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Home My WebLink AboutFS 2009-03-03 Item 2A - Ordinance - Amendment to Gambiling Tax Relating to Charitable and Non-Profit Organizations City of Tukwila Jim Haggerton, Mayor INFORMATIONAL MEMORANDUM TO: Mayor Haggerton Finance and Safety Committee FROM: Evie Boykan, Human Services Manager DATE: February 18, 2009 SUBJECT: Amendments to Gambling Tax Ordinance #2150 ISSUE The proposed amendments waiving the gambling tax for charitable and nonprofit organizations create more clarity around eligible non-profits and state definition of charitable non-profits. BACKGROUND In 2007, Council approved ordinance 2150, waiving the gambling tax for charitable and nonprofit organizations. The Seattle Jaycees, one of the charitable organizations, established an application process for nonprofits delivering services to the Tukwila community. DISCUSSION The current language identifies 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. Since several recipients of the grants are providers of services in Tukwila, but are not located in Tukwila, clarifying language could offer more inclusivity for those nonprofits that are serving our population but not located in the city. This expansion would provide a greater pool of applicants for the Jaycees to choose from. Reportedly, there were quarters in 2008 that had inadequate numbers of applicants. Upon City Attorney review, the City's code should be further amended to add references to RCW 9.46.0209, the state legislature's definition of the term "charitable non-profit organization" since the City's code does not reference this in TMC 3.08.030. See attached memo from Assistant City Attorney Kari Sand. At the February 3, 2009 Finance and Safety Committee, the members requested that a representative from the Seattle Jaycees attend a Finance and Safety Committee meeting to answer questions. A representative wiIJ be present at the March 3, 2009 meeting. RECOMMENDATION The Committee is being asked to forward this item for consideration at the March 9, 2009 Committee of the Whole Meeting and subsequent April 6, 2009 Regular Meeting. ATTACHMENTS Email from Kari Sand, City Attorney's Office, dated 1/2/09 Draft Ordinance with identified changes 2007 -2008 Grant Recipient List C:\DOCUME-1\christy\LOCALS-1\T emp\XPGrpWise\lnfoMemoJaycees2.doc (oJf2jL~99_~)J~~lYJ:l Boykcitl-Re: Gambling Tax Amendment "~____ __ - - __ - __ .' __ uO-'- ,,"- - - ".- ---- _.- . - -- - - -~ --. .- -~ -- - '" - . -- - - - . Page i : _"" -__ n_- __ -.., J From: To: Date: Subject: Attachments: "Kari Sand" <KARI@kenyondisend.com> "Evelyn Boykan" <eboykan@cLtukwila.wa.us> 01/21/20093:43 PM Re: Gambling Tax Amendment Ord - Gambling Tax - Waiver for Nonprofits.doc cc: Hi, Evie- "Shelley Kerslake" <skerslake@ci.tukwila.wa.us> Attached is a draft ordinance reflecting the code amendments recommended to expand non-profit organizations eligible to receive gambling tax revenues to those located outside the city provided they "serve" residents of the City, instead of only those inside the City. Thus, a wider pool of non-profits will be eligible to receive the gambling tax revenues. Please also note that the City's code should be further amended to add references to RCW 9.46.0209, the state legislature's definition of the term "charitable non-profit organization," since the City's code does not otherwise define the term even though the code states that such term is "as defined in TMC Chapter 3.08" and "as defined in TMC 3.08.030." Based on my review, the term "charitable non-profit organization" is not actually defined anywhere in Chapter 3.08 TMC, so I recommend amending the City's code to add cross-references to the definition of a "charitable non-profit organization" found in the RCW. Please revise your "Information Memorandum" to delete the reference to Amy Pearsall who, as you know, is no longer with our firm and you can insert my name instead. Please feel free to call or e-mail me if you have any questions or require any further assistance with this. -Kari Kari L. Sand Kenyon Disend, PLLC The Municipal Law Firm 11 Front Street South Issaquah, Washington 98027 425/392-7090 - phone 425/392-7071 - fax Kari@KenyonDisend.com . ,_ _ _ DRAFT AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON; AMEl\TDING TUKvVILA MUNICIPAL CODE SECTION 3.08.030, "GAMBLING ACTIVITIES - TAX RATES," RELATED TO THE WAIVER OF GAMBLING TAX FOR BONA FIDE CHARITABLE AND NON-PROFIT ORGANIZATIONS; PROVIDING FOR SEVERABILITY; AATD ESTABLISHING AN EFFECTIVE DATE. .WHEREAS, the City desires to encourage charitable and non-profit organizations conducting certain gambling activities in Tukwila to donate to charitable, non-profit organizations serving the Tukwila community; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKl-VILA, WASHINGTON, HEREBY ORDAINS AS FOLLmVS: Section 1. TMC 3.08.030 Amended. Tukwila Municipal Code 3.08.030, "Gambling Activities - Tax Rates," is hereby amended to read as follows: 3.08.030 Tax Rates A. Pursuant to RON 9.46.110 and RCW 9.46.120, as amended by the Laws of \'Vashington, 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 folloV\ring 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 card room operated as a cOffilnercial stimulant, a tax rate of 10% 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 TMC Clt<J.p~cr 3.08, RCW 9.46.0209, which organization has no paid or management personnel, and has gross C:\=e.,,15 and 5ettings\All Users\Desktop\Kelly\MSDATA \Ordk,ances\GamblingTax R>tes.doc 1/27 /20[j~ Page 1 of 2 irlcome from bingo ai,d raffles, or any combination t.hereot not exceedi.t,g $5,000 per year, less 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 TMC Ch.:ptcr 3.08.030, RCW 9.46.0209. This waiver may occur only if the charitable or nonprofit organization demonstrates by clear and convincing documentation that an amOlli.t equal to at least 70% of the tax due the City, as computed purSUa.llt to TMC 3.08.030, "Will be donated to charitable nonprofit orga.rlizations loc:1tcd L.'1 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. 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 CITY OF TUI<:\^iILA, "\V ASillNGTON, at a Regular Meeting thereof this day of .2009. A TIEST / AUTHE1\!lICA TED: Jim Haggerton, Mayor Christy O'Flaherty, CMC City Clerk APPROVED AS TO FORM BY: Filed with the City Clerk: Passed by the City Council: Published: Effective Date: Ordinance Number: Office of the City Attorney C:\D:xuments and S:ettings\All US2...""S\DQktop\Kelly\W'sDATA \Ord.ir.~'"lces\G:::whli.11.g Tax Rates.doc: i/Ll /2009 Page 2 of 2 Name of Organization (Tukwila Community Schools Collaboration (2006) Tukwila Pantry (2006) South Seattle Community College APPLE (2006) Way Back Inn (2006) American Cancer Society (2006) South Seattle Community College APPLE Tukwila Community Schools Coolaboration Tukwila Pantry Way Back Inn IADT La Mode Fashion Show Special Olympics 1Foster HS C Squad Boys Basketball Domestic Abuse Women's Network Tukwila Pantry Showalter Middle School 6th Grade Math Showalter Parent Crew Tukwila Pantry Cascade View Elementary Showalter MS Parent Crew Showalter MS 6th Grade Math Desks Tukwila Pantry Luncheon Scholarships Qadir Raz IADT Ruth Anne Smith IADT Natalya Yerokin IADT Total Scholarships Total Grants GRAND TOTAL 2007 Tukwila Grants i Quarter 4 4 4 4 4 1 1 1 1 1 1 2 2 2 2 2 3 3 3 3 3 2 2 2 Amount Requested $8,102.50 $3,200.00 $1,500.00 $4,720.00 $7,200.00 $6,000.00 $8,102.50 $4,000.00 $5,000.00 $5,000.00 $1,950.00 $8,102.50 $844.00 $1,200.00 Amount Approved $500.00 $650.00 $650.00 $3,000.00 $4,720.00 $500.00 $2,000.00 $2,000.00 $500.00 $5,000.00 $2,500.00 $2,000.00 $2,000.00 $2,000.00 $1,607.00 $1,200.00 $4,000.00 $811.00 $630.00 $4,616.00 $200.00 $1,000.00 $1,000.00 $500.00 $2,500.00 $41,084.00 $43,584.00 Reason for Declining 4 attendees Check* 1006 1004 1005 1002 1003 1012 1011 1013 1015 1014 1016 2002 1021 1020 1024 1023 10271 2004 1029 10301 1026 1018 1017 1019 Foster HS Wrestling Mats (2007) Name of Organization 1 Literacy Source 1FHS Senior Class Committee 1Foster HS Golf Team Intl Academy of Design /Tech Lieracy Source Showalter Middle School SPAA Special Olympics Tukwila Pantry Tukwila Comm Schools Collaboration Tukwila School District Girl Scouts of Western WA Cascade View Elementary Dream On Foundation Tukwila Pantry (2 parts) OTHER Tukwila Community Center Sponsorship Susan G Komen Matching Bingo Fundraiser Alzheimer's Assoc Matching Bingo Fundraiser Total Other Total Grants GRAND TOTAL 2008 Tukwila Grants Quarter 4 1 2 2 2 2 2 2 2 2 2 2 2 3 3 3 3 2 2 Amount Requested 1 $13,443.931 $5,196.851 1 $5,480.701 $10,000.001 1 $1,000.001 $2,500.001 $8,000.001 $1,000.001 $7,500.001 $320.001 $2,750.001 $8,000.001 Amount Approved 1 $13,444.001 $3,900.001 1 No budget/incomplete. (Other organizations selected $10,000.001 $4,746.001 I Need before selections 1Not received on time 1 Need before selections 1 Other organizations selected 1Need before selections 'Other organizations selected 'Need before selections 1 INo budget $2,750.001 $2,750.001 1 $1,000.001 $500.001 $600.001 $2,100.001 $37,590.001 $39,690.001 Reason for Declining Check 2006' 276914 J 2007/2008 2009 2012 2013 2014 20051 2010+