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Home My WebLink AboutReg 2011-02-22 Item 5A.2 - Ordinance - Raise Tax Rate Applied to Social Card Rooms COUNCIL AGENDA SYNOPSIS J. ,N, w .4 Initials ITEM Meeting Date Prepared by 1 Mayp it a eview Council review ,:.7-1 r 1 1 I 01/24/11 I SK I A R 7 6ft 4 02/1 /11 I SK I I (0/./ 02/22/13 I car I (_64- i.� 11, s 9os ITEM INFORMATION CAS NUMBER: 11-007 I ORIGINAL AGENDA DATE: JANUARY 24, 2011 AGIND;\ ITI;IMI Ti'n Ordinance repealing ban on new social card rooms until January 1, 201 -4 and Ordinance raising the tax rate on social card rooms STAFF SPONSOR: SHELLEY KERSLAKE C.\7'I )R\' Discussion Motion Resolution Ordinance BidAzvard Public Hearing Other 1141g Date 01/24/11 Mtg Date Mtg Date Mtg Date 2/22/1 Ktt Date Mtg Date 1/24/11 Mtg Date (SPONSOR Council Mayor Adm Svcs DCD Finance Fire Legal P&R Police PW SPONSOR'S This ordinance repeals the current ban on the establishment of new social card rooms and Su1M RY related "grandfather" provisions for existing social card rooms. Pursuant to the ordinance, the operation of social card rooms in the City must cease by January 1,-20147 The ordinance also amends TMC 3.08.080 to clarify certain gambling tax collection provisions. The Council is asked to consider and approve the ordinances. RI?YI IWIM B1' I I COW Mtg. M CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. Planning Comm. DATE: 01/10/11 COMMITTEE CHAIR SEAL RECOMMENDATIONS: SPONSOR /ADMIN. City Council COMMITTEE unanimous Approval; Forward to Committee of the Whole COST: IMPACT FUND SOURCE EXP1sNDITURt RI?.QLURED AMOUNT BUDGETED APPROPRIATION REQUIRED $0 $0 $0 Fund Source: ,e Conunnents: 1 MTG. DATE RECORD OFCOUNCIL ACTION' 1 1/24/11 Return item to the February 14, 2011 Committee of the Whole Meeting I 2/22/11 Forward to next Regular Meeting I 1 MTG. DATE :;ATTACHMENTS 01/24/11 Informational Memorandum dated 1/5/11 Ordinance in Draft Form Minutes from the Community Affairs and Parks Committee meeting of 01/10/11 02/14/11 Same attachments as shown above 02/22/11 Ordinance in strike -thru underlined format with amendments from 2/14 C.O.W. Informational memorandum dated 2/17/11 Ordinance in strike -thru underlined format raising the tax rate 1 2 r J ��ILA41,, s City of Tukwila GI a -4 Jim Haggerton, Mayor if_.!: -1--:, 90. INFORMATIONAL MEMORANDUM TO: Mayor Haggerton City Councilmembers FROM: Shelley M. Kerslake, City Attorney DATE: February 17, 2011 SUBJECT: Tax Increase for Social Card Games ISSUE Whether to raise the tax rate applied to social card games, not to exceed the limit placed on such tax by RCW 9.46.110(3)(f)? BACKGROUND At the Committee of the Whole meeting of February 14, 2011, the Council requested that the City Attorney's Office prepare an ordinance amending TMC 3.08.030 to increase the tax rate imposed on social card games to 15 DISCUSSION RCW 9.46.110(3)(f), allows the gross revenue from social card games to be taxed at a maximum rate of twenty percent. The City has had a 10% tax rate on such games for 35 years. Alternatives include: Leaving the tax rate at 10 Increasing the tax rate to 15% Increasing the tax rate to any percentage 20% or below. RECOMMENDATION The City Attorney's Office is not making any recommendation on this policy issue. ATTACHMENTS Draft Ordinance 7 8 J �N 4 ti: T y� 1.9 City of Tukwila Washington Ordinance No. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, REPEALING ORDINANCE NOS. 1809 §1 (PART), 1891, 2150, AND 2230, AS CODIFIED AT TUKWILA MUNICIPAL CODE (TMC) SECTION 3.08.030; RE- ENACTING TMC SECTION 3.08.030, "TAX RATES," TO RAISE THE TAX RATE APPLIED TO SOCIAL CARD ROOMS; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, RCW 9.46.110(3)(f) allows the gross revenue from social card games to be taxed at a maximum rate of 20 percent; and WHEREAS, the City has had the same tax rate for social card rooms since 1976; and WHEREAS, the City Council desires to raise the tax rate applied to social card rooms; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY ORDAINS AS FOLLOWS: Section 1. TMC Section 3.08.030, "Tax Rates," Amended. Tukwila Municipal Code (TMC) Section 3.08.030, `Tax Rates," is hereby amended to read as follows: A. Pursuant to RCW 9.46.110 and RCW 9.46.120, as amended by the Laws of Washington, effective July 27, 1997, there is levied upon all persons, associations and organizations who have been duly licensed by the Washington State Gambling Commission, as authorized by law, the following tax: 1. To conduct or operate any bingo games and raffles, a tax rate of 5% of the gross revenue received therefrom, less the actual amount paid by such person, association or organization for or as prizes; 2. To conduct any amusement game, a tax rate of 2% of the gross revenue received therefrom, Tess the actual amount paid by such person, association or organization for or as prizes; 3. For the conduct or operation of any punchboards or pulltabs, a tax rate of 5% of the gross receipts from such activities for commercial stimulant operators (taverns, restaurants, etc.); and a tax rate of 10% on the gross receipts less the amount paid out as prizes for charitable or nonprofit organizations; 4. For the conduct or operation of any premises or facility used to play social card games, a tax rate of 20% of the gross receipts received therefrom; and W: Word Processing \Ordinances \Tax Rates Amended Strike -thru 2 -17 -11 SMK:mrh /bjs Page 1 of 2 9 5. Any public card room operated as a commercial stimulant, a tax rate of 10 15% of the gross receipts received therefrom. B. Non Profit Organizations. 1. No tax shall be imposed under the authority of TMC Chapter 3.08 on bingo or raffles when such activities or any combination thereof are conducted by any bona fide charitable or nonprofit organization as defined in RCW 9.46.0209, which organization has no paid or management personnel, and has gross income from bingo and raffles, or any combination thereof, not exceeding $5,000 per year, Tess the amount paid for or as prizes. 2. The Finance Director may waive the tax due each quarter from a bona fide charitable or nonprofit organization as defined in RCW 9.46.0209. This waiver may occur only if the charitable or nonprofit organization demonstrates by clear and convincing documentation that an amount equal to at least 70% of the tax due the City, as computed pursuant to TMC Section 3.08.030, will be donated to charitable nonprofit organizations serving the City whose purpose is to provide programs or facilities for meeting the basic health, education, welfare, or other needs of the residents of the City. Failure to donate at least 70% of the tax due the City will result in revocation of the waiver and the disqualification of the bona fide charitable or nonprofit organization to receive a waiver for future tax payments. Section 2. Repealer. Ordinance Nos. 1809 §1 (part), 1891, 2150, and 2230 are hereby repealed. Section 3. Severability. Should any section, paragraph, sentence, clause or phrase of this ordinance, or its application to any person or circumstance, be declared unconstitutional or otherwise invalid for any reason, or should any portion of this ordinance be pre empted by state or federal law or regulation, such decision or pre emption shall not affect the validity of the remaining portions of this ordinance or its application to other persons or circumstances. Section 4. Effective Date. This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force five days after passage and publication as provided by law. PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this day of 2011. ATTEST /AUTHENTICATED: Christy O'Flaherty, City Clerk Jim Haggerton, Mayor APPROVED AS TO FORM BY: Filed with the City Clerk: Passed by the City Council: Published: Effective Date: Shelley M. Kerslake, City Attorney Ordinance Number: W: Word Processing \Ordinances \Tax Rates Amended Strike -thru 2 -17 -11 SMK:mrh /bjs Page 2 of 2 10