HomeMy WebLinkAbout4449ORDINANCE NO. 4449
AN ORDINANCE of the City Council of the
City of Kent, Washington, amending sections
3.18.020, 3.28.010 and 3.28.130 of the Kent City
Code to revise the fund allocations for tax revenue
generated from the City's tax on water, sewer, and
drainage utilities, and to remove limitations on the
allocation of revenue generated from the City's B&O
gross receipts and square footage tax.
RECITALS
A. From time to time, the City Council reallocates tax revenues
among various funds established in the City budget.
B. The purpose of this ordinance is to address the General Fund's
reliance on property taxes. Because property tax revenue is limited to 1%
annual growth, plus new construction, such revenue does not keep pace with
the City's ongoing operational expenses within the General Fund.
C. This ordinance reallocates revenue from the tax on water,
sewer, and drainage utilities, and revenue from the B&O gross receipts and
square footage tax. These allocation revisions will better align the City's
General Fund revenue sources with the City's ongoing operational expenses.
1 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS:
ORDINANCE
SECTION 1. - Amendment - KCC 3.18.020. Section 3.18.020 of the
Kent City Code, entitled 'Certain utilities subject to tax," is amended as
follows:
Sec. 3.18.020. Certain utilities subject to tax.
A. In addition to the other business and license fees required by the
ordinances of the city, the city levies upon all persons, firms, or corporations
(including the city) engaged in certain business activities a utilities tax to be
collected as follows:
1. Upon every person, firm, or corporation engaging in or carrying
on any telephone business within the city, an annual tax equal to six percent
of the total gross income, including revenues from intrastate toll, derived
from the operation of such business within the city. This six percent tax will
be allocated as follows: 4.7 percent to the general fund, 0.3 percent to
youth/teen programs, and one percent to street improvement programs.
2. Upon every person, firm, or corporation engaging in or carrying
on a business of selling, wheeling, furnishing, distributing, or producing gas,
whether manufactured or natural, for commercial or domestic use or
purposes, a fee or tax equal to six percent of the total gross income from
such business in the city during the tax year for which the license is required.
This six percent tax will be allocated as follows: 4.7 percent to the general
fund, 0.3 percent to youth/teen programs, and one percent to street
improvement programs.
2 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
3. Upon every person, firm, or corporation engaged in or carrying
on the business of selling, wheeling, furnishing, or distributing electricity for
light and power, a fee or tax equal to six percent of the total gross income
from such business in the city during the tax year for which a license is
required. This six percent tax will be allocated as follows: 4.7 percent to the
general fund, 0.3 percent to youth/teen programs, and one percent to street
improvement programs.
4. Upon every person, firm, or corporation engaged in or carrying
on the business of providing cable television services, a tax equal to six
percent of the total gross income from that business in the city during the
tax year for which the license is required. All revenue received from this tax
must be applied only to funding the city's information technology
department operations and capital projects budgets in the proportion
determined by the city council in its biennial budget, including all
amendments.
5. Upon every person, firm, or corporation engaging in or carrying
on a business providing solid waste collection services, a tax equal to 18.4
percent of the total gross income from such business in the city during the
tax year for which the license is required. This 18.4 percent tax will be
allocated as follows: 6.5 percent to the general fund, 0.3 percent to
youth/teen programs, one percent to street improvement programs, and
10.6 percent to maintain and repair residential streets, including related
impacts to curbs, gutters, sidewalks, and other road amenities, including
crosswalks along with necessary appurtenances, and improvements related
to residential traffic calming, but this 10.6 percent portion of the solid waste
utility tax shall not be used to expand, extend, or widen existing residential
streets or to build new residential streets. The amount used from this fund
for neighborhood traffic calming devices and crosswalks shall not exceed
$150,000 in any year.
3 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
6. Upon every person (including the city) engaging in or carrying
on the business of selling, furnishing, or distributing water services, a tax
equal to 13 percent of the total gross income from that business in the city
during the tax year; upon every person (including the city) engaging in or
carrying on the business of selling, furnishing, or distributing sewer services,
a tax equal to 9.5 percent of the total gross income from that business in
the city during the tax year; and upon every person (including the city)
engaging in or carrying on the business of selling, furnishing, or distributing
drainage services, a tax equal to 19.5 percent of the total gross income from
such business in the city during the tax year. Unless otherwise directed by
the city council in its budget process, the total of these tax revenues will be
allocated as follows: 90.0043.85 percent to the general fund for the use as
allocated in the city's budget;
;
7.69 percent to street improvement
programs; and 2.31 percent to youth/teen programs.
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4 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
B. In computing the tax provided in subsection (A) of this section, the
taxpayer may deduct from total gross income the following items:
1. The actual amount of credit losses and uncollectible receivables
sustained by the taxpayer.
2. Amounts derived from transactions in interstate and foreign
commerce which the city is prohibited from taxing under the laws and
Constitution of the United States.
SECTION 2. - Amendment - KCC 3.28.010. Section 3.28.010 of the
Kent City Code, entitled "Purpose" is amended as follows:
Sec. 3.28.010. Purpose. This chapter implements Washington
Constitution Article XI, Section 12 and RCW 35A.82.020 and 35A.11.020,
which give municipalities the authority to license for revenue. In the absence
of a legal or constitutional prohibition, municipalities have the power to
define taxation categories as they see fit in order to respond to the unique
concerns and responsibilities of local government. The city E)f Kent has
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5 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
SECTION 3. - Repeal - KCC 3.28.130. Section 3.28.130 of the Kent
City Code, entitled 'Limitation of revenue received" is hereby repealed in its
entirety.
SECTION 4. - 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 5. - 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 6. - Effective Date. This ordinance shall take effect and be
in force 30 days from and after its passage, as provided by law.
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KIMBERLEY A(. 4 OMOTO, CITY-SCLERK
November 15, 2022
Date Approved
November 15, 2022
Date Adopted
6 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue
APPROVE�O AS TO FORM:
H ITE, CITY ATTO RN EY
November 18, 2022
Date Published
7 Amend KCC 3.18.020, KCC 3.28.010
and KCC 3.28.130
re Fund Allocations for Tax Revenue