HomeMy WebLinkAboutReg 2007-01-16 Item 7B - Ordinance - Waive Gambling Taxes for Bona Fide Charitable and Non-Profit Organizations 1
COUNCIL AGENDA SYNOPSIS
Initials ITEM No.
4,% 10 1 Meeting Date Prepared by 1 Mayor's review Cowl review
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ITEM INFORMATION
CAS NUMBER: 07-005 !ORIGINAL AGENDA DATE: JANUARY 16, 2007
AGENDA I•I'EM TITLE Proposed Ordinance amending Tukwila Municipal Code Section 3.08.030 Gambling
Tax Rates
C:!TEGORY Discussion Motion Resolution Ordinance Bid Award Public. Hearing Other
Mtg Date Mtg Date Mtg Date tlftg Date 01/16/07 Aftg Date Mtg Date Mtg Date
!SPONSOR Council Mayor Aden Svcs DCD Finance n Fire Legal Pea Police PIFI
SPONSOR'S The Seattle Jaycees, a charitable non -profit organization, operate a bingo parlor within
SummAR\' the city. Citing the adverse impact of an initiative upon their business, the Seattle Jaycees
have requested the City's consideration of granting a gambling tax waiver. The gambling
tax waiver would allow the organization to maintain it's state gambling license and
financial integrity.
RI MEWED BY C Mt CA &P Cmte F &S Cmte Transportation Cmte
Utilities Cmte Arts Comm. Parks Comm. Planning Comm.
DA 1'E: 01/16/07
RECOMMENDATIONS:
SPONSOR /ADMIN. Adopt ordinance amending TMC section 3.08.030
COMMITTEE The ordinance will be reviewed at the 1/16/07 F &S Committee meeting
COST IMPACT FUND SOURCE
EXPENDI1'URIs REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
Fund Source: N/A
Comments: N/A
MTG. DATE J RECORD OF COUNCIL ACTION
J MTG. DATE ATTACHMENTS
1/16/07 Memorandum from Finance Director to Finance Safety Committee dated 1/8/07
Memorandum from Mayor to City Council dated 12/7/06
Draft Ordinance prepared by the City Attorney's Office showing changes to code
TMC Section 3.08.030 Tax Rates
Ordinance in Final form for adoption
To: Finance Safety Committee
From: Kevin A. Fuhrer, Finance Director dal
Date: January 8, 2007
Subject: Ordinance Amending TMC Section 3.08.030 Gambling Tax
Waiver for Charitable and Non Profit Organizations
Based upon the direction of the Council at the December 11, 2006 special
meeting, administration is moving forward with a recommended amendment
to the TMC that will provide for a gambling tax waiver for charitable and
non profit organizations. The Seattle Jaycees are the sole organization
located in the city to which the amendment would apply.
I have attached the following items for your review:
Memo from Mayor Mullet dated December 7, 2006
Draft Ordinance amending TMC Section 3.08.030
TMC Section 3.08.030
Assistant City Attorney Peter Beckwith prepared the proposed amendatory
language. Council President Griffin has graciously agreed to place this item
on the January 16, 2007 regular council meeting agenda.
I look forward to reviewing this with you at our committee meeting next
week.
/VILA, ‘p
�,i City of Tukwila
�i1 ms 6200 Southcenter Boulevard Tukwila, Washington 98188 Steven M. Mullet, Mayor
7908 r
To:" City Council
Q
From: Mayor Mullet
Date: December 7, 2006
Subject: Seattle Jaycees Request for Waiver of City Gambling Tax
As you are aware, in the waiver request presented by the Seattle Jaycees
they have cited a dire financial condition that presents the distinct likelihood
that they will lose their gambling license. Without state licensing, the
organization will be faced with closing its bingo operation in Tukwila. To
put it in perspective, the Jaycees currently employ 18 staff and generated
$75,000 in gambling tax revenue in 2005.
City Administration has been working with the Jaycees over the last couple
of months to gain an understanding of its operation and finances, and I am
pleased to state that a solution has been folinulated that will benefit both
parties. Under the proposal, the City will waive the gambling tax with the
caveat that the Seattle Jaycees provide a contribution of 70% of what the tax
obligation would have been directly to a Tukwila based charitable
organization.
A payment waiver of municipal gambling taxes by charitable non profit
organizations has precedent. The City of Lakewood exempts these agencies
and I understand that the City of Tacoma is currently considering the matter.
The granting of a waiver will necessitate an amendment of the Tukwila
Municipal Code (TMC).
I will present this information during my report at the December 11, 2006
Special Council Meeting. I would like to obtain your feedback to determine
if there is support in having Administration bring an amendment to the TMC
for Council consideration in January 2007.
ez
Phone: 206 -433 -1800 City Hall Fax: 206 -433 -1833 www'ci.tukwila.wa.us
1
DRAFT
CITY OF TUKWILA
WASHINGTON
ORDINANCE NO. 0
AN ORDINANCE OF THE CITY OF TUKWILA,
WASHINGTON, AMENDING TUKWILA MUNICIPAL
CODE SECTION 3.08.030 (TAX RATES) RELATED TO
THE WAIVER OF GAMBLING TAX FOR BONA FIDE
CHARITABLE AND NONPROFIT ORGANIZATIONS;
PROVIDING FOR SEVERABILITY; AND ESTABLISHING
AN EFFECTIVE DATE
WHEREAS; the City desires to encourage charitable and nonprofit organizations
conducting certain gambling activities in Tukwila to donate to charitable, nonprofit organization
based/located within Tukwila and serving the Tukwila community;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, DO ORDAIN AS FOLLOWS:
Section 1 TMC '3 OR 010, Amended. Tukwila Municipal Code Section 3.08.030 entitled
"Tax Rates" is hereby amended to read as follows:
3.08.030 Tax Rates
In pursuance of 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 less 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;
5. Any public cardroom operated as a commercial stimulant, a tax rate of
10% of the gross receipts received therefrom.
The Finance Director may waive the tax due each Onarter from a bona fide
charitable or nonprofit orginization as defined in this Chapter This waiver may
nrcnr only if the charitable or nonprofit or•anization demonstrates Hy clear and
1
convincing documentation that an amount equal to at least 70% of the tax due the
City, as computed pursuant to this Chapter_ will he donated to charitable nonprofit
organizations located in the City whose nose is to provide programs or
facilities for meeting the basic health, education welfare nr 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 reneive a waiver for future tax payments.
Provided, however, that no tax shall be imposed under the authority of this
Chapter on bingo or raffles when such activities or any combination thereof are
conducted by any bona fide charitable or nonprofit organization as defined in this
Chapter, which organization has no paid operating or management personnel and
has gross income from bingo and raffles, or any combination thereof, not
exceeding $5,000 per year less the amount paid for as prizes.
,Section 7 Reverahi1it 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 Effective Date. This Ordinance shall be published in the official newspaper of
the City, shall take effect and be in full force five (5) days after the date of publication, and shall be
retroactively applied to taxes payable for the fourth quarter of 2006.
ADOPTED BY THE CITY COUNCIL AT A REGULAR MEETING THEREOF ON
THE DAY OF 2007.
CITY OF TUKWILA
Mayor Steven M. Mullet
ATTEST /AUTHENTICATED:
Jane Cantu, City Clerk
Approved as to form:
Shelley M. Kerslake, City Attorney
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TITLE 3 REVENUE AND FINANCE
9 3.08.030 Tax Rates adopted by the Washington State Gambling Commis
In pursuance of RCW 9.46.110 and RCW Sion from time to time. The Finance Director shall
9.46.120, as amended by the Laws of Washington, adopt and publish such rules and regulations as may be
effective July 27, 1997, there is levied upon all persons, reasonably necessary to enable the collection of the tax
associations and organizations who have been duly imposed hereby.
licensed by the Washington State Gambling
Commission, as authorized by law, the following tax: 3 Declarations And Statements Required To
1. To conduct or operate any bingo games and q
raffles, a tax rate of 5% of the gross revenue received Be Filed
therefrom less the actual amount paid by such person, A. For the purpose of properly identifying the
association or organization for or as prizes; person, association and organization subject to any tax
2. To conduct any amusement game, a tax imposed by this chapter, such person, association or
rate of 2% of the gross revenue received therefrom less organization intending to conduct or operate any
the actual amount paid by such person, association or gambling activity authorized by the above specified
organization for or as prizes; laws, or as the same may be amended hereafter, shall,
3. For the conduct or operation of any prior to commencement of any such activity, file with
punchboards or pulltabs, a tax rate of 5% of the gross the Finance Director a sworn declaration of intent to
receipts from such activities for commercial stimulant conduct or operate such activity, together with a true
operators (taverns, restaurants, etc.); and a tax rate of and correct copy of the license issued by the Washing
10% on the gross receipts less the amount paid out as ton State Gambling Commission or any renewal or
prizes for charitable or nonprofit organizations; extension of such license or temporary license.
4. For the conduct or operation of any B. Thereafter, for any period covered by such
premises or facility used to play social card games, a tax State license or any renewal or extension thereof, any
rate of 20% of the gross receipts received therefrom; person, association or organization shall, on or before
5. Any public cardroom operated as a the last day of the month following the end of the
commercial stimulant, a tax rate of 10% of the gross quarterly period in which the tax accrued, file with the
receipts received therefrom. Finance Director a sworn statement, under penalty of
Provided, however, that no tax shall be imposed perjury, on a form to be provided and prescribed by the
under the authority of this chapter on bingo or raffles Finance Director for the purpose of ascertaining the tax
when such activities or any combination thereof are due for the preceding quarterly period.
conducted by any bona fide charitable or nonprofit C. In addition, any such person, association or
organization as defined in this chapter, which organization shall file with the Finance Director copies
organization has no paid operating or management of any daily, weekly, monthly or other periodic tax
personnel and has gross income from bingo and raffles, statements, financial reports, daily control sheets, daily
or any combination thereof, not exceeding $5,000 per time sheets, records of attendance, or any other
year less the amount paid for as prizes. information required to be filed by it to the State of
Washington Gambling Commission.
D. The Chief of the Police Department may
3.08.040 Fundraising Events Allowed Limitations establish such further and additional reporting
Any and all fundraising events conducted or oper- requirements of any person, association or organization
ated by bona fide charitable or nonprofit organizations authorized to conduct gambling activities in the City
as authorized by the Revised Code of Washington, which are reasonably intended to provide information
Chapter 9.46 as it now exists or is hereafter amended, to the City regarding the conduct of said activities.
are allowed subject to the following limitations:
1. No organization shall be allowed to
conduct more than two such events in the City in any 3.08.070 Filing Of Application With Finance Director
one calendar year; and Each person, association, or organization licensed
2. No more than four such events may take by the Washington State Gambling Commission shall
place at the same location in the City in any one likewise submit to the Finance Director a true and
calendar year. correct copy of any application made to such
commission for a license, together with any and all
amendments thereof. Such copy shall be submitted at
3.08.050 Administration And Collection Of Tax or prior to the filing of the first tax return due under
The administration and collection of tax imposed this chapter.
by this chapter shall be by the Finance Director and in
strict pursuance of the rules and regulations as may be
Printed February 2005 Page 3
4UA 1;01
.,:4„,_____"...,
City of Tukwila
Washington
Ordinance No.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, AMENDING ORDINANCE NOS. 1809 AND 1891, AS
CODIFIED AT TUKWILA MUNICIPAL CODE SECTION 3.08.030 (TAX
RATES) RELATING TO THE WAIVER OF GAMBLING TAX FOR BONA
FIDE CHARITABLE AND NONPROFIT ORGANIZATIONS; PROVIDING
FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE.
WHEREAS, the City desires to encourage charitable and nonprofit organizations
conducting certain gambling activities in Tukwila to donate to charitable, nonprofit
organizations based /located within Tukwila and serving the Tukwila community;
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, DO ORDAIN AS FOLLOWS:
Section 1. TMC 3.08.030 Amended. Ordinance No. 1809, §1 (part) and 1891 §1, as
codified at TMC 3.08.030, "Tax Rates," is hereby amended to read as follows:
3.08.030 Tax Rates.
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, less the actual amount paid by such person, association or
organization for or as prizes;
3. For the conduct or operation of any punchboards or pull tabs, 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;
5. Any public card room operated as a commercial stimulant, a tax rate of
10% of the gross receipts received therefrom.
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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 TMC Chapter 3.08, which
organization has no paid operating or management personnel, and has gross income
from bingo and raffles, or any combination thereof, not exceeding $5,000 per year, less
the amount paid for as prizes.
2. The Finance Director may waive the tax due each quarter from a bona fide
charitable or nonprofit organization as defined in TMC 3.08.030. 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 3.08.030 will be donated to charitable nonprofit
organizations located in 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. Severability. If any section, subsection, paragraph, sentence, clause or
phrase of this ordinance or its application to any person or situation should be held to
be invalid or unconstitutional for any reason by a court of competent jurisdiction, such
invalidity or unconstitutionality shall not affect the validity or constitutionality of the
remaining portions of this ordinance or its application to any other person or situation.
Section 3. 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 Cli Y OF TUKWILA, WASHINGTON,
at a Regular Meeting thereof this day of 2007.
ATTEST /AUTHENTICATED:
Steven M. Mullet, Mayor
Jane E. Cantu, CMC, City Clerk
Filed with the City Clerk:
APPROVED AS TO FORM BY: Passed by the City Council:
Published:
Effective Date:
Office of the City Attorney Ordinance Number:
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