree to negotiate in good faith the impact those measures have on the ultimate contract work. Most Favorable Terms. The City reserves the right to make an award without further discussion of the proposal submitted. Therefore, the proposal should be submitted initially on the most favorable terms that the Proposer can propose. There will be no best and final offer procedure. The City does reserve the right to contact a Proposer for clarification of its proposal during the evaluation process. In addition, if the Proposer is selected as the apparent successful Proposer, the City reserves the right to enter into contract negotiations with the apparent successful Proposer, which may include discussion regarding the terms of the proposal. Contract negotiations may result in incorporation of some or all of the Proposer submission. The Proposer should be prepared to accept this RFP for incorporation into a contract resulting from this RFP. It is also understood that the proposal will become part of the official procurement file. Acceptance Period. Proposals must provide 60 days for acceptance by the City from the due date for receipt of proposals. Rejection of Proposals and Waiver of Informalities. The City reserves the right at its sole discretion to reject any or all proposals that the City receives without penalty, and to waive irregularities and informalities with respect to any proposal. Contract and General Terms and Conditions. The apparent successful Proposer will be expected to enter into a contract that is substantially the same as the sample contract and its specific and general terms and conditions attached as Exhibit B. In no event is a Proposer to submit its own standard contract terms and conditions in response to this solicitation. A Proposer may submit exceptions as allowed in the Certifications and Assurances section, Exhibit A to this solicitation. The City will review requested exceptions and accept or reject the same at its sole discretion. RFP Non-represented Employees Classification/Compensation Study Page 8 Qbdlfu!Qh/!2: 6/C/b No Obligation to Contract. This RFP does not obligate the City to contract for services specified herein. Participation in this RFP and /or submission of a proposal does not confer any legal right or entitlement to Proposers, nor create any obligation thereto on the part of the City. Commitment of Funds. the City to the expenditure of funds for a contract resulting from this RFP. No cost chargeable to the proposed contract may be incurred before receipt of a fully executed contract. Insurance Coverage. The selected Proposer(s) shall, at its own expense, obtain and keep in force insurance coverage that shall be maintained in full force and effect during the term of the contract in the types and amounts required by Exhibit C. At the time any contract is executed, the selected Proposer(s) shall furnish evidence of such coverage, in the form of a Certificate of Insurance and an additional insured endorsement. Equal Opportunity Employer. The City is an Equal Opportunity Employer and does not discriminate against individuals or firms because of their race, color, creed, marital status, religion, age, sex, national origin, sexual orientation, or the presence of any mental, physical or sensory handicap in an otherwise qualified handicapped person. Compliance with Applicable Laws. In addition to these nondiscrimination compliance requirements, the vendor ultimately awarded a contract shall comply with federal, state and local laws, statutes, regulations and ordinances relative to the execution of the services. This requirement includes, but is not limited to, protection of public and employee safety and health; disabilities; environmental protection; waste reduction and recycling; the protection of natural resources; permits; fees; taxes; and similar subjects; and social distancing, personal protective equipment, and sanitation requirements in response to the current COVID- 19 pandemic. Public Records. All submitted proposals and evaluation materials become public information and may be reviewed by anyone requesting to do so at the conclusion of the evaluation, negotiation, and award process. This process is concluded when a signed contract is completed between the City and the selected Proposer. Temporary Waiver of Right to Submit Public Records Request. By electing to participate in this RFP process, the Proposer agrees not to make a public records request for any documents or information submitted by any other Proposer who responds to this RFP, and to the extent allowed by law, waives its right to make such a request until contract execution is complete. Conditional Proposal Invalid. A response from a Proposer that indicates that any of the information requested by the City in this RFP will be provided only if the Proposer is selected as the apparently successful Proposer from consideration. VIII. Exhibits Exhibit A Certifications and Assurances Exhibit B Sample Consultant Services Contract Exhibit C Insurance Requirements RFP Non-represented Employees Classification/Compensation Study Page 9 Qbdlfu!Qh/!31 6/C/b Exhibit A To the RFP for Non-represented Employees Classification/Compensation Study CERTIFICATIONS AND ASSURANCES I/we make the following certifications and assurances as a required element of the proposal to which it is attached, understanding that the truthfulness of the facts affirmed here and the continuing compliance with these requirements are conditions precedent to the award or continuation of the related contract(s): 1. I/we declare that all answers and statements made in the proposal are true and correct. 2. The prices and/or costs data have been determined independently, without consultation, communication, or agreement with others for the purpose of restricting competition. However, I/we may freely join with other persons or organizations for the purpose of presenting a single proposal. 3. The attached proposal is a firm offer for a period of 60 days following the due date for receipt of proposals, and it may be accepted by the City of Kent, Washington without further negotiation (except where obviously required by lack of certainty in key terms) at any time within the 60-day period. 4. In preparing this proposal, I/we have not been assisted by any current or former employee of the City of Kent whose duties relate (or did relate) to this proposal or prospective contract, and who was assisting in other than his or her official, public capacity. (Any exceptions to these assurances are described in full detail on a separate page and attached to this document.) 5. I/we understand that the City of Kent will not reimburse me/us for any costs incurred in the preparation of this proposal. All proposals become the property of the City of Kent, and I/we claim no proprietary right to the ideas, writings, items, or samples, unless so stated in this proposal. 6. Unless otherwise required by law, the prices and/or cost data which have been submitted have not been knowingly disclosed by the Proposer and will not knowingly be disclosed by him/her prior to opening, directly or indirectly, to any other Proposer or to any competitor. 7. I/we agree that submission of the attached proposal constitutes acceptance of the solicitation contents and the attached sample contract and general terms and conditions. If there are any exceptions to these terms, I/we have described those exceptions in detail on a page attached to this document. 8. No attempt has been made or will be made by the Proposer to induce any other person or firm to submit or not to submit a proposal for the purpose of restricting competition. 9. I/we grant the City of Kent the right to contact references and others, who may have pertinent information regarding the Proposer's prior experience and ability to perform the services contemplated in this procurement. Signature of Proposer Title Date EXHIBIT A Certifications and Assurances RFP Non-represented Employees Classification/Compensation Study Page 10 Qbdlfu!Qh/!32 6/C/b Exhibit B Sample Consultant Services Agreement CONSULTANT SERVICES AGREEMENT between the City of Kent and \[Insert Consultant's Company Name\] THIS AGREEMENT is made between the City of Kent, a Washington municipal corporation (hereinafter the "City"), and \[Insert Consultant's Co. Name\] organized under the laws of the State of \[Insert State Co. Formed Under\], located and doing business at \[Insert Consultant's Address and Phone Number\] (hereinafter the "Consultant"). I. DESCRIPTION OF WORK. The Consultant shall perform the following services for the City in accordance with the following described plans and/or specifications: \[Insert Detailed Description of Work Consultant will be Performing\] The Consultant further represents that the services furnished under this Agreement will be performed in accordance with generally accepted professional practices within the Puget Sound region in effect at the time those services are performed. II. TIME OF COMPLETION. The parties agree that work will begin on the tasks described in Section I above immediately upon the effective date of this Agreement. The Consultant shall complete the work described in Section I \[Type either "within" or "by" depending on deadline in next form field\] \[Insert either a date specific or enter # of days, weeks, months, years, etc.\]. III. COMPENSATION. A. The City shall pay the Consultant, based on time and materials, an amount not to exceed \[Insert maximum dollar amount to be paid for services. You may type out the dollar amount and place the numerical dollar amount in parentheses or you may just enter the numerical dollar amount, plus applicable Washington State sales tax,\], for the services described in this Agreement. This is the maximum amount to be paid under this Agreement for the work described in Section I above, and shall not be exceeded without the prior written authorization Buubdinfou;!Opo.Sfq!Dpnq!Tuvez!!)3:74!;!Opo.Sfqsftfoufe!Tbmbsz!Tuvez!.!Bvuipsj{f* of the City in the form of a negotiated and executed amendment to this agreement. The Consultant agrees that the hourly or flat rate charged by it for its services contracted for herein shall remain locked at the negotiated rate(s) for a period of one (1) year from the effective date of this Agreement. The Consultant's billing rates shall be as delineated in Exhibit \[Insert the Exhibit # that lists the rate to be charged\]. B. The Consultant shall submit \[Enter monthly or quarterly\] payment invoices to the City for work performed, and a final bill upon completion of all services described in this Agreement. The City shall provide payment within forty-five (45) days of receipt of an invoice. If the City EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 11 Qbdlfu!Qh/!33 6/C/b objects to all or any portion of an invoice, it shall notify the Consultant and reserves the option to only pay that portion of the invoice not in dispute. In that event, the parties will immediately make every effort to settle the disputed portion. C. Card Payment Program. The Consultant may elect to participate in automated credit card payments provided for by the City and its financial institution. This Program is provided as an alternative to payment by check and is available for the convenience of the Consultant. If the Consultant voluntarily participates in this Program, the Consultant will be solely responsible for any fees imposed by financial institutions or credit card companies. The Consultant shall not charge those fees back to the City. IV. INDEPENDENT CONTRACTOR. The parties intend that an Independent Contractor- Employer Relationship will be created by this Agreement. By their execution of this Agreement, and in accordance with Ch. 51.08 RCW, the parties make the following representations: A. The Consultant has the ability to control and direct the performance and details of its work, the City being interested only in the results obtained under this Agreement. B. The Consultant maintains and pays for its own place of business from which the C. The Consultant has an established and independent business that is eligible for a business deduction for federal income tax purposes that existed before the City retained the established trade, occupation, profession, or business of the same nature as that involved under this Agreement. D. The Consultant is responsible for filing as they become due all necessary tax documents with appropriate federal and state agencies, including the Internal Revenue Service and the state Department of Revenue. E. The Consultant has registered its business and established an account with the state Department of Revenue and other state agencies as may be required by the from the State of Washington. F. The Consultant maintains a set of books dedicated to the expenses and earnings of its business. V. TERMINATION. Either party may terminate this Agreement, with or without cause, upon providing the other party thirty (30) days written notice at its address set forth on the signature block of this the records or data is not related to this project, it shall be without liability or legal exposure to the Consultant. VI. FORCE MAJEURE. Neither party shall be liable to the other for breach due to delay or failure in performance resulting from acts of God, acts of war or of the public enemy, riots, pandemic, fire, flood, delayed due to a force majeure event shall not result in liability to the delayed party. Both parties represent to the other that at the time of signing this Agreement, they are able to perform as required and their performance will not be prevented, hindered, or delayed by the current COVID-19 pandemic, any existing state or national declarations of emergency, or any current social distancing restrictions or personal protective equipment requirements that may be required under federal, state, or local law in response to the current pandemic. If any future performance is prevented or delayed by a force majeure event, the party whose performance is prevented or delayed shall promptly notify the other party of the existence and nature of EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Qbdlfu!Qh/!34 Page 12 6/C/b the force majeure event causing the prevention or delay in performance. Any excuse from liability shall be effective only to the extent and duration of the force majeure event causing the prevention or delay in performance and, provided, that the party prevented or delayed has not caused such event to occur and continues to use diligent, good faith efforts to avoid the effects of such event and to perform the obligation. Notwithstanding other provisions of this section, the Consultant shall not be entitled to, and the City shall not be liable for, the payment of any part of the contract price during a force majeure event, or any costs, losses, expenses, damages, or delay costs incurred by the Consultant due to a force majeure event. Performance that is more costly due to a force majeure event is not included within the scope of this Force Majeure provision. If a force majeure event occurs, the City may direct the Consultant to restart any work or performance that may have ceased, to change the work, or to take other action to secure the work or the project site during the force majeure event. The cost to restart, change, or secure the work or project site arising from a direction by the City under this clause will be dealt with as a change order, except to the extent that the loss or damage has been caused or exacerbated by the failure of the Consultant to fulfill its obligations under this Agreement. Except as expressly contemplated by this section, all other costs will be borne by the Consultant. VII. DISCRIMINATION. In the hiring of employees for the performance of work under this Agreement or any subcontract, the Consultant, its subcontractors, or any person acting on behalf of the Consultant or subcontractor shall not, by reason of race, religion, color, sex, age, sexual orientation, national origin, or the presence of any sensory, mental, or physical disability, discriminate against any person who is qualified and available to perform the work to which the employment relates. The Consultant shall execute the attached City of Kent Equal Employment Opportunity Policy Declaration, Comply with City Administrative Policy 1.2, and upon completion of the contract work, file the attached Compliance Statement. VIII. INDEMNIFICATION. The Consultant shall defend, indemnify and hold the City, its officers, officials, employees, agents and volunteers harmless from any and all claims, injuries, damages, losses or suits, including all legal costs and attorney fees, arising out of or in connection with the Consultant's performance of this Agreement, except for that portion of the injuries and damages caused by the City's negligence. The City's inspection or acceptance of any of the Consultant's work when completed shall not be grounds to avoid any of these covenants of indemnification. Should a court of competent jurisdiction determine that this Agreement is subject to RCW 4.24.115, then, in the event of liability for damages arising out of bodily injury to persons or damages to property caused by or resulting from the concurrent negligence of the Consultant and the City, its officers, officials, employees, agents and volunteers, the Consultant's duty to defend, indemnify, and hold the City harmless, liability accruing from that obligation shall be only to the extent of the Consultant's negligence. IT IS FURTHER SPECIFICALLY AND EXPRESSLY UNDERSTOOD THAT THE INDEMNIFICATION PROVIDED HEREIN CONSTITUTES THE CONSULTANT'S WAIVER OF IMMUNITY UNDER INDUSTRIAL INSURANCE, TITLE 51 RCW, SOLELY FOR THE PURPOSES OF THIS INDEMNIFICATION. THE PARTIES FURTHER ACKNOWLEDGE THAT THEY HAVE MUTUALLY NEGOTIATED THIS WAIVER. In the event the Consultant refuses tender of defense in any suit or any claim, if that tender was made pursuant to this indemnification clause, and if that refusal is subsequently determined by a court having jurisdiction (or other agreed tribunal) the re was a wrongful refusal The provisions of this section shall survive the expiration or termination of this Agreement. EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Qbdlfu!Qh/!35 Page 13 6/C/b IX. INSURANCE. The Consultant shall procure and maintain for the duration of the Agreement, insurance of the types and in the amounts described in Exhibit \[Insert Exhibit #\] attached and incorporated by this reference. X. EXCHANGE OF INFORMATION. The City will provide its best efforts to provide reasonable accuracy of any information supplied by it to the Consultant for the purpose of completion of the work under this Agreement. XI. OWNERSHIP AND USE OF RECORDS AND DOCUMENTS. Original documents, drawings, designs, reports, or any other records developed or created under this Agreement shall belong to and become the property of the City. All records submitted by the City to the Consultant will be safeguarded by the Consultant. The Consultant shall make such data, documents, and files available to the City upon the Act codified in Chapter 42.56 of the Revised Code of Washington. As such, the Consultant agrees to and files created by the Consultant for this project by anyone other than the Consultant on any other project shall be without liability or legal exposure to the Consultant. XII. CITY'S RIGHT OF INSPECTION. Even though the Consultant is an independent contractor with the authority to control and direct the performance and details of the work authorized under this Agreement, the work must meet the approval of the City and shall be subject to the City's general right of inspection to secure satisfactory completion. XIII. WORK PERFORMED AT CONSULTANT'S RISK. The Consultant shall take all necessary precautions and shall be responsible for the safety of its employees, agents, and subcontractors in the performance of the contract work and shall utilize all protection necessary for that purpose. All work shall be done at the Consultant's own risk, and the Consultant shall be responsible for any loss of or damage to materials, tools, or other articles used or held for use in connection with the work. XIV. MISCELLANEOUS PROVISIONS. A. Recyclable Materials. Pursuant to Chapter 3.80 of the Kent City Code, the City requires its contractors and consultants to use recycled and recyclable products whenever practicable. A price preference may be available for any designated recycled product. B. Non-Waiver of Breach. The failure of the City to insist upon strict performance of any of the covenants and agreements contained in this Agreement, or to exercise any option conferred by this Agreement in one or more instances shall not be construed to be a waiver or relinquishment of those covenants, agreements or options, and the same shall be and remain in full force and effect. C. Resolution of Disputes and Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. If the parties are unable to settle any of resolving that dispute, difference or claim, shall only be by filing suit exclusively under the venue, rules and jurisdiction of the King County Superior Court, King County, Washington, unless the parties agree in writing to an alternative dispute resolution process. In any claim or lawsuit for damages arising from the parties' performance of this Agreement, each party shall pay all its legal costs and attorney's fees incurred in defending or bringing such claim or lawsuit, including all appeals, in addition to any other recovery or award provided by law; provided, however, nothing in this paragraph shall be construed to limit the City's right to indemnification under Section VIII of this Agreement. D. Written Notice. All communications regarding this Agreement shall be sent to the parties at the addresses listed on the signature page of the Agreement, unless notified to the contrary. Any written notice hereunder shall become effective three (3) business days after the date of mailing by registered or certified mail, and shall be deemed sufficiently given if sent to the addressee at the address stated in this Agreement or such other address as may be hereafter specified in writing. EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Qbdlfu!Qh/!36 Page 14 6/C/b E. Assignment. Any assignment of this Agreement by either party without the written consent of the non-assigning party shall be void. If the non-assigning party gives its consent to any assignment, the terms of this Agreement shall continue in full force and effect and no further assignment shall be made without additional written consent. F. Modification. No waiver, alteration, or modification of any of the provisions of this Agreement shall be binding unless in writing and signed by a duly authorized representative of the City and the Consultant. G. Entire Agreement. The written provisions and terms of this Agreement, together with any Exhibits attached hereto, shall supersede all prior verbal statements of any officer or other representative of the City, and such statements shall not be effective or be construed as entering into or forming a part of or altering in any manner this Agreement. All of the above documents are hereby made a part of this Agreement. However, should any language in any of the Exhibits to this Agreement conflict with any language contained in this Agreement, the terms of this Agreement shall prevail. H. Compliance with Laws. The Consultant agrees to comply with all federal, state, and municipal laws, rules, and regulations that are now effective or in the future become applicable to the Consultant's business, equipment, and personnel engaged in operations covered by this Agreement or accruing out of the performance of those operations. I. Public Records Act. The Consultant acknowledges that the City is a public agency subject to the Public Records Act codified in Chapter 42.56 of the Revised Code of Washington and documents, notes, emails, and other records prepared or gathered by the Consultant in its performance of this Agreement may be subject to public review and disclosure, even if those records are not produced to or possessed by the City of Kent. As such, the Consultant agrees to coop and obligations under the Public Records Act. J. City Business License Required. Prior to commencing the tasks described in Section I, Contractor agrees to provide proof of a current city of Kent business license pursuant to Chapter 5.01 of the Kent City Code. K. Counterparts and Signatures by Fax or Email. This Agreement may be executed in any number of counterparts, each of which shall constitute an original, and all of which will together constitute this one Agreement. Further, upon executing this Agreement, either party may deliver the signature page to the other by fax or email and that signature shall have the same force and effect as if the Agreement bearing the original signature was received in person. / / / / / / / / / / / / EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Qbdlfu!Qh/!37 Page 15 6/C/b IN WITNESS, the parties below execute this Agreement, which shall become effective on the last date entered below. All acts consistent with the authority of this Agreement and prior to its effective date are ratified and affirmed, and the terms of the Agreement shall be deemed to have applied. CONSULTANT: CITY OF KENT: By: By: (signature) (signature) Print Name: Print Name: Dana Ralph Its: Its: Mayor (title) DATE: DATE: NOTICES TO BE SENT TO: NOTICES TO BE SENT TO: CONSULTANT: CITY OF KENT: \[Insert Contact Name\] \[Insert Name of City Rep. to Receive Notice\] \[Insert Company Name\] City of Kent \[Insert Address\] 220 Fourth Avenue South \[Address - Continued\] Kent, WA 98032 (253) \[Insert Phone Number\] (telephone) \[Insert Telephone Number\] (telephone) (253) \[Insert Fax Number\] (facsimile) \[Insert Fax Number\] (facsimile) APPROVED AS TO FORM: Kent Law Department ATTEST: Kent City Clerk EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Qbdlfu!Qh/!38 Page 16 6/C/b DECLARATION CITY OF KENT EQUAL EMPLOYMENT OPPORTUNITY POLICY The City of Kent is committed to conform to Federal and State laws regarding equal opportunity. As such all contractors, subcontractors and suppliers who perform work with relation to this Agreement shall The following questions specifically identify the requirements the City deems necessary for any contractor, subcontractor or supplier on this specific Agreement to adhere to. An affirmative response is required on all of the following questions for this Agreement to be valid and binding. If any contractor, subcontractor or supplier willfully misrepresents themselves with regard to the directives outlines, it will be considered a or part of the Agreement. The questions are as follows: 1. I have read the attached City of Kent administrative policy number 1.2. 2. During the time of this Agreement, I will not discriminate in employment on the basis of sex, race, color, national origin, age, or the presence of all sensory, mental or physical disability. 3. During the time of this Agreement the prime contractor will provide a written statement to all new employees and subcontractors indicating commitment as an equal opportunity employer. 4. During the time of the Agreement I, the prime contractor, will actively consider hiring and promotion of women and minorities. 5. Before acceptance of this Agreement, an adherence statement will be signed by me, the Prime Contractor, that the Prime Contractor complied with the requirements as set forth above. By signing below, I agree to fulfill the five requirements referenced above. By: _______________________________________________ For: _______________________________________________ Title: ______________________________________________ Date: _____________________________________________ EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 17 Qbdlfu!Qh/!39 6/C/b CITY OF KENT ADMINISTRATIVE POLICY NUMBER: 1.2 EFFECTIVE DATE: January 1, 1998 SUBJECT: MINORITY AND WOMEN SUPERSEDES: April 1, 1996 CONTRACTORS APPROVED BY Jim White, Mayor POLICY: Equal employment opportunity requirements for the City of Kent will conform to federal and state laws. All contractors, subcontractors, consultants and suppliers of the City must guarantee equal employment opportunity within their organization and, if holding Agreements with the City amounting to $10,000 or more within any given year, must take the following affirmative steps: 1. Provide a written statement to all new employees and subcontractors indicating commitment as an equal opportunity employer. 2. Actively consider for promotion and advancement available minorities and women. and equal opportunity requirements shall be considered in breach of contract and subject to suspension or termination for all or part of the Agreement. Contract Compliance Officers will be appointed by the Directors of Planning, Parks, and Public Works Departments to assume the following duties for their respective departments. 1. Ensuring that contractors, subcontractors, consultants, and suppliers subject to these regulations are 2. Monitoring to assure adherence to federal, state and local laws, policies and guidelines. ! EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 18 Qbdlfu!Qh/!3: 6/C/b CITY OF KENT EQUAL EMPLOYMENT OPPORTUNITY COMPLIANCE STATEMENT This form shall be filled out AFTER COMPLETION of this project by the Contractor awarded the Agreement. I, the undersigned, a duly represented agent of Company, hereby acknowledge and declare that the before-mentioned company was the prime contractor for the Agreement known as that was entered into on the (date) between the firm I represent and the City of Kent. I declare that I complied fully with all of the requirements and obligations as outlined in the City of Kent Administrative Policy 1.2 and the Declaration City of Kent Equal Employment Opportunity Policy that was part of the before-mentioned Agreement. By: _______________________________________________ For: _______________________________________________ Title: ______________________________________________ Date: _____________________________________________ EXHIBIT B Sample Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 19 Qbdlfu!Qh/!41 6/C/b EXHIBIT C INSURANCE REQUIREMENTS FOR CONSULTANT SERVICES AGREEMENTS Insurance The Consultant shall procure and maintain for the duration of the Agreement, insurance against claims for injuries to persons or damage to property which may arise from or in connection with the performance of the work hereunder by the Consultant, their agents, representatives, employees or subcontractors. Minimum Scope of Insurance Consultant shall obtain insurance of the types described below: 1. Commercial General Liability insurance shall be written on ISO occurrence form CG 00 01 and shall cover liability arising from premises, operations, independent contractors, products-completed operations, personal injury and advertising injury, and liability assumed under an insured contract. The Commercial General Liability insurance shall be endorsed to provide the Aggregate Per Project Endorsement ISO form CG 25 03 11 85. The City shall be named as an insured under the City using ISO additional insured endorsement CG 20 10 11 85 or a substitute endorsement providing equivalent coverage. 2. Cyber Liability insurance naming the City as an Additional Insured. Minimum Amounts of Insurance Consultant shall maintain the following insurance limits: 1. Commercial General Liability insurance shall be written with limits no less than $1,000,000 each occurrence, $2,000,000 general aggregate. Coverage may be in the form of an underlying GL policy combined with an Umbrella/Excess policy in order to meet the limits required. 2. Cyber Liability insurance shall be written with limits no less than $2,000,000 per occurrence and $2,000,000 aggregate. Other Insurance Provisions The insurance policies are to contain, or be endorsed to contain, the following provisions for Automobile Liability and Commercial General Liability insurance: 1. self-insurance, or insurance pool coverage maintained by the City shall be excess of the C insurance and shall not contribute with it. 2. party, except after thirty (30) days prior written notice by certified mail, return receipt requested, has been given to the City. 3. The City of Kent shall be named as an additional insured on all policies (except Professional Liability) as respects work performed by or on behalf of the Consultant and a copy of the endorsement naming EXHIBIT C Insurance Requirements for Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 20 Qbdlfu!Qh/!42 6/C/b the City as additional insured shall be attached to the Certificate of Insurance. The City reserves the General Liability insurance shall also contain a clause stating that coverage shall apply separately to each insured against whom claim is made or suit is brought, except with respects to the limits of the D. Acceptability of Insurers Insurance is to be placed with insurers with a current A.M. Best rating of not less than A:VII. E.!Verification of Coverage Consultant shall furnish the City with original certificates and a copy of the amendatory endorsements, including but not necessarily limited to the additional insured endorsement, evidencing the insurance requirements of the Consultant before commencement of the work. F.Subcontractors Consultant shall include all subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each subcontractor. All coverages for subcontractors shall be subject to all of the same insurance requirements as stated herein for the Consultant. EXHIBIT C Insurance Requirements for Consultant Services Agreement RFP Non-represented Employees Classification/Compensation Study Page 21 Qbdlfu!Qh/!43 6/C/b EXHIBIT D SCOPE OF SERVICES Note: This scope is not final until a consultant is selected and negotiations are completed. 1.!Project Management/Consultation Coordination a. The Consultant shall coordinate with the City's project manager throughout the project. b. The Consultant shall develop a mutually agreeable project management plan that clearly describes all phases of the project with schedules, milestones, responsibilities, constraints, and deliverables. c. The Consultant shall prepare and implement a communication program that ensures full communication to leadership and employees throughout the project and provides opportunities for meaningful engagement without unduly prolonging the process. d. The Consultant shall submit monthly invoices with a written summary of project progress. 2.!Classification and Compensation Analysis a. Identify and evaluate appropriate options for the City: i. Conduct a job audit of all positions, including a general task analysis by department, which shall include interviews with department directors/managers and other key personnel to determine the organizational structure and essential functions of each position. ii. Review and recommend revisions to existing job descriptions for City staff to update, as needed. Identifying Fair Labor Standards Act designation for each job classification shall be included in this review. Identify updates to wording in job descriptions to be consistent with Diversity, Equity and Inclusion (DEI) standards. iii. Evaluate jobs by developing, then reviewing, a job-ranking structure; verify ranking by analyzing pertinent market data concerning the ranking; compare the initial ranking with that of the market's hierarchy and adjust as determined; prepare a matrix with an organizational review on the basis of required tasks and future forecasts; develop a matrix of jobs crossing lines and departments; compare the matrix with the City structure. iv. Determine recommended comparable cities and present to City staff for discussion. v. Determine recommended compensation philosophy and present to City staff for discussion. vi. Determine an appropriate salary range within the existing salary structure. vii. Develop and present to staff recommendations and impact studies including the cost, if any, of implementing the proposed compensation policies with EXHIBIT D Scope of Services RFP Non-represented Employees Classification/Compensation Study Page 22 Qbdlfu!Qh/!44 6/C/b current employees, and the future impact of recommended changes. viii. Schedule and attend meetings with City staff and attend agreed upon City Council meetings for updates as necessary. 3.!Meetings a. The Consultant shall lead a kick-off meeting with City staff. b. The Consultant shall meet with City staff to discuss and identify information that is relevant to the analysis. c. The Consultant shall meet with City leadership and employees as needed to coordinate progress and review draft findings. At a minimum, there shall be an initial kick-off session and two additional progress check-ins. These progress updates may be conducted virtually (i.e. via Teams platform). d. The Consultant shall attend a meeting to review the final report with City leadership and staff. e. The Consultant shall attend a City Council meeting to present on the findings of the study. 4.!Deliverables a. The Consultant shall prepare a draft report for review and comment by City leadership and staff. b. The Consultant shall prepare a final report for presentation to the City Council and City leadership and staff. c. The Consultant shall provide recommendation(s) to revise job descriptions, as needed. d. The Consultant shall be responsible for preparing the materials and exhibits for the presentation to the City Council, leadership and employees. e. The Consultant shall also prepare written responses to additional questions posed by leadership, employees and/or the City Council as practicable and prepare additional information as requested. 5.!Public Meetings a. The Consultant shall make a presentation and be prepared to answer questions from City Council at a Council meeting where the proposed recommendations are discussed. b. The Consultant may then be asked to provide additional rate proposals based on additional questions or assumptions discussed in those presentations. EXHIBIT D Scope of Services RFP Non-represented Employees Classification/Compensation Study Page 23 Qbdlfu!Qh/!45 6/D POLICE DEPARTMENT Rafael Padilla, Police Chief 220 Fourth Avenue South Kent, WA 98032 253-852-2121 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: INFO ONLY: New Conversations - Training SUMMARY: Chief Padilla will provide a recap of a recent training that was attended by officers that focused on enhancing community police relations. SUPPORTS STRATEGIC PLAN GOAL: Thriving City - Creating safe neighborhoods, healthy people, vibrant commercial districts, and inviting parks and recreation. Inclusive Community - Embracing our diversity and advancing equity through genuine community engagement. Qbdlfu!Qh/!46 6/E FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: Consolidating Budget Adjustment Ordinance for Adjustments between October 1, 2021 and November 30, 2021 - Adopt MOTION: I move to adopt Ordinance No. 4421, approving the consolidating budget adjustments made between October 1, 2021 and November 30, 2021, reflecting an overall budget increase of $31,099,990. SUMMARY: Authorization is requested to approve the technical gross budget adjustment ordinance reflecting an overall budget increase of $31,099,990. Adjustments totaling $24,780,850 have previously been approved by Council and are summarized as follows: A total of $23,580,850 in grants: · $13,291,160 for the first payment of ARPA Grant funding received in 2021. The second and final payment will occur in 2022. · $8,000,000 Regional Mobility Grant for a funding agreement with the King County Metro Transit Department to design and construct RapidRide I bus stops and access to transit improvements. · $1,525,220 Shuttered Venue Operators Grant supplemental award for COVID-19 emergency assistance at the accesso ShoWare Center. · $696,880 RCO Grant for the Downey Farmstead project. · $59,990 in Criminal Justice grants including the 2021-22 Walter/Roller Grant for a race & equity youth partnership ($50k) and a Target Zero Grant for manager overtime ($10k). · $7,600 DNR Grant for an Urban Forestry Plan. · A total of $1,200,000 in other items previously brought before and approved by City Council including the following: · $700,000 increase to Police salaries & benefits due to the establishment of new 12-hour and 10.5-hour overtime exempt shifts and a compensation increase that accounts for the additional hours of work, a market adjustment and a cost-of-living adjustment. · $500,000 contribution for new scoreboard at the accesso ShoWare Center. The remaining adjustments totaling $6,319,140 have not been previously approved Qbdlfu!Qh/!47 6/E by Council and include the following: $2,242,080 for increased insurance costs including Liability Insurance ($2m), Workers Compensation Insurance ($125k) and Property Insurance ($117k). $1,144,750 adjustment to the 2016 LTGO debt service; a $2.1m increase to interest, offset by a $991k decrease in debt principal. $800,000 use of Drainage fund balance for the GRNRA South Pump Station project. $800,000 in increased internal utility taxes in the Drainage ($500k) and Sewerage ($300k) funds, offset by increased service charge revenues in each fund. $700,000 for the King County pass through portion of additional Sewerage service charge revenues. $200,000 for the transfer of utility ($76k) and capital resource ($24k) funds for the Shops Parking Lot Fence project and the use of those funds ($100k). $134,980 of Parks/Facilities additional funding including an increase to the Public Arts Program ($50k), reimbursement to PSRFA for parking sealcoat ($61k), transfer of Parks reinvestment program funds to the Chestnut Ridge project ($25k) and a Youth Initiative Internship ($10k), offset by the return of KC Levy funds from the Lake Meridian Dock project. $100,000 to transfer funds from Streets Maintenance to the 2021 Bridge Load Rating project. This project was previously approved as part of the 2021 operating budget, but the transfer of funds to the project requires additional approval. $90,000 use of Public Works Street Lifecycle funds for a 2021 Overlay project. $77,540 to close the Miscellaneous Intersection Signs project to the Panther Lake Signal project. ($20k) and establishing a budget for PSE rebate revenues ($9k). BUDGET IMPACT: These expenditures are funded by grants, existing fund balance, or other new revenues. SUPPORTS STRATEGIC PLAN GOAL: Sustainable Services - Providing quality services through responsible financial management, economic growth, and partnerships. ATTACHMENTS: 1. Budget Adjustment Ordinance Q4 2021 (PDF) Qbdlfu!Qh/!48 6/E/b ORDINANCE NO. 4421 AN ORDINANCE of the City Council of the City of Kent, Washington, approving the consolidating budget adjustments made between October 1, 2021 and November 30, 2021, reflecting an overall budget increase of $31,099,990. RECITALS A. Expenditures as classified in the final, adopted budget constitute the city’s appropriations for that year. After adoption, there are a variety of events that will precipitate the need to amend the adopted budget, such as grant awards, bonds issuance, collective bargaining agreements and additional budget requests. These modifications are periodically consolidated into a supplemental budget adjustment ordinance amending the original adopted budget. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: ORDINANCE SECTION 1. – Budget Adjustments. The 2021-2022 biennial budget is amended to include budget fund adjustments for the Fourth Quarter of 2021 from October 1 to November 30, 2021, as summarized and set forth Buubdinfou;!Cvehfu!Bekvtunfou!Psejobodf!R5!3132!!)3:61!;!Gpvsui!Rvbsufs!Cvehfu!Bekvtunfou!Psejobodf!.!Bepqu* in Exhibit “A,” which is attached and incorporated into this ordinance. 1 2021-2022 Budget Adjustment Fourth Quarter 2021 Qbdlfu!Qh/!49 6/E/b Except as amended by this ordinance, all terms and provisions of the 2021- 2022 biennial budget Ordinance No. 4381, as amended by Ordinance Nos. 4404, 4411 and 4413, shall remain unchanged. SECTION 2. – Severability. If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. SECTION 3. – Corrections by City Clerk or Code Reviser. Upon approval of the City Attorney, the City Clerk and the Code Reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 4. – Effective Date. This ordinance shall take effect and be in force five days after publication, as provided by law. December 14, 2021 DANA RALPH, MAYOR Date Approved ATTEST: December 14, 2021 KIMBERLEY A. KOMOTO, CITY CLERK Date Adopted December 17, 2021 Date Published APPROVED AS TO FORM: ARTHUR “PAT” FITZPATRICK, CITY ATTORNEY Buubdinfou;!Cvehfu!Bekvtunfou!Psejobodf!R5!3132!!)3:61!;!Gpvsui!Rvbsufs!Cvehfu!Bekvtunfou!Psejobodf!.!Bepqu* 2 2021-2022 Budget Adjustment Fourth Quarter 2021 Qbdlfu!Qh/!4: 6/E/b Exhibit A City of Kent Budget Adjustment Ordinance Adjustments from October 1, 2021 to November 30, 2021 Total PreviouslyApproval Fund TitleAdjustment ApprovedRequested Ordinance General Fund700,000 - 700,000 Street Fund8,000,000 (50,000) 7,950,000 Capital Resources Fund7,600 33,420 41,020 Criminal Justice Fund59,990 - 59,990 Management Operating Projects Fund13,291,160 - 13,291,160 City Arts Program Fund- 50,000 50,000 Kent Events Center Operating Fund2,025,220 - 2,025,220 Non-Voted Debt Service Fund- 1,144,750 1,144,750 Street Capital Projects Fund- 317,540 317,540 Parks Capital Projects Fund- 23,740 23,740 Technology Capital Projects Fund- (5,650) (5,650) Facilities Capital Projects Fund- 66,960 66,960 Water Operating Fund- 134,510 134,510 Sewerage Operating Fund- 1,016,510 1,016,510 Drainage Operating Fund696,880 1,325,000 2,021,880 Facilities Management Fund- 20,280 20,280 Insurance Funds- 2,242,080 2,242,080 Total24,780,850 6,319,140 31,099,990 Buubdinfou;!Cvehfu!Bekvtunfou!Psejobodf!R5!3132!!)3:61!;!Gpvsui!Rvbsufs!Cvehfu!Bekvtunfou!Psejobodf!.!Bepqu* Qbdlfu!Qh/!51 6/E/b Budget Adjustment Detail for Budget Changes October 1, 2021 to November 30, 2021 Approval Previously Not Previously Total Date or Approved by Approved by Adjustment Other FundCouncil Council Ordinance General Fund Police S&B Increase - shift schedule, cost-of-living, market adjustment9/21/2021700,000 700,000 Total General Fund 700,000 - 700,000 Street Fund Move Unallocated B&O budget to James & 2nd Pedestrian Crossing 3100(50,000) (50,000) Move Unallocated B&O budget to 4th & Willis Roundabout3100(100,000) (100,000) KC Regional Mobility Grant for RapidRide I bus stops and transit access8/18/20208,000,000 8,000,000 Transfer Street Maintenance funds to 2021 Bridge Load Rating project100,000 100,000 Total Street Fund (50,000)8,000,000 7,950,000 Capital Resources Fund Capital contribution to Shops Parking Lot Fence 23,98023,980 DNR Grant for Urban Foresty PlanKCC 3.707,600 7,600 Establish budget for PSE Rebate revenues 9,4409,440 Total Capital Resources Fund 33,4207,600 41,020 Criminal Justice Fund CEU/Target Zero Grant for Manager Overtime10/19/202110,000 10,000 2021-22 Walter/Roller Grant for a race & equity youth partnershipKCC 3.7049,990 49,990 -59,990 59,990 Total Criminal Justice Fund Management Operating Projects Fund 2021 ARPA Funding6/1/202113,291,160 13,291,160 Total Management Operating Projects Fund 13,291,160 - 13,291,160 City Arts Program Fund Increase Public Arts Program Budget 50,00050,000 Total City Arts Program Fund - 50,000 50,000 Kent Events Center Operating Fund SVOG ShoWare Grant - supplemental award11/2/20211,525,220 1,525,220 accesso ShoWare scoreboard2/4/2020 500,000 500,000 - Total Kent Events Center Operating Fund 2,025,220 2,025,220 Non-Voted Debt Service Fund 2016 LTGO Principal (991,400)(991,400) 2016 LTGO Interest 2,136,1502,136,150 1,144,750 Non-Voted Debt Service Fund - 1,144,750 Street Capital Projects Fund Move Unallocated B&O budget to James & 2nd Pedestrian Crossing 110050,000 50,000 Move Unallocated B&O budget to 4th & Willis Roundabout1100100,000 100,000 Close Misc Intersection Signs project to Panther Lake Signal project77,540 77,540 Use of PW Lifecycle funds for 2021 Overlay Project 110090,000 90,000 Total Street Capital Projects Fund - 317,540 317,540 Parks Capital Projects Fund Use of Parks Reinvestment Program funds for Chesnut Ridge project24,830 24,830 Youth Initiative Internship 10,00010,000 Return KC Levy funds from Lake Meridian Dock project (11,090)(11,090) - Total Parks Capital Projects Fund 23,740 23,740 Technology Capital Projects Fund Buubdinfou;!Cvehfu!Bekvtunfou!Psejobodf!R5!3132!!)3:61!;!Gpvsui!Rvbsufs!Cvehfu!Bekvtunfou!Psejobodf!.!Bepqu* Move Hardware Lifecycle funds to Security Camera Software project 3500 (26,000)(26,000) - Parks contribution to HCM project1000 20,35020,350 - Total Technology Capital Projects Fund - (5,650) (5,650) Qbdlfu!Qh/!52 6/E/b Budget Adjustment Detail for Budget Changes October 1, 2021 to November 30, 2021 Approval Previously Not Previously Total Date or Approved by Approved by Adjustment Other FundCouncil Council Ordinance Facilities Capital Projects Fund Use of IT HLC budget for Security Camera Software project340026,000 26,000 Reallocate Facilities operating budget for City Hall Patio Repairs project540040,960 40,960 - Total Facilities Capital Projects Fund 66,960 66,960 Water Operating Fund Shops Parking Lot Fence project and Water contribution to project134,510 134,510 Total Water Operating Fund 134,510- 134,510 Sewerage Operating Fund Sewerage contribution to Shops Parking Lot Fence 16,51016,510 King County passthrough expense 700,000700,000 Internal Utility Taxes 300,000300,000 Total Sewerage Operating Fund 1,016,510- 1,016,510 Drainage Operating Fund Use of Drainage FB for GRNRA South Pump Station project 800,000800,000 Drainage contribution to Shops Parking Lot Fence 25,00025,000 Internal Utility Taxes 500,000500,000 RCO Grant for Downey Farmstead project 9/7/2021696,880 696,880 Total Drainage Operating Fund 1,325,000696,880 2,021,880 Facilities Management Fund Reallocate Facilities operating budget for City Hall Patio Repairs project(40, (40,960)960) Reimburse PSRFA for Sealcoat Parking 61,24061,240 Total Facilities Management Fund 20,280- 20,280 Insurance Funds Increased Property Insurance costs 117,080117,080 Increased Workers Compensation costs 125,000125,000 Increased Liability Insurance costs 2,000,0002,000,000 Total Insurance Funds 2,242,080- 2,242,080 Grand Total All Funds 6,319,14024,780,850 31,099,990 Buubdinfou;!Cvehfu!Bekvtunfou!Psejobodf!R5!3132!!)3:61!;!Gpvsui!Rvbsufs!Cvehfu!Bekvtunfou!Psejobodf!.!Bepqu* Qbdlfu!Qh/!53 6/F FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: Ordinance Amending Chapter 5.01 of the Kent City Code Relating to Business Licensing - Adopt MOTION: I move to adopt Ordinance No. 4422, amending Chapter 5.01 of the Kent City Code to improve the business license application process process for business license denials and revocations, and to add additional grounds for which a business license may be denied or revoked. SUMMARY: There are approximately 7,000 active City of Kent business licenses, including approximately 2,800 commercial business licenses. Pursuant to RCW 35.90.020, effective June 30, 2021 the City elected to partner with FileLocal for City business licensing. Since going live with FileLocal, approximately 80% of the new business license applications received have come through the FileLocal portal. The re-licensing period for calendar year 2022 commenced December 1, 2021. FileLocal is a municipal corporation that was formed to make it easier and more efficient for businesses to apply for business licenses and file city business and occupation taxes while allowing cities to retain local control over these operations. At this time, the City is only utilizing FileLocal for business licensing. As of December 7, 2021, there were ten cities comprising FileLocal, including the cities of Bellevue, Kent, Seattle, and Tacoma. licensing process: Businesses have the option to obtain a license through FileLocal or directly through the City. Consistent with current practice, new business license applications received during December are processed for the subsequent calendar year licensing period. Businesses are required to provide required information for new licenses within 30 calendar days of the date of filing or the application may be cancelled. Inclusion of four additional grounds for denial or revocation of license comprised of zoning, building or fire codes, Rental Housing Inspection Program, or Qbdlfu!Qh/!54 6/F any other violation of the Kent City Code. Currently, the hearing is scheduled by the City upon the issuance of denial or revocation, and the hearing is held between 14 and 60 calendar days from the date of the notice. In order to align with the standard appeal process established in KCC 12.01 Administration of Development Regulations, the burden shifts to the business to file an appeal of denial or revocation and to do so within 14 calendar days. Authorizes the assessment of costs against the licensee incurred by the City for the hearing examiner to prepare and appear for the hearing should the licensee fail to appear on the specified hearing date. Various other administrative changes. BUDGET IMPACT: None. SUPPORTS STRATEGIC PLAN GOAL: Innovative Government - Delivering outstanding customer service, developing leaders, and fostering innovation. Thriving City - Creating safe neighborhoods, healthy people, vibrant commercial districts, and inviting parks and recreation. Sustainable Services - Providing quality services through responsible financial management, economic growth, and partnerships. Inclusive Community - Embracing our diversity and advancing equity through genuine community engagement. ATTACHMENTS: 1. Business License Ordinance (PDF) Qbdlfu!Qh/!55 6/F/b ORDINANCE NO. 4422 AN ORDINANCE of the City Council of the City of Kent, Washington, amending Chapter 5.01 of the Kent City Code entitled, “General Business Licenses” to improve the business license application process pursuant to the City’s partnership with the business license and tax filing portal “FileLocal,” to modify the appeal process for business license denials and revocations, and to add additional grounds for which a business license may be denied or revoked. RECITALS A. Pursuant to RCW 35.90.020, effective July 1, 2021 all cities that issue a general business license must partner with either the Department of Revenue or the business licensing and tax filing portal “FileLocal.” The City of Kent has elected to partner with FileLocal. B. Pursuant to Kent City Code 5.01.140, a licensee has the right to notice and an opportunity to be heard subsequent to the denial of a business license and prior to the revocation of an existing license. Historically, the burden has been on the City to schedule the hearing before the City’s Hearing Examiner and include the hearing date on the notice of denial or revocation that is issued to the licensee. C. It is not uncommon for a licensee to abandon their application and fail to appear for the hearing without any notice to the City. The City 1 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!56 6/F/b expends time and resources scheduling the hearing, preparing for the hearing, and paying for the Hearing Examiner’s time. D. The amendments made to Section 5.01.150 put the burden of requesting a hearing on the licensee. The licensee will still receive notice of the City’s intent to deny or revoke their business license and will have an opportunity to be heard before the City’s Hearing Examiner, but that hearing will no longer be automatically scheduled without a request from the licensee. E. In August 2011, the Kent City Council adopted Ordinance 4001, which enumerated a list of reasons the City may deny or revoke a business license. Since that time, it has become evident that there are additional reasons a City business license cannot and should not be granted. For example, a business that is prohibited from operating in a particular zoning district. The amendments made to KCC 5.01.130 provide additional grounds for which a business license application may be denied or revoked. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: ORDINANCE SECTION 1. – Amendment – KCC 5.01.090. Section 5.01.090 of the Kent City Code, entitled “Application procedure, license fee,” is amended as follows: Sec. 5.01.090 Application and review procedure, license fee. A. The city council shall, by resolution, establish the fees to be assessed to implement and operate the regulations adopted in this chapter. In the event of any conflict or ambiguity regarding any fees established by council 2 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!57 6/F/b resolution, the director is authorized to interpret the fee schedule(s) to resolve the conflict or ambiguity. B. All businesses operated not for profit or a qualifying participant in the STAR program established in Chapter 5.14 KCC shall be required to be licensed but shall be exempt from paying a business license fee upon satisfactory proof to the director of their not-for-profit or STAR qualified status. C. Application. The licensee shall make application for any business license required under this chapter to the director on a form prepared by the department, which application shall be accompanied by a receipt from the department showing payment of the required fee. A new business license shall be required annually. Pursuant to RCW 35.90.020, effective July 1, 2021, all cities that issue a general business license must partner with either the Department of Revenue or the business licensing and tax filing portal “FileLocal”. Businesses subject to the city’s general business licensing requirements have the option to obtain a license through FileLocal or directly through the city at the Customer Service counter. A new business license shall be required annually. If the application for a new license is made July 1 through November 30, within six months of the date fixed for expiration, the fee shall be one-half the annual fee. Approved applications received during the month of December will be processed for the subsequent calendar year licensing period. D. Completeness. A business license application shall be reviewed for completeness upon submittal to the Department. If the application is deemed as incomplete, the Department shall notify the licensee of information needed to complete the application. 3 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!58 6/F/b E. Licensee Response to Requests for Information. The licensee shall provide the requested information to the Department within thirty (30) calendar days of the date of the Department’s request. Failure to provide all requested information may result in the application being canceled. F. Review. The application will be reviewed by appropriate city personnel to determine if it meets the requirements established through the Kent City Code and other appropriate regulatory requirements. If a reviewing division determines that additional or revised information is necessary to achieve code compliance, the city shall notify the licensee in writing of the requested information or changes, and the licensee’s resubmittal period set forth in subsection (E) of this section shall be repeated. This process may continue until complete or corrected information is obtained. G. Denial. If a reviewing division within the city determines that the proposed business meets one or more of the grounds for denial as listed in KCC 5.01.130, the city shall deny the license and notify the applicant in writing as outlined in KCC 5.01.150. H. A business license will not be issued until the city has accepted the application as complete and determined it to be code compliant. It is unlawful to operate a business without having first obtained a valid business license. SECTION 2. – Amendment – KCC 5.01.130. Section 5.01.130 of the Kent City Code, entitled “Grounds for denial or revocation of license,” is amended as follows: Sec. 5.01.130 Grounds for denial or revocation of license. 4 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!59 6/F/b A. In addition to other actions or penalties provided by law, the city may deny or revoke any license applied for or issued pursuant to this chapter for any of the following reasons: 1. The license application contains an omission or misrepresentation of material fact; 2. The license was procured by fraud; 3. The license is used, or is intended to be used, for a business materially different from that applied for; 4. The licensee or business fails to pay the licensing fee applicable to such license; 5. The licensee or business violates any of the requirements of this chapter; 6. The business engages in, or the licensee seeks to license to engage in, an unlawful business or activity; 7. The business operates in a manner that constitutes a nuisance pursuant to common law or the ordinances, codes, and statutes of the city of Kent or the state of Washington; 8. The applicant is not eighteen (18) years of age or older at the time the license is applied for; 9. The applicant or the business is delinquent in the payment of any fees, taxes, assessments, or fines owed to the city, including but not limited to permit fees, utility fees, gambling taxes, local improvement district assessments, and civil fines; or 10. The licensee or business has had a similar license denied or revoked and has not corrected the basis for the denial or revocation;. 11. The business is not allowed in the zoning district of the proposed business location pursuant to KCC Title 15; 12. The business location does not comply with the building or fire codes adopted in Chs. 13.01 and 14.01 KCC; 13. The residential rental property is not in compliance with the Rental Housing Inspection Program pursuant to Ch. 10.02 KCC; or 5 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!5: 6/F/b 14. The business or licensee operates in a manner or engages in conduct that constitutes a violation of any provision of the Kent City Code. B. The issuance of a license that could have been denied pursuant to subsection (A) of this section shall not prohibit the city from taking action to revoke the license at a later date, and it shall at all times remain the exclusive responsibility of the licensee to ensure that the business complies with the requirements of this chapter. and that the business is operated in compliance with all other relevant provisions of Kent City Code. SECTION 3. – Amendment – KCC 5.01.150. Section 5.01.150 of the Kent City Code, entitled “Notice of license denial or revocation and scheduling of hearing,” is amended as follows: Sec. 5.01.150 Notice of license denial or revocation and scheduling of hearing. A. Denial of license. Any action to deny a license applied for or issued shall be commenced by notice of the denial. A notice issued under this subsection shall substantially comply with the following: 1. The notice shall be delivered, by first class mail, e-mail, or by personal service, to the licensee business license applicant or the holder of the business license as set forth in the most recent business license application. 2. The notice shall describe the basis for the denial. 3. The notice shall describe corrective action, if any, that may be taken to eliminate the basis for denial. 4. The notice shall specify that the licensee may a date for which a hearing to contest the denial has been scheduled before the hearing examiner in order for the licensee to appeal the denial. Such date shall by submitting an appeal electronically to the city’s Permit Center 6 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!61 6/F/b occur not less than within fourteen (14) calendar but not more than sixty (60) days after of the date of the denial notice is delivered in accordance with this subsection (A). 5. Appeal hearings held pursuant to subsection (A)(4) of this section shall follow the procedures outlined in KCC 5.01.160 and shall occur not less than fourteen (14) but not more than sixty (60) calendar days after the date the appeal is received. 65. The notice shall provide that i If the licensee fails to appear on the date specified in the notice of the hearing, the hearing examiner shall enter a default order or judgment affirming the city’s denial of the licensee’s application for a business license. the appeal of the denial is waived. B. Revocation of license. Any action to revoke a license issued shall be commenced by a notice of the revocation. A notice issued under this subsection shall substantially comply with the following: 1. The notice shall be delivered, by first class mail, e-mail, or by personal service, to the licensee holder of the business license as set forth in the most recent business license application or business license issued. 2. The notice shall describe the basis for the revocation. 3. The notice shall describe corrective action, if any, that may be taken to eliminate the basis for revocation. 4. The notice shall include the date on which the revocation is to be effective. 54. The notice shall specify that the licensee may appeal a date for which a hearing to contest the revocation by submitting an appeal electronically to the city’s permit center within fourteen (14) calendar days of the date of the revocation notice. has been scheduled before the hearing examiner. Such date shall be scheduled to occur not less than fourteen (14) but not more than sixty (60) days after the date the notice 7 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!62 6/F/b is delivered in accordance with this subsection (B). The effective date of the revocation shall be stayed pending resolution of the appeal. 6.Any hearing requested pursuant to subsection (B)(5)(4) of this section shall follow the procedures outlined in KCC 5.01.160 and shall occur not less than fourteen (14) but not more than sixty (60) calendar days after the date the appeal is received. 75. The notice shall provide that if the licensee holder of the business license fails to appear on the date specified in the notice of the hearing, the hearing examiner shall enter a default order or default judgment affirming the city’s revocation of the licensee’s business license. shall be entered, and the license shall be revoked upon the failure to appear. 86. The business may continue to operate until such time as the hearing examiner issues an order regarding the revocation unless the city obtains an order enjoining the operation of the business pending the hearing examiner’s order. SECTION 4. – Amendment – KCC 5.01.160. Section 5.01.160 of the Kent City Code, entitled “Hearing to deny or revoke business license,” is amended as follows: Sec. 5.01.160 Appeal Hearing to deny or revoke business license. A. Parties to hearing. The parties to a hearing provided pursuant to this chapter shall be the city and the licensee. Either party may be represented by legal counsel properly licensed in the state of Washington. B. Date for Continuance of hearing. Hearings shall be scheduled to occur no less than fourteen (14) but not more than sixty (60) days after the date the notice is delivered in accordance with KCC 5.01.150; 8 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!63 6/F/b provided, additional hearings may be held after sixty (60) days as determined by the hearing examiner. The hearing examiner shall have discretion to grant continuances and reschedule hearings in the interest of the parties and justice. C. Prehearing conferences. The hearing examiner may, at his or her discretion, or at the request of either of the parties, hold a prehearing conference to schedule additional hearings, order discovery, and to make other appropriate pretrial determinations. A prehearing conference may be held by telephone. D. Hearing process. The parties to the hearing, or legal counsel for the parties, may call witnesses and present evidence and rebuttal evidence subject to the following: 1. Where the city has commenced an action to revoke a business license, the city shall have the burden of proving, by a preponderance of the evidence, that there are sufficient grounds for the denial or revocation of the license pursuant to KCC 5.01.130. In cases involving the denial of a business license, the burden of proof shall be on the licensee. 2. The parties shall be responsible for securing the appearance of any witnesses they may call. Neither the city nor the hearing examiner shall have the burden of securing any witnesses on behalf of the licensee. 3. Formal rules of evidence shall not apply. The hearing examiner may allow hearsay evidence and may permit the admission of evidence without proof of the chain of custody of evidence. Notes, reports, summaries, notices, photographs, or other materials prepared by the parties may be admitted into evidence if requested without satisfaction of formal rules of evidence. Notwithstanding the admission of evidence, the hearing examiner shall determine the proper weight to be assigned to any evidence admitted. 9 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!64 6/F/b E. Default order or judgment; costs incurred by city. If the licensee fails to appear on the hearing date specified in the notice, or at any other hearing set by the hearing examiner, the hearing examiner shall issue a default order or judgment affirming the city’s denial of the licensee’s business license application, or the city’s revocation of the licensee’s previously issued business license. the right to a hearing shall be forfeited, default judgment shall be entered, the appeal shall be waived, and the license shall be denied or revoked. The costs incurred by the city for the hearing examiner to prepare and appear for the hearing may be requested by the city to be included within the default order and assessed against the licensee. If requested by the city, the hearing examiner shall include such costs in the default order. SECTION 5. – Severability. If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. SECTION 6. – Corrections by City Clerk or Code Reviser. Upon approval of the city attorney, the city clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 7. – Effective Date. This ordinance shall take effect and be in force thirty days from and after its passage, as provided by law. December 14, 2021 DANA RALPH, MAYOR Date Approved 10 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!65 6/F/b ATTEST: December 14, 2021 KIMBERLEY A. KOMOTO, CITY CLERK Date Adopted December 17, 2021 Date Published APPROVED AS TO FORM: ARTHUR “PAT” FITZPATRICK, CITY ATTORNEY 11 Amend Ch. 5.01 KCC – Buubdinfou;!Cvtjoftt!Mjdfotf!Psejobodf!!)3:55!;!Psejobodf!Bnfoejoh!Dibqufs!6/12!pg!uif!Lfou!Djuz!Dpef!Sfmbujoh!up!Cvtjoftt!Mjdfotjoh!. General Business Licenses Qbdlfu!Qh/!66 6/G FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: Tax Code Amendments - Ordinance - Adopt MOTION: I move to adopt Ordinance No. 4423, amending Chapters 3.18, 3.28 and 3.29 of the Kent City Code to update definitions related to telephone businesses and gross income, clarify code language related to business and occupation tax, and to codify current practices related to square footage tax. SUMMARY: Pursuant to Chapter 3.28 of the Kent City Code, the City imposes a business and occupation (B&O) tax, and pursuant to Chapter 3.18 of the Kent City Code, the City imposes utility taxes on the following utility services: Electricity Manufactured and Natural Gas Telephone, including Cellular Phone Cable Television Solid Waste Collection Water, Sewer and Drainage There are approximately 7,300 businesses registered for City business and occupation taxes, including approximately 2,900 that have a filing requirement. The City continues to work in collaboration with the business community and other cities to identify opportunities to further simplify the tax determination and filing requirements, including providing clarity for determining taxes due to the City. tax obligation or reporting requirement for any business; however, it does affirm existing City practice and provide clarity as follows: 1. Chapter 3.18 Utility Tax on Telephone, Gas, Electric, Solid Waste, Water, Sewer and Drainage Utilities: a. excluding water, sewer, and drainage sewer service connection fees from gross income. Qbdlfu!Qh/!67 6/G b. selected other cities, including Seattle. c. definition of telephone business makes it unnecessary. 2. Chapter 3.28 Business and Occupation Tax: a. The B&O tax is comprised of two separate taxes: gross receipts tax and square footage tax, and the business is required to pay the higher of these two taxes for each reporting period. Specifically, the reference to gross receipts is excluded from the title of Chapter 3.28, and Section 3.28.050 is appropriately modified. b. Clarifies that gross receipts tax rates are measured based on application of a specified rate rather than a percentage of taxable gross receipts. c. Clarifies that the square footage tax does not apply to residential dwelling units. d. Clarifies that the responsibility for square footage tax shifts to tenants only if they are engaging in business activities in the space. e. Self-storage rental business operations: Unless otherwise exempt, the square footage tax is measured based on taxable other business floor space. The rental of self-storage units where tenants are permitted 24-hour unrestricted access to their individual unit and tenants are permitted to lock or secure there unit to prevent access by others, is exempt from the gross receipts tax if rented for 30 days or longer; however, is still subject to the square footage tax. The self-storage business is responsible for payment of the square footage tax calculated based on the taxable square footage of all storage units, i.e. responsibility for payment of tax does not shift to the tenants. This will result in an increase in tax for the self-storage business because it will lose a potential reduction in tax obligation; however, based on historical information known to date, the total estimated impact is approximately $800 per year. 3. Chapter 3.29 Tax - Administrative Provisions: a. Technical clarification in Section 3.29.120 Cancellation of Penalties that b. Determination that the taxpayer or the City may apply for a writ of review in King Qbdlfu!Qh/!68 6/G County superior court. BUDGET IMPACT: None SUPPORTS STRATEGIC PLAN GOAL: Innovative Government - Delivering outstanding customer service, developing leaders, and fostering innovation. Thriving City - Creating safe neighborhoods, healthy people, vibrant commercial districts, and inviting parks and recreation. Sustainable Services - Providing quality services through responsible financial management, economic growth, and partnerships. Inclusive Community - Embracing our diversity and advancing equity through genuine community engagement. ATTACHMENTS: 1. DRAFT ORDINANCE - Tax Code Changes (PDF) Qbdlfu!Qh/!69 6/G/b ORDINANCE NO. 4423 AN ORDINANCE of the City Council of the City of Kent, Washington, amending chapters 3.18, 3.28 and 3.29 of the Kent City Code, to update definitions related to telephone businesses and gross income, clarify code language relating to business and occupation tax, and codify current practices related to square footage tax. RECITALS A. The City levies a utility tax against certain businesses pursuant to Chapter 3.18 of the Kent City Code (KCC). Telephone businesses are one of the businesses subject to the utility tax. In order to keep up with evolving technologies, from time to time it is necessary to update the City’s tax code to recognize changes in the way traditional services are provided by utility businesses and to clarify the taxability of such services. B. The amendments to Chapter 3.18 of the KCC will better align the code with current technology provided by telephone businesses, and ensure that connection charges associated with water, sewer and drainage utility services continue to be exempt from the City’s utility tax, in accord with current practices. 1 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!6: 6/G/b C. The City levies a business and occupation tax (B&O tax) pursuant to Chapter 3.28 KCC. The B&O tax is comprised of two separate taxes, a gross receipts tax and a square footage tax. The amendments related to the gross receipts tax are generally for the purposes of simplifying the code language to clarify the proper calculation of taxes due. D. The amendments related to the square footage tax are for the purpose of clarifying the application of the tax to specific business practices. In particular, the amendments serve to clarify how the square footage tax applies to the rental of real estate and codify the City Council’s intent to exempt residential rental units from square footage tax. The amendments also clarify that when space is rented to a tenant, the tax obligation will only shift to commercial tenants when the tenant is using the space for business purposes. E. The amendments related to the square footage tax also address the application of the tax to self-storage operations. Recently, the City was successful in defending against a challenge to tax assessed against a self-storage business. The amendments herein are in line with the decision of the Hearing Examiner in that tax appeal, and will codify current tax practices as they apply to self-storage businesses. The amendments are necessary only to clarify how the business space of self-storage operations is to be categorized and to ensure that the payment of the tax remains the responsibility of the business, not the tenants renting the individual storage units. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: 2 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!71 6/G/b ORDINANCE SECTION 1. – Amendment – KCC 3.18.010. Section 3.18.010 of the Kent City Code, entitled “Definitions,” is hereby amended as follows: Section 3.18.010. Definitions. The following words, terms, and phrases, when used in this chapter, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning: Cable television business means: 1. A system providing service pursuant to a franchise issued by the city under the Cable Communications Policy Act of 1984, Public Law No. 98-549, 47 U.S.C. Section 521, as it may be amended or superseded; or 2. Any system that competes directly with such franchised system by employing antennas, microwaves, wires, wave guides, coaxial cables, or other conductors, equipment, or facilities designed, construed, or used for the purpose of: a. Collecting and amplifying local and distant broadcast television signals and distributing and transmitting them; b. Transmitting original cable cast programming not received through television broadcast signals; or c. Transmitting television pictures, film, and videotape programs not received through broadcast television signals, whether or not 3 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!72 6/G/b encoded or processed to permit reception by only selected receivers; provided, however, that “cable television business” shall not include entities that are subject to charges as “commercial TV stations” under 47 U.S.C. Section 158, as it may be amended or superseded. Cellular telephone service means any two-way voice and/or data telephone or similar communications system based in whole or in substantial part on wireless radio communications, including cellular mobile service, and which is not subject to regulation by the Washington State Utilities and Transportation Commission that conflicts with or overrides this chapter. Cellular telephone service includes other wireless radio communications services including, without limitation, specialized mobile radio, paging services, personal communications, and data services, and any other evolving wireless radio communications technology that accomplishes a purpose substantially similar to cellular telephone service. Cellular telephone service is included within the definition of “telephone business” for the purposes of this chapter. Competitive telephone service means the providing by any person, firm, or corporation of telecommunications equipment or apparatus, or service related to that equipment or apparatus such as repair or maintenance service, if the equipment or apparatus is of a type which can be provided by persons that are not subject to regulation as telephone companies under RCW Title 80 and for which a separate charge is made. Gross income means the value proceeding or accruing from the performance of the particular public service business involved, including operations incidental thereto, but without any deduction on account of the cost of the commodity furnished or sold, the cost of materials used, labor costs, 4 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!73 6/G/b interest, discount, delivery costs, taxes, or any other expense whatsoever paid or accrued and without any deduction on account of losses. In addition, when determining total gross income from cellular telephone service, “gross income” shall include all income from cellular telephone service (including roaming charges incurred outside this state) provided to customers whose “place of primary use” is in the city, regardless of the location of the facilities used to provide the service. The customer’s place of primary use is, with respect to each telephone: (a) the customer’s address shown on the telephone service company’s records; or (b) the customer’s place of residence if the telephone is for personal use, and in both cases must be located within the licensed service area of the home service provider. Roaming charges and cellular telephone charges to customers whose place of primary use is outside the city of Kent will not be taxable even though those cellular services are provided within the city of Kent. There is a rebuttable presumption that the address shown on the cellular telephone service company’s records is the place of primary use and is accurate. If the cellular telephone service company knows or should have known that a customer’s place of primary use address for a telephone is within the city, then the gross income from cellular telephone service provided to that customer with respect to that telephone is to be included in the company’s gross income. For the purposes of this chapter, water, sewer, and drainage service connection fees shall be excluded from gross income. Solid waste means all putrescible and nonputrescible solid and semisolid wastes including, but not limited to, garbage, rubbish, ashes, industrial wastes, swill, sewage sludge, infectious, hazardous, or toxic wastes, demolition and construction wastes, abandoned vehicles or parts thereof, 5 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!74 6/G/b and recyclable or reusable materials collected, in whole or in part, for recycling or salvage. Solid waste collection service means receiving solid waste for transfer, storage, processing, treatment, or disposal including, but not limited to, all residential and commercial collection services, public or private solid waste disposal sites, transfer stations, and similar operations. Solid waste collection service includes the activities of transferring, processing, treating, storing, or disposing of the solid waste collected. Telephone business means the electronic transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point, or between or among points. It includes such transmission, conveyance, or routing in which computer processing applications are used to act on the form, code, or protocol of the content for purposes of transmission, conveyance, or routing without regard to whether such service is referred to as voice over internet protocol services or is classified by the Federal Communications Commission as enhanced or value added. Telephone business shall include 100 percent of the business and total gross income derived from calls originating and/or billed to subscribers within the city. Telephone business also includes ancillary services that are associated with or incidental to the provision of telecommunication services including, but not limited to, conference bridging, detailed telecommunications billing, directory assistance, vertical service, or voice mail services as defined in RCW 82.04.065. 6 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!75 6/G/b Telephone business also includes the providing by any person, firm, or corporation of access to a local telephone network, local telephone network switching service, toll service, cellular or mobile telephone service, coin telephone services, pager service, or the providing of telephonic, video, data, or similar communication or transmission for hire, via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. The term includes the provision of cooperative or farmer line telephone services or associations operating exchanges. The term also includes the provision of transmission to and from the site of an internet provider via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. Telephone business does not include the providing of competitive telephone service, data processing, providing of cable television service, or other providing of broadcast services by radio or television stations. Transmission of communication through cellular telephones is classified as telephone business rather than competitive telephone service. SECTION 2. – Amendment – KCC 3.28. The title of Chapter 3.28 of the Kent City Code, entitled “Business and Occupation Tax – Gross Receipts,” is hereby revised as follows: Chapter 3.28 BUSINESS AND OCCUPATION TAX SECTION 3. – Amendment – KCC 3.28.030. Section 3.28.030 of the Kent City Code, entitled “Definitions,” is hereby amended as follows: 7 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!76 6/G/b Section 3.28.030. Definitions. In construing the provisions of this chapter, the following definitions shall be applied. Words in the singular number shall include the plural, and the plural shall include the singular. A. Advance, reimbursement. 1. Advance means money or credits received by a taxpayer from a customer or client with which the taxpayer is to pay costs or fees on behalf of the customer or client. 2. Reimbursement means money or credits received from a customer or client to repay the taxpayer for money or credits expended by the taxpayer in payment of costs or fees of the customer or client. B. Agricultural product, farmer. 1. Agricultural product means any product of plant cultivation or animal husbandry including, but not limited to: a product of horticulture, grain cultivation, vermiculture, viticulture, or aquaculture as defined in RCW 15.85.020; plantation Christmas trees; turf; or any animal including but not limited to an animal that is a private sector cultured aquatic product as defined in RCW 15.85.020, or a bird, or insect, or the substances obtained from such an animal. “Agricultural product” does not include animals intended to be pets. 2. Farmer means any person engaged in the business of growing or producing, upon the person’s own lands or upon the lands in which the person has a present right of possession, any agricultural product whatsoever for sale. “Farmer” does not include a person using such products 8 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!77 6/G/b as ingredients in a manufacturing process, or a person growing or producing such products for the person’s own consumption. “Farmer” does not include a person selling any animal or substance obtained therefrom in connection with the person’s business of operating a stockyard or a slaughter or packing house. “Farmer” does not include any person in respect to the business of taking, cultivating, or raising timber. C. Artistic or cultural organization. As used in this chapter: 1. The term “artistic or cultural organization” means an organization which is organized and operated exclusively for the purpose of providing artistic or cultural exhibitions, presentations, or performances or cultural or art education programs, as defined in subsection (C)(10) of this section, for viewing or attendance by the general public. 2. The organization must be a not-for-profit corporation under Chapter 24.03 RCW. 3. The organization must be managed by a governing board of not less than eight individuals, none of whom is a paid employee of the organization or by a corporation sole under Chapter 24.12 RCW. 4. No part of its income may be paid directly or indirectly to its members, stockholders, officers, directors, or trustees except in the form of services rendered by the corporation in accordance with its purposes and bylaws. 9 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!78 6/G/b 5. Salary or compensation paid to its officers and executives must be only for actual services rendered, and at levels comparable to the salary or compensation of like positions within the state. 6. Assets of the corporation must be irrevocably dedicated to the activities for which the exemption is granted and, on the liquidation, dissolution, or abandonment by the corporation, may not inure directly or indirectly to the benefit of any member or individual except a nonprofit organization, association, or corporation which also would be entitled to the exemption. 7. The corporation must be duly licensed or certified when licensing or certification is required by law or regulation. 8. The amounts received that qualify for exemption must be used for the activities for which the exemption is granted. 9. Services must be available regardless of race, color, national origin, ancestry, religion, age, sex, marital status, sexual orientation, Vietnam or disabled veteran status, or the presence of any mental or physical disability. 10. The term artistic or cultural exhibitions, presentations, or performances or cultural or art education programs is limited to: a. An exhibition or presentation of works of art or objects of cultural or historical significance, such as those commonly displayed in art or history museums; 10 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!79 6/G/b b. A musical or dramatic performance or series of performances; or c. An educational seminar or program, or series of such programs, offered by the organization to the general public on an artistic, cultural, or historical subject. D. Business includes all activities engaged in with the object of gain, benefit, or advantage to the taxpayer or to another person or class, directly or indirectly. E. Business and occupation tax or gross receipts tax means a tax imposed on or measured by the value of products, the gross income of the business, or the gross proceeds of sales, as the case may be, and that is the legal liability of the business. F. Commercial or industrial use means the following uses of products, including byproducts, by the extractor or manufacturer thereof: 1. Any use as a consumer; and 2. The manufacturing of articles, substances, or commodities. G. Competitive telephone service means the providing by any person of telecommunications equipment or apparatus, or service related to that equipment or apparatus such as repair or maintenance service, if the equipment or apparatus is of a type which can be provided by persons that are not subject to regulation as telephone companies under RCW Title 80 and for which a separate charge is made. 11 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!7: 6/G/b H. Consumer means the following: 1. Any person who purchases, acquires, owns, holds, or uses any tangible or intangible personal property irrespective of the nature of the person’s business and including, among others, without limiting the scope hereof, persons who install, repair, clean, alter, improve, construct, or decorate real or personal property of or for a consumer other than for the purpose of: a. Resale as tangible or intangible personal property in the regular course of business; b. Incorporating such property as an ingredient or component of real or personal property when installing, repairing, cleaning, altering, imprinting, improving, constructing, or decorating such real or personal property of or for consumers; c. Incorporating such property as an ingredient or component of a new product or as a chemical used in processing a new product when the primary purpose of such chemical is to create a chemical reaction directly through contact with an ingredient of a new product; or d. Consuming the property in producing ferrosilicon which is subsequently used in producing magnesium for sale, if the primary purpose of such property is to create a chemical reaction directly through contact with an ingredient of ferrosilicon; 12 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!81 6/G/b 2. Any person engaged in any business activity taxable under KCC 3.28.050(A)(7); 3. Any person who purchases, acquires, or uses any competitive telephone service as herein defined, other than for resale in the regular course of business; 4. Any person who purchases, acquires, or uses any personal, business, or professional service defined as a retail sale or retail service in this section, other than for resale in the regular course of business; 5. Any person who is an end user of software; 6. Any person engaged in the business of “public road construction” in respect to tangible personal property when that person incorporates the tangible personal property as an ingredient or component of a publicly owned street, place, road, highway, easement, right-of-way, mass public transportation terminal or parking facility, bridge, tunnel, or trestle by installing, placing, or spreading the property in or upon the right- of-way of a publicly owned street, place, road, highway, easement, bridge, tunnel, or trestle or in or upon the site of a publicly owned mass public transportation terminal or parking facility; 7. Any person who is an owner, lessee, or has the right of possession to or an easement in real property which is being constructed, repaired, decorated, improved, or otherwise altered by a person engaged in business; 13 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!82 6/G/b 8. Any person who is an owner, lessee, or has the right of possession to personal property which is being constructed, repaired, improved, cleaned, imprinted, or otherwise altered by a person engaged in business; 9. Any person engaged in “government contracting.” Any such person shall be a consumer within the meaning of this subsection in respect to tangible personal property incorporated into, installed in, or attached to such building or other structure by such person. Nothing contained in this or any other subsection of this section shall be construed to modify any other definition of “consumer.” I. Delivery means the transfer of possession of tangible personal property between the seller and the buyer or the buyer’s representative. Delivery to an employee of a buyer is considered delivery to the buyer. Transfer of possession of tangible personal property occurs when the buyer or the buyer’s representative first takes physical control of the property or exercises dominion and control over the property. Dominion and control means the buyer has the ability to put the property to the buyer’s own purposes. It means the buyer or the buyer’s representative has made the final decision to accept or reject the property, and the seller has no further right to possession of the property and the buyer has no right to return the property to the seller, other than under a warranty contract. A buyer does not exercise dominion and control over tangible personal property merely by arranging for shipment of the property from the seller to itself. A buyer’s representative is a person, other than an employee of the buyer, who is authorized in writing by the buyer to receive tangible personal property and take dominion and control by making the final decision to accept or reject 14 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!83 6/G/b the property. Neither a shipping company nor a seller can serve as a buyer’s representative. It is immaterial where the contract of sale is negotiated or where the buyer obtains title to the property. Delivery terms and other provisions of the Uniform Commercial Code (RCW Title 62A) do not determine when or where delivery of tangible personal property occurs for purposes of taxation. J. Director means the finance director of the city or any officer, agent or employee of the city designated to act on the director’s behalf. K. Digital automated service, digital code, and digital goods have the same meaning as in RCW 82.04.192. L. Digital products means digital goods, digital codes, digital automated services, and the services described in RCW 82.04.050(2)(g) and (6)(b). M. Eligible gross receipts tax. The term “eligible gross receipts tax” means a tax which: 1. Is imposed on the act or privilege of engaging in business activities within KCC 3.28.050; and 2. Is measured by the gross volume of business, in terms of gross receipts, and is not an income tax or value added tax; and 3. Is not, pursuant to law or custom, separately stated from the sales price; and 15 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!84 6/G/b 4. Is not a sales or use tax, business license fee, franchise fee, royalty, or severance tax measured by volume or weight, or concession charge, or payment for the use and enjoyment of property, property right, or a privilege; and 5. Is a tax imposed by a local jurisdiction, whether within or without the state of Washington, and not by a country, state, province, or any other nonlocal jurisdiction above the county level. N. Engaging in business. 1. The term “engaging in business” means commencing, conducting, or continuing in business, and also the exercise of corporate or franchise powers, as well as liquidating a business when the liquidators thereof hold themselves out to the public as conducting such business. 2.This section sets forth examples of activities that constitute engaging in business in the city, and establishes safe harbors for certain of those activities so that a person who meets the criteria may engage in de minimis business activities in the city without having to register and obtain a business license or pay city business and occupation taxes. The activities listed in this section are illustrative only and are not intended to narrow the definition of “engaging in business” in subsection (N)(1) of this section. If an activity is not listed, whether it constitutes engaging in business in the city shall be determined by considering all the facts and circumstances and applicable law. 3.Without being all inclusive, any one of the following activities conducted within the city by a person, or its employee, agent, 16 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!85 6/G/b representative, independent contractor, broker, or another acting on its behalf, constitutes engaging in business and requires a person to register and obtain a business license: a. Owning, renting, leasing, maintaining, or having the right to use, or using, tangible personal property, intangible personal property, or real property permanently or temporarily located in the city. b. Owning, renting, leasing, using, or maintaining an office, place of business, or other establishment in the city. c. Soliciting sales. d. Making repairs or providing maintenance or service to real or tangible personal property, including warranty work and property maintenance. e. Providing technical assistance or service, including quality control, product inspections, warranty work, or similar services, on or in connection with tangible personal property sold by the person or on its behalf. f. Installing, constructing, or supervising installation or construction of real or tangible personal property. g. Soliciting, negotiating, or approving franchise, license, or other similar agreements. h. Collecting current or delinquent accounts. 17 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!86 6/G/b i. Picking up and transporting tangible personal property, solid waste, construction debris, or excavated materials. j. Providing disinfecting and pest control services, employment and labor pool services, home nursing care, janitorial services, appraising, landscape architectural services, security system services, surveying, and real estate services including the listing of homes and managing real property. k. Rendering professional services such as those provided by accountants, architects, attorneys, auctioneers, consultants, engineers, professional athletes, barbers, baseball clubs and other sports organizations, chemists, psychologists, court reporters, dentists, doctors, detectives, laboratory operators, teachers, and veterinarians. l. Meeting with customers or potential customers, even when no sales or orders are solicited at the meetings. m. Training or recruiting agents, representatives, independent contractors, brokers, or others, domiciled or operating on a job in the city, acting on its behalf, or for customers or potential customers. n. Investigating, resolving, or otherwise assisting in resolving customer complaints. o. In-store stocking or manipulating products or goods, sold to and owned by a customer, regardless of where sale and delivery of the goods took place. 18 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!87 6/G/b p. Delivering goods in vehicles owned, rented, leased, used, or maintained by the person or another acting on its behalf. 4. If a person, or its employee, agent, representative, independent contractor, broker, or another acting on the person’s behalf, engages in no other activities in or with the city but the following, it need not register and obtain a business license and pay tax: a. Meeting with suppliers of goods and services as a customer. b. Meeting with government representatives in their official capacity, other than those performing contracting or purchasing functions. c. Attending meetings, such as board meetings, retreats, seminars, and conferences, or other meetings, wherein the person does not provide training in connection with tangible personal property sold by the person or on its behalf. This provision does not apply to any board of director member or attendee engaging in business, such as a member of a board of directors who attends a board meeting. d. Renting tangible or intangible property as a customer when the property is not used in the city. e. Attending but not participating in a “trade show” or “multiple vendor events.” Persons participating at a trade show shall review the city’s trade show or multiple vendor event ordinances. 19 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!88 6/G/b f. Conducting advertising through the mail. g. Soliciting sales by phone from a location outside the city. 5. A seller located outside the city merely delivering goods into the city by means of common carrier is not required to register and obtain a business license; provided, that it engages in no other business activities in the city. Such activities do not include those in subsection (N)(4) of this section. 6. The city expressly intends that engaging in business includes any activity sufficient to establish nexus for purposes of applying the tax under the law and the constitutions of the United States and the state of Washington. Nexus is presumed to continue as long as the taxpayer benefits from the activity that constituted the original nexus generating contact or subsequent contacts. O. Extracting is the activity engaged in by an extractor and is reportable under the extracting classification. P. Extractor means every person who from the person’s own land or from the land of another under a right or license granted by lease or contract, either directly or by contracting with others for the necessary labor or mechanical services, for sale or for commercial or industrial use, mines, quarries, takes, or produces coal, oil, natural gas, ore, stone, sand, gravel, clay, mineral, or other natural resource product; or fells, cuts, or takes timber, Christmas trees, other than plantation Christmas trees, or other natural products; or takes fish, shellfish, or other sea or inland water foods or products. “Extractor” does not include persons performing under contract 20 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!89 6/G/b the necessary labor or mechanical services for others, or persons meeting the definition of “farmer.” Q. Extractor for hire means a person who performs under contract necessary labor or mechanical services for an extractor. R. Gross income of the business means the value proceeding or accruing by reason of the transaction of the business engaged in and includes gross proceeds of sales, compensation for the rendition of services, gains realized from trading in stocks, bonds, or other evidences of indebtedness, interest, discount, rents, royalties, fees, commissions, dividends, and other emoluments however designated, all without any deduction on account of the cost of tangible property sold, the cost of materials used, labor costs, interest, discount, delivery costs, taxes, or any other expense whatsoever paid or accrued and without any deduction on account of losses. S. Gross proceeds of sales means the value proceeding or accruing from the sale of tangible personal property, digital goods, digital codes, digital automated services, or for other services rendered, without any deduction on account of the cost of property sold, the cost of materials used, labor costs, interest, discount paid, delivery costs, taxes, or any other expense whatsoever paid or accrued and without any deduction on account of losses. T. Manufacturing means the activity conducted by a manufacturer and is reported under the manufacturing classification. U. Manufacturer, to manufacture. 21 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!8: 6/G/b 1. Manufacturer means every person who, either directly or by contracting with others for the necessary labor or mechanical services, manufactures for sale or for commercial or industrial use from the person’s own materials or ingredients any products. When the owner of equipment or facilities furnishes, or sells to the customer prior to manufacture, materials or ingredients equal to less than 20 percent of the total value of all materials or ingredients that become a part of the finished product, the owner of the equipment or facilities will be deemed to be a processor for hire, and not a manufacturer. A business not located in this city that is the owner of materials or ingredients processed for it in this city by a processor for hire shall be deemed to be engaged in business as a manufacturer in this city. 2. To manufacture means all activities of a commercial or industrial nature wherein labor or skill is applied, by hand or machinery, to materials or ingredients so that as a result thereof a new, different or useful product is produced for sale or commercial or industrial use, and shall include: a. The production of special made or custom made articles; b. The production of dental appliances, devices, restorations, substitutes, or other dental laboratory products by a dental laboratory or dental technician; c. Crushing and/or blending of rock, sand, stone, gravel, or ore; and 22 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!91 6/G/b d. The producing of articles for sale, or for commercial or industrial use, from raw materials or prepared materials by giving such materials, articles, and substances of trade or commerce new forms, qualities, properties, or combinations including, but not limited to, such activities as making, fabricating, processing, refining, mixing, slaughtering, packing, aging, curing, mild curing, preserving, canning, and the preparing and freezing of fresh fruits and vegetables. “To manufacture” shall not include the production of digital goods or the production of computer software if the computer software is delivered from the seller to the purchaser by means other than tangible storage media, including the delivery by use of a tangible storage media where the tangible storage media is not physically transferred to the purchaser. V. Newspaper means a publication offered for sale regularly at stated intervals at least once a week and printed on newsprint in tabloid or broadsheet format folded loosely together without stapling, glue, or any other binding of any kind. Magazine or periodical means any printed publication, other than a newspaper, issued and offered for sale regularly at stated intervals at least once every three months, including any supplement or special edition of the publication. Any publication meeting this definition qualifies regardless of its content. W. Nonprofit corporation or nonprofit organization means a corporation or organization in which no part of the income can be distributed to its members, directors, or officers and that holds a current tax exempt status as provided under Section 501(c)(3) of the Internal Revenue Code, as 23 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!92 6/G/b hereafter amended, or is specifically exempted from the requirement to apply for its tax exempt status under Section 501(c)(3) of the Internal Revenue Code, as hereafter amended. Where the term “nonprofit organization” is used, it is meant to include a nonprofit corporation. X. Office or place of business means a fixed location or permanent facility where the regular business of the person is conducted and which is either owned by the person or over which the person exercises legal dominion and control. The regular business of the person is presumed conducted at a location: 1. Whose address the person uses as its business mailing address; 2. Where the place of primary use is shown on a telephone billing or a location containing a telephone line listed in a public telephone directory or other similar publication under the business name; 3. Where the person holds itself out to the general public as conducting its regular business through signage or other means; and 4. Where the person is required to obtain any appropriate state and local business license or registration unless they are exempted by law from such requirement. A vehicle such as a pick-up, van, truck, boat or other motor vehicle is not an office or place of business. A post office box is not an office or place of business. 24 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!93 6/G/b If a person has an office or place of business, the person’s home is not an office or place of business unless it meets the criteria for office or place of business above. If a person has no office or place of business, the person’s home or apartment within the city will be deemed the place of business. If a person is operating a self-storage business where storage units are rented to tenants, the storage units shall be considered a part of the person’s place of business. Y. Person means any individual, receiver, administrator, executor, assignee, trustee in bankruptcy, trust, estate, firm, copartnership, joint venture, club, company, joint stock company, business trust, municipal corporation, political subdivision of the state of Washington, corporation, limited liability company, association, society, or any group of individuals acting as a unit, whether mutual, cooperative, fraternal, nonprofit, or otherwise, and the United States or any instrumentality thereof. Z. Processing for hire means the performance of labor and mechanical services upon materials or ingredients belonging to others so that as a result a new, different, or useful product is produced for sale, or commercial or industrial use. A processor for hire is any person who would be a manufacturer if that person were performing the labor and mechanical services upon that person’s own materials or ingredients. If a person furnishes, or sells to the customer prior to manufacture, materials or ingredients equal to 20 percent or more of the total value of all materials or ingredients that become a part of the finished product, the person will be deemed to be a manufacturer and not a processor for hire. 25 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!94 6/G/b AA. Product means tangible personal property, including articles, substances, or commodities created, brought forth, extracted, or manufactured by human or mechanical effort. Byproduct means any additional product, other than the principal or intended product, which results from extracting or manufacturing activities and which has a market value without regard to whether or not such additional product was an expected or intended result of the extracting or manufacturing activities. BB. Retailing means the activity of engaging in making sales at retail and is reported under the retailing classification. CC. Retail service shall include the sale of or charge made for personal, business, or professional services including amounts designated as interest, rents, fees, admission, and other service emoluments however designated, received by persons engaging in the following business activities: 1. Amusement and recreation services including but not limited to golf, pool, billiards, skating, bowling, swimming, bungee jumping, ski lifts and tows, basketball, racquet ball, handball, squash, tennis, batting cages, day trips for sightseeing purposes, and others, when provided to consumers. “Amusement and recreation services” also includes the provision of related facilities such as basketball courts, tennis courts, handball courts, swimming pools, and charges made for providing the opportunity to dance. The term “amusement and recreation services” does not include instructional lessons to learn a particular activity such as tennis lessons, swimming lessons, or archery lessons; 26 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!95 6/G/b 2. Abstract, title insurance, and escrow services; 3. Credit bureau services; 4. Automobile parking and storage garage services; 5. Landscape maintenance and horticultural services but excluding (a) horticultural services provided to farmers and (b) pruning, trimming, repairing, removing, and clearing of trees and brush near electric transmission or distribution lines or equipment, if performed by or at the direction of an electric utility; 6. Service charges associated with tickets to professional sporting events; and 7. The following personal services: physical fitness services, tanning salon services, tattoo parlor services, steam bath services, Turkish bath services, escort services, and dating services. 8. The term shall also include the renting or leasing of tangible personal property to consumers and the rental of equipment with an operator. DD. Sale, casual or isolated sale. 1. Sale means any transfer of the ownership of, title to, or possession of property for a valuable consideration and includes any activity classified as a “sale at retail,” “retail sale,” or “retail service.” It includes renting or leasing, conditional sale contracts, leases with option to purchase, 27 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!96 6/G/b and any contract under which possession of the property is given to the purchaser but title is retained by the vendor as security for the payment of the purchase price. It also includes the furnishing of food, drink, or meals for compensation whether consumed upon the premises or not. 2. Casual or isolated sale means a sale made by a person who is not engaged in the business of selling the type of property involved on a routine or continuous basis. EE. Sale at retail, retail sale. 1. Sale at retail or retail sale means every sale of tangible personal property (including articles produced, fabricated, or imprinted) to all persons irrespective of the nature of their business and including, among others, without limiting the scope hereof, persons who install, repair, clean, alter, improve, construct, or decorate real or personal property of or for consumers, other than a sale to a person who presents a resale certificate under RCW 82.04.470 and who: a. Purchases for the purpose of resale as tangible personal property in the regular course of business without intervening use by such person; or b. Installs, repairs, cleans, alters, imprints, improves, constructs, or decorates real or personal property of or for consumers, if such tangible personal property becomes an ingredient or component of such real or personal property without intervening use by such person; or 28 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!97 6/G/b c. Purchases for the purpose of consuming the property purchased in producing for sale a new article of tangible personal property or substance, of which such property becomes an ingredient or component or is a chemical used in processing, when the primary purpose of such chemical is to create a chemical reaction directly through contact with an ingredient of a new article being produced for sale; or d. Purchases for the purpose of consuming the property purchased in producing ferrosilicon which is subsequently used in producing magnesium for sale, if the primary purpose of such property is to create a chemical reaction directly through contact with an ingredient of ferrosilicon; or e. Purchases for the purpose of providing the property to consumers as part of competitive telephone service, as defined in RCW 82.04.065. The term shall include every sale of tangible personal property which is used or consumed or to be used or consumed in the performance of any activity classified as a “sale at retail” or “retail sale” even though such property is resold or utilized as provided in subsection (EE)(1)(a), (b), (c), (d), or (e) of this section following such use; or f. Purchases for the purpose of satisfying the person’s obligations under an extended warranty as defined in subsection (EE)(7) of this section, if such tangible personal property replaces or becomes an ingredient or component of property covered by the extended warranty without intervening use by such person. 29 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!98 6/G/b 2. “Sale at retail” or “retail sale” also means every sale of tangible personal property to persons engaged in any business activity which is taxable under KCC 3.28.050(A)(7). 3. “Sale at retail” or “retail sale” shall include the sale of or charge made for tangible personal property consumed and/or for labor and services rendered in respect to the following: a. The installing, repairing, cleaning, altering, imprinting, or improving of tangible personal property of or for consumers, including charges made for the mere use of facilities in respect thereto, but excluding charges made for the use of coin-operated laundry facilities when such facilities are situated in an apartment house, rooming house, or mobile home park for the exclusive use of the tenants thereof, and also excluding sales of laundry service to nonprofit health care facilities, and excluding services rendered in respect to live animals, birds, and insects; b. The constructing, repairing, decorating, or improving of new or existing buildings or other structures under, upon, or above real property of or for consumers, including the installing or attaching of any article of tangible personal property therein or thereto, whether or not such personal property becomes a part of the realty by virtue of installation, and shall also include the sale of services or charges made for the clearing of land and the moving of earth excepting the mere leveling of land used in commercial farming or agriculture; c. The charge for labor and services rendered in respect to constructing, repairing, or improving any structure upon, above, or under any real property owned by an owner who conveys the property by title, 30 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!99 6/G/b possession, or any other means to the person performing such construction, repair, or improvement for the purpose of performing such construction, repair, or improvement and the property is then reconveyed by title, possession, or any other means to the original owner; d. The sale of or charge made for labor and services rendered in respect to the cleaning, fumigating, razing, or moving of existing buildings or structures, but shall not include the charge made for janitorial services; and for purposes of this section the term “janitorial services” shall mean those cleaning and caretaking services ordinarily performed by commercial janitor service businesses including, but not limited to, wall and window washing, floor cleaning and waxing, and the cleaning in place of rugs, drapes, and upholstery. The term “janitorial services” does not include painting, papering, repairing, furnace or septic tank cleaning, snow removal, or sandblasting; e. The sale of or charge made for labor and services rendered in respect to automobile towing and similar automotive transportation services, but not in respect to those required to report and pay taxes under Chapter 82.16 RCW; f. The sale of and charge made for the furnishing of lodging and all other services, except telephone business and cable service, by a hotel, rooming house, tourist court, motel, trailer camp, and the granting of any similar license to use real property, as distinguished from the renting or leasing of real property, and it shall be presumed that the occupancy of real property for a continuous period of one month or more constitutes a rental or lease of real property and not a mere license to use or enjoy the same. For the purposes of this subsection, it shall be presumed that the sale of and 31 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!9: 6/G/b charge made for the furnishing of lodging for a continuous period of one month or more to a person is a rental or lease of real property and not a mere license to enjoy the same; g. The installing, repairing, altering, or improving of digital goods for consumers; h. The sale of or charge made for tangible personal property, labor, and services to persons taxable under subsections (EE)(3)(a), (b), (c), (d), (e), (f), and (g) of this section when such sales or charges are for property, labor, and services which are used or consumed in whole or in part by such persons in the performance of any activity defined as a “sale at retail” or “retail sale” even though such property, labor, and services may be resold after such use or consumption. Nothing contained in this subsection shall be construed to modify subsection (EE)(1) of this section and nothing contained in subsection (EE)(1) of this section shall be construed to modify this subsection. 4. “Sale at retail” or “retail sale” shall also include the providing of competitive telephone service to consumers. 5.a. “Sale at retail” or “retail sale” shall also include the sale of prewritten software other than a sale to a person who presents a resale certificate under RCW 82.04.470, regardless of the method of delivery to the end user. For purposes of this subsection (EE)(5)(a) the sale of prewritten computer software includes the sale of or charge made for a key or an enabling or activation code, where the key or code is required to activate prewritten computer software and put the software into use. There is no separate sale of the key or code from the prewritten computer 32 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:1 6/G/b software, regardless of how the sale may be characterized by the vendor or by the purchaser. The term “sale at retail” or “retail sale” does not include the sale of or charge made for: i. Custom software; or ii. The customization of prewritten software. b.i. The term also includes the charge made to consumers for the right to access and use prewritten computer software, where possession of the software is maintained by the seller or a third party, regardless of whether the charge for the service is on a per use, per user, per license, subscription, or some other basis. ii.(A) The service described in subsection (EE)(5)(b)(i) of this section includes the right to access and use prewritten software to perform data processing. (B) For purposes of this subsection (EE)(5)(b)(ii) data processing means the systematic performance of operations on data to extract the required information in an appropriate form or to convert the data to usable information. Data processing includes check processing, image processing, form processing, survey processing, payroll processing, claim processing, and similar activities. 6. “Sale at retail” or “retail sale” shall also include the sale of or charge made for labor and services rendered in respect to the building, 33 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:2 6/G/b repairing, or improving of any street, place, road, highway, easement, right- of-way, mass public transportation terminal or parking facility, bridge, tunnel, or trestle which is owned by a municipal corporation or political subdivision of the state, the state of Washington, or by the United States and which is used or to be used primarily for foot or vehicular traffic including mass transportation vehicles of any kind. 7 “Sale at retail” or “retail sale” shall also include the sale of or charge made for an extended warranty to a consumer. For purposes of this subsection, extended warranty means an agreement for a specified duration to perform the replacement or repair of tangible personal property at no additional charge or a reduced charge for tangible personal property, labor, or both, or to provide indemnification for the replacement or repair of tangible personal property, based on the occurrence of specified events. The term “extended warranty” does not include an agreement, otherwise meeting the definition of “extended warranty” in this subsection, if no separate charge is made for the agreement and the value of the agreement is included in the sales price of the tangible personal property covered by the agreement. 8. “Sale at retail” or “retail sale” shall also include the sale of or charge made for labor and services rendered in respect to the constructing, repairing, decorating, or improving of new or existing buildings or other structures under, upon, or above real property of or for the United States, any instrumentality thereof, or a county or city housing authority created pursuant to Chapter 35.82 RCW, including the installing or attaching of any article of tangible personal property therein or thereto, whether or not such personal property becomes a part of the realty by virtue of installation. 34 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:3 6/G/b 9. “Sale at retail” or “retail sale” shall not include the sale of services or charges made for the clearing of land and the moving of earth of or for the United States, any instrumentality thereof, or a county or city housing authority. Nor shall the term include the sale of services or charges made for cleaning up for the United States, or its instrumentalities, radioactive waste and other byproducts of weapons production and nuclear research and development. 10. “Sale at retail” or “retail sale” shall not include the sale of or charge made for labor and services rendered for environmental remedial action. 11. “Sale at retail” or “retail sale” shall also include the following sales to consumers of digital goods, digital codes, and digital automated services: a. Sales in which the seller has granted the purchaser the right of permanent use; b. Sales in which the seller has granted the purchaser a right of use that is less than permanent; c. Sales in which the purchaser is not obligated to make continued payment as a condition of the sale; and d. Sales in which the purchaser is obligated to make continued payment as a condition of the sale. 35 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:4 6/G/b A retail sale of digital goods, digital codes, or digital automated services under this subsection (EE)(11) includes any services provided by the seller exclusively in connection with the digital goods, digital codes, or digital automated services, whether or not a separate charge is made for such services. For purposes of this subsection, permanent means perpetual or for an indefinite or unspecified length of time. A right of permanent use is presumed to have been granted unless the agreement between the seller and the purchaser specifies or the circumstances surrounding the transaction suggest or indicate that the right to use terminates on the occurrence of a condition subsequent. 12. “Sale at retail” or “retail sale” shall also include the installing, repairing, altering, or improving of digital goods for consumers. FF. Sale at wholesale or wholesale sale means any sale of tangible personal property, digital goods, digital codes, digital automated services, prewritten computer software, or services described in subsection (EE)(5)(b)(i) of this section which is not a retail sale, and any charge made for labor and services rendered for persons who are not consumers, in respect to real or personal property and retail services, if such charge is expressly defined as a retail sale or retail service when rendered to or for consumers. Sale at wholesale also includes the sale of telephone business to another telecommunications company as defined in RCW 80.04.010 for the purpose of resale, as contemplated by RCW 35.21.715. GG. Services includes those activities that do not fall within one of the other tax classifications used by the city. 36 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:5 6/G/b HH. Software, prewritten software, custom software, customization of canned software, master copies, retained rights. 1. Prewritten software or canned software means computer software, including prewritten upgrades, that is not designed and developed by the author or other creator to the specifications of a specific purchaser. The combining of two or more prewritten computer software programs or prewritten portions thereof does not cause the combination to be other than prewritten computer software. Prewritten computer software includes software designed and developed by the author or other creator to the specifications of a specific purchaser when it is sold to a person other than such purchaser. Where a person modifies or enhances computer software of which such person is not the author or creator, the person shall be deemed to be the author or creator only of the person’s modifications or enhancements. Prewritten computer software or a prewritten portion thereof that is modified or enhanced to any degree, where such modification or enhancement is designed and developed to the specifications of a specific purchaser, remains prewritten computer software; however, where there is a reasonable, separately stated charge or an invoice or other statement of the price given to the purchaser for the modification or enhancement, the modification or enhancement shall not constitute prewritten computer software. 2. Custom software means software created for a single person. 3. Customization of canned software means any alteration, modification, or development of applications using or incorporating canned software to specific individualized requirements of a single person. 37 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:6 6/G/b Customization of canned software includes individualized configuration of software to work with other software and computer hardware but does not include routine installation. Customization of canned software does not change the underlying character or taxability of the original canned software. 4. Master copies of software means copies of software from which a software developer, author, inventor, publisher, licensor, sublicensor, or distributor makes copies for sale or license. The software encoded on a master copy and the media upon which the software resides are both ingredients of the master copy. 5. Retained rights means any and all rights, including intellectual property rights such as those rights arising from copyrights, patents, and trade secret laws, that are owned or are held under contract or license by a software developer, author, inventor, publisher, licensor, sublicensor, or distributor. 6. Software means any information, program, or routine, or any set of one or more programs, routines, or collections of information, used, or intended for use, to convey information that causes one or more computers or pieces of computer-related peripheral equipment, or any combination thereof, to perform a task or set of tasks. “Software” includes the associated documentation, materials, or ingredients, regardless of the media upon which that documentation is provided, that describe the code and its use, operation, and maintenance and that typically are delivered with the code to the consumer. All software is classified as either canned or custom. 38 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:7 6/G/b II. Taxpayer means any “person,” as herein defined, required to have a business license under this chapter or liable for the collection of any tax or fee under this chapter, or who engages in any business or who performs any act for which a tax or fee is imposed by this chapter. JJ. Tuition fee includes library, laboratory, health service, and other special fees, and amounts charged for room and board by an educational institution when the property or service for which such charges are made is furnished exclusively to the students or faculty of such institution. Educational institution, as used in this section, means only those institutions created or generally accredited as such by the state and includes educational programs that such educational institution cosponsors with a nonprofit organization, as defined by the Internal Revenue Code Section 501(c)(3), as hereafter amended, if such educational institution grants college credit for coursework successfully completed through the educational program, or an approved branch campus of a foreign degree-granting institution in compliance with Chapter 28B.90 RCW, and in accordance with RCW 82.04.4332 or defined as a degree-granting institution under RCW 28B.85.010(3) and accredited by an accrediting association recognized by the United States Secretary of Education, and offering to students an educational program of a general academic nature or those institutions which are not operated for profit and which are privately endowed under a deed of trust to offer instruction in trade, industry, and agriculture, but not including specialty schools, business colleges, other trade schools, or similar institutions. KK. Value proceeding or accruing means the consideration, whether money, credits, rights, or other property expressed in terms of money, a person is entitled to receive or which is actually received or accrued. The 39 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:8 6/G/b term shall be applied, in each case, on a cash receipts or accrual basis according to which method of accounting is regularly employed in keeping the books of the taxpayer. LL. Value of products. 1. The value of products, including byproducts, extracted or manufactured, shall be determined by the gross proceeds derived from the sale thereof whether such sale is at wholesale or at retail, to which shall be added all subsidies and bonuses received from the purchaser or from any other person with respect to the extraction, manufacture, or sale of such products or byproducts by the seller. 2. Where such products, including byproducts, are extracted or manufactured for commercial or industrial use; and where such products, including byproducts, are shipped, transported or transferred out of the city, or to another person, without prior sale or are sold under circumstances such that the gross proceeds from the sale are not indicative of the true value of the subject matter of the sale; the value shall correspond as nearly as possible to the gross proceeds from sales in this state of similar products of like quality and character, and in similar quantities by other taxpayers, plus the amount of subsidies or bonuses ordinarily payable by the purchaser or by any third person with respect to the extraction, manufacture, or sale of such products. In the absence of sales of similar products as a guide to value, such value may be determined upon a cost basis. In such cases, there shall be included every item of cost attributable to the particular article or article extracted or manufactured, including direct and indirect overhead costs. The director may prescribe rules for the purpose of ascertaining such values. 40 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:9 6/G/b 3. Notwithstanding subsection (LL)(2) of this section, the value of a product manufactured or produced for purposes of serving as a prototype for the development of a new or improved product shall correspond to: a. The retail selling price of such new or improved product when first offered for sale; or b. The value of materials incorporated into the prototype in cases in which the new or improved product is not offered for sale. MM. Wholesaling means engaging in the activity of making sales at wholesale, and is reported under the wholesaling classification. SECTION 4. – Amendment – KCC 3.28.050. Section 3.28.050 of the Kent City Code, entitled “Imposition of the tax – Tax or fee levied,” is hereby amended as follows: Section 3.28.050. Imposition of the tax Except as provided in subsection (C) of this section, there is hereby levied upon and shall be collected from every person a tax for the act or privilege of engaging in business activities within the city, whether the person’s office or place of business be within or without the city. The gross receipts tax and square footage tax are separate business and occupation taxes imposed by this chapter. The amount for the gross receipts tax shall be determined by application of rates against the gross proceeds of sale, gross income of business, or value of products, including byproducts as described in subsection “A” of this section. The amount for the square footage tax shall 41 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!:: 6/G/b be determined by application of rates against the square footage of the business space within the city as described in subsection “B” of this section. The amount of tax due to the city shall be the larger of the amounts calculated under each tax, as measured for each tax reporting period. A. Gross receipts tax. 1. Upon every person engaging within the city in business as an extractor; as to such persons the amount of the tax with respect to such business shall be equal to the value of the products, including byproducts, extracted within the city for sale or for commercial or industrial use, multiplied by the rate of 0.00152 through December 31, 2021, and multiplied by the rate of 0.002 effective January 1, 2022. The measure of the tax is the value of the products, including byproducts, so extracted, regardless of the place of sale or the fact that deliveries may be made to points outside the city. 2. Upon every person engaging within the city in business as a manufacturer, as to such persons, the amount of the tax with respect to such business shall be equal to the value of the products, including byproducts, manufactured within the city, multiplied by the rate of 0.00046 through December 31, 2021, and multiplied by the rate of 0.001 effective January 1, 2022. The measure of the tax is the value of the products, including byproducts, so manufactured, regardless of the place of sale or the fact that deliveries may be made to points outside the city. 3. Upon every person engaging within the city in the business of making sales at wholesale, as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of such sales 42 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!211 6/G/b of the business without regard to the place of delivery of articles, commodities or merchandise sold, multiplied by the rate of 0.00152 through December 31, 2019, and multiplied by the rate 0.002 effective January 1, 2020. 4. Upon every person engaging within the city in the business of making sales at retail, as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of such sales of the business, without regard to the place of delivery of articles, commodities or merchandise sold, multiplied by the rate of 0.00046 through December 31, 2021, and multiplied by the rate of 0.001 effective January 1, 2022. 5. Upon every person engaging within the city in the business of (a) printing, (b) both printing and publishing newspapers, magazines, periodicals, books, music, and other printed items, (c) publishing newspapers, magazines and periodicals, (d) extracting for hire, and (e) processing for hire; as to such persons, the amount of tax on such business shall be equal to the gross income of the business multiplied by the rate of 0.00046 through December 31, 2021, and multiplied by the rate of 0.001 effective January 1, 2022. 6. Upon every person engaging within the city in the business of making sales of retail services; as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of sales multiplied by the rate of 0.00152 through December 31, 2021, and multiplied by the rate of 0.002 effective January 1, 2022. 7. Upon every other person engaging within the city in any business activity other than or in addition to those enumerated in the above 43 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!212 6/G/b subsections; as to such persons, the amount of tax on account of such activities shall be equal to the gross income of the business multiplied by the rate of 0.00152 through December 31, 2021, and multiplied by the rate of 0.002 effective January 1, 2022. This subsection includes, among others, and without limiting the scope hereof (whether or not title to material used in the performance of such business passes to another by accession, merger, or other than by outright sale), persons engaged in the business of developing or producing custom software or of customizing canned software, producing royalties or commissions, and persons engaged in the business of rendering any type of service which does not constitute a sale at retail, a sale at wholesale, or a retail service. B. Square footage tax. Upon every person who leases, owns, occupies, or otherwise maintains an office, warehouse, outdoor warehouse, or other place of business within the city for purposes of engaging in business activities in the city, the tax shall be measured by the number of square feet of business warehouse floor space, outdoor warehouse space, or other business floor space for each office, warehouse, outdoor warehouse, or other place of business leased, owned, occupied, or otherwise maintained within the city during the reporting period, calculated to the nearest square foot. 1. The amount of the tax due shall be equal to the sum of the number of square feet of business warehouse floor space and outdoor warehouse space for each business warehouse or outdoor warehouse leased, owned, occupied, or otherwise maintained within the city multiplied by the rate for each calendar year listed below, and the number of square feet of other business floor space for each office or other place of business leased, owned, occupied, or otherwise maintained within the city multiplied by the rate for each calendar year listed below. 44 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!213 6/G/b Business Effective Warehouse Floor Other Business Date Space/Outdoor Floor Space Warehouse Space 1/1/2019 0.06 quarterly rate 0.02 quarterly rate 0.24 annual rate 0.08 annual rate 1/1/2020 0.09 quarterly rate 0.02 quarterly rate 0.36 annual rate 0.08 annual rate 1/1/2025 0.12 quarterly rate 0.02 quarterly rate 0.48 annual rate 0.08 annual rate 1/1/2028 0.15 quarterly rate 0.03 quarterly rate 0.60 annual rate 0.12 annual rate 2. For purposes of this section, business warehouse means a building or structure, or any part thereof, in which goods, wares, merchandise, or commodities are received or stored, whether or not for compensation, in furtherance of engaging in business. The storage units of self-storage businesses are not business warehouses. 3. For purposes of this section, outdoor warehouse means an area that is outdoors and is primarily used for the transloading of goods, wares, merchandise, or commodities on property for purposes of switching modes or vehicles of conveyance for the primary purpose of wholesaling, distributing, or reorganizing goods, wares, merchandise, or commodities en route to final destinations of sale or other transaction. Transloading generally involves the transfer of goods from one mode of transportation to 45 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!214 6/G/b another en route to an ultimate destination and, for purposes of the square footage tax, includes areas used for crossdocking, waylaying, temporary embarkment, and other similar activities. 4. For purposes of this section, other business floor space means the floor space of an office or place of business, other than a business warehouse or outdoor warehouse. 5. For purposes of this section, the square footage of a business warehouse and other business floor space shall be computed by measuring to the inside finish of permanent outer building walls and shall include space used by columns and projections necessary to the building. Square footage shall not include stairs, elevator shafts, flues, pipe shafts, vertical ducts, heating or ventilation shafts, janitor closets, and electrical or utility closets. 6. For purposes of this section, the square footage of an outdoor warehouse shall only include those areas used for the receipt or storage of goods, wares, merchandise, or commodities that are being received and temporarily stored for transloading, whether or not for compensation, in furtherance of engaging in business. Such areas will typically include those areas where goods, wares, merchandise, and commodities, in transit to their ultimate destination, are parked, packaged, or stored after transloading, waylaying, or crossdocking. Square footage shall not include areas used only for employee, customer, or visitor parking, dock high loading areas used primarily for a business warehouse, buildings, areas used only for direct sales or rentals to consumers, landscaped areas, stormwater facilities, maneuvering areas and drive aisles, areas used only for garbage or recycling pickup, rights-of-way, or other areas clearly not used for the temporary storage of goods, wares, merchandise, and commodities in transit. Outdoor 46 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!215 6/G/b areas used for storage of agricultural products or for ancillary storage of materials utilized in, or products resulting from, onsite manufacturing operations are not considered outdoor warehouses. 7. Persons with more than one office, business warehouse, outdoor warehouse, or other place of business within the city must include all business warehouse floor space, outdoor warehouse space, and other business floor space for all locations within the city. Except in the case of self-storage units, when a person rents space to another person, the person occupying the rental space is responsible for the square footage business tax on that rental space only if the space is used by the renter for purposes of engaging in business activities and the renter has exclusive right of possession in the space as against the landlord. Space rented as self-storage units shall be included in the other business floor space of the person that operates the self-storage business. Space rented for the storage of goods in a warehouse or outdoor warehouse where no walls or other barriers separate the goods, and where the exclusive right of possession in the space is not held by the person to whom the space is rented, shall be included in the business warehouse floor space of the person that operates the business warehouse, and not by the person renting the warehouse space. C. Gross receipts and square footage threshold. 1. Gross receipts threshold. The gross receipts tax imposed in subsection (A) of this section shall not apply to any person engaging in any one or more business activities which are otherwise taxable pursuant to this section, whose value of products, including byproducts, gross proceeds of sales, and gross income of the business, as the case may be, from all 47 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!216 6/G/b activities conducted within the city during any calendar year does not exceed the threshold amount of $250,000. 2. Square footage threshold. The square footage tax on business warehouse floor space and other business floor space imposed in subsection (B) of this section shall not apply to any person unless that person’s total area of business warehouse space and other business floor space within the city exceeds one of the following thresholds: a. Four thousand taxable square feet of business warehouse space; or b. Twelve thousand taxable square feet of other business floor space. If the square footage tax applies to business warehouse floor space or other business floor space, it applies to all business warehouse space and other business floor space leased, owned, occupied, or otherwise maintained by the taxpayer during the applicable reporting period. The square footage tax on outdoor warehouse space imposed in subsection (B) of this section shall not apply to any person unless that person’s total area of outdoor warehouse space within the city exceeds 261,360 taxable square feet (six acres) of outdoor warehouse space. If the square footage tax applies to outdoor warehouse space, it applies to all outdoor warehouse space leased, owned, occupied, or otherwise maintained by the taxpayer during the applicable reporting period. 48 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!217 6/G/b D. Gross receipts maximum – Retailing activities. Effective January 1, 2022, the gross receipts tax imposed in subsection (A) of this section shall not apply to retailing activities exceeding $20,000,000 in any calendar year which are otherwise taxable pursuant to this section. E. Rules. The director may promulgate rules and regulations regarding the manner, means, and method of calculating any tax imposed under this section. SECTION 5. – Amendment – KCC 3.28.090. Section 3.28.090 of the Kent City Code, entitled “Exemptions,” is hereby amended as follows: Section 3.28.090. Exemptions. A. Nonprofit corporations or nonprofit organizations. This chapter shall not apply to nonprofit organizations exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code, as hereafter amended, except with respect to retail sales of such persons. B. Certain fraternal and beneficiary organizations. This chapter shall not apply to fraternal benefit societies or fraternal fire insurance associations, as described in RCW Title 48; nor to beneficiary corporations or societies organized under and existing by virtue of RCW Title 24, if such beneficiary corporations or societies provide in their bylaws for the payment of death benefits. This exemption is limited, however, to gross income from premiums, fees, assessments, dues, or other charges directly attributable to the insurance or death benefits provided by such societies, associations, or corporations. 49 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!218 6/G/b C. Certain corporations furnishing aid and relief. This chapter shall not apply to the gross sales or the gross income received by corporations which have been incorporated under any act of the congress of the United States of America and whose principal purposes are to furnish volunteer aid to members of the armed forces of the United States and also to carry on a system of national and international relief and to apply the same in mitigating the sufferings caused by pestilence, famine, fire, floods, and other national calamities and to devise and carry on measures for preventing the same. D. Operation of sheltered workshops. This chapter shall not apply to income received from the Department of Social and Health Services for the cost of care, maintenance, support, and training of persons with developmental disabilities at nonprofit group training homes as defined by Chapter 71A.22 RCW or to the business activities of nonprofit organizations from the operation of sheltered workshops. For the purposes of this subsection, “the operation of sheltered workshops” means performance of business activities of any kind on or off the premises of such nonprofit organizations which are performed for the primary purpose of: 1. Providing gainful employment or rehabilitation services to the handicapped as an interim step in the rehabilitation process for those who cannot be readily absorbed in the competitive labor market or during such time as employment opportunities for them in the competitive labor market do not exist; or 2. Providing evaluation and work adjustment services for handicapped individuals. 50 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!219 6/G/b E. Credit unions. This chapter shall not apply to the gross income of credit unions organized under the laws of the state, any other state, or the United States. F. Health maintenance organization, health care service contractor, certified health plan. This chapter does not apply to any health maintenance organization, health care service contractor, or certified health plan in respect to premiums or prepayments that are taxable under RCW 48.14.0201. G. Public utilities. This chapter shall not apply to any person in respect to a business activity with respect to which tax liability is specifically imposed under the utility tax provisions of Chapter 3.18 KCC. H. Investments – Dividends from subsidiary corporations. This chapter shall not apply to amounts derived by persons, other than those engaging in banking, loan, security, or other financial businesses, from investments or the use of money as such, and also amounts derived as dividends by a parent from its subsidiary corporations. I. International banking facilities. This chapter shall not apply to the gross receipts of an international banking facility. As used in this subsection, an international banking facility means a facility represented by a set of asset and liability accounts segregated on the books and records of a commercial bank, the principal office of which is located in this state, and which is incorporated and doing business under the laws of the United States or of this state, a United States branch or agency of a foreign bank, an Edge corporation organized under Section 25(a) of the Federal Reserve Act, 12 U.S.C. Sections 611 through 631, or an Agreement corporation having an 51 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!21: 6/G/b agreement or undertaking with the Board of Governors of the Federal Reserve System under Section 25 of the Federal Reserve Act, 12 U.S.C. Sections 601 through 604(a), that includes only international banking facility time deposits (as defined in subsection (a)(2) of Section 204.8 of Regulation D (12 CFR Part 204), as promulgated by the Board of Governors of the Federal Reserve System), and international banking facility extensions of credit (as defined in subsection (a)(3) of Section 204.8 of Regulation D). J. Insurance business. This chapter shall not apply to amounts received by any person who is an insurer, or their appointed insurance producer, upon which a tax based on gross premiums is paid to the state pursuant to RCW 48.14.020; and provided further, that the provisions of this subsection shall not exempt any bonding company from tax with respect to gross income derived from the completion of any contract as to which it is a surety, or as to any liability as successor to the liability of the defaulting contractor. K. Farmers – Agriculture. This chapter shall not apply to any farmer in respect to amounts received from selling fruits, vegetables, berries, butter, eggs, fish, milk, poultry, meats, or any other agricultural product that is raised, caught, produced, or manufactured by such persons. L. Athletic exhibitions. This chapter shall not apply to any person in respect to the business of conducting boxing contests and sparring or wrestling matches and exhibitions for the conduct of which a license must be secured from the State Boxing Commission. M. Racing. This chapter shall not apply to any person in respect to the business of conducting race meets for the conduct of which a license must be secured from the Washington State Horse Racing Commission. 52 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!221 6/G/b N. Ride sharing. This chapter does not apply to any funds received in the course of commuter ride sharing or ride sharing for persons with special transportation needs in accordance with RCW 46.74.010. O. Employees. 1. This chapter shall not apply to any person in respect to the person’s employment in the capacity as an employee or servant as distinguished from that of an independent contractor. For the purposes of this subsection, the definition of “employee” shall include those persons that are defined in the Internal Revenue Code, as hereafter amended. 2. A booth renter is an independent contractor for purposes of this chapter. P. Sale or rental of real estate. This chapter shall not apply to gross proceeds derived from the sale of real estate. This, however, shall not be construed to allow an exemption of amounts received as commissions from the sale of real estate, nor as fees, handling charges, discounts, interest, or similar financial charges resulting from, or relating to, real estate transactions. This chapter shall also not apply to amounts received for the rental of real estate if the rental income is derived from a contract to rent for a continuous period of 30 days or longer. The rental of self-storage units where tenants are permitted 24-hour unrestricted access to their individual unit and tenants are permitted to lock or secure their unit to prevent access by others, is considered the rental of real estate when units are rented for a continuous period of 30 days or longer. The square footage tax shall not apply to residential dwelling units. 53 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!222 6/G/b Q. Mortgage brokers’ third-party provider services trust accounts. This chapter shall not apply to amounts received from trust accounts to mortgage brokers for the payment of third-party costs if the accounts are operated in a manner consistent with RCW 19.146.050 and any rules adopted by the director of financial institutions. R. Amounts derived from manufacturing, selling, or distributing motor vehicle fuel. This chapter shall not apply to the manufacturing, selling, or distributing motor vehicle fuel, as the term “motor vehicle fuel” is defined in RCW 82.38.010 and exempt under RCW 82.38.280; provided, that any fuel not subjected to the state fuel excise tax, or any other applicable deduction or exemption, will be taxable under this chapter. S. Amounts derived from liquor, and the sale or distribution of liquor. This chapter shall not apply to liquor as defined in RCW 66.04.010 and exempt in RCW 66.08.120. T. Casual and isolated sales. This chapter shall not apply to the gross proceeds derived from casual or isolated sales. U. Accommodation sales. This chapter shall not apply to sales for resale by persons regularly engaged in the business of making retail sales of the type of property so sold to other persons similarly engaged in the business of selling such property where (1) the amount paid by the buyer does not exceed the amount paid by the seller to the vendor in the acquisition of the article and (2) the sale is made as an accommodation to the buyer to enable the buyer to fill a bona fide existing order of a customer or is made within 54 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!223 6/G/b 14 days to reimburse in kind a previous accommodation sale by the buyer to the seller. V. Taxes collected as trust funds. This chapter shall not apply to amounts collected by the taxpayer from third parties to satisfy third-party obligations to pay taxes such as the retail sales tax, use tax, and admission tax. W. United States, Washington State governmental entities. This chapter shall not apply to gross income received by the United States or any instrumentality thereof and by the state of Washington or any municipal subdivision thereof. X. Research and development under federal contracts. This chapter shall not apply to amounts received for research and development activities performed on behalf of, under contract to, or in partnership with the United States government. For purposes of this section, research and development activities means activities performed to discover technological information, and technical and nonroutine activities concerned with translating technological information into new or improved products, processes, techniques, formulas, inventions, or software, the application of which is intended to be useful in the development of a new or improved federal project or component thereof. SECTION 6. – Amendment – KCC 3.29.120. Section 3.29.120 of the Kent City Code, entitled “Cancellation of penalties,” is hereby amended as follows: Section 3.29.120 Cancellation of penalties. 55 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!224 6/G/b A. The director may cancel any penalties imposed under KCC 3.29.110(A) if the taxpayer shows that its failure to timely file or pay the tax was due to reasonable cause and not willful neglect. Willful neglect is presumed unless the taxpayer shows that it exercised ordinary business care and prudence in making arrangements to file the return and pay the tax but was, nevertheless, due to circumstances beyond the taxpayer’s control, unable to file or pay by the due date. The director has no authority to cancel any other penalties or to cancel penalties for any other reason except as provided in this section. B. A request for cancellation of penalties must be received by the director within 30 days after the date the department mails the notice that the penalties are due. The request must be in writing and contain competent proof of all pertinent facts supporting a reasonable cause determination. In all cases the burden of proving the facts rests upon the taxpayer. C. The director may cancel the penalties in KCC 3.29.110(A) one time if a person: 1. Is not currently registered and filing returns; 2. Was unaware of its responsibility to file and pay tax; and 3. Obtained a registration certificate and any applicable business licenses and filed past due tax returns within 30 days after being notified by the department. D. The director shall not cancel any interest charged upon amounts due. 56 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!225 6/G/b E. The director may cancel the penalties imposed under KCC 3.29.110(A) one time for a person: 1. If payment of any tax due on a return to be filed by a taxpayer was received by the director by the due date for the previous 24 months; or 2. If payment of any tax due on a return to be filed by a taxpayer was received by the director by the due date for all previous months, if the person has not been required to file a return for the previous 24 months. SECTION 7. – Amendment – KCC 3.29.150. Section 3.29.150 of the Kent City Code, entitled “Judicial review of director’s determination,” is hereby amended as follows: Section 3.29.150. Judicial review of director’s determination. The taxpayer or the city may obtain judicial review of the hearing examiner’s administrative decision by applying for a Writ of Review in the King County superior court, in accordance with the procedure set forth in Chapter 7.16 RCW, other applicable law, and court rules, within 21 calendar days following the date that the decision of the hearing examiner was transmitted electronically or sent by first class mail to the parties. The city shall have the same right of review from the administrative decision as does a taxpayer. SECTION 8. – Severability. If any one or more section, subsection, or sentence of this ordinance is held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this ordinance and the same shall remain in full force and effect. 57 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!226 6/G/b SECTION 9. – Corrections by City Clerk or Code Reviser. Upon approval of the city attorney, the city clerk and the code reviser are authorized to make necessary corrections to this ordinance, including the correction of clerical errors; ordinance, section, or subsection numbering; or references to other local, state, or federal laws, codes, rules, or regulations. SECTION 10. – Effective Date. This ordinance shall take effect and be in force thirty days from and after its passage, as provided by law. DANA RALPH, MAYOR Date Approved ATTEST: KIMBERLEY A. KOMOTO, CITY CLERK Date Adopted Date Published APPROVED AS TO FORM: ARTHUR “PAT” FITZPATRICK, CITY ATTORNEY 58 Amend KCC Chapters 3.18, 3.28, 3.29 - Re: B&O Tax; Utility Tax Qbdlfu!Qh/!227 6/H FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: INFO ONLY: Third Quarter Investment Report SUMMARY: Senior Financial Analyst, Joe Bartlemay will present the Third Quarter 2021 Investment Report. SUPPORTS STRATEGIC PLAN GOAL: Sustainable Services - Providing quality services through responsible financial management, economic growth, and partnerships. ATTACHMENTS: 1. Q3 2021 Investment Report_ (PPTX) Qbdlfu!Qh/!228 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!229 ent ortfolio 2021 - Q3 City of K Investment P Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!22: Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!231 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!232 June 30,2021. – rant funding. In addition, A g ARP July 1, 2020 $14.1M of the period of time funds of - of SST Mitigation for *In June 2021, the City received onethe City received $3.6M Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!233 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!234 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!235 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!236 Buubdinfou;!R4!3132!Jowftunfou!Sfqpsu`!!)3:54!;!JOGP!POMZ;!Uijse!Rvbsufs!Jowftunfou!Sfqpsu* 6/H/b Qbdlfu!Qh/!237 6/I FINANCE DEPARTMENT Paula Painter, CPA 220 Fourth Avenue South Kent, WA 98032 253-856-5264 DATE: December 7, 2021 TO: Operations and Public Safety Committee SUBJECT: INFO ONLY: October Financial Report SUMMARY: Financial Planning Manager, Michelle Ferguson will present the October Financial Report. ATTACHMENTS: 1. October 2021 Financial Report (PDF) Qbdlfu!Qh/!238 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Overview Variance %Variance 202120212021 FavorableFavorable Adj BudgetYTDEst Actual (Unfavorable)(Unfavorable) 108,787,47094,474,244113,014,7204,227,2503.9% Revenues 114,843,29084,589,473111,875,3702,967,9202.6% Expenditures (6,055,820)9,884,7711,139,3507,195,170 Net Revenues Less Expenditures 41,969,90041,969,90041,969,900 Beginning Fund Balance 35,914,08051,854,67143,109,250 Ending Fund Balance Ending Fund Balance Detail: 35,652,28942,847,460 General Fund Reserves 31.0%38.3% 261,791261,790 Restricted for Annexation Required Ending Fund Balance Calculation Estimated Expenditures for 2021 114,843,290111,875,370 (from above) 18.0%18.0% 18% GF Ending Fund Balance20,671,79220,137,567 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Qbdlfu!Qh/!239 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Overview - Revenues Variance %Variance 202120212021 Revenue CategoriesFavorableFavorable Adj BudgetYTDEst Actual (Unfavorable)(Unfavorable) Taxes: Property31,684,60029,727,25832,104,600420,0001.3% Sales & Use19,132,66020,206,25624,299,8305,167,17027.0% Utility19,408,17016,754,24519,854,520446,3502.3% Business & Occupation17,000,00011,385,80916,585,890(414,110)-2.4% Other866,260240,755436,710(429,550)-49.6% Licenses and Permits6,786,9806,165,2917,081,440294,4604.3% Intergovernmental Revenue2,899,0502,780,7383,143,200244,1508.4% Charges for Services5,695,1404,194,7994,951,420(743,720)-13.1% Fines and Forfeitures1,158,500764,253900,770(257,730)-22.2% Miscellaneous Revenue2,630,5901,603,9092,130,820(499,770)-19.0% Transfers In1,525,520650,930 1,525,520- Total Revenues108,787,47094,474,244113,014,7204,227,2503.9% Variance analysis for revenues is provided for particular line items or those in which the estimated actual amount differs from the budgeted amount by at least 10% or minimum of $500,000. Variance Notes Sales & Use Tax: $5.2m favorable variance due to higher than anticipated sales tax revenues due to a strong construction and retail economy. Other Taxes: $430k unfavorable variance primarily due to lower than anticipated Admissions Tax revenues. Charges for Services: $743k unfavorable variance due primarily to lower than anticipated culture and rec charges. Fines & Forfeitures: $258k unfavorable variance due primarily to lower than anticipated criminal and civil penalties. Miscellaneous Revenues: $500k unfavorable variance due primarily to decreased interest income and donations. Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Qbdlfu!Qh/!23: 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Revenues ($ in Thousands) All Revenues Sources Prior Year Budgeted Actual RevenuesRevenuesRevenues January6,8776,2215,898 February5,7365,4944,174 March6,7747,8976,127 April16,92517,76721,521 May8,5888,0757,927 June7,6916,5835,491 July6,3767,5159,733 August4,9955,6626,326 September5,3286,6165,725 October19,96318,78721,552 November8,2117,6410 December11,26710,5310 Total108,732108,78794,474 Property Tax Prior Year Budgeted Actual RevenuesRevenuesRevenues January0120 February247248217 March1,4611,0341,438 April9,32812,35913,218 May3,1992,3981,945 June2,242618198 July19614680 August152117190 September538624394 October10,67311,81412,046 November3,1092,0730 December2322420 Total31,37531,68529,727 Sales Tax Prior Year Budgeted Actual RevenuesRevenuesRevenues January2,1581,5001,802 February2,4251,8032,264 March2,1431,4931,786 April1,9291,3881,753 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* May1,9591,6202,270 June2,1271,4362,005 July6391,3602,061 August1,9061,7032,172 September1,9091,5742,070 October1,8291,6262,023 November2,0531,7370 December2,5521,8930 Total23,63019,13320,206 Qbdlfu!Qh/!241 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Revenues ($ in Thousands) Utility Tax Prior Year Budgeted Actual RevenuesRevenuesRevenues January2,0331,9552,141 February1,7791,7661,215 March1,6271,6881,583 April1,8451,7711,700 May1,5811,5801,542 June1,4941,4691,312 July1,3301,5792,420 August1,4731,4871,632 September1,5191,7101,621 October1,5611,4611,588 November1,5071,5590 December1,2221,3840 Total18,97119,40816,754 Other Taxes Prior Year Budgeted Actual RevenuesRevenuesRevenues January23283 February132 March33230(156) April2,7652,6492,912 May8981,2211,008 June117205203 July2,9373,3372,966 August7728151,219 September92144107 October2,9793,6473,083 November9247400 December3,6834,8720 Total15,20317,86611,627 Other Revenues (Intergovernmental, Licenses & Permits, Charges for Service, Fines & Forfeits, and Misc Revenues) Prior Year Budgeted Actual RevenuesRevenuesRevenues January2,6841,9021,672 February1,284864475 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* March1,5082,1751,476 April1,0591,4791,938 May9511,2491,161 June1,7112,1441,773 July1,2751,4962,205 August6921,1391,113 September1,2721,9881,533 October2,9211,8332,812 November6181,2950 December3,5793,1310 Total19,55420,69616,160 Qbdlfu!Qh/!242 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Overview - Expenditures Variance %Variance 202120212021 DepartmentFavorable Favorable Adj BudgetYTDEst Actual (Unfavorable)(Unfavorable) City Council279,960229,114272,9307,0302.5% Administration2,786,2702,032,6622,541,200245,0708.8% Economic & Community Dev8,309,5506,149,6267,942,080367,4704.4% Finance2,822,6002,065,5622,590,150232,4508.2% Fire Contracted Services3,795,9002,982,6983,718,02077,8802.1% Human Resources1,613,7301,227,1231,531,97081,7605.1% Law1,503,3501,176,3321,441,57061,7804.1% Municipal Court3,793,4202,815,9343,501,350292,0707.7% Parks, Recreation & Comm Svcs19,841,42014,007,87717,649,8702,191,55011.0% Police45,548,79037,105,85746,137,930(589,140)-1.3% Non-Departmental24,548,30014,796,68724,548,300 Total Expenditures114,843,29084,589,473111,875,3702,967,9202.6% Variance analysis for expenditures is provided for particular departments or those in which the estimated actual amount differs from the budgeted amount by at least 10% or a minimum of $500,000. Variance Notes Parks, Recreation, & Community Services: Estimated spend by Parks, Recreation, & Community Services is $2.2m under budget due to the impacts of Covid-19, specifically reductions in S&B ($1.1m), Services ($1.1m) and pplies ($50k). su Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Qbdlfu!Qh/!243 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund 20192020202120212021 ActualActualAdj BudgetYTDEst Actual Beginning Fund Balance23,750,46134,399,77541,969,90041,969,90041,969,900 Revenues Taxes: Property30,731,78631,374,82731,684,600 29,727,258 32,104,600 Sales & Use27,121,40023,629,97219,132,660 20,206,256 24,299,830 Utility19,600,34718,970,71519,408,170 16,754,245 19,854,520 Business & Occupation12,999,56414,784,79517,000,000 11,385,809 16,585,890 Other963,837418,235866,260 240,755 436,710 Licenses and Permits7,483,6437,223,4206,786,980 6,165,291 7,081,440 Intergovernmental Revenue6,645,9623,196,7012,899,050 2,780,738 3,143,200 Charges for Services7,996,8463,658,2325,695,140 4,194,799 4,951,420 Fines and Forfeitures1,289,334776,9481,158,500 764,253 900,770 Miscellaneous Revenue3,586,9791,954,9372,630,590 1,603,909 2,130,820 Transfers In984,4114,820,3431,525,520 650,930 1,525,520 Total Revenues119,404,108110,809,127108,787,47094,474,244113,014,720 Expenditures City Council392,115384,062279,960229,114272,930 Administration2,768,2731,774,8082,786,2702,032,6622,541,200 Economic & Community Dev7,044,2176,711,4898,309,5506,149,6267,942,080 Finance3,236,9602,323,6362,822,6002,065,5622,590,150 Fire Contracted Services3,927,0883,674,4013,795,9002,982,6983,718,020 Human Resources2,047,1021,405,2191,613,7301,227,1231,531,970 Information Technology513,448172,932 Law1,801,5071,452,0881,503,3501,176,3321,441,570 Municipal Court3,646,2753,402,3143,793,4202,815,9343,501,350 Parks, Recreation & Comm Svcs18,396,67816,631,89919,841,42014,007,87717,649,870 Police43,849,28943,464,67945,548,79037,105,85746,137,930 Public Works1,208,835629,087 Non-Departmental20,332,20420,802,82624,548,30014,796,68724,548,300 109,163,991102,829,440114,843,290 Total Expenditures84,589,473111,875,370 Net Revenues less Expenditures10,240,1177,979,686(6,055,820)9,884,7711,139,350 Ending Fund Balance33,990,57842,379,46135,914,08051,854,67143,109,250 Ending Fund Balance Detail: Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* General Fund Reserves32,309,35840,962,23135,652,28942,847,460 based on same year actuals/budget29.6%39.8%31.0%38.3% Restricted for Annexation1,681,2201,417,230261,791261,790 Qbdlfu!Qh/!244 6/I/b October 2021 Monthly Financial Report City of Kent, Washington General Fund Year-to-Year Month Comparison 201920202021% of2021-20 thru Octthru Octthru OctBudgetVariance Revenues Taxes: Property28,835,366 28,034,519 29,727,258 1,692,739 6.0%93.8% Sales & Use22,114,046 19,025,303 20,206,256 1,180,953 6.2%105.6% Utility16, 16,241,302490,877 16,754,245 512,943 3.2%86.3% Business & Occupation8,871,499 10,262,319 11,385,809 1,123,490 10.9%67.0% Other575,682 333,698 240,755 (92,942) -27.9%27.8% Licenses and Permits6,411,993 5,632,057 6,165,291 533,233 9.5%90.8% Intergovernmental Revenue6,010,267 2,658,167 2,780,738 122,571 4.6%95.9% Charges for Services5,961,647 2,949,486 4,194,799 1,245,314 42.2%73.7% Fines and Forfeitures981,018 834,038 764,253 (69,785) -8.4%66.0% Miscellaneous Revenue2,750,577 1,441,931 1,603,909 161,979 11.2%61.0% Transfers In37,631 1,840,760 650,930 (1,189,830) -64.6%42.7% Total Revenues99,040,60289,253,57994,474,2445,220,6645.8%86.8% Expenditures City Council(95,669)-29.5%81.8% 324,782324,101 229,114 Administration690,88551.5%73.0% 1,341,7772,141,360 2,032,662 Economic & Community Dev553,9829.9%74.0% 5,595,6445,643,693 6,149,626 Finance203,61410.9%73.2% 1,861,9492,773,370 2,065,562 Fire Contracted Services17,4030.6%78.6% 2,965,2953,179,942 2,982,698 Human Resources40,6993.4%76.0% 1,186,4241,694,336 1,227,123 (172,932)-100.0% Information Technology - 172,932428,817 Law(13,348)-1.1%78.2% 1,189,6801,458,803 1,176,332 Municipal Court42,0941.5%74.2% 2,773,8402,984,444 2,815,934 Parks, Recreation & Comm Svcs1,060,6508.2%70.6% 12,947,22715,098,101 14,007,877 Police1,532,2044.3%81.5% 35,573,65235,385,909 37,105,857 Public Works(629,087)-100.0% 629,087955,016 - Non-Departmental4,621,81345.4%60.3% 10,174,8747,209,876 14,796,687 Total Expenditures79,277,76776,737,16284,589,4737,852,31110.2%73.7% Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* *General Govt. includes City Council, Mayor/Clerk, HR, IT, & Finance Qbdlfu!Qh/!245 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Fund Balances 2021 202120212021Estimated BeginningEstimatedEstimatedEnding Fund Fund BalanceRevenuesExpendituresBalance Operating revenues and expenditures only; capital and non-capital projects are excluded. General Fund General Fund41,969,901113,014,720111,875,37043,109,251 Special Revenue Funds Street Fund7,403,91218,504,11016,682,6309,225,392 LEOFF 1 Retiree Benefits1,582,2641,245,7401,480,8101,347,194 Lodging Tax73,678207,830179,090102,418 Youth/Teen Programs281,622967,380924,390324,612 Capital Resources14,023,50527,960,91019,109,20022,875,215 Criminal Justice8,271,5919,878,2608,325,2309,824,621 ShoWare Operating2,990,8451,325,0002,284,9802,030,865 Other Operating567,507109,320159,220517,607 Debt Service Funds Councilmanic Debt Service2,380,6977,408,2407,204,6602,584,277 Special Assessments Debt Service97,612698,080858,320(62,628) Enterprise Funds Water Utility14,447,09331,223,42029,370,03016,300,483 Sewer Utility2,409,86535,377,01033,980,6503,806,225 Drainage Utility18,807,59524,717,33025,075,04018,449,885 Solid Waste Utility437,037857,4201,028,180266,277 Golf Complex2,270,6662,653,0004,557,000366,666 Internal Service Funds Fleet Services3,281,4215,504,0305,111,3703,674,081 Central Services87,729381,700327,890141,539 Information Technology2,340,14910,773,38010,717,0502,396,479 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Facilities3,097,0017,022,3406,385,0303,734,311 Unemployment1,373,716156,150183,1601,346,706 Workers Compensation2,284,9001,101,9101,563,9201,822,890 Employee Health & Wellness7,561,69515,983,00014,702,2508,842,445 Liability Insurance(891,300)7,670,0804,252,5002,526,280 Property Insurance714,743613,920687,550641,113 Other Funds Impact Fee Trust Fund3,685,9603,685,960 Qbdlfu!Qh/!246 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) 20192020202120212021 ActualActualAdj BudgetYTDEst Actual Operating revenues and expenditures only; capital and non-capital projects are excluded. In instances where expenditures exceed revenues, fund balance is being utilized. Special Revenue Funds Street Fund Revenues17,415,00019,350,92817,518,85012,779,62618,504,110 Expenditures18,858,48619,205,26617,662,20012,128,75316,682,630 Net Revenues Less Expenditures(1,443,485)145,662(143,350)650,8731,821,480 LEOFF 1 Retiree Benefits Revenues1,401,7861,232,5751,272,4301,075,3321,245,740 Expenditures1,352,6241,571,5851,541,9801,225,6011,480,810 Net Revenues Less Expenditures49,162(339,010)(269,550)(150,268)(235,070) Lodging Tax Revenues314,588158,384239,110167,975207,830 Expenditures465,527270,532179,190137,731179,090 Net Revenues Less Expenditures(150,940)(112,148)59,92030,24428,740 Youth/Teen Programs Revenues941,240897,527924,390813,316967,380 Expenditures957,730691,260924,3906,500924,390 Net Revenues Less Expenditures(16,490)206,267806,81642,990 Capital Resources Revenues22,567,13022,885,70716,533,85023,252,81027,960,910 Expenditures19,339,04627,520,42619,109,20014,795,87119,109,200 Net Revenues Less Expenditures3,228,084(4,634,719)(2,575,350)8,456,9398,851,710 Criminal Justice Revenues7,054,2228,673,7948,193,6308,133,7839,878,260 Expenditures6,432,3778,504,6728,686,8506,160,6268,325,230 Net Revenues Less Expenditures621,845169,122(493,220)1,973,1571,553,030 ShoWare Operating Revenues1,456,3111,512,5891,150,0001,150,8551,325,000 Expenditures1,089,7631,451,7522,284,9801,377,5392,284,980 Net Revenues Less Expenditures366,54860,837(1,134,980)(226,684)(959,980) Other Operating Revenues185,821105,155109,320109,320 Expenditures178,558106,003159,32079,547159,220 Net Revenues Less Expenditures7,263(848)(50,000)(79,547)(49,900) Debt Service Funds Councilmanic Debt Service Revenues10,266,9239,144,5876,997,8402,314,8117,408,240 Expenditures9,802,0978,679,7617,204,6602,347,2767,204,660 Net Revenues Less Expenditures464,826464,826(206,820)(32,465)203,580 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* pecial Assessment Debt Service S Revenues1,339,332784,469728,560525,116698,080 Expenditures1,119,3931,386,712858,4205,092858,320 Net Revenues Less Expenditures219,939(602,243)(129,860)520,024(160,240) Qbdlfu!Qh/!247 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) 20192020202120212021 ActualActualAdj BudgetYTDEst Actual Operating revenues and expenditures only; capital and non-capital projects are excluded. In instances where expenditures exceed revenues, fund balance is being utilized. Enterprise Funds Water Utility Revenues28,578,90329,573,42429,573,29025,440,40031,223,420 Expenditures30,237,15626,464,13329,933,06023,677,03429,370,030 Net Revenues Less Expenditures(1,658,253)3,109,291(359,770)1,763,3651,853,390 Sewer Utility Revenues33,063,79833,513,29433,234,65029,252,69035,377,010 Expenditures31,664,33932,252,70633,147,12028,732,65533,980,650 Net Revenues Less Expenditures1,399,4581,260,58887,530520,0351,396,360 Note: Sewer Utility was combined with Drainage Utility in 2018. Drainage Utility Revenues26,947,64424,537,48323,688,63019,731,72224,717,330 Expenditures25,690,58721,804,80224,591,71019,225,04225,075,040 Net Revenues Less Expenditures1,257,0572,732,681(903,080)506,681(357,710) Solid Waste Utility Revenues874,164837,3091,119,760670,799857,420 Expenditures809,006876,8711,304,290810,7961,028,180 Net Revenues Less Expenditures65,158(39,562)(184,530)(139,997)(170,760) Golf Complex Revenues2,698,6095,938,1832,861,6602,233,7732,653,000 Expenditures2,636,1103,070,8994,653,4904,069,2444,557,000 Net Revenues Less Expenditures62,4992,867,283(1,791,830)(1,835,471)(1,904,000) Internal Service Funds Fleet Services Revenues8,514,1595,478,5895,486,1004,525,2895,504,030 Expenditures6,413,5006,559,5396,202,8204,077,5685,111,370 Net Revenues Less Expenditures2,100,659(1,080,950)(716,720)447,721392,660 Central Services Revenues367,717309,535428,030298,134381,700 Expenditures326,927277,640404,190260,523327,890 Net Revenues Less Expenditures40,79031,89523,84037,61153,810 Information Technology Revenues9,063,6039,062,09910,600,2308,644,62010,773,380 Expenditures8,702,49010,531,89210,790,2208,810,56610,717,050 Net Revenues Less Expenditures361,113(1,469,793)(189,990)(165,946)56,330 Facilities Revenues5,417,6086,327,1406,863,2605,878,4677,022,340 Expenditures5,035,5055,125,0268,541,5604,961,5376,385,030 Net Revenues Less Expenditures382,1031,202,114(1,678,300)916,930637,310 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Unemployment Revenues178,465166,229148,630131,258156,150 Expenditures220,850151,350238,140143,475183,160 Net Revenues Less Expenditures(42,384)14,879(89,510)(12,217)(27,010) Qbdlfu!Qh/!248 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) 20192020202120212021 ActualActualAdj BudgetYTDEst Actual Operating revenues and expenditures only; capital and non-capital projects are excluded. In instances where expenditures exceed revenues, fund balance is being utilized. Workers Compensation Revenues1,289,3641,551,5221,159,680918,4341,101,910 Expenditures1,928,1012,106,6161,545,2401,306,3851,563,920 Net Revenues Less Expenditures(638,737)(555,093)(385,560)(387,951)(462,010) Employee Health & Wellness Revenues15,629,64915,929,22416,205,06013,246,61815,983,000 Expenditures13,786,30814,097,29815,771,03011,996,64814,702,250 Net Revenues Less Expenditures1,843,3421,831,926434,0301,249,9701,280,750 Liability Insurance Revenues2,798,49338,1047,140,7107,222,0247,670,080 Expenditures1,753,5452,852,6652,331,5403,697,3474,252,500 Net Revenues Less Expenditures1,044,947(2,814,561)4,809,1703,524,6773,417,580 Property Insurance Revenues1,328,717578,755619,730511,230613,920 Expenditures1,213,255587,011701,0001,010,741687,550 Net Revenues Less Expenditures115,462(8,257)(81,270)(499,511)(73,630) Other Funds Impact Fee Trust Fund Revenues3,685,9603,525,4583,685,960 Expenditures3,685,9602,656,4163,685,960 Net Revenues Less Expenditures869,042 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Qbdlfu!Qh/!249 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Year-to-Year Month Comparison 2019202020212021-2020 thru Octthru Octthru OctVariance Operating revenues and expenditures only; capital and non-capital projects are excluded. Special Revenue Funds Street Fund Revenues11,394,34110,828,68612,779,6261,950,94018.0% Expenditures13,475,03311,413,81212,128,753714,9416.3% Net Revenues Less Expenditures(2,080,692)(585,126)650,873 LEOFF 1 Retiree Benefits Revenues837,7641,005,5381,075,33269,7946.9% Expenditures1,145,1241,316,2561,225,601(90,655)-6.9% penditures(307,360)(310,718)(150,268) Net Revenues Less Ex Lodging Tax Revenues260,176146,184167,97521,79114.9% Expenditures398,372187,962137,731(50,231)-26.7% Net Revenues Less Expenditures(138,197)(41,778)30,244 Youth/Teen Programs Revenues789,552783,374813,31629,9423.8% penditures5,9086,50059210.0% Ex penditures789,552777,465806,816 Net Revenues Less Ex Capital Resources Revenues14,864,96216,305,45123,252,8106,947,35942.6% Expenditures13,534,65821,269,82414,795,871(6,473,953)-30.4% Net Revenues Less Expenditures1,330,304(4,964,373)8,456,939 Criminal Justice Revenues4,841,2837,015,1748,133,7831,118,61015.9% penditures5,253,3837,304,4666,160,626(1,143,840)-15.7% Ex penditures(412,100)(289,293)1,973,157 Net Revenues Less Ex ShoWare Operating Revenues233,4551,218,2481,150,855(67,393)-5.5% Expenditures760,7951,185,9311,377,539191,60816.2% Net Revenues Less Expenditures(527,340)32,317(226,684) Admissions Tax revenues received quarterly(April, July, September, January) Other Operating Revenues Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Expenditures117,569106,99679,547(27,448)-25.7% Net Revenues Less Expenditures(117,569)(106,996)(79,547) Combines several small programs, including City Art Program and Neighborhood Matching Grants Debt Service Funds Councilmanic Debt Service (95,282)-4.0% Revenues2,510,9012,410,0932,314,811 penditures2,546,4432,504,0292,347,276(156,753)-6.3% Ex penditures(35,541)(93,936)(32,465) Net Revenues Less Ex Debt service payments are generally due in June and December. Qbdlfu!Qh/!24: 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Year-to-Year Month Comparison 2019202020212021-2020 thru Octthru Octthru OctVariance Operating revenues and expenditures only; capital and non-capital projects are excluded. Special Assessments Debt Service Revenues774,225264,726525,116260,39098.4% Expenditures441,733331,3975,092(326,305)-98.5% Net Revenues Less Expenditures332,493(66,671)520,024 Enterprise Funds Water Utility Revenues25,303,39323,553,16825,440,4001,887,2328.0% Expenditures28,723,63721,081,09823,677,0342,595,93712.3% Net Revenues Less Expenditures(3,420,244)2,472,0701,763,365 Sewer Utility Revenues27,361,91027,727,95229,252,6901,524,7385.5% Expenditures26,698,19827,320,71528,732,6551,411,9405.2% Net Revenues Less Expenditures663,712407,236520,035 Note: Sewer Utility was combined with Drainage Utility in 2018. Drainage Utility Revenues21,419,81019,434,48919,731,722297,2331.5% penditures22,721,00316,641,99819,225,0422,583,04415.5% Ex penditures(1,301,192)2,792,491506,681 Net Revenues Less Ex Note: Sewer Utility was combined with Drainage Utility in 2018. Solid Waste Utility Revenues662,020641,703670,79929,0964.5% penditures651,604735,658810,79675,13810.2% Ex penditures10,416(93,955)(139,997) Net Revenues Less Ex Golf Complex Revenues2,218,3685,526,5412,233,773(3,292,767)-59.6% penditures2,411,5033,383,2064,069,244686,03820.3% Ex penditures(193,134)2,143,334(1,835,471) Net Revenues Less Ex Internal Service Funds Fleet Services (80,031)-1.7% Revenues6,234,3694,605,3204,525,289 penditures5,530,0124,662,1264,077,568(584,558)-12.5% Ex penditures704,357(56,806)447,721 Net Revenues Less Ex Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Central Services Revenues306,163249,435298,13448,69919.5% Expenditures260,898223,995260,52336,52916.3% Net Revenues Less Expenditures45,26525,44137,611 Information Technology Revenues7,601,7547,473,4448,644,6201,171,17615.7% penditures7,193,3408,868,1498,810,566(57,583)-0.6% Ex penditures408,414(1,394,704)(165,946) Net Revenues Less Ex Facilities Revenues4,451,3565,325,4795,878,467552,98810.4% Expenditures3,535,7564,192,0334,961,537769,50418.4% Net Revenues Less Expenditures915,6001,133,446916,930 Qbdlfu!Qh/!251 6/I/b October 2021 Monthly Financial Report City of Kent, Washington Other Funds Overview (Revenues and Expenditures) Year-to-Year Month Comparison 2019202020212021-2020 thru Octthru Octthru OctVariance Operating revenues and expenditures only; capital and non-capital projects are excluded. Unemployment Revenues136,995133,660131,258(2,402)-1.8% penditures211,526145,467143,475(1,992)-1.4% Ex Net Revenues Less Expenditures(74,531)(11,807)(12,217) Workers Compensation Revenues1,069,0301,240,506918,434(322,073)-26.0% Expenditures1,067,6741,056,7811,306,385249,60423.6% Net Revenues Less Expenditures1,357183,726(387,951) Employee Health & Wellness Revenues12,878,36413,069,61313,246,618177,0051.4% penditures11,352,84011,461,56411,996,648535,0844.7% Ex penditures1,525,5241,608,0491,249,970 Net Revenues Less Ex Liability Insurance Revenues1,756,3932,036,8247,222,0245,185,200254.6% Expenditures2,613,3231,741,2703,697,3471,956,077112.3% Net Revenues Less Expenditures(856,930)295,5543,524,677 Property Insurance Revenues1,227,739481,684511,23029,5466.1% penditures1,423,624873,0251,010,741137,71615.8% Ex penditures(195,886)(391,341)(499,511) Net Revenues Less Ex Other Funds Impact Fee Trust Fund Revenues3,525,4583,525,458 Expenditures2,656,4162,656,416 Net Revenues Less Expenditures869,042 Buubdinfou;!Pdupcfs!3132!Gjobodjbm!Sfqpsu!!)3:58!;!JOGP!POMZ;!Pdupcfs!Gjobodjbm!Sfqpsu* Qbdlfu!Qh/!252