HomeMy WebLinkAboutFIN 2022-10-24 COMPLETE AGENDA PACKETCity of Tukwila
Finance and Governance
Committee
O De'Sean Quinn, Chair
O Kate Kruller
O Cynthia Delostrinos Johnson
AGENDA
MONDAY, OCTOBER 24, 2022 — 5:30 PM
Distribution:
D. Quinn
K. Kruller
C. Delostrinos Johnson
T. McLeod
K. Hougardy
M. Abdi
T. Sharp
Mayor Ekberg
D. Cline
R. Bianchi
C. O'Flaherty
A. Youn
L. Humphrey
THIS MEETING WILL BE CONDUCTED BOTH ON-SITE AT TUKWILA CITY HALL AND ALSO VIRTUALLY.
ON-SITE PRESENCE WILL BE IN THE DUWAMISH CONFERENCE ROOM
(2ND FLOOR, 6300 SOUTHCENTER BOULEVARD)
THE PHONE NUMBER FOR THE PUBLIC TO PARTICIPATE IN THIS
MEETING IS: 1-253-292-9750, Access Code 49933731#
Click here to: Join Microsoft Teams Meeting
For Technical Support during the meeting call: 1-206-433-7155.
Item
Recommended Action
1. BUSINESS AGENDA
a. Tax levy legislation:
a. Forward to 11/14 C.O.W.
Pg.1
1. An ordinance levying the general taxes for the City
for Public Hearing and
commencing 1/1/2023.
11/21 Regular Meeting.
2. An ordinance increasing the regular tax levy commencing
1/1/2023.
Vicky Carlsen, Finance Director
b. A resolution authorizing an interfund loan for a fire
b. Forward to 11/14 C.O.W.
Pg.13
engine.
and 11/21 Regular Meeting.
Vicky Carlsen, Finance Director
c. Budget legislation:
c. Forward to 11/14 C.O.W.
Pg.17
1. An ordinance adopting the 2023-2024 Biennial Budget.
for Public Hearing and
2. A resolution adopting the 2023-2028 Financial Planning
11/21 Regular Meeting.
Model and CIP (Capital Improvement Program).
3. An ordinance amending the 2021-2022 Biennial Budget.
Pg.27
Vicky Carlsen, Finance Director
(continued...)
SThe City of Tukwila strives to accommodate individuals with disabilities.
Please contact the City Clerk's Office at 206-433-1800 (TukwilaCityClerk@TukwilaWA.gov) for assistance.
Finance and Governance Committee
Monday, October 24, 2022
Page 2
Item
Recommended Action
1. BUSINESS AGENDA (cont.)
d. B&O (Business and Occupation) tax:
d.
Pg.39
1. An update on a B&O tax.
1. Forward to 10/24
C.O.W. Meeting.
2. An ordinance adopting a B&O tax effective 1/1/2024.
2. Forward to 11/14 C.O.W.
Pg.59
Tony Cu//erton, Deputy Finance Director
for Public Hearing and
11/21 Regular Meeting.
e. An ordinance setting City Council compensation for
e. Forward to 11/14 C.O.W.
Pg.97
2023-2026.
and 11/21 Regular Meeting.
Laurel Humphrey, Legislative Analyst
f. A contract with Ogden Murphy Wallace for City Attorney
f. Forward to 11/14 C.O.W.
Pg.103
services for 2023-2024.
and 11/21 Regular Meeting
David Cline, City Administrator
Consent Agenda.
g. A contract with Kirshenbaum & Goss for public defense
g. Forward to 11/14 C.O.W.
Pg.115
services for 2023-2024.
and 11/21 Regular Meeting
David Cline, City Administrator
Consent Agenda.
h. Monthly General Fund update.
h. Discussion only.
Pg.127
Tony Cullerton, Deputy Finance Director
2. MISCELLANEOUS
Next Scheduled Meeting: November 14, 2022
SThe City of Tukwila strives to accommodate individuals with disabilities.
Please contact the City Clerk's Office at 206-433-1800 (TukwilaCityClerk@TukwilaWA.gov) for assistance.
City of Tukwila
INFORMATIONAL MEMORANDUM
Allan Ekberg, Mayor
TO: Finance & Governance Committee
FROM: Vicky Carlsen, Finance Director
BY: Aaron Williams, Fiscal Manager
CC: Mayor Ekberg
DATE: October 24, 2021
SUBJECT: 2023 Property Tax Levy
ISSUE
Approval of ordinances adjusting the regular levy from the previous year and adopting the general
and excess property tax levies for 2023 by November 30, 2022.
BACKGROUND
A Public Hearing for adoption of the 2023 property tax levy is required by RCW 84.55.120. The
Hearing is scheduled for November 14, 2022.
The City was notified on October 17, 2022 that the assessed value for Tukwila for 2023 is
projected to be $8,981,288,883.
The ordinance to set the general tax levy also includes the excess levy related to the Public Safety
Plan that voters approved on the November 8, 2016, general election. The City sold $36.5 million
of bonds in 2016 and debt service repayment began in 2017. The remaining voter -approved
bonds were sold in October 2019. The excess levy for both bond issues will be assessed for as
long as the bonds are outstanding; the final payment for the 2016 issue is scheduled for December
2036 and the final payment for the 2019 issue is scheduled for December 2039. The total excess
levy requirement for 2023 debt service is $4,535,975.
DISCUSSION
Levy Amount
The assessed value and the allowable levy are subject to change until final levy rate
determination. A levy amount of $17,600,000 will be used for the ordinance. If the final allowable
levy is less than the ordinance amount, King County Department of Assessments will adjust the
ordinance amount to the final allowable levy amount and no further action by the Council will be
required.
Also included in the tax levy ordinance is an excess levy in the amount of $4,535,975 for debt
service related to the unlimited tax obligation bonds that were sold at the end of 2016 and in
2019. All voter -approved bonds have now been issued.
1
INFORMATIONAL MEMO
Page 2
Levy Limit
RCW 27.12.390 allows for a maximum statutory levy rate for cities at $3.60 per $1,000 of
assessed value, less the actual regular levy made by a library district. RCW 41.16.060 also allows
for an additional levy of $0.225 if a city has a firemen's pension fund. The maximum allowable
levy for 2023 is estimated to be $3.59032. However, due to the 1% limitation, the Levy Limit
Worksheet received from King County estimates the City's preliminary levy rate for 2023 at
$1.94813 per $1,000 of assessed value.
RECOMMENDATION
The City Council is being asked to approve the ordinance adopting the General Tax Levy and the
ordinance showing the dollar and percent change from the previous year at the November 14,
2022 Committee of the Whole meeting and subsequent November 21, 2022 Regular Meeting. A
public hearing has also been scheduled at the November 14, 2022 Committee of the Whole.
ATTACHMENTS
Draft Ordinances (2)
Preliminary Levy Limit Worksheet -2023 Tax Roll
2
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, LEVYING THE GENERAL TAXES
FOR THE CITY OF TUKWILA IN KING COUNTY FOR THE
FISCAL YEAR COMMENCING JANUARY 1, 2023, ON ALL
PROPERTY, BOTH REAL AND PERSONAL, IN SAID CITY, THAT
IS SUBJECT TO TAXATION FOR THE PURPOSE OF PAYING
SUFFICIENT REVENUE TO CARRY ON THE SERVICES OF THE
SEVERAL DEPARTMENTS OF SAID CITY FOR THE ENSUING
YEAR, WITH AN EXCESS PROPERTY TAX LEVY FOR THE
PURPOSE OF PAYING DEBT SERVICE ON THE CITY'S
UNLIMITED TAX GENERAL OBLIGATION BONDS ISSUED IN
2016 AND 2019, AS REQUIRED BY LAW; PROVIDING FOR
SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE.
WHEREAS, the City Council of the City of Tukwila has considered the City's anticipated
financial requirements for 2023 and the amounts necessary and available to be raised by
ad valorem taxes on real, personal and utility property; and
WHEREAS, the following sentence is provided for information only: The maximum
Statutory Levy Rate for the City of Tukwila, as allowed by RCW 84.52.043, is $3.825, which
includes $0.225 for the Firemen's Pension Fund as allowed by RCW 41.16.060; and
WHEREAS, the City, pursuant to Ordinance No. 2514, passed on November 21, 2016,
authorized the issuance and sale of $36,500,000 principal amount of the City's Unlimited
Tax General Obligation Bonds, 2016 and pursuant to Ordinance No. 2610, passed on July
15, 2019, authorized the issuance and sale of $40,885,000 principal amount of the City's
Unlimited General Obligation Bonds, 2019 (together the "Bonds"); and has determined that
to provide the money necessary to pay the debt service requirements on the Bonds in the
year 2023, an excess property tax levy in the amount of $4,535,975 for the Bonds must be
levied in year 2022, and collected in year 2023; and
WHEREAS, the final assessed valuation calculation has been determined;
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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. Regular and Excess Tax Levy.
A. There shall be and hereby is levied on all real, personal and utility property in the
City of Tukwila, in King County, whose estimated assessed valuation is $8,981,288,883,
current taxes for the ensuing year commencing January 1, 2023, in the amounts specified
below:
Regular Tax Levy
Excess Tax Levy
Rate Amount
$1.95 $ 17,600,000
$0.50 $ 4,535,975
B. The said taxes herein provided for are levied for the purpose of payment upon the
general bonded indebtedness of the City of Tukwila, the General Fund, and for the
maintenance of the departments of the municipal government of the City of Tukwila for the
fiscal year beginning January 1, 2023. The regular tax levy includes new construction and
improvements to property, estimated to be $74,619, a re -levy of prior year refunds in the
estimated amount of $20,825, and any increase in the value of state -assessed property.
C. The excess levy is levied for the purpose of debt service payments on the
unlimited tax obligation bonds sold to finance costs related to the City's Public Safety
Plan, as submitted to the qualified electors of the City at a special election held on
November 8, 2016.
Section 2. Collection. This ordinance shall be certified to the proper County officials,
as provided by law, and taxes here levied shall be collected to pay to the Finance Director
of the City of Tukwila at the time and in the manner provided by the laws of the State of
Washington for the collection of taxes for non -chartered code cities.
Section 3. Corrections by City Clerk or Code Reviser Authorized. 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
Section 4. 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 5. 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 and effect
January 1, 2023.
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PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk Allan Ekberg, Mayor
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
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AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, INCREASING THE CITY OF
TUKWILA REGULAR LEVY FROM THE PREVIOUS YEAR,
COMMENCING JANUARY 1, 2023, ON ALL PROPERTY,
BOTH REAL AND PERSONAL, IN COMPLIANCE WITH
RCW 84.55.120; PROVIDING FOR SEVERABILITY; AND
ESTABLISHING AN EFFECTIVE DATE.
WHEREAS, the City of Tukwila has properly given notice of a public hearing held on
November 14, 2022, pursuant to RCW 84.55.120; and
WHEREAS, after such hearing and after duly considering all relevant evidence and
testimony presented, the City Council has determined that in order to discharge its expected
expenses and obligations the City requires an increase in property tax revenue from the
previous year, in addition to the increase resulting from the addition of new construction and
improvements to property and any increase in the value of State -assessed property; and
WHEREAS, the City Council has determined it is in the City's best interest and
necessary to meet its expenses and obligations for the property tax revenue to be increased
for 2023, and the final assessed valuation calculation has been determined;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. An increase in the regular property tax levy, in addition to any amount
resulting from the addition of new construction and improvements to property and any
increase in the value of State -assessed property, is hereby authorized for the 2023 levy in
the amount of $158,660, which is a percentage increase of 0.92% from the previous year.
This increase is exclusive of additional revenue resulting from new construction,
improvements to property, any increase in the value of State -assessed property, any
annexations that have occurred and refunds made.
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Section 2. Corrections by City Clerk or Code Reviser Authorized. 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
Section 3. 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 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 and effect
January 1, 2023.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, CMC, City Clerk Allan Ekberg, Mayor
APPROVED AS TO FORM BY: Filed with the City Clerk:
Passed by the City Council:
Published:
Effective Date:
Office of the City Attorney
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Ordinance Number:
Page 2 of 2
PRELIMINARY
LEVY LIMIT WORKSHEET - 2023 Tax Roll
TAXING DISTRICT: City of Tukwila
The following determination of your regular levy limit for 2023 property taxes is provided by the King County
Assessor pursuant to RCW 84.55.100.
Annexed to Library District
Using Limit Factor
For District
17,228,992
1.0100
17,401,282
34,561,877
0
34,561,877
2.15900
74,619
17,475,901
(Note 1) Estimated Library rate: 0.23468
Calculation of Limit Factor Levy
Levy basis for calculation: (2022 Limit Factor) (Note 2)
x Limit Factor
= Levy
Local new construction
+ Increase in utility value (Note 3)
= Total new construction
x Last year's regular levy rate
= New construction levy
Total Limit Factor Levy
Using Implicit
Price Deflator
17,228,992
1.0646
18,341,468
34,561,877
0
34,561,877
2.15900
74,619
18,416,087
0
17,475,901
8,981,288,883
1.94581
0
0
Annexation Levy
Omitted assessment levy (Note 4)
Total Limit Factor Levy + new lid lifts
Regular levy assessed value less annexations
= Annexation rate (cannot exceed statutory maximum rate)
x Annexation assessed value
= Annexation Levy
0
18,416,087
8,981,288,883
2.05049
0
0
0
17,475,901
17,475,901
20,825
17,496,726
Lid lifts, Refunds and Total
+ First year lid lifts
+ Limit Factor Levy
= Total RCW 84.55 levy
+ Relevy for prior year refunds (Note 5)
= Total RCW 84.55 levy + refunds
Levy Correction: Year of Error (+or-)
0
18,416,087
18,416,087
20,825
18,436,912
17,496,726
ALLOWABLE LEVY (Note 6)
18,436,912 1
1.94813
17,242,622
158,660
0.92%
Increase Information (Note 7)
Levy rate based on allowable levy
Last year's ACTUAL regular levy
Dollar increase over last year other than N/C — Annex
Percent increase over last year other than N/C — Annex
2.05281
17,242,622
1,098,846
6.37%
Calculation of statutory levy
Regular levy assessed value (Note 8)
x Maximum statutory rate
= Maximum statutory levy
+Omitted assessments levy
=Maximum statutory levy
Limit factor needed for statutory levy
8,981,288,883
3.59032
32,245,701
0
32,245,701
Not usable
ALL YEARS SHOWN ON THIS FORM ARE THE YEARS IN WHICH THE TAX IS PAYABLE.
Please read carefully the notes on the reverse side.
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LevyLimitWS.doc
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Notes:
1) Rates for fire districts and the library district are estimated at the time this worksheet is
produced. Fire district and library district rates affect the maximum allowable rate for cities
annexed to them. These rates will change, mainly in response to the actual levy requests
from the fire and library districts. Hence, affected cities may have a higher or lower
allowable levy rate than is shown here when final levy rates are calculated.
2) This figure shows the maximum allowable levy, which may differ from any actual prior levy
if a district has levied less than its maximum in prior years. The maximum allowable levy
excludes any allowable refund levy if the maximum was based on a limit factor. The
maximum allowable levy excludes omitted assessments if the maximum was determined by
your district's statutory rate limit. If your district passed a limit factor ordinance in the year
indicated, that limit factor would help determine the highest allowable levy. However, if the
statutory rate limit was more restrictive than your stated limit factor, the statutory rate limit is
controlling.
3) Any increase in value in state -assessed property is considered to be new construction value
for purposes of calculating the respective limits State -assessed property is property
belonging to inter -county utility and transportation companies (telephone, railroad, airline
companies and the like).
4) An omitted assessment is property value that should have been included on a prior year's roll
but will be included on the tax roll for which this worksheet has been prepared. Omits are
assessed and taxed at the rate in effect for the year omitted (RCW 84.40.080-085). Omitted
assessments tax is deducted from the levy maximum before calculating the levy rate for
current assessments and added back in as a current year's receivable.
5) Administrative refunds under RCW 84.69.020 were removed from the levy lid by the 1981
legislature.
6) A district is entitled to the lesser of the maximum levies determined by application of the
limit under RCW 84.55 and the statutory rate limit. Levies may be subject to further
proration if aggregate rate limits set in Article VII of the state constitution and in RCW
84.52.043 are exceeded.
7) This section is provided for your information, and to assist in preparing any Increase
Ordinance that may be required by RCW 84.55.120. The increase information compares the
allowable levy for the next tax year with your ACTUAL levy being collected this year. The
actual levy excludes any refund levy and expired temporary lid lifts, if applicable. New
construction, annexation and refund levies, as well as temporary lid lifts in their initial year,
are subtracted from this year's allowable levy before the comparison is made.
8) Assessed valuations shown are subject to change from error corrections and appeal board
decisions recorded between the date of this worksheet and final levy rate determination.
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z City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Finance & Governance Committee
FROM: Vicky Carlsen, Finance Director
CC: Mayor Ekberg
DATE: October 18, 2022
SUBJECT: Interfund loan from the Sewer Fund to purchase a fire engine not to exceed
$1,100,000
ISSUE
Authorize an interfund loan from the Sewer Fund to purchase a new fire engine as part of the
Interlocal Agreement with the Puget Sound Regional Fire Authority (PSRFA).
BACKGROUND
The City's Public Safety Plan provided for the purchases of fire apparatus and equipment. For
apparatus, a new engine was planned in 2024 and was to be funded via financing through the
State of Washington's LOCAL program. This would be either a 10- or 20 -year repayment
schedule with interest being paid to the State.
Per the agreement that City Council approved at the October 3, 2022, Regular Meeting, the
engine will be ordered by the Puget Sound Regional Fire Authority and reimbursed by the City.
DISCUSSION
The City's Sewer Fund currently has a healthy fund balance available from which to transfer funds
of up to $1,100,000 to purchase a fire engine as part of the interlocal agreement with PSRFA.
Fund will be repaid by 2026 with interest. This loan will not impede the ability to move forward
with planned capital projects in this fund nor will utility rates increase because of this loan.
Repayment of the loan would occur in 2026, after a positive vote for annexation of the fire
department in to the PSRFA. Interest will accrue at the rate in effect with the Local Government
Investment Pool (LGIP) as of the effective date of the interfund loan. Interest will be calculated
on an annual basis. Repayment will occur as one lump sum in 2026 that will include principal and
all accrued interest.
Payment for the engine is expected to occur no later than January 15, 2023 but will most likely
occur in the latter part of 2022. The interfund loan and purchase of the engine will be included in
the year-end budget amendments.
RECOMMENDATION
Council is being asked to approve the resolution and consider this at the November 14, 2022,
Committee of the whole and subsequent November 21, 2022, Regular Meeting.
ATTACHMENTS
Draft Resolution
13
14
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, AUTHORIZING THE TRANSFER
OF FUNDS FOR THE PURPOSE OF MAKING A LOAN FROM
THE SEWER FUND TO THE GENERAL FUND;
ESTABLISHING AN INTEREST RATE AND REPAYMENT
SCHEDULE FOR SAID INTERFUND LOAN.
WHEREAS, the City's Public Safety Plan originally planned for the purchase of
Fire Department Apparatus (new engine) in 2024 that was to be funded through the State
of Washington's LOCAL Program for a 10 -year to 20 -year repayment term; and
WHEREAS, at the October 3, 2022 Regular Council Meeting, the City Council
authorized the Mayor to sign an Interlocal Agreement with the Puget Sound Regional Fire
Authority for Fire/Emergency Medical Services; and
WHEREAS, at the October 3, 2022 Regular Council Meeting, the City Council also
approved the expenditure of up to $1,100,000 utilizing an interfund loan for Fire
Department Apparatus (new engine); and
WHEREAS, utilizing an interfund loan will provide the City with greater control over
the repayment terms; and
WHEREAS, the City's Sewer Fund presently has sufficient funds from which to
transfer funds in an amount not to exceed $1,100,000 for the purpose of making a loan
to the General Fund to cover the authorized expenditure, in accordance with the
requirements set forth herein;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA HEREBY
RESOLVES AS FOLLOWS:
Section 1. Interfund Loan Authorized. An interfund loan in the principal amount
not to exceed $1,100,000.00 is hereby authorized from the Sewer Fund (Fund 402) to the
General Fund (Fund 000). The effective date of said interfund loan shall be no later than
January 16, 2023.
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Section 2. Interest. Interest on the interfund loan authorized per Section 1 shall
accrue at the rate in effect with the Local Government Investment Pool (LGIP) as of the
effective date of the interfund loan. The interest rate shall be calculated on an annual
basis.
Section 3. Repayment Schedule. The interfund loan authorized per Section 1
shall be repaid in full to the Sewer Fund (Fund 402), together with accrued interest
consistent with Section 2, as sufficient revenues become available to the General Fund
(Fund 000), but in no event later than December 31, 2026. Nothing in this resolution shall
be construed as authorizing a permanent diversion of the funds transferred through said
interfund loan.
Section 4. Implementation. The Finance Director is hereby authorized to
implement such administrative procedures as may be necessary to carry out the directions
of this legislation, including, without limitation, taking such action as may be necessary to
amend the budgets for the affected years to reflect the interfund loan described in this
resolution, and including bringing forth budget amendments or reconciliations to Council, if
Council approval in addition to this resolution is determined to be necessary under State
law.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON,
at a Regular Meeting thereof this day of , 2022
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk Thomas McLeod, Council President
APPROVED AS TO FORM BY:
Office of the City Attorney
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Filed with the City Clerk:
Passed by the City Council:
Resolution Number:
Page 2of2
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i City of Tukwila
INFORMATIONAL MEMORANDUM
Allan Ekberg, Mayor
TO: Finance & Governance Committee
FROM: Vicky Carlsen, Finance Director
CC: Mayor Ekberg
DATE: October 18, 2022
SUBJECT: 2023 — 2024 Biennial Budget Ordinance
2023 — 2028 Financial Planning Model and Capital Improvement Program
ISSUE
Adopt the 2023 — 2024 biennial budget and the 2023 — 2028 Capital Improvement Program (CIP) by the
end of December.
BACKGROUND
The proposed biennial budget for 2023 — 2024 and draft 2023 — 2028 CIP were presented to Council on
October 3, 2022. Departments within the general fund and all other funds have been reviewed in Council
Committees and at the Council Committee of the Whole. Additionally, Council held budget workshops on
October 11 and October 13, 2022, to discuss both the budget and CIP. Additional workshops will be
scheduled before final adoption.
DISCUSSION
At this time the proposed 2023 — 2024 biennial budget as well as the 2023 — 2028 CIP is being presented
to the Finance & Governance Committee for review and discussion. The public hearing, another
opportunity for community input, is scheduled for Tuesday, November 14, 2022.
The ordinance and resolution are in draft form and will be updated prior to final adoption if any changes are
made to either the proposed biennial budget or the CIP.
RECOMMENDATION
The Finance & Governance Committee is being asked to review the 2023 — 2024 biennial budget ordinance
and the 2023 — 2028 Financial Planning Model and Capital Improvement Plan resolution and forward to the
Committee of the Whole for the legally required Public Hearing on November 14, 2022. Final action on the
budget legislation could occur at the November 21 Regular Meeting, or any Regular or Special meeting
through the end of the year per the Council's preference.
ATTACHMENTS
Draft Budget Ordinance
Reconciliation of 2023 — 2024 Budget Summary to Ordinance
Draft CIP Resolution
17
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AN ORDINANCE OF THE CITY COUNCIL OF
THE CITY OF TUKWILA, WASHINGTON;
ADOPTING THE BIENNIAL BUDGET OF THE
CITY OF TUKWILA FOR THE 2023-2024
BIENNIUM; PROVIDING FOR SEVERABILITY;
AND ESTABLISHING AN EFFECTIVE DATE.
WHEREAS, the preliminary budget of the City of Tukwila for the 2023-2024 biennium
was submitted to the City Council in a timely manner for their review; and
WHEREAS, a Public Hearing on the proposed budget was advertised and held on
November 14, 2022; and
WHEREAS, as budget oversight is one of its key legislative responsibilities, the City
Council conducted a thorough process to deliberate the proposed 2023-2024 Biennial
Budget;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. The City Council hereby adopts the document entitled "City of Tukwila 2023-
2024 Biennial Budget," incorporated by this reference as if fully set forth herein, in
accordance with RCW 35A.34.120.
Section 2. Cost of living adjustments (COLAs) for non -represented employees shall be
implemented per the City Council's Compensation Policy.
Section 3. A market and compression study for non -represented employees, as
included in the 2023-2024 Biennial Budget, is expected to be completed by the end of 2023
and upon completion of the study, compensation will be adjusted per the market study with
an effective date of January 1, 2020. Adjustments will be for non -represented employees on
staff when the market study is completed.
Section 4. The totals of the estimated revenues and appropriations for each separate
fund and the aggregate totals are as follows:
CC:Legislative Development\Adopt 2023-2024 Biennial Budget 9-30-22
VC:AY Review and analysis by Andy Youn
19
Total Total
Fund Expenditures Revenues
000 General $ 166,485,032 $ 166,485,032
105 Contingency 7,082,148 7,082,148
101 Hotel/Motel 3,530,201 3,530,201
103 City Street 9,326,503 9,326,503
104 Arterial Street 30,749,479 30,749,479
109 Drug Seizure Fund 666,515 666,515
2XX LTGO Debt Service Funds 11,815,404 11,815,404
213 Unlimited Tax G.O. Bonds 9,615,168 9,615,168
206 LID Guaranty 764,958 764,958
233 2013 LID 1,615,678 1,615,678
301 Land Acquisition, Recreation & Park Dev. 4,692,436 4,692,436
302 Facility Replacement 2,533,800 2,533,800
303 General Government Improvements 2,345,128 2,345,128
304 Fire Improvements 600,000 600,000
305 Public Safety Plan 2,738,557 2,738,557
306 City Facilities 6,256,324 6,256,324
401 Water 22,155, 562 22,155, 562
402 Sewer 34,034,242 34,034,242
411 Foster Golf Course 6,094,043 6,094,043
412 Surface Water 28,393,244 28,393,244
501 Equipment Rental 7,945,539 7,945,539
502 Insurance Fund 13,172,855 13,172,855
503 Insurance - LEOFF 1 Fund 959,737 959,737
611 Firemen's Pension 1,694,370 1,694,370
Total All Funds Combined $ 375,266,924 $ 375,266,924
Section 5. A complete copy of the final budget for 2023-2024, as adopted, together
with a copy of this adopting ordinance, shall be kept on file electronically by the City Clerk
and accessible from the City's website in accordance with Washington State records
retention schedule requirements and City policy, and shall be made available to the public
upon request. A complete copy of the final budget for 2023-2024, as adopted, together
with a copy of this adopting ordinance, shall be transmitted by the City Clerk to the
Division of Municipal Corporations of the Office of the State Auditor and to the Association
of Washington Cities.
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; references to other
local, state or federal laws, codes, rules, or regulations; or ordinance numbering and
section/subsection numbering.
CC:Legislative Development\Adopt 2023-2024 Biennial Budget 9-30-22
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20
Section 7. 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 8. 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 , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
Allan Ekberg, Mayor
Filed with the City Clerk:
Passed by the City Council:
Published:
Effective Date:
Ordinance Number:
CC:Legislative Development\Adopt 2023-2024 Biennial Budget 9-30-22
VC:AY Review and analysis by Andy Youn
21
22
Reconciliation of 2023-2024 Budget Summary to Ordinance
REVENUES
2023 Beginning
Fund Balance
2023
Revenues
2024
Revenues
Total
Revenues
000 General
$ 19,085,142
$ 71,839,634
$ 75,560,256
$ 166,485,032
101 Hotel/Motel
2,048,201
726,000
756,000
3,530,201
103 City Street
847,903
5,352,800
3,125,800
9,326,503
104 Arterial Street
6,570,879
4,873,800
19,304,800
30,749,479
105 Contingency
7,042,148
20,000
20,000
7,082,148
109 Drug Seizure Fund
435,515
115,500
115,500
666,515
200 LTGO Bona
392,475
389,375
781,85,.
208 LTGO Bonds - 2017 (Public Safety Plan)
1,532,700
1,534,450
3,067,150
209 LTGO Bonds - 2017 (Residential Street)
558,400
557,750
1,116,150
210 Limited Tax G.O. Refunding Bonds, 2003
-
-
-
211 Limited Tax G.O. Refunding Bonds, 2008
-
-
212 Limited Tax G.O. Bonds, 2009A
376.87'
376,914
753.790
214 Limited Tax G.O. Bonds, 2010A
216 Limited Tax G.O. Refunding Bonds, Valley Comm
217 2011 Refunding Bonds
218 2014 MPD
-
219 LTGO - PSP/PW Shops
',691,050
1,689,550
3,380,600
220 2020 Bonds - refunding
513,029
516,579
1,029,606
221 2021 Bonds - refunding / PW Shops
'414.540
571.716
1.686, 25(
2XX LTGO Debt Service Funds
-
6,179,070
5,636,334
11,815,404
213 UTGO Bonds
314,818
4,487,175
4,813,175
9,615,168
206 LID Guaranty
758,958
3,000
3,000
764,958
233 2013 LID
586,678
525,000
504,000
1,615,678
301 Land Acquisition, Recreation & Park Dev.
3,751,186
487,250
454,000
4,692,436
302 Facility Replacement
1,183,800
1,350,000
-
2,533,800
303 General Government Improvements
444,128
1,901,000
-
2,345,128
304 Fire Improvements
-
300,000
300,000
600,000
305 Public Safety Plan
538,557
1,100,000
1,100,000
2,738,557
306 City Facilities
2,274,324
2,141,000
1,841,000
6,256,324
401 Water
4,690,562
7,728,000
9,737,000
22,155,562
402 Sewer
11,742,027
10,882,300
11,409,915
34,034,242
411 Foster Golf Course
1,505,043
2,294,500
2,294,500
6,094,043
412 Surface Water
5,944,369
11,367,500
11,081,375
28,393,244
501 Equipment Rental
4,322,760
2,237,991
1,384,788
7,945,539
502 Insurance Fund
764,171
6,204,342
6,204,342
13,172,855
503 Insurance - LEOFF 1 Fund
258,737
350,500
350,500
959,737
611 Firemen's Pension
1,543,370
75,500
75,500
1,694,370
Total
$ 76,653,277
$ 142,541,862
$ 156,071,785
$ 375,266,924
23
EXPENDITURES
2023
Expenditures
2024
Expenditures
2024 Ending
Fund Balance
Total
Expenditures
000 General
$ 75,756,268
$ 77,992,440
$ 12,736,324
$ 166,485,032
101 Hotel/Motel
938,890
944,668
1,646,643
3,530,201
103 City Street
5,912,000
3,145,000
269,503
9,326,503
104 Arterial Street
6,149,662
19,209,451
5,390,366
30,749,479
105 Contingency
--
7,082,148
7,082,148
109 Drug Seizure Fund
266,008
279,297
121,211
666,515
200 LTGO Bonds
392,475
389,375
781,850
208 LTGO Bonds - 2017 (Public Safety Plan)
1,532, 700
1,534,450
3,067,150
209 LTGO Bonds - 2017 (Residential Street)
558,400
557,750
1,116,150
210 Limited Tax G.O. Refunding Bonds, 2003
-
-
211 Limited Tax G.O. Refunding Bonds, 2008
-
-
-
212 Limited Tax G.O. Bonds, 2009A
376,876
376, 91,,
753,790
214 Limited Tax G.O. Bonds, 2010A
-
-
-
216 Limited Tax G.O. Refunding Bonds, Valley Comm
217 2011 Refunding Bonds
218 2014 MPD
-
219 LTGO - PSP/PW Shops
1,691,050
1,689,550
3,380,600
220 2020 Bonds - refunding
513,029
516,579
1,029,608
221 2021 Bonds-refunding/PW Shops
1,114,540
571,716
1,686,256
2XX LTGO Debt Service Funds
6,179,070
5,636,334
-
11,815,404
213 UTGO Bonds
4,485,975
4,811,975
317,218
9,615,168
206 LID Guaranty
--
764,958
764,958
233 2013 LID
525,000
504,000
586,678
1,615,678
301 Land Acquisition, Recreation & Park Dev.
931,250
1,179,000
2,582,186
4,692,436
302 Facility Replacement
300,000
200,000
2,033,800
2,533,800
303 General Government Improvements
2,345,128
-
2,345,128
304 Fire Improvements
300,000
300,000
-
600,000
305 Public Safety Plan
1,319,019
1,317,849
101,689
2,738,557
306 City Facilities
2,700,000
3,000,000
556,324
6,256,324
401 Water
9,191,362
9,852,599
3,111,601
22,155,562
402 Sewer
12,549,000
13,570,855
7,914,388
34,034,242
411 Foster Golf Course
2,312,871
2,441,024
1,340,148
6,094,043
412 Surface Water
12,409,424
11,792,110
4,191,711
28,393,244
501 Equipment Rental
3,210,844
3,076,219
1,658,476
7,945,539
502 Insurance Fund
6,060,861
6,506,054
605,940
13,172,855
503 Insurance - LEOFF 1 Fund
444,438
460,558
54,741
959,737
611 Firemen's Pension
62,000
62,000
1,570,370
1,694,370
Total
$ 154,349,069
$ 166,281,432
$ 54,636,423
$ 375,266,924
24
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF TUKWILA, WASHINGTON, ADOPTING THE 2023-
2028 FINANCIAL PLANNING MODEL AND THE
CAPITAL IMPROVEMENT PROGRAM FOR GENERAL
GOVERNMENT AND THE CITY'S ENTERPRISE FUNDS.
WHEREAS, when used in conjunction with the biennial City budget, the Capital
Improvement Program (CIP) and the Financial Planning Model for the period of 2023-
2028 are resource documents to help plan directions the City will consider for the future;
and
WHEREAS, the Financial Planning Model and Capital Improvement Program are not
permanent fixed plans, but are guidelines or tools to help reflect future goals and future
resources at the time budgets are being planned; and
WHEREAS, the commitment of funds and resources can only be made through the
budget process;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
Section 1. The City Council hereby adopts the 2023-2028 Financial Planning Model
and accompanying Capital Improvement Program, incorporated by this reference as if
fully set forth herein.
Section 2. A copy of the 2023-2028 Financial Planning Model and accompanying
Capital Improvement Program shall be kept on file electronically by the City Clerk and
accessible from the City's website in accordance with Washington State records retention
schedule requirements and City policy, and shall be made available to the public upon
request.
Section 3. The assumptions, revenues and expenditures will be reviewed and
updated biennially, or as necessary, by the City Council.
CC: Legislative Development\Financial Planning Model & CIP 10-03-22
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25
Section 4. The detail of Capital Improvement Program projects will be reflected in
the published Financial Planning Model and Capital Improvement Program 2023-2028.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk Thomas McLeod, Council President
APPROVED AS TO FORM BY:
Office of the City Attorney
CC: Legislative Development\Financial Planning Model & CIP 10-03-22
GL:AY Review and analysis by Andy Youn
26
Filed with the City Clerk:
Passed by the City Council:
Resolution Number:
Page 2of2
o/ z City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Finance & Governance Committee
FROM: Vicky Carlsen, Finance Director
BY: Aaron Williams, Fiscal Manager
CC: Mayor Ekberg
DATE: October 24, 2022
SUBJECT: 2022 Biennial Budget Amendment Ordinance
ISSUE
Approve the administrative 2022 biennial budget amendments.
BACKGROUND
While amending the budget is only required when a fund, in total, is in danger of exceeding budget,
it is a best practice to adjust the budget to identify significant changes in financial plans, policy
decisions, and provide transparency for key decisions.
Several of the proposed budget amendments have been reviewed and consensus given by Council
Committee and/or Council process as noted below in the discussion. The proposed budget
amendments make the following types of modification to the current biennium:
• Housekeeping amendments such as adjusting budgeted beginning fund balance to actual
beginning fund balance,
• Increasing certain general fund revenue streams,
• Reflect revenue -backed projects/expenditures,
• Formalize budget amendments previously approved via Council consensus
All budget amendments are detailed below with explanations provided for each amendment as well
as the effect on ending fund balance. Budget amendments are summarized by fund in the tables
attached to this memo.
DISCUSSION
General Fund
Adjust Beginning Fund Balance
A beginning fund balance increase of $3,525,024 to adjust the budgeted beginning fund balance to
reflect the actual beginning fund balance. Fiscal year 2021 ended the year with a fund balance of
$16.9 million, which exceeds the fund balance policy by approximately $5.3 million. This increase
in beginning fund balance is one leg of the three-legged stool to balance the 2023-2024 budget.
It should be noted that after all amendments, the general fund is expected to meet, and exceed,
reserve policy in 2022.
27
INFORMATIONAL MEMO
Page 2
Amendments by Department
The footnotes following the chart provide additional details about each proposed amendment.
Dept. -
Footnc a
Description of Proposed Amendment
2022
Revenue
Expenditure
Recreation -Parks
la
Partners in Employment contract (part of SEEK)
64,000
64,000
Recreation
1b
Summer Experience & Enrichment (SEEK) grant
30,000
30,000
Recreation
lc
You Got Next Tukwila Basketball Festival (held at TCC 9/17/22)
20,000
20,000
Recreation
1d
Kaleidoscope Play & Learn (KPL) Program
10,000
10,000
Recreation Total
$ 124,000
$ 124,000
Community Development
2
TDM Program, new Sustainable Transportation Communication Specialist
70,000
70,000
Community Development Total
$ 70,000
$ 70,000
Fire
3
Increase to Contract -Karen Reed Fire Advisory Task Force
40,000
Fire
4
Dispatching-ValleyComm contract costs
80,000
Fire
5
Salaries/Benefits (Includes leave payouts and overtime)
355,000
Fire Department Total
$ -
$ 475,000
Dept. 20 - Transfers Out
6
Transfer out to 105, 10% PY constr sales tax
166,463
Dept. 20 -Transfers Out
7
Interfund Loan from 402 and subsequent tranfser out to 305 for engine
purchase
1,100,000
1,100,000
Dept. 20 Transfers Total
$ 1,100,000
$ 1,266,463
General Revenue
8
Increase to Retail Sales Tax revenue budget
500,000
General Revenue
8
Increase to utility tax revenue budget
500,000
General Revenue
8
Increase to Gambling tax revenue budget
1,000,000
Total General Revenue Amendments
$ 2,000,000
$ -
Total General Fund
3,294,000 1,935,463
1) Add revenue and expenditure budgets for Parks & Recreation grants awarded to the City.
a. Partners in Employment, part of the SEEK program, provided youth with education
opportunities to learn about ecosystem restoration. Program enrolled 91 youth over the
summer. (authorized 6/6/22 Special meeting)
b. SEEK grant, remaining activity incurred as part of the summer recreation experiences for
the SEEK grant. A total of 131 participants took part. (authorized 2/28/22 Special
meeting)
c. You Got Next Tukwila Basketball Festival held at TCC on 9/17 in partnership with the
Seattle Sports Commission, also includes some rental fees paid for TCC usage. Total
attendance was approximately 450 with 250 of those being youth, event was provided to
the public for free. (from 9/17/22 Community Services & Safety Committee)
d. Funding for Kaleidoscope Play & Learn Program. KPL provides children and their
caregivers with culturally and developmentally appropriate play activities as well as peer
to peer activities for caregivers to learn what they can do at home to support their child's
growth. (grant contract amended with additional funds)
2) Add revenue and expenditure budgets for the addition of a new FTE to the TDM Program,
grant funded. The new grant -funded Sustainable Transportation Communications Specialist
will coordinate TDM communications and media to reach residents, commuters, and
employers in Tukwila and South King County. (authorized 6/6/22 regular meeting)
3) Budget expenditures for the Fire advisory task force, Consultant Karen Reed's contract was
extended to allow her to continue leading the TFD annexation conversation. (approved 5/2/22
regular meeting)
4) Add expenditure budget for additional Valley Communications contract costs, 2022 budget
was based on a low estimate; assessment increased 15% over prior year.
5) Adjustment to increase Fire salaries and benefits, which includes leave payouts and additional
overtime. In anticipation of upcoming retirements, the department has been hiring several
new employees. A portion of the amendment covers leave payouts for these retirements, as
well as covering addition costs incurred to maintain minimum staffing levels. Leave payouts
also include compensation time as specified in the Interlocal Agreement.
6) Annual transfer to Contingency Fund from General fund of 10% of prior year construction
related sales taxes, per reserve policy. Based on 2021 construction sales taxes of $1,664,634.
28
INFORMATIONAL MEMO
Page 3
7) Interfund loan from Sewer Fund (402) to the General Fund (000) and transfer to PSP Fund
(305) for purchase of Fire Engine for PSRFA contract. (Interlocal Agreement with PSRFA
approved 10/3)
8) Adjustments to reflect additional revenues anticipated above budget for Sales Tax, Gambling
Tax and Utility Taxes. The City continues to see improvements in some revenue streams;
however some revenues are still lagging behind pre -pandemic levels.
Other Funds
Included in the proposed budget amendments are amendments in other funds. In addition to the
amendments listed below, beginning fund balances are being adjusted to reflect actual balance
available in the fund. The footnotes following the chart provide additional details about each
proposed amendment.
Fund
Footnote
Description of Proposed Amendment
2022
Revenue
Expenditure
Contingency - Fund 105
6
Transfer Gen Fd - 10% Prior year constr sales tax revenues
166,463
Total Contingency Fund Amendments
$ 166,463
$ -
Drug Seizure - Fund 109
9
Mental Health Co -Responder (carryforward from 2021)
85,000
Drug Seizure - Fund 109
10
SPIDR Tech for public perception survey's
20,000
Drug Seizure - Fund 109
11
Purchase of armored truck for SWAT
100,000
Total Drug Seizure Fund Amendments
$ -
$ 205,000
Gen Gov Improvements - Fund 303
12
City Hall siding repair additional budget
100,000
Total General Government Improvements Amendments
$ -
$ 100,000
Public Safety Plan - Fund 305
7
Transfer In from General Fund and Engine purchase for RFA per contract
1,100,000
1,100,000
Public Safety Plan - Fund 305
7
Fire Equipment additional for RFA per contract
200,000
Total Public Safety Plan Amendments
$ 1,100,000
$ 1,300,000
City Facilities (PW Shops) - Fund 306
13
PWS Phase 1 Additional project costs, funding from land sale/utilities
1,000,000
1,000,000
City Facilities (PW Shops) - Fund 306
14
phase 2 -land sales
2,000,000
City Facilities (PW Shops) - Fund 306
14
Authorize PWS expenditures (carried forward budget)
1,500,000
Total City Facilities (PW Shops) Amendments
$ 3,000,000
$ 2,500,000
Golf Course - Fund 411
15
Golf operational adjustments
300,000
200,000
Total Golf Course Amendments
$ 300,000
$ 200,000
Water - Fund 401
13
PWS Phase 1 - $500k utility fund transfer to 306 (@ 34% alloc)
170,000
Total Water Amendments
$ -
$ 170,000
Sewer - Fund 402
7
Interfund Loan to General Fund for RFA engine purchase
1,100,000
Sewer - Fund 402
13
PWS Phase 1 - $500k utility fund transfer to 306 (@ 19% alloc)
95,000
Total Sewer Amendments
$ -
$ 1,195,000
Surface Water - Fund 412
13
PWS Phase 1 - $500k utility fund transfer to 306 (@ 47% alloc)
235,000
Total Surface Water Amendments
$ -
$ 235,000
Equipment Rental & Replacement (501)
16
Carryforward of 2021 budget for Vactor truck (delayed in 2021)
600,000
Equipment Rental & Replacement (501)
17
Increase to fuel budget due to high gas prices
122,000
Equipment Rental & Replacement (501)
18
Repair costs for damaged aerial
97,000
Total Equipment Rental & Replacement Amendments
$ -
$ 819,000
6) Transfer to Contingency Fund from General fund of 10% of prior year construction related
sales taxes. Based on 2021 construction sales taxes of $1,664,634.
7) Interfund loan from Sewer Fund (402) to the General Fund (000) and transfer to PSP Fund
(305) for purchase of Fire Engine for PSRFA contract. Additionally, for PSP fund 305: Add
budget for additional Fire equipment purchases for PSRFA contract. (Interlocal Agreement
with PSRFA approved 10/3)
9) Drug Seizure fund 109: carryforward of 2021 budget for Mental Health Co -responder. The
Department budgeted this pilot program for 2021 but the program actually began incurring
expenses in 2022.
10) Drug Seizure fund 109: The Department partnered with SPIDR Tech to send out
questionnaires, surveys, and updates to 911 -callers to gauge public perception of police
services and to improve communication with victims of crimes. (discussion at 4/25 CSS
Committee)
29
INFORMATIONAL MEMO
Page 4
11) Drug Seizure fund 109: The Department purchased a covert armored personnel transport
vehicle that will improve the safety of victims, perpetrators, and responding officers in high-
risk scenarios. (authorized 9/19/22 regular meeting)
12) City Facilities fund 303: increase expenditures budget by $100,000 for City Hall siding repairs.
(contract authorized 10/3/22 regular meeting)
13) PW Shop phase 1, additional $1 million in project costs with funding from the upcoming land
sale of the George Long Shop ($500k) and from utility funds ($500k). These adjustments
maintain the 50/50 split between the government and utility funds. Final true -up allocation will
be determined once project is completed. (Consensus from 4/11/22 Committee of the Whole)
14) PW Shop phase 2, budget for land sales revenue from the George Long Shop. In addition,
increasing the expenditure budget based on projected year end expenditures. The addition
of land sale revenue will be balanced with utility fund contributions in the 2023 proposed
budget to maintain the 50/50 balance between government and utility funds. (Consensus
from 5/9/22 Committee of the Whole)
15) Foster Golf Course fund 411: Golf operational adjustments, increase for greens fees and
adding budget for some unexpected repair projects at the course.
16) Adjust fleet fund purchases to reflect carry over from 2021 for the purchase of the Vactor truck,
delivery of truck occurred in early 2022.
17) Increase for city fuel budgets due to abnormally high gas prices.
18) Additional budget for fleet repairs expenses related to repair costs due to damaged Aerial
Truck
30
INFORMATIONAL MEMO
Page 5
Adjusting Beginning Fund Balances
In addition to the budget amendments proposed for other funds, beginning fund balances in various
funds are also being adjusted to true up to actual beginning fund balances. The chart below details
the adjustments to beginning fund balances included with these budget amendments.
$ 65,772,218 $
10,088,650 $
75,860,868
RECOMMENDATION
The Council is asked to approve the Budget Amendment ordinance and consider this item at the
November 14, 2022, Committee of the Whole, and November 21, 2022, Regular Council Meeting.
ATTACHMENTS
Draft Ordinance
Proposed Budget Changes — Summary by Fund
Reconciliation of 2021-2022 Budget Summary to Ordinance
31
Beginning Fund Balance
Fund
Adopted
Budget
Proposed
Amendments
Proposed
Revised Budget
General Fund:
General Fund
13,392,295
3,525,024
16,917,319
Contingency
6,468,169
285,896
6,754,065
Special Revenue Funds:
Lodging Tax
1,016,608
725,758
1,742,366
Drug Seizure
166,034
401,239
567,273
Debt Service Funds:
LTGO Debt Service Funds (2)X)
36,541
(36,541)
-
UTGO Debt Service Fund
11,984
301,309
313,293
LID/Guaranty
1,298,797
41,474
1,340,271
Capital Projects Funds:
Residential Streets
724,912
(17,106)
707,806
Bridges and Arterial Streets
2,516,741
1,165,446
3,682,187
Land Acquisition, Rec. and Park Dev.
1,541,330
1,354,515
2,895,845
Urban Renewal
1,452,144
1,010,117
2,462,261
General Government
573,148
104,885
678,033
Fire Impact Fees
500
(500)
-
Public Safety Plan
6,976,196
(6,898,524)
77,672
City Facilities (PW Shops)
3,138,454
361,590
3,500,044
Enterprise Funds:
Water
4,386,963
2,600,671
6,987,634
Sewer
11,022,180
2,136,095
13,158,275
Golf
1,056,224
(12,075)
1,044,149
Surface Water
4,634,122
1,269,695
5,903,817
Internal Service Funds:
Equipment Rental and Replacement
3,600,733
1,134,552
4,735,285
Employee Healthcare Plan
70,012
527,780
597,792
LEOFF 1 Retiree Healthcare Plan
165,675
98,583
264,258
Fiduciary Fund:
Firemen's Pension
1,522,456
8,767
1,531,223
$ 65,772,218 $
10,088,650 $
75,860,868
RECOMMENDATION
The Council is asked to approve the Budget Amendment ordinance and consider this item at the
November 14, 2022, Committee of the Whole, and November 21, 2022, Regular Council Meeting.
ATTACHMENTS
Draft Ordinance
Proposed Budget Changes — Summary by Fund
Reconciliation of 2021-2022 Budget Summary to Ordinance
31
32
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, AMENDING ORDINANCE NO.
2641, WHICH ADOPTED THE CITY OF TUKWILA'S
BIENNIAL BUDGET FOR THE 2021-2022 BIENNIUM, TO
ADOPT AN AMENDED YEAR-END BUDGET; PROVIDING
FOR SEVERABILITY; AND ESTABLISHING AN
EFFECTIVE DATE.
WHEREAS, on December 7, 2020, the City Council of the City of Tukwila adopted
Ordinance No. 2641, which adopted the 2021-2022 Biennial Budget of the City of Tukwila;
and
WHEREAS, the City has determined a need to amend the 2021-2022 Biennial
Budget before fiscal year-end; and
WHEREAS, on November 14, 2022, following required public notification, the City
Council conducted a public hearing on the proposed 2022 Year -End Budget Amendment
to the 2021-2022 Biennial Budget;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. Ordinance Amended. Tukwila Ordinance No. 2641 is hereby amended
with the City Council's adoption of the document entitled "City of Tukwila 2021-2022 Year -
End Budget Amendment," attached hereto and incorporated by this reference as if fully
set forth herein, in accordance with RCW 35A.34.200.
Section 2. Estimated Revenues and Appropriations. The totals of the estimated
revenues and appropriations for each separate fund and the aggregate totals are as
follows:
CC:Legislative Development\Budget Amendment 2021-2022 Year -End 10-6-22
VC:AY Review and analysis by Andy Youn
Page 1 of 3
33
FUND
EXPENDITURES
REVENUES
000 General
$158,906,119
$158,906,119
105 Contingency
$6,940,529
$6,940,529
101 Lodging Tax
$3,300,147
$3,300,147
103 Residential Streets
$5,032,806
$5,032,806
104 Bridges and Arterial Streets
$18,143,488
$18,143,488
109 Drug Seizure
$863,773
$863,773
2XX LTGO Debt Service
$16,960,329
$16,960,329
206 LID Guaranty
$8,716,437
$8,716,437
213 UTGO Bonds
$316,293
$316,293
233 2013 LID
$1,831,397
$1,831,397
301 Land Acquisition, Recreation & Park Dev.
$6,032,635
$6,032,635
302 Urban Renewal
$5,147,261
$5,147,261
303 General Government Improvements
$918,533
$918,533
304 Fire Impact Fees
$600,500
$600,500
305 Public Safety Plan
$10,245,489
$10,245,489
306 City Facilities
$12,962,452
$12,962,452
401 Water
$22,710,878
$22,710,878
402 Sewer
$35,818,071
$35,818,071
411 Foster Golf Course
$5,198,164
$5,198,164
412 Surface Water
$25,544,931
$25,544,931
501 Equipment Rental and Replacement
$10,660,984
$10,660,984
502 Employe Healthcare Plan
$17,459,368
$17,459,368
503 LEOFF 1 Retiree Healthcare Plan
$1,187,178
$1,187,178
611 Firemen's Pension
$1,666,223
$1,666,223
Total
$377,163,987
$377,163,987
Section 3. Copies on File. A complete copy of the amended budget for 2021-2022,
as adopted, together with a copy of this amending ordinance, shall be kept on file
electronically by the City Clerk and accessible from the City's website in accordance with
Washington State records retention schedule requirements and City policy, and shall be
made available to the public upon request. A copy of the amended budget for 2021-2022,
as adopted, together with a copy of this amending ordinance, shall be transmitted by the
City Clerk to the Division of Municipal Corporations of the Office of the State Auditor and
to the Association of Washington Cities.
Section 4. Corrections by City Clerk or Code Reviser Authorized. 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
CC:Legislative Development\Budget Amendment 2021-2022 Year -End 10-6-22
VC:AY Review and analysis by Andy Youn
34
Page 2 of 3
Section 5. 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 6. 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 and effect 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 , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
Allan Ekberg, Mayor
Filed with the City Clerk:
Passed by the City Council:
Published:
Effective Date:
Ordinance Number:
Attachment: City of Tukwila 2021-2022 Year -End Budget Amendment
CC:Legislative Development\Budget Amendment 2021-2022 Year -End 10-6-22
VC:AY Review and analysis by Andy Youn
Page 3 of 3
35
36
Proposed Budget Changes - Summary by Fund
Ending Fund Balance
Proposed
Adopted Proposed Revised
Budget Amendments Budget
16,898,040
1,182,068
392,773
6,940,528
O
O
N
313,318
1,295,708
553,806
4,586,088
2,873,135
1,126,261
378,533
500
OW
N 000
I:N
co I-
N N
M cN
4,044,863
10,415,326
1,103,570
4,334,966
4,012,707
612,512
N
N N
M (O
O co
N N
C)N
co
a
725,758
196,239
0)co
co
6N-
co
301,309
41,474
co c0
N
.-O
1,354,515
1,010,117
4,885
(500)
(7,098,524)
861,590
2,430,671
941,095
87,925
1,034,695
315,552
527,780
98,583
8,767
12,014,479
456,310
196,534
co
m
d
g
co
12,009
1,254,234
570,912
3,420,642
ca .-
m m
373,648
1,000
na
vco
o
1,614,192
9,474,231
1,015,645
3,300,271
3,697,155
84,732
104,635
1,527,456
Expenditure
Proposed
Adopted Proposed Revised
Budget Amendments Budget
76,517,963
1,016,298
245,000
V'
O
O
M
g
W
4,374,975
628,563
4,010,000
9,307,099
505,000
3,196,000
300,000
300,000
3,690,467
3,925,000
9,889,771
13,027,949
2,090,579
12,077,851
3,088,409
8,710,402
497,040
65,000
O
p
V
X
70,000
475,000
r)
o
ry
co
(00O
V
co
205,000
i
p
O
O
1,300,000
2,500,000
170,000
1,195,000
200,000
235,000
O
O
74,582,500
1,016,298
40,000
8,643,004
4,374,975
628,563
4,010,000
9,307,099
505,000
3,196,000
200,000
300,000
2,390,467
1,425,000
CO
0) 0)
ON
0) co
m r
0)
N 00
O N
co
2,269,409
8,710,402
497,040
65,000
Revenue
Proposed
Adopted Proposed Revised
Budget Amendments Budget
v
co
c0
0)
O
(0
6
C`
456,000
70,500
M
6
V
o
m
c-
8,645,004
4,375,000
r 584,000
3,856,000
10,211,000
482,290
1,860,000
500
300,500
7,200,000
3,000,000
6,947,000
10,285,000
2,150,000
10,509,000
2,365,831
8,725,122
436,000
70,000
E9
g
NO
p
p
O
O
2,000,000
3,294,000
CMO
to
i i
. .
. .
, .
1,100,000
3,000,000
300,000
a6
O
N
M
N-
`1
456,000
70,500
20,000
8,645,004
4,375,000
584,000
3,856,000
10,211,000
482,290
1,860,000
500
300,500
6,100,000
6,947,000
10,285,000
1,850,000
10,509,000
c0 N
D W
N
c0 N
CO I-
cV 6
436,000
70,000
Beginning Fund Balance
Proposed
Adopted Proposed Revised
Budget Amendments Budget
7.3
c7
h
O
D
1,742,366
567,273
6,754,065
'
N N
r o
M
707,806
3,682,187
2,895,845
2,462,261
678,033
co g
0- o
r_ in
0)
M
6,987,634
13,158,275
1,044,149
5,903,817
4,735,285
597,792
N N
a. -
N N_
O
N
LO
C)
725,758
401,239
N
co
C
NM
co-
301,309
41,474
(17,106)
1,165,446
N h
to
0) O
O
r
104,885
(500)
(6,898,524)
361,590
2,600,671
2,136,095
(12,075)
1,269,695
1,134,552
527,780
98,583
8,767
N
O)
N
m
co
CM
1,016,608
166,034
(00
coO
V.
CO
36,541
11,984
1,298,797
724,912
2,516,741
1,541,330
1,452,144
573,148
500
N
N N
COV
N. CO
0)
c0 M
4,386,963
11,022,180
N
N
N co
O c0
.- d'
3,600,733
70,012
165,675
1,522,456
N
N
O
N
a
C
3
LL
General Fund Depts.
1 Council
Mayor
Administrative Services
C
m
E
C." a
m @
c `)
iu Ce
Community Development
Municipal Court
v
o
a LT:
Public Works
Transfers
General Revenue
Total General Fund
Special Revenue Funds:
Lodging Tax
Drug Seizure
Contingency
Debt Service Funds:
LTGO Debt Service Funds (2XX)
UTGO Debt Service Fund
LID/Guaranty
Capital Projects Funds:
Residential Streets
Bridges and Arterial Streets
Land Acquisition, Rec. and Park Dev.
Urban Renewal
General Government
Fire Impact Fees
Public Safety Plan
City Facilities (PW Shops)
Enterprise Funds:
Water
Sewer
Golf
Surface Water
Internal Service Funds:
Equipment Rental and Replacement
Employee Healthcare Plan
LEOFF 1 Retiree Healthcare Plan
Firemen's Pension
M
00
N
C)
co
6
37
38
Total
Revenues
0) 0)
N
3- 0)
(O O
O a
co W
CO (O
N
V3
3,300,147
5,032,806
18,143,488
863,773
16,960,329
8,716,437
R) r
03 0)
N 0)
O.-
.-(0
CO CO
N
CO (0
(O N
N r
co a.-
O
(O N
CO O
CO O
l() 0)
06 0
O
an d
10,245,489
12,962,452
22,710,878
35,818,071
a
(0 CO
3- co
CO a
0) a
(n
(()
04
N
10,660,984
17,459,368
CO CO r
r N CO
N co„
r co
co co to
3- 0
.- A
r
co
W
2022 Year -End
Amendments
$ 3294,000
166,463
725,758
(17.105'
1,165,446
196,240
(36,541'
726.478
(410.519'
26.825
ui r
in,-
v o
Co O
4,885
(500'
1,100,000
3,000,000
2,430,671
941,095
300,000
.
co
.t.
m
co
o
Beginning
Fund Balance
Adjustment
$ 3,525,023
285,896
725,758
(17,105'
1,165,446
401,240
(36,541
726,478
0 o
3- N
O CO
0 (o
N
a
0) r
3- 3-
to 3--
a Ci
(n 3-
COO
N 0
CO O
CO In
cc
0
c-
(6,898,523'
361,590
2,600,671
2,136,095
(12,075
1,269,695
1,134,553
527,780
98,584
8,767
$ 10,088,653
Mid -Biennial
Amended
Revenues
$ 152,087,096
6,488,169
2,574,389
5,049,912
16,978,042
462,534
16,996,870
7,989,959
CO N
r
CO (0
CO a
N
OD
4,678,120
4,137,144
00 0
70 0
CD O
CO 3-
CO 0
CO N
3- O
O CO
70 0
O (O
CD O
20,110,207
33,681,976
4,910,239
24,275,236
N CO
CO CO
a (n
(O 3-
0 0
m co
1,088,595
1,657,456
$ 359,214,871
Mid -Biennial
Amendments
$ 10,108,0371
(653,809
O N
to O
a
O O
CO W
ro
5,858,785
(1,709;
3,587,898
(66,380,',
o 3-
r O
(O CO
.-- 0r
CO (O
N r
a D)
0)
OJ CO
r 0)
N 0
(O N
N CD
CD
3,091,140
1,901,718
270,343
602,178
D) CO
R)
r a
CO N
(O 0
co N
1,406,556
(555,257'
93,392
676
$ 26,424,171
R
a
d
C
j
R@
$ 141,979,059
7,141,978
2,604,844
4,159,810
r 00
in a
N N
Di o
a
N 0
r CO
W R)
0 (o
o Lo
V 0
r
725,137
1,874,373
4,590,662
4,105,169
801,021
610,259
12,952,873
7,699,144
19,839,864
33,079,798
4,541,520
24,777,674
8,119,876
17,486,845
995,203
1,656,780
$ 332,790,700
2022
Revenues
$ 67,597,992
20,000
456,000
3,456,000
3,311,000
70,500
8,645,004
4,375,000
O O
O o
0 0
m
O
OO
0
475,940
1,860,000
500
300,500
O
O
0
o
0
‘;(O
6,947,000
10,285,000
1,850,000
10,509,000
,- N
co N
w
(0 0 N4
(O
CO l'-
N o
436,000
70,000
$ 138,440,389
2021
Revenues
$ 62,749,717
20,000
406,000
589,000
6,481,000
60,500
4,382,338
3,605,000
3,000
601,000
1,942,800
410,000
300,500
300,500
6,705,000
3,450,000
6,722,000
10,032,000
1,818,000
8,883,000
2,784,818
8,118,924
316,000
70,000
$ 130,751,097
2021 Beginning
Fund Balance
$ 11,631,350
7,101,978
1,742,844
114,810
r CO
N a
N N
r M
N CO
0 C)
381,630
76,339
719,137
692,373
2,171,922
1,835,169
500,021
9,259
147,873
4,249,144
6,170,864
12,762,798
873,520
5,385,674
2,969,227
642,799
243,203
1,516,780
$ 63,599,214
REVENUES
000 General
105 Contingency
101 Lodging Tax
103 Residential Street
104 Arterial Street
109 Drug Seizure Fund
2)CX LTGO Debt SeMce
213 UTGO Bonds
206 LID Guaranty
233 2013 LID
301 Land Acquisition, Rec & Park Dev.
302 Urban Renewal
303 General GovernmentImpnrtnnts
304 Fire Im pact Fees
305 Public Safety Plan
306 City Facilities
401 Water
402 Sewer
411 Foster Golf Course
412 Surface Water
501 Equipment Rental
502 Insurance Fund
503 Insurance - LEOFF 1 Fund
611 Firemen's Pension
Total
Total
Expenditures
$ 158,906,119
6,940,529
3,300,147
5,032,806
18,143,488
863,773
16,960,329
8.716.437
316,293
1,831,397
M m
(D N
N r
(o a
O
6 4)
CO) o
•'-
(n 0)
N 0
O
CO 0
10,245,489
12,962,452
COR.
O O
O O
. .
r CO
N N
N CO
(0
d CO
3- O)
O a
03 a
in
4) (n
N
10,660,984
17,459,368
1,187,178
1,666,223
$ 377,163,987
Net Effect on
2022 Ending
Fund Balance
$ 4,883,560
452,360
725,758
(17.105'
1,165,446
196,240
(36,541'
726.478
(410.519'
26.825
ui r
in,-
v o
Co O
4,885
(500'
(7,098.523!
861,590
2,430,671
941,095
87,925
1,034,695
315,553
527,780
W (r0 N
Orb
00 of
N
N
M
2022 Year -End
Amendments
R)
co
tri
<o
m
(A
205,000
O
O
o
o
1,300,000
2,500,000
170,000
1,195,000
200,000
235,000
O
O
of
oo
$ 8,659,463
Mid -Biennial
Amended
Expenditures
$ 152,087,096
6,488,169
2,574,389
5,049,912
16,978,042
462,534
16,996,870
7,989,959
726,813
1,804,572
4,678,120
4,137,144
CO O
(aD O
O
CO CO
16,044,013
9,600,862
20,110,207
33,681,976
4,910,239
24,275,236
9,526,432
16,931,588
1,088,595
1,657,456
$ 359,214,871
Mid -Biennial
Amendments
$ 10,108,037
(653,809)
(n N
6 O
a
O O
0) O)
CO
N 0)
CJ O
r r
W.
(O "
CO
3,587,898
(66,3801
t0 .-
r 0
(O W
. O
(O
CO (O
to r
a 0)
r ,-
CO CO
12,627
(9,259,
O CO
a
r
CD O
O0)
270,343
602,178
0 CO
co
r a
O N
O O
0) LO
O r
N to
(n N
(O to
O to
a N
r
93,392
676
$ 26,424,171
Total
Expenditures
$ 141,979,059
7,141,978
2,604,844
4,159,810
11,119,257
464,243
N 0)
0 CO
0 co
O to
a O
co 07
725,137
1,874,373
4,590,662
4,105,169
801.021
610,259
CO a
rN'-
N O
(n 0)
m co
, n
19,839,864
33,079,798
4,541,520
24,777,674
8,119,876
17,486,845
995,203
1,656,780
$ 332,790,700
2022 Ending
Fund Balance
$ 11,858,749
7,141,978
489,854
180,810
858,683
224,243
O co
(n W
O co
0'1 C0
r
725,137
597,222
1,580,662
84,169
361,021
10.259
7,594,589
36,736
1,595,291
9,526,677
852,648
4,161,122
(0 0
a m
CO 0
N
. o
CO
O 0
CO
11,243
1,526,780
$ 53,174,724
2022
Expenditures
O
0
N '
a
r
m
0
0
M
1,013,209
3,610,000
3,395,273
40,000
8,643,004
4,374,975
co
0
to
W
N
co
505,000
2,786,000
200,000
300,000
2,390,467
9,689,329
11,801,825
1,844,993
11,789,938
2,252,165
8,710,402
497,040
65,000
$ 141,511,443
2021
Expenditures
0
to
O '
(D
.1-
M
O
1.101,781
369,000
6,865,301
200,000
4,740,338
3,602,975
0
0
' o
W
a
p
2,505,000
1,235,000
240,000
300,000
2,967,817
7,662,408
a o
a 0)
N N
6 ,-
o N
In r
W
1,843,879
8,826,614
2,854,868
8,136,454
486,920
65,000
$ 138,104,533
EXPENDITURES
000 General
105 Contingency
101 Lodging Tax
103 Residential Street
104 Arterial Street
109 Drug Seizure Fund
2)IX LTGO Debt Service
213 UTGO Bonds
206 LID Guaranty
233 2013 LID
301 Land Acquisition, Rec & Park Dev.
302 Urban Renewal
303 General GovernmentImprvmnts
304 Fire Improvements
305 Public Safety Plan
306 City Facilities
401 Water
402 Sewer
411 Foster Golf Course
412 Surface Water
501 Equipment Rental
502 Insurance Fund
503 Insurance - LEOFF 1 Fund
611 Firemen's Pension
Total
City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Finance Committee
FROM: Vicky Carlsen, Finance Director
BY: Tony Cullerton Deputy Finance Director
CC: Mayor Ekberg
DATE: October 24, 2022
SUBJECT: Business & Occupation Tax Information
ISSUE
This memo provides information pertaining to the proposed Business and Occupation (B&O) tax
in Tukwila to take effect January 1, 2024, including information on the tax rates, implementation,
and potential revenue.
BACKGROUND
Like many jurisdictions in Washington State, the City of Tukwila has experienced a structural
deficit for multiple biennia. This is due to several factors, including the 1`)/0 limitation on regular
property tax, the sunset of streamlined sales tax mitigation revenue, and ongoing expenses that
are growing significantly faster than revenues.
On October 3rd, 2022, Mayor Ekberg presented his budget to the City Council. As part of the
budget, the Mayor recommended the adoption of a modest B&O Tax as part of a "three-legged
stool" approach to a balance budget, which also includes using one-time funds and keeping
some open positions vacant over the coming biennium.
The State of Washington Revised Code of Washington (RCW) allows for local jurisdictions to
levy a local B&O tax which is paid to the local government. While sales tax is collected by the
State, local B&O taxes are administered by the taxing jurisdiction. This means the exemptions,
collection, enforcement, and the administrative code are the responsibility of the taxing
jurisdiction. Additionally, the implementation of a local B&O tax will require additional effort by
both the taxing entity and the business. For example, the City will need to administer the tax,
and businesses in Tukwila that are subject to it will need to file an additional tax return.
B&O Categories (NAICS Category Codes)
The following categories are subject to B&O tax, per state law:
• Manufacturing
• Wholesaling
• Retail
• Service & Other Activities
These classifications are assigned a category rate that is assessed to all businesses within that
category. Rates may differ among categories but all businesses within the same category must
be assessed the same rate.
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40
INFORMATIONAL MEMO
Page 2
DISCUSSION
Businesses subjected to the local B&O tax are entities that meet all of the following criteria:
• The business falls into one (or more) of the NAICS category codes.
• The business maintains a physical address within the Tukwila city limit.
• Generate annual gross receipts equal to or more than $20,000.
• Nonexempt businesses
Exempt Businesses
Per the State Model Ordinance for B&O taxes, the following eleven business and revenue types
are exempt from being assessed a B&O tax.
(1) Public utilities
(2) Investments
(3) Insurance business
(4) Employees.
(5) Amounts derived from sale of real estate.
(6) Mortgage brokers' third -party provider services trust accounts.
(7) Amounts derived from manufacturing, selling or distributing motor vehicle fuel
(8) Amounts derived from liquor, and the sale or distribution of liquor
(9) Casual and isolated sales
(10) Accommodation sales
(11) Taxes collected as trust funds
In addition to the State mandated exempt businesses, the City is proposing exemptions for
nonprofit organizations exempt from federal income tax under section 501(c)(3) of the Internal
Revenue code, businesses operating as a card room, and
professional/amateur/semiprofessional sports teams. The City Is proposing a threshold of
$750,000, meaning any business that earns $750,000 or less is exempt from the tax.
Surrounding Jurisdictions B&O Thresholds and Rates
The State Model Ordinance for B&O tax requires cities to adopt an exemption threshold
allowing businesses that gross revenues less than the adopted threshold to opt out of
participation in the B&O tax program. The minimum allowable threshold as stipulated by RCW is
$20,000. The City of Tukwila is proposing a minimum threshold amount of $750,000.
Businesses generating gross revenues equal to or less than the $750,000 threshold will be
exempt from B&O taxes.
Category
Manufacturing
Retail
Services & Other
Wholesale
Threshold
Tukwila
(Proposed)
0.00085
0.00050
0.00085
0.00085
$750,000
Renton Kent Des Moines Auburn Burien
0.00085 0.00100 0.00200 0.00100 0.00100
0.00050 0.00100 0.00200 0.00050 0.00100
0.00085 0.00200 0.00200 0.00100 0.00100
0.00085 0.00200 0.00200 0.00180 0.00100
$500,000 $250,000 $50,000 $500,000 $200,000
C:1Users\tony-c\Work Master\Projects\B & 0 Tax\Finance Committee\City Clerk Upload\Informational Memorandum_3.0.docx
INFORMATIONAL MEMO
Page 3
Proposed Revenue
Proposed B&O applies only to businesses with gross income over $750,000 and includes higher
exemptions than State law. Revenues are estimate until B&O implemented, forecast above
assumes 100% collection and likely captures 501(c)3. Actual revenues expected to be $3M.
Row Labels
Manufacturing
Retail
Service & Other Activities
Wholesale
Grand Total
Sum of Gross Income Count
346,896,394
1,689,165,125
2,155,345,125
913,639,413
5,105,046,057
Rate
38 0.00085
208 0.00050
355 0.00085
75 0.00085
676
$ Amount
294,862
844,583
1,832,043
776,594
3,748,081
MODEST B&O TAX proposal
• Highest gross revenue threshold of surrounding cities ($750,000)
• Lowest rates of surrounding cities
• Proposed Exemptions:
o 501(c)(3) organizations
o Professional/Amateur/Semiprofessional sports teams
o Cardrooms
• Effective January 1, 2024, giving businesses over a year to budget for the new tax.
• Forecasted revenues to be approximately $3M per year.
Benefits of a B&O Tax
• Critical foundation of the "third legged stool" to balance this year's bridge budget, which
also includes holding vacancies open and using one-time funds.
• Without a B&O more cuts will be necessary throughout the organization.
• B&O tax revenues are unrestricted and may be used for any lawful governmental
purpose.
• Reoccurring revenue that diversifies the City's revenue sources.
• Only business with annual gross revenues above $750k will be subject to B&O Tax.
501(c)3, cardrooms and amateur/semi-professional/professional sports teams exempt
regardless of gross revenues.
• Several major surrounding cities have already implemented a B&O tax; other cities
currently deliberating implementation as a part of the 2023/2024 budget process.
• The City establishes the Category Rates, exemptions and gross revenue threshold
amount, thus maintaining significant influence over the impacts of the tax.
• A new revenue source diversifies our revenue sources and will assist with maintaining
our current strong bond rating.
C:1Users\tony-c\Work Master\Projects\B & 0 Tax\Finance Committee\City Clerk Upload\Informational Memorandum_3.0.docx
41
42
INFORMATIONAL MEMO
Page 4
Required next steps
• Adoption of the State's Model Administrative and B&O Tax Ordinance.
• Approve two new FTE positions in Finance (one in early 2023 to develop the program,
one additional in late 2024 to help administer).
• Ongoing outreach with local businesses.
Conclusion
The implementation of a local B&O tax provides the City with an additional revenue source that
will assist with current ongoing operations and programing, and provide a new continuous
revenue stream for an additional, enhanced level of providing of services. The strategic
identification of a $750,000 gross revenue threshold will ensure that sole proprietors and small
businesses are exempt. Without the addition of a new revenue source the City will have to
reduce at lease $3M in services, resulting in reduction of staff, as well as programs and services
important to the Tukwila community.
RECOMMENDATION
Discussion Only
ATTACHMENTS
• PowerPoint Presentation
• Deviations from Model Ordinance
• Local B&O Tax Rates 2022
• Exempt Business Exemption
C:1Users\tony-c\Work Master\Projects\B & 0 Tax\Finance Committee\City Clerk Upload\Informational Memorandum_3.0.docx
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Business & Occupation Tax Discussion
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Adoption of the State's Model Administrative and B&O Tax Ordinance.
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Comparison of Deviations from Core Model Ordinance Provisions
City of Tukwila
B&O TAX
PROVISION:
Summary of Change from Model B&O Tax Ordinance:
.050 Imposition of
(2) The gross receipts tax imposed in this section shall not apply to any
the tax — tax or fee
person whose gross proceeds of sales, gross income of the business,
levied.
and value of products, including by-products, as the case may be, from
all activities conducted within the City during any calendar year is equal
to or less than $750,000, or is equal to or less than $187,500 during
any quarter if on a quarterly reporting basis.
.090 Exemptions.
• Nonprofit organizations exempt from federal income tax under
Section 501(c)(3) of the Internal Revenue code (except retail
sales)
• Businesses operating as a casino
• Amateur/Professional/Semi-Professional sports teams
53
54
Local business & occupation (B&O) tax rates"
Effective January 1, 2022
City
Phone #
Manufacturing
rate
Retail rate
Services rate
Wholesale
rate
Threshold
Quarterly
Annual
Aberdeen
(360) 533-4100
0.002
0.003 e
0.0037 e
0.003 e
$5,000
$20,000
Algona
(253) 833-2897
0.00045
0.00045
0.00045
0.00045
$10,000
$40,000
Auburn****
(253) 392-6496
0.001
0.0005
0.0010
0.0018
$500,000
Bainbridge Island
(206) 780-8668
0.001
0.005
0.001
0.001
$150,000
Bellevue
(425) 452-6851
0.001496
0.001496
0.001496
0.001496
$170,000
Bellingham
(360) 778-8010
0.0017
0.0017
0.0044 e
0.0017
$5,000
$20,000
Blaine
(360) 332-8311
0.002
0.002
$250,000
Bremerton
(360) 473-5311
0.0016
0.00125
0.002
0.0016
$1,000,000
Burien
(206) 241-4647
0.001
0.001
0.001
0.001
$200,000
Burlington
(360) 755-0531
0.001
$1,000,000
Cosmopolis
(360) 532-9230
0.002
0.002
0.002
0.002
$5,000
$20,000
Darrington
(360) 436-1131
0.00075
0.00075
0.00075
0.00075
$20,000
Des Moines
(206) 878-4595
0.002
0.002
0.002
0.002
$50,000
DuPont
(253) 964-8121
0.001
0.001
0.001
0.001
$5,000
$20,000
Everett***
(425) 257-8610
0.001
0.001
0.001
0.001
$5,000
$20,000
Everson
(360) 966-3411
0.002
0.002
$1,000,000
Granite Falls**
(360) 691-6441
$5,000
$20,000
Hoquiam
(360) 532-5700
0.002
0.002
0.002
0.002
$5,000
$20,000
Ilwaco
(360) 642-3145
0.002
0.002
0.002
0.002
$20,000
Issaquah
(425) 837-3054
0.0012
0.0012
0.0015
0.0012
$25,000
$100,000
Kelso
(360) 423-0900
0.001
0.001
0.002
0.001
$20,000
Kenmore
(425) 398-8900
0.002 *
$5,000
Kent
(253) 856-6266
0.001
0.001
0.002
0.002
$62,500
$250,000
Lacey
(360) 491-3214
0.001
0.002
$5,000
$20,000
Lake Forest Park
(206) 368-5440
0.002
0.002
0.002
0.002
$5,000
Long Beach
(360) 642-4421
0.002
0.002
0.002
0.002
$5,000
Longview
(360) 442-5040
0.001
0.001
0.002
0.001
$20,000
Lyman
(360) 826-3033
0.002
0.002
0.002
0.002
$5,000
$20,000
Mercer Island
(206) 275-7783
0.001
0.001
0.001
0.001
$150,000
North Bend
(425) 888-1211
0.002
0.002
0.002
0.002
$5,000
Ocean Shores
(360) 289-2488
0.002
0.002
0.002
0.002
$5,000
$20,000
Olympia
(360) 753-8327
0.001
0.001
0.002
0.001
$5,000
$20,000
Pacific
(253) 929-1100
0.002
0.002
0.002
0.002
$5,000
$20,000
Port Townsend
(360) 385-2700
0.002
0.002
0.002
0.002
$0
$100,000
Rainier
(360) 446-2265
0.002
0.002
0.002
0.002
$5,000
Raymond
(360) 942-3451
0.002
0.002
0.002
0.002
$5,000
$20,000
Renton
(425) 430-6400
0.00085
0.0005
0.00085
0.00085
$500,000
Roy
(253) 843-1113
0.001
0.002
0.002
0.001
$5,000
$20,000
Ruston
(253) 759-3544
0.0011
0.00153
0.002
0.00102
$5,000
$20,000
Seattle
(206) 684-8484
0.00222 v
0.00222 v
0.00427 v
0.00222 v
$100,000
Shelton
(360) 426-4491
0.001
0.001
0.001
0.001
$5,000
$20,000
Shoreline
(206) 801-2324
0.001
0.001
0.002
0.001
$125,000
$500,000
Snoqualmie
(425) 888-1555
0.0015
0.0015
0.0015
0.0015
$5,000
South Bend
(360) 875-5571
0.001
0.002
0.002
0.002
$5,000
Tacoma
(253) 591-5252
0.0011
0.00153
0.004 e
0.00102
$250,000
Tenino
(360) 264-2368
0.002
0.002
0.002
0.002
$5,000
$20,000
Tumwater
(360) 754-5855
0.001
0.001
0.002
0.001
$5,000
$20,000
Westport
(360) 268-0131
0.0025 e
0.005 e
0.005 e
0.0025 e
$5,000
YeIm
(360) 458-3244
0.001
0.002
0.002
0.001
$5,000
(v) = voter approved increase above statutory limit
(e) = rate higher than statutory limit because rate was effective prior to January 1, 1982 (i.e., grandfathered).
*Kenmore's B&O tax applies to heavy manufacturing only.
**Granite Falls repealed its B&O tax for all businesses other than extracting.
***For manufacturing gross reciepts over $8 billion, the B&O rate drops to 0.00025.
****Auburn adopted a B&O tax effective January 1, 2022.
NOTE: Tax rates may apply to businesses categories other than those above. Thresholds are subject to change. Exemptions, deductions, or other
exceptions may apply in certain circumstances. Contact the city finance department for more information.
^ Tax rates are provided for cities with general local B&O taxes as of the date listed. If a city is not listed, they have not reported to AWC that they
have a local B&O tax. Contact the city directly for specific information or other business licenses or taxes that may apply.
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Exempt Businesses Per State
(1) 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 provisions of [local utility tax cite].
(2) 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.
(3) 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.
(4) Employees. (a) 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. (b) A booth renter is an independent contractor for
purposes of this chapter.
(5) Amounts derived from sale 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 thirty (30) days or longer.
(6) 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.
(7) 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 82.36.01082.38.020 and exempt under RCW 82.36.44082.38.280, 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. (Mandatory)
(8) 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. (Mandatory)
(9) Casual and isolated sales. This chapter shall not apply to the gross proceeds derived from casual or
isolated sales.
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(10) 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 fourteen days to reimburse in kind a previous accommodation sale by the buyer to the
seller.
(11) 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.
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AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON; ESTABLISHING A NEW
CHAPTER 3.26 OF THE TUKWILA MUNICIPAL CODE (TMC)
ENTITLED, "BUSINESS AND OCCUPATION TAX";
ESTABLISHING TMC CHAPTER 3.27 ENTITLED "BUSINESS
AND OCCUPATION TAX ADMINISTRATIVE PROVISIONS";
PROVIDING FOR A REFERENDUM PROCESS; PROVIDING
FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE
DATE.
WHEREAS, in 2022, during the creation of the City's 2023-2024 Biennial Budget, the
City's long-range forecast identified a structural deficit on the General Fund financial
condition resulting from several factors, including the 1% limitation on regular property
tax, the sunset of streamlined sales tax mitigation revenue, and the pressure for increased
services that outpace the increase in property and sales tax; and
WHEREAS, pursuant to RCW 35A.82.020, the City of Tukwila is authorized to impose
a business and occupation tax on business activities within the City; and
WHEREAS, RCW 35.102.040 requires the City utilize the mandatory provisions of
the model ordinances developed by Washington cities when imposing a business and
occupation tax and adopting administrative provisions related to the imposition and
collection of such a tax, but also allow for flexibility to customize the ordinances based on
local goals and policies; and
WHEREAS, the model ordinance provides mandatory and standard exemptions for
potential inclusion but also gives the City the ability to create certain exemptions from
business and occupation tax including an annual gross receipts exemption threshold for
small businesses to meet the City's own objectives, exemptions to set economic policy,
and exemptions to maintain local control; and
WHEREAS, the City Council has determined that imposition of a business and
occupation tax as provided herein and providing for uniform administration of the City's
tax codes will be in the best interest of the public health, safety, and welfare;
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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. Chapter 3.26 of the Tukwila Municipal Code Established. A chapter of
the Tukwila Municipal Code entitled "Business and Occupation Tax," to be codified as
Tukwila Municipal Code (TMC) Chapter 3.26, is hereby established to read as follows:
CHAPTER 3.26
BUSINESS AND OCCUPATION TAX
Sections:
3.26.010 Purpose
3.26.020 Exercise of Revenue License Power
3.26.030 Administrative Provisions
3.26.040 Definitions
3.26.050 Imposition of the Tax — Tax or Fee Levied
3.26.070 Multiple Activities Credit When Activities Take Place in One or More
Cities with Eligible Gross Receipt Taxes
3.26.075 Deductions to Prevent Multiple Taxation of Manufacturing Activities
and Prior to January 1, 2008, Transactions Involving More Than
One City with An Eligible Gross Receipts Tax
3.26.076 Assignment of Gross Income Derived from Intangibles
3.26.077 Allocation and Apportionment of Income when Activities Take Place
in More than One Jurisdiction
3.26.078 Allocation and Apportionment of Printing and Publishing Income
when Activities Take Place in More than One Jurisdiction
3.26.090 Exemptions
3.26.100 Deductions
3.26.120 Tax Part of Overhead
3.26.130 Severability Clause
Section 2. Regulations Established. A new TMC Section 3.26.010 is hereby
established to read as follows:
3.26.010 Purpose
The purpose of this Chapter is to implement Washington Constitution Article XI,
Section 12, RCW 35A.11.020, and RCW 35A.82,020, which give municipalities the
authority to license for revenue. In the absence of a legal or constitutional prohibition, the
City has the power to define taxation categories as they see fit in order to respond to the
unique concerns and responsibilities of local government.
Section 3. Regulations Established. A new TMC Section 3.26.020 is hereby
established to read as follows:
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3.26.020 Exercise of Revenue License Power
The provisions of this Chapter shall be deemed an exercise of the power of the City
to license for revenue. The provisions of this Chapter are subject to periodic statutory or
administrative rule changes or judicial interpretations of the ordinances or rules. The
responsibility rests with the licensee or taxpayer to reconfirm tax computation procedures
and remain in compliance with the City code.
Section 4. Regulations Established. A new TMC Section 3.26.030 is hereby
established to read as follows:
3.26.030 Administrative Provisions
The administrative provisions contained herein and as codified in TMC Chapter 3.27
shall be fully applicable to the provisions of this Chapter, except as expressly stated to
the contrary herein.
Section 5. Regulations Established. A new TMC Section 3.26.040 is hereby
established to read as follows:
3.26.040 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. "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.
B. "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.
C. "Commercial or industrial use" means the following uses of products,
including by-products, by the extractor or manufacturer thereof:
1. Any use as a consumer; and
2. The manufacturing of articles, substances or commodities.
D. "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.
E. "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
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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 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 (Title 62A RCW) do not determine when or where delivery of tangible personal
property occurs for purposes of taxation.
F. "Digital automated service," "digital code," and "digital goods" have the same
meaning as in RCW 82.04.192 as now in effect or as may be subsequently amended or
recodified.
G. "Digital products" means digital goods, digital codes, digital automated services,
and the services described in RCW 82.04.050(2)(g) and (6)(b) as now in effect or as may
be subsequently amended or recodified.
H. "Eligible gross receipts tax" means a tax which:
1. Is imposed on the act or privilege of engaging in business activities within TMC
Section 3.26.050; 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
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 non -local jurisdiction above
the County level.
1. "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.
1. 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 TMC Section 3.26.040.1. 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.
2. Without being all inclusive, any one of the following activities conducted within
the City by a person, or its employee, agent, representative, independent contractor, broker
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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.
9.
agreements.
Soliciting, negotiating, or approving franchise, license, or other similar
h. Collecting current or delinquent accounts.
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, consultants, psychologists, court
reporters, dentists, doctors, detectives, laboratory operators, teachers, veterinarians.
I. 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.
p. Delivering goods in vehicles owned, rented, leased, used, or maintained
by the person or another acting on its behalf.
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3. 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.
f. Conducting advertising through the mail.
g. Soliciting sales by phone from a location outside the City.
4. 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
TMC Section 3.26.040.1.3.
5. The City expressly intends that engaging in business include 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.
J. "Extracting" is the activity engaged in by an extractor and is reportable under the
extracting classification.
K. "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 the necessary labor or mechanical services for
others; or persons meeting the definition of farmer.
L. "Extractor for Hire" means a person who performs under contract necessary
labor or mechanical services for an extractor.
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M. "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.
N. "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.
0. "Manufacturing" means the activity conducted by a manufacturer and is
reported under the manufacturing classification.
P. "Manufacturer," "to manufacture."
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% 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.
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
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.
3. "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.
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Q. "Person" means any individual, receiver, administrator, executor, assignee,
trustee in bankruptcy, trust, estate, firm, co -partnership, 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, non-profit, or otherwise
in the United States or any instrumentality thereof.
R. "Retailing" means the activity of engaging in making sales at retail and is reported
under the retailing classification.
S. "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 include 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.
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 (i)
horticultural services provided to farmers and (ii) 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.
T. "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, 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.
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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.
U. "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
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 TMC Section 3.26.040.U.1.a, b, c, d, or e
following such use.
f. Purchases for the purpose of satisfying the person's obligations under an
extended warranty as defined in TMC Section 3.26.040.U.7 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.
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 TMC Section
3.26.050.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
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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, 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 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.
consumers;
The installing, repairing, altering, or improving of digital goods for
h. The sale of or charge made for tangible personal property, labor and
services to persons taxable under TMC Section 3.26.040.U.3.a, b, c, d, e, f, and g when
such sales or charges are for property, labor and services which are used or consumed in
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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 section shall be construed to modify TMC
Section 3.26.040.U.1 and nothing contained in TMC Section 3.26.040.U.1 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. "Sale at retail" or "retail sale":
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 the purposes of this
section, 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 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. 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.
i. The service described in TMC Section 3.26.040.U.5.b includes the
right to access and use prewritten software to perform data processing.
ii. For the purposes of TMC Section 3.26.040.U.5.b(i), "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, 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
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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 (government contracting).
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. A retail sale of digital goods, digital codes, or digital automated
services under TMC Section 3.26.040.U.5.b.2 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.
V. "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 TMC Section 3.26.040.U.5.b.i, which is not a retail sale,
and any charge made for labor and services rendered for persons who are not consumers,
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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.
W. "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.
X. "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 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.
Y "Value of products"
1. The value of products, including by-products, 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 by-products by the seller.
2. Where such products, including by-products, are extracted or manufactured
for commercial or industrial use; and where such products, including by-products, 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.
3. Notwithstanding TMC Section 3.26.040.Y.2 above, 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.
Z "Wholesaling" means engaging in the activity of making sales at wholesale, and
is reported under the wholesaling classification.
Section 6. Regulations Established. A new TMC Section 3.26.050 is hereby
established to read as follows:
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3.26.050 Imposition of the Tax — Tax or Fee Levied
A. Except as provided in TMC Section 3.26.050.B, 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 tax shall be in amounts to be determined by application of rates
against gross proceeds of sale, gross income of business, or value of products, including
by-products, as the case may be, as follows:
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 by-products, extracted within the City for sale or for
commercial or industrial use, multiplied by the rate of 0.085%. The measure of the tax is
the value of the products, including by-products, 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 by-products, manufactured within the City, multiplied
by the rate of 0.085%. The measure of the tax is the value of the products, including by-
products, 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 of the business without regard to the place
of delivery of articles, commodities or merchandise sold, multiplied by the rate of 0.085%.
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 0.05%.
5. 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 0.05%.
6. Upon every person engaging within the City in the business of (i) printing, (ii)
both printing and publishing newspapers, magazines, periodicals, books, music, and
other printed items, (iii) publishing newspapers, magazines and periodicals, (iv) extracting
for hire, and (v) 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
0.085%.
7. Upon every other person engaging within the City in any business activity
other than or in addition to those enumerated in the above 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 0.085%. 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
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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. The gross receipts tax imposed in this section shall not apply to any person
whose gross proceeds of sales, gross income of the business, and value of products,
including by-products, as the case may be, from all activities conducted within the City
during any calendar year is equal to or less than $750,000, or is equal to or less than
$187,500 during any quarter if on a quarterly reporting basis.
Section 7. Regulations Established. A new TMC Section 3.26.070 is hereby
established to read as follows:
3.26.070 Multiple Activities Credit When Activities Take Place in One or More Cities
with Eligible Gross Receipt Taxes
A. Persons who engage in business activities that are within the purview of two or
more subsections of TMC Section 3.26.050 shall be taxable under each applicable
subsection.
B. Notwithstanding anything to the contrary herein, if imposition of the City's tax
would place an undue burden upon interstate commerce or violate constitutional
requirements, a taxpayer shall be allowed a credit to the extent necessary to preserve the
validity of the City's tax, and still apply the City tax to as much of the taxpayer's activities
as may be subject to the City's taxing authority.
C. To take the credit authorized by this section, a taxpayer must be able to
document that the amount of tax sought to be credited was paid upon the same gross
receipts used in computing the tax against which the credit is applied.
D. Credit for persons that sell in the City products that they extract or
manufacture. Persons taxable under the retailing or wholesaling classification with
respect to selling products in this City shall be allowed a credit against those taxes for
any eligible gross receipts taxes paid (a) with respect to the manufacturing of the products
sold in the City, and (b) with respect to the extracting of the products, or the ingredients
used in the products, sold in the City. The amount of the credit shall not exceed the tax
liability arising under this chapter with respect to the sale of those products.
E. Credit for persons that manufacture products in the City using ingredients
they extract. Persons taxable under the manufacturing classification with respect to
manufacturing products in this City shall be allowed a credit against those taxes for any
eligible gross receipts tax paid with respect to extracting the ingredients of the products
manufactured in the City. The amount of the credit shall not exceed the tax liability arising
under this chapter with respect to the manufacturing of those products.
F. Credit for persons that sell within the City products that they print, or
publish and print. Persons taxable under the retailing or wholesaling classification with
respect to selling products in this City shall be allowed a credit against those taxes for
any eligible gross receipts taxes paid with respect to the printing, or the printing and
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publishing, of the products sold within the City. The amount of the credit shall not exceed
the tax liability arising under this chapter with respect to the sale of those products.
Section 8. Regulations Established. A new TMC Section 3.26.075 is hereby
established to read as follows:
3.26.075 Deductions to Prevent Multiple Taxation of Manufacturing Activities and
Prior to January 1, 2008, Transactions Involving More Than One City with An
Eligible Gross Receipts Tax
A. Amounts subject to an eligible gross receipts tax in another city that also
maintains nexus over the same activity. For taxes due prior to January 1, 2008, a
taxpayer that is subject to an eligible gross receipts tax on the same activity in more than
one jurisdiction may be entitled to a deduction as follows:
1. A taxpayer that has paid an eligible gross receipts tax, with respect to a sale
of goods or services, to a jurisdiction in which the goods are delivered or the services are
provided may deduct an amount equal to the gross receipts used to measure that tax
from the measure of the tax owed to the City.
2. Notwithstanding the above, a person that is subject to an eligible gross
receipts tax in more than one jurisdiction on the gross income derived from intangibles
such as royalties, trademarks, patents, or goodwill shall assign those gross receipts to
the jurisdiction where the person is domiciled (its headquarters is located).
3. A taxpayer that has paid an eligible gross receipts tax on the privilege of
accepting or executing a contract with another city may deduct an amount equal to the
contract price used to measure the tax due to the other city from the measure of the tax
owed to the City.
B. Person manufacturing products within and without. A person manufacturing
products within the City using products manufactured by the same person outside the
City may deduct from the measure of the manufacturing tax the value of products
manufactured outside the City and included in the measure of an eligible gross receipts
tax paid to the other jurisdiction with respect to manufacturing such products.
Section 9. Regulations Established. A new TMC Section 3.26.076 is hereby
established to read as follows:
3.26.076 Assignment of Gross Income Derived from Intangibles
Gross income derived from the sale of intangibles such as royalties, trademarks,
patents, or goodwill shall be assigned to the jurisdiction where the person is domiciled (its
headquarters is located).
Section 10. Regulations Established. A new TMC Section 3.26.077 is hereby
established to read as follows:
3.26.077 Allocation and Apportionment of Income when Activities Take Place in
More than One Jurisdiction
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Effective January 1, 2024, gross income, other than persons subject to the provisions
of chapter 82.14A RCW, shall be allocated and apportioned as follows:
A. Gross income derived from all activities other than those taxed as service or
royalties under TMC Section 3.26.050.A.7. shall be allocated to the location where the
activity takes place.
B. In the case of sales of tangible personal property, the activity takes place where
delivery to the buyer occurs.
C. In the case of sales of digital products, the activity takes place where delivery to
the buyer occurs. The delivery of digital products will be deemed to occur at:
1. The seller's place of business if the purchaser receives the digital product at
the seller's place of business;
2. If not received at the seller's place of business, the location where the
purchaser or the purchaser's donee, designated as such by the purchaser, receives the
digital product, including the location indicated by instructions for delivery to the purchaser
or donee, known to the seller;
3. If the location where the purchaser or the purchaser's donee receives the
digital product is not known, the purchaser's address maintained in the ordinary course
of the seller's business when use of this address does not constitute bad faith;
4. If no address for the purchaser is maintained in the ordinary course of the
seller's business, the purchaser's address obtained during the consummation of the sale,
including the address of a purchaser's payment instrument, if no other address is
available, when use of this address does not constitute bad faith; and
5. If no address for the purchaser is obtained during the consummation of the
sale, the address where the digital good or digital code is first made available for
transmission by the seller or the address from which the digital automated service or
service described in RCW 82.04.050 (2)(g) or (6)(b) was provided, disregarding for these
purposes any location that merely provided the digital transfer of the product sold.
D. If none of the methods in TMC Section 3.26.077.0 for determining where the
delivery of digital products occurs are available after a good faith effort by the taxpayer to
apply the methods provided in TMC Section 3.26.077.C.1 through TMC Section
3.26.077.C.5, then the City and the taxpayer may mutually agree to employ any other
method to effectuate an equitable allocation of income from the sale of digital products.
The taxpayer will be responsible for petitioning the City to use an alternative method under
TMC Section 3.26.077.D. The City may employ an alternative method for allocating the
income from the sale of digital products if the methods provided in TMC Section
3.26.077.C.1 through TMC Section 3.26.077.C.5 are not available and the taxpayer and
the City are unable to mutually agree on an alternative method to effectuate an equitable
allocation of income from the sale of digital products.
E. For purposes of TMC Section 3.26.077.C.1 through TMC Section 3.26.077.C.5,
the following definitions apply:
1. "Digital automated services," "digital codes," and "digital goods" have the
same meaning as in RCW 82.04.192;
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2. "Digital products" means digital goods, digital codes, digital automated
services, and the services described in RCW 82.04.050(2)(g) and (6)(c); and
3. "Receive" has the same meaning as in RCW 82.32.730.
F. Gross income derived from activities taxed as services and other activities taxed
under TMC Section 3.26.050.A.7 shall be apportioned to the City by multiplying
apportionable income by a fraction, the numerator of which is the payroll factor plus the
service income factor and the denominator of which is two.
1. The payroll factor is a fraction, the numerator of which is the total amount
paid in the City during the tax period by the taxpayer for compensation and the
denominator of which is the total compensation paid everywhere during the tax period.
Compensation is paid in the City if:
a. The individual is primarily assigned within the City;
b. The individual is not primarily assigned to any place of business for the
tax period and the employee performs 50% or more of his or her service for the tax period
in the City; or
c. The individual is not primarily assigned to any place of business for the
tax period, the individual does not perform 50% or more of his or her service in any city
and the employee resides in the City.
2. The service income factor is a fraction, the numerator of which is the total
service income of the taxpayer in the City during the tax period, and the denominator of
which is the total service income of the taxpayer everywhere during the tax period. Service
income is in the City if the customer location is in the City.
3. Gross income of the business from engaging in an apportionable activity
must be excluded from the denominator of the service income factor if, in respect to such
activity, at least some of the activity is performed in the City, and the gross income is
attributable under TMC Section 3.26.077.F.2 to a city or unincorporated area of a county
within the United States or to a foreign country in which the taxpayer is not taxable. For
purposes of TMC Section 3.26.077.F.3, "not taxable" means that the taxpayer is not
subject to a business activities tax by that city or county within the United States or by
that foreign country, except that a taxpayer is taxable in a city or county within the United
States or in a foreign country in which it would be deemed to have a substantial nexus
with the city or county within the United States or with the foreign country under the
standards in RCW 35.102.050 regardless of whether that city or county within the United
States or that foreign country imposes such a tax.
4. If the allocation and apportionment provisions of TMC Section 3.26.077.F do
not fairly represent the extent of the taxpayer's business activity in the City, the taxpayer
may petition for or the tax administrator may require, in respect to all or any part of the
taxpayer's business activity, if reasonable:
a. Separate accounting;
b. The exclusion of any one or more of the factors;
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c. The inclusion of one or more additional factors that will fairly represent
the taxpayer's business activity in the City; or
d. The employment of any other method to effectuate an equitable
allocation and apportionment of the taxpayer's income.
5. The party petitioning for, or the tax administrator requiring, the use of any
method to effectuate an equitable allocation and apportionment of the taxpayer's income
pursuant to TMC Section 3.26.077.F.4 must prove by a preponderance of the evidence:
a. That the allocation and apportionment provisions of this TMC Section
3.26.077.F do not fairly represent the extent of the taxpayer's business activity in the City;
and
b. That the alternative to such provisions is reasonable.
c. The same burden of proof shall apply whether the taxpayer is
petitioning for, or the tax administrator is requiring, the use of an alternative, reasonable
method to effectuate an equitable allocation and apportionment of the taxpayer's income.
6. If the tax administrator requires any method to effectuate an equitable
allocation and apportionment of the taxpayer's income, the tax administrator cannot
impose any civil or criminal penalty with reference to the tax due that is attributable to the
taxpayer's reasonable reliance solely on the allocation and apportionment provisions of
TMC Section 3.26.077.F.
7. A taxpayer that has received written permission from the tax administrator to
use a reasonable method to effectuate an equitable allocation and apportionment of the
taxpayer's income shall not have that permission revoked with respect to transactions
and activities that have already occurred unless there has been a material change in, or
a material misrepresentation of, the facts provided by the taxpayer upon which the tax
administrator reasonably relied in approving a reasonable alternative method.
G. The definitions in this subsection apply throughout this section.
1. "Apportionable income" means the gross income of the business taxable
under the service classifications of a city's gross receipts tax, including income received
from activities outside the City if the income would be taxable under the service
classification if received from activities within the City, less any exemptions or deductions
available.
2. "Business activities tax" means a tax measured by the amount of, or
economic results of, business activity conducted in a city or county within the United
States or within a foreign country. The term includes taxes measured in whole or in part
on net income or gross income or receipts. "Business activities tax" does not include a
sales tax, use tax, or a similar transaction tax, imposed on the sale or acquisition of goods
or services, whether or not denominated on a gross receipts tax or a tax imposed on the
privilege of doing business.
3. "Compensation" means wages, salaries, commissions, and any other form
of remuneration paid to individuals for personal services that are or would be included in
the individual's gross income under the federal Internal Revenue Code.
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4. "Customer" means a person or entity to whom the taxpayer makes a sale
or renders services or from whom the taxpayer otherwise receives gross income of the
business.
5. "Customer location" means the following:
a. For a customer not engaged in business, if the service requires the
customer to be physically present, where the service is performed.
b. For a customer not engaged in business, if the service does not require
the customer to be physically present:
(1) The customer's residence; or
(2) If the customer's residence is not known, the customer's
billing/mailing address.
c. For a customer engaged in business:
(1) Where the services are ordered from;
(2) At the customer's billing/mailing address if the location from which
the services are ordered is not known; or
(3) At the customer's commercial domicile if none of the above are
known.
6. "Individual" means any individual who, under the usual common law rules
applicable in determining the employer-employee relationship, has the status of an
employee of that taxpayer.
7. "Primarily assigned" means the business location of the taxpayer where
the individual performs his or her duties.
8. "Service -taxable income" or "service income" means gross income of
the business subject to tax under either the service or royalty classification.
9. "Tax period" means the calendar year during which tax liability is accrued.
If taxes are reported by a taxpayer on a basis more frequent than once per year, taxpayers
shall calculate the factors for the previous calendar year for reporting in the current
calendar year and correct the reporting for the previous year when the factors are
calculated for that year, but not later than the end of the first quarter of the following year.
H. Assignment or apportionment of revenue under this section shall be made in
accordance with and in full compliance with the provisions of the interstate commerce
clause of the United States Constitution where applicable.
Section 11. Regulations Established. A new TMC Section 3.26.078 is hereby
established to read as follows:
3.26.078 Allocation and Apportionment of Printing and Publishing Income when
Activities Take Place in More than One Jurisdiction
Notwithstanding RCW 35.102.130, effective January 1, 2008, gross income from the
activities of printing, and of publishing newspapers, periodicals, or magazines, shall be
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allocated to the principal place in this state from which the taxpayer's business is directed
or managed. As used in this section, the activities of printing, and of publishing
newspapers, periodicals, or magazines, have the same meanings as attributed to those
terms in RCW 82.04.280(1) by the Department of Revenue.
Section 12. Regulations Established. A new TMC Section 3.26.090 is hereby
established to read as follows:
3.26.090 Exemptions
A. 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
provisions of TMC Chapter 3.50.
B. 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.
C. 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.
D. 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.
E. Amounts derived from sale 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.
F. 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.
G. Amounts derived from manufacturing, selling or distributing motor vehicle
fuel. This chapter shall not apply to the manufacturing, selling, or distributing motor
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vehicle fuel, as the term "motor vehicle fuel" is defined in RCW 82.38.020 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.
H. 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.
I. Casual and isolated sales. This chapter shall not apply to the gross proceeds
derived from casual or isolated sales.
J. 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 14 days to reimburse in kind a previous accommodation sale by the buyer to the
seller.
K. 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.
L. Nonprofit organizations. This chapter shall not apply to entities that are exempt
from federal income tax under Section 501(c)(3) of the Internal Revenue Code, except
retail sales.
M. Businesses operating as a casino. This chapter shall not apply to
establishments primarily engaged in operating gambling facilities that offer table wagering
games along with other gambling activities.
N. Amateur/Professional/Semi-professional sports teams. This chapter shall
not apply to amateur, professional or semi-professional sports teams or clubs primarily
engaged in participating in live sporting events, such as baseball, basketball, football,
hockey, soccer, and jai alai games, before a paying audience. These teams or clubs may
or may not operate their own arena, stadium, or other facility for presenting these events.
Section 13. Regulations Established. A new TMC Section 3.26.100 is hereby
established to read as follows:
3.26.100 Deductions
In computing the license fee or tax, there may be deducted from the measure of tax
the following items:
A. Receipts from tangible personal property delivered outside the State. In
computing tax, there may be deducted from the measure of tax under retailing or
wholesaling amounts derived from the sale of tangible personal property that is delivered
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by the seller to the buyer or the buyer's representative at a location outside the State of
Washington.
B. Cash discount taken by purchaser. In computing tax, there may be deducted
from the measure of tax the cash discount amounts actually taken by the purchaser. This
deduction is not allowed in arriving at the taxable amount under the extracting or
manufacturing classifications with respect to articles produced or manufactured, the
reported values of which, for the purposes of this tax, have been computed according to
the "value of product" provisions.
C. Credit losses of accrual basis taxpayers. In computing tax, there may be
deducted from the measure of tax the amount of credit losses actually sustained by
taxpayers whose regular books of account are kept upon an accrual basis.
D. Constitutional prohibitions. In computing tax, there may be deducted from the
measure of the tax amounts derived from business which the City is prohibited from taxing
under the Constitution of the State of Washington or the Constitution of the United States.
E. Receipts from the Sale of Tangible Personal Property and Retail Services
Delivered Outside the City but Within Washington. Effective January 1, 2024,
amounts included in the gross receipts reported on the tax return derived from the sale of
tangible personal property delivered to the buyer or the buyer's representative outside the
City but within the State of Washington may be deducted from the measure of tax under
the retailing, retail services, or wholesaling classification.
F. Professional employer services. In computing the tax, a professional employer
organization may deduct from the calculation of gross income the gross income of the
business derived from performing professional employer services that is equal to the
portion of the fee charged to a client that represents the actual cost of wages and salaries,
benefits, workers' compensation, payroll taxes, withholding, or other assessments paid to
or on behalf of a covered employee by the professional employer organization under a
professional employer agreement.
G. Interest on investments or loans secured by mortgages or deeds of trust.
In computing tax, to the extent permitted by Chapter 82.14A RCW, there may be deducted
from the measure of tax by those engaged in banking, loan, security or other financial
businesses, amounts derived from interest received on investments or loans primarily
secured by first mortgages or trust deeds on non -transient residential properties.
Section 14. Regulations Established. A new TMC Section 3.26.120 is hereby
established to read as follows:
3.26.120 Tax Part of Overhead
It is not the intention of this chapter that the taxes or fees herein levied upon persons
engaging in business be construed as taxes or fees upon the purchasers or customer,
but that such taxes or fees shall be levied upon, and collectible from, the person engaging
in the business activities herein designated and that such taxes or fees shall constitute a
part of the cost of doing business of such persons.
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Section 15. Regulations Established. A new TMC Section 3.26.130 is hereby
established to read as follows:
3.26.130 Severability Clause
If any provision of this chapter or its application to any person or circumstance is
held invalid, the remainder of the chapter or the application of the provision to other
persons or circumstances shall not be affected.
Section 16. Chapter 3.27 of the Tukwila Municipal Code Established. A chapter
of the Tukwila Municipal Code entitled "Business and Occupation Tax Administrative
Provisions," to be codified as Tukwila Municipal Code (TMC) Chapter 3.27, is hereby
established to read as follows:
CHAPTER 3.27
BUSINESS AND OCCUPATION TAX ADMINISTRATIVE PROVISIONS
Sections:
3.27.010 Purpose
3.27.015 Application of Chapter Stated
3.27.020 Definitions
3.27.021 Definitions — References to Chapter 82.32 RCW
3.27.025 Registration/License Requirements
3.27.040 When Due and Payable — Reporting Periods — Monthly, Quarterly,
and Annual Returns — Threshold Provisions or Relief from Filing
Requirements — Computing Time Periods — Failure to File Returns
3.27.050 Payment Methods — Mailing Returns or Remittances — Time
Extension — Deposits — Recording Payments — Payment Must
Accompany Return — NSF Checks
3.27.060 Records to be Preserved — Examination — Estoppel to Question
Assessment
3.27.070 Accounting Methods
3.27.080 Public Work Contracts — Payment of Fee and Tax Before Final
Payment for Work
3.27.090 Underpayment of Tax, Interest, or Penalty — Interest
3.27.095 Time in Which Assessment May Be Made
3.27.100 Over Payment of Tax, Penalty, or Interest — Credit or Refund —
Interest Rate — Statute of Limitations
3.27.110 Late Payment — Disregard of Written Instructions — Evasion —
Penalties
3.27.120 Cancellation of Penalties
3.27.130 Taxpayer Quitting Business — Liability of Successor
3.27.140 Administrative Appeal
3.27.260 Severability
Section 17. Regulations Established. A new TMC Section 3.27.010 is hereby
established to read as follows:
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3.27.010 Purpose
The purpose of this Chapter is to provide for the administrative procedures for the
Business and Occupation Tax as codified in TMC Chapter 3.26, setting administrative fees
and prescribing penalties for noncompliance with the provisions of this chapter.
Section 18. Regulations Established. A new TMC Section 3.27.015 is hereby
established to read as follows:
3.27.015 Application of Chapter Stated
The provisions of this Chapter shall apply with respect to the taxes imposed under
TMC Chapter 3.26 and under other titles, chapters, and sections in such manner and to
such extent as indicated in each such title, chapter or section.
Section 19. Regulations Established. A new TMC Section 3.27.020 is hereby
established to read as follows:
3.27.020 Definitions
For purposes of this Chapter, the definitions contained in TMC Chapter 3.26 shall
apply equally to the provisions of this chapter unless the term is defined otherwise in this
chapter. In addition, the following definitions shall apply:
A. "Reporting period" means:
1. A one-month period beginning the first day of each calendar month (monthly);
or
2. A three-month period beginning the first day of January, April, July or October
of each year (quarterly); or
3. A twelve-month period beginning the first day of January of each year
(annual).
B. "Return" means any document a person is required by the City to file to satisfy
or establish a tax or fee obligation that is administered or collected by the City and that
has a statutorily defined due date.
C "Successor" means any person to whom a taxpayer quitting, selling out,
exchanging, or disposing of a business sells or otherwise conveys, directly or indirectly, in
bulk and not in the ordinary course of the taxpayer's business, any part of the materials,
supplies, merchandise, inventory, fixtures, or equipment of the taxpayer. Any person
obligated to fulfill the terms of a contract shall be deemed a successor to any contractor
defaulting in the performance of any contract as to which such person is a surety or
guarantor.
D "Tax year" or "taxable year" means the calendar year.
Section 20. Regulations Established. A new TMC Section 3.27.021 is hereby
established to read as follows:
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3.27.021 Definitions — References to Chapter 82.32 RCW
Where provisions of Chapter 82.32 RCW are incorporated in TMC Section 3.27.090
of this Title, "Department" as used in the RCW shall refer to the "Director" as defined in
TMC Section 3.26.040.D and "warrant" as used in the RCW shall mean "citation or
criminal complaint."
Section 21. Regulations Established. A new TMC Section 3.27.025 is hereby
established to read as follows:
3.27.025 Registration/License Requirements
No person shall engage in any business or conduct any business activity without first
obtaining a valid current business registration as required by TMC 5.04.015.
Section 22. Regulations Established. A new TMC Section 3.27.040 is hereby
established to read as follows:
3.27.040 When Due and Payable — Reporting Periods — Monthly, Quarterly, and
Annual Returns — Threshold Provisions or Relief from Filing Requirements —
Computing Time Periods — Failure to File Returns.
A. Other than any annual license fee or registration fee assessed under this chapter,
the tax imposed by this chapter shall be due and payable in quarterly installments. At the
Director's discretion, businesses may be assigned to a monthly or annual reporting period
depending on the tax amount owing or type of tax. Effective January 1, 2024, tax
payments are due on or before the time as provided in RCW 82.32.045(1), (2), and (3).
B. Taxes shall be paid as provided in this chapter and accompanied by a return on
forms as prescribed by the Director. The return shall be signed by the taxpayer personally
or by a responsible officer or agent of the taxpayer. The individual signing the return shall
swear or affirm that the information in the return is complete and true.
C. Tax returns must be filed and returned by the due date whether or not any tax is
owed.
D. For purposes of the tax imposed by TMC Chapter 3.26, any person whose value
of products, gross proceeds of sales, or gross income of the business, subject to tax after
all allowable deductions, is equal to or less than $750,000 in the current calendar year,
shall file a return, declare no tax due on their return, and submit the return to the Director.
The gross receipts and deduction amounts shall be entered on the tax return even though
no tax may be due.
E. A taxpayer that commences to engage in business activity shall file a return and
pay the tax or fee for the portion of the reporting period during which the taxpayer is
engaged in business activity.
F. Except as otherwise specifically provided by any other provision of this chapter,
in computing any period of days prescribed by this chapter the day of the act or event
from which the designated period of time runs shall not be included. The last day of the
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period shall be included unless it is a Saturday, Sunday, or City or Federal legal holiday,
in which case the last day of such period shall be the next succeeding day which is neither
a Saturday, Sunday, or City or Federal legal holiday.
G. If any taxpayer fails, neglects or refuses to make a return as and when required
in this chapter, the Director is authorized to determine the amount of the tax or fees
payable by obtaining facts and information upon which to base the Director's estimate of
the tax or fees due. Such assessment shall be deemed prima facie correct and shall be
the amount of tax owed to the City by the taxpayer. The Director shall notify the taxpayer
by mail of the amount of tax so determined, together with any penalty, interest, and fees
due; the total of such amounts shall thereupon become immediately due and payable.
Section 23. Regulations Established. A new TMC Section 3.27.050 is hereby
established to read as follows:
3.27.050 Payment Methods — Mailing Returns or Remittances — Time Extension —
Deposits — Recording Payments — Payment Must Accompany Return — NSF
Checks.
A. Taxes shall be paid to the Director in United States currency by bank draft,
certified check, cashier's check, personal check, money order, cash, or by wire transfer
or electronic payment if such wire transfer or electronic payment is authorized by the
Director. If payment so received is not paid by the bank on which it is drawn, the
taxpayer, by whom such payment is tendered, shall remain liable for payment of the tax
and for all legal penalties, the same as if such payment had not been tendered.
Acceptance of any sum by the Director shall not discharge the tax or fee due unless the
amount paid is the full amount due.
B. A return or remittance that is transmitted to the City by United States mail shall
be deemed filed or received on the date shown by the cancellation mark stamped by the
Post Office upon the envelope containing it. The Director may allow electronic filing of
returns or remittances from any taxpayer. A return or remittance which is transmitted to
the City electronically shall be deemed filed or received according to procedures set
forth by the Director.
C. If a written request is received prior to the due date, the Director, for good
cause, may grant, in writing, additional time within which to make and file returns.
D. The Director shall keep full and accurate records of all funds received or
refunded. The Director shall apply payments first against all penalties and interest
owing, and then upon the tax, without regard to any direction of the taxpayer.
E. For any return not accompanied by a remittance of the tax shown to be due
thereon, the taxpayer shall be deemed to have failed or refused to file a return and shall
be subject to the penalties and interest provided in this chapter.
F. Any payment made that is returned for lack of sufficient funds or for any other
reason will not be considered received until payment by certified check, money order, or
cash of the original amount due, plus a "non -sufficient funds" (NSF) charge of $25.00
for checks of $50.00 or less and $40.00 for checks over $50.00 is received by the
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Director. Any license issued upon payment with a NSF check will be considered void,
and shall be returned to the Director. No license shall be reissued until payment
(including the NSF charge) is received.
G. The Director is authorized, but not required, to mail tax return forms to
taxpayers, but failure of the taxpayer to receive any such forms shall not excuse the
taxpayer from filing returns and making payment of the taxes or fees, when and as due
under this chapter.
Section 24. Regulations Established. A new TMC Section 3.27.060 is hereby
established to read as follows:
3.27.060 Records to be Preserved — Examination — Estoppel to Question
Assessment.
Every person liable for any fee or tax imposed by this chapter shall keep and
preserve, fora period of 5 years after filing a tax return, such records as may be necessary
to determine the amount of any fee or tax for which the person may be liable; which
records shall include copies of all federal income tax and state tax returns and reports
made by the person. All books, records, papers, invoices, vendor lists, inventories, stocks
of merchandise, and other data including federal income tax and state tax returns and
reports shall be open for examination at any time by the Director or its duly authorized
agent. Every person's business premises shall be open for inspection or examination by
the Director or a duly authorized agent.
A. If a person does not keep the necessary books and records within the City, it
shall be sufficient if such person (a) produces within the City such books and records as
may be required by the Director, or (b) bears the cost of examination by the Director's
agent at the place where such books and records are kept; provided that the person
electing to bear such cost shall pay in advance to the Director the estimated amount
thereof including round-trip fare, lodging, meals and incidental expenses, subject to
adjustment upon completion of the examination.
B. Any person who fails, or refuses a Department request, to provide or make
available records, or to allow inspection or examination of the business premises, shall
be forever barred from questioning in any court action, the correctness of any assessment
of taxes made by the City for any period for which such records have not been provided,
made available or kept and preserved, or in respect of which inspection or examination
of the business premises has been denied. The Director is authorized to determine the
amount of the tax or fees payable by obtaining facts and information upon which to base
the estimate of the tax or fees due. Such fee or tax assessment shall be deemed prima
facie correct and shall be the amount of tax owing the City by the taxpayer. The Director
shall notify the taxpayer by mail the amount of tax so determined, together with any
penalty, interest, and fees due; the total of such amounts shall thereupon become
immediately due and payable.
Section 25. Regulations Established. A new TMC Section 3.27.070 is hereby
established to read as follows:
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3.27.070 Accounting Methods
A. A taxpayer may file tax returns in each reporting period with amounts based upon
cash receipts only if the taxpayer's books of account are kept on a cash receipts basis. A
taxpayer that does not regularly keep books of account on a cash receipts basis must file
returns with amounts based on the accrual method.
B. The taxes imposed and the returns required hereunder shall be upon a calendar
year basis.
Section 26. Regulations Established. A new TMC Section 3.27.080 is hereby
established to read as follows:
3.27.080 Public Work Contracts — Payment of Fee and Tax Before Final Payment
for Work
The Director may, before issuing any final payment to any person performing any
public work contract for the City, require such person to pay in full all license fees or taxes
due under this title from such person on account of such contract or otherwise, and may
require such taxpayer to file with the Director a verified list of all subcontractors supplying
labor and/or materials to the person in connection with said public work.
Section 27. Regulations Established. A new TMC Section 3.27.090 is hereby
established to read as follows:
3.27.090 Underpayment of Tax, Interest, or Penalty - Interest
A. If, upon examination of any returns, or from other information obtained by the
Director, it appears that a tax or penalty less than that properly due has been paid, the
Director shall assess the additional amount found to be due and shall add thereto interest
on the tax only. The Director shall notify the person by mail of the additional amount,
which shall become due and shall be paid within 30 days from the date of the notice, or
within such time as the Director may provide in writing.
B. For tax periods after December 31, 2004 the Director shall compute interest in
accordance with RCW 82.32.050 as it now exists or as it may be amended.
C. If TMC Section 3.27.090.B is held to be invalid, then the provisions of RCW
82.32.050 existing at the effective date of this ordinance shall apply.
Section 28. Regulations Established. A new TMC Section 3.27.095 is hereby
established to read as follows:
3.27.095 Time in Which Assessment May Be Made
The Director shall not assess, or correct an assessment for additional taxes,
penalties, or interest due more than four years after the close of the calendar year in
which they were incurred, except that the Director may issue an assessment:
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A. Against a person who is not currently registered or licensed or has not filed a tax
return as required by this chapter for taxes due within the period commencing 10 years
prior to the close of the calendar year in which the person was contacted in writing by the
Director;
B. Against a person that has committed fraud or who misrepresented a material
fact; or
C. Against a person that has executed a written waiver of such limitations.
Section 29. Regulations Established. A new TMC Section 3.27.100 is hereby
established to read as follows:
3.27.100 Over Payment of Tax, Penalty, or Interest — Credit or Refund — Interest
Rate — Statute of Limitations
A. If, upon receipt of an application for a refund, or during an audit or examination
of the taxpayer's records and tax returns, the Director determines that the amount of tax,
penalty, or interest paid is in excess of that properly due, the excess amount shall be
credited to the taxpayer's account or shall be refunded to the taxpayer. Except as
provided in TMC Section 3.27.100.B, no refund or credit shall be made for taxes,
penalties, or interest paid more than 4 years prior to the beginning of the calendar year in
which the refund application is made or examination of records is completed.
B. The execution of a written waiver shall extend the time for applying for, or making
a refund or credit of any taxes paid during, or attributable to, the years covered by the
waiver if, prior to the expiration of the waiver period, an application for refund of such
taxes is made by the taxpayer or the Director discovers that a refund or credit is due.
C. Refunds shall be made by means of vouchers approved by the Director and by
the issuance of a City check or warrants drawn upon and payable from such funds as the
City may provide.
D. Any final judgment for which a recovery is granted by any court of competent
jurisdiction for tax, penalties, interest, or costs paid by any person shall be paid in the
same manner, as provided in TMC Section 3.27.100.C, upon the filing with the Director a
certified copy of the order or judgment of the court.
Section 30. Regulations Established. A new TMC Section 3.27.110 is hereby
established to read as follows:
3.27.110 Late Payment — Disregard of Written Instructions — Evasion - Penalties
A. If payment of any tax due on a return to be filed by a taxpayer is not received by
the Director by the due date, the Director shall add a penalty in accordance with RCW
82.32.090(1), as it now exists or as it may be amended.
B. If the Director determines that any tax has been substantially underpaid as
defined in RCW 82.32.090(2), there shall be added a penalty in accordance with RCW
82.32.090(2), as it now exists or as it may be amended.
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C. If a citation or criminal complaint is issued by the Director for the collection of
taxes, fees, assessments, interest or penalties, there shall be added thereto a penalty in
accordance with RCW 82.32.090(3), as it now exists or as it may be amended.
D. If the Director finds that a person has engaged in any business or performed any
act upon which a tax is imposed under this title and that person has not obtained from the
Director a license as required by City of Tukwila, the Director shall impose a penalty in
accordance with RCW 82.32.090(4), as it now exists or as it may be amended. No penalty
shall be imposed under TMC Section 3.27.110.D if the person who has engaged in
business without a license obtains a license prior to being notified by the Director of the
need to be licensed.
E. If the Director determines that all or any part of a deficiency resulted from the
taxpayer's failure to follow specific written tax reporting instructions, there shall be
assessed a penalty in accordance with RCW 82.32.090(5), as it now exists or as it may
be amended.
F. If the Director finds that all or any part of the deficiency resulted from an intent to
evade the tax payable, the Director shall assess a penalty in accordance with RCW
82.32.090(5), as it now exists or as it may be amended.
G. The penalties imposed under TMC Section 3.27.110.A through E can each be
imposed on the same tax found to be due. This subsection does not prohibit or restrict
the application of other penalties authorized by law.
H. The Director shall not impose both the evasion penalty and the penalty for
disregarding specific written instructions on the same tax found to be due.
I. For the purposes of this section, "return" means any document a person is
required by the City of Tukwila to file to satisfy or establish a tax or fee obligation that is
administered or collected by the City, and that has a statutorily defined due date.
J. If incorporation of future changes to RCW 82.32.090 into the Tukwila Municipal
Code is deemed invalid, then the provisions of RCW 82.32.090 existing at the time this
ordinance is effective shall apply.
Section 31. Regulations Established. A new TMC Section 3.27.120 is hereby
established to read as follows:
3.27.120 Cancellation of Penalties
A. The Director may cancel any penalties imposed under TMC Section 3.27.110.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 TMC
Section 3.27.120.C.
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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 TMC Section 3.27.110.A one time if a
person:
1. Is not currently licensed and filing returns,
2. Was unaware of its responsibility to file and pay tax, and
3. Obtained 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.
Section 32. Regulations Established. A new TMC Section 3.27.130 is hereby
established to read as follows:
3.27.130 Taxpayer Quitting Business — Liability of Successor
A. Whenever any taxpayer quits business, sells out, exchanges, or otherwise
disposes of his business or his stock of goods, any tax payable hereunder shall become
immediately due and payable. Such taxpayer shall, within 10 days thereafter, make a
return and pay the tax due.
B. Any person who becomes a successor shall become liable for the full amount of
any tax owing. The successor shall withhold from the purchase price a sum sufficient to
pay any tax due to the City from the taxpayer until such time as: a) the taxpayer shall
produce a receipt from the City showing payment in full of any tax due or a certificate that
no tax is due, or b) more than 6 months has passed since the successor notified the
Director of the acquisition and the Director has not issued and notified the successor of
an assessment.
C. Payment of the tax by the successor shall, to the extent thereof, be deemed a
payment upon the purchase price. If such payment is greater in amount than the purchase
price, the amount of the difference shall become a debt due such successor from the
taxpayer.
D. Notwithstanding the above, if a successor gives written notice to the Director of
the acquisition, and the Department does not within 6 months of the date it received the
notice issue an assessment against the taxpayer and mail a copy of that assessment to
the successor, the successor shall not be liable for the tax.
Section 33. Regulations Established. A new TMC Section 3.27.140 is hereby
established to read as follows:
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3.27.140 Administrative Appeal
A. Any person aggrieved by the calculation of the tax determined to be due to the
City pursuant to this chapter may appeal to the Finance Director or his/her designee
from such determination by filing a written notice of appeal with the City Clerk within 20
calendar days from the date on which such person was given notice of the tax. The
notice of appeal must state the grounds for appeal, including a detailed explanation of
why the amount of the tax was incorrect. The Finance Director or designee shall review
the basis for the appeal and may request clarification from the appellant. After the
review is complete, the Finance Director or designee shall issue an administrative
decision that may sustain or modify the amount of tax owed. Notice of the
administrative decision shall be sent to the appellant by certified mail within 10 days of
issuance.
B. The appellant, if aggrieved by the decision of the Finance Director or designee,
may then appeal to the City Hearing Examiner within 20 calendar days of the date the
administrative decision is mailed to the appellant. The notice of appeal must state the
grounds for appeal, including a detailed explanation of why the administrative decision
is incorrect. The notice of appeal must be accompanied by an Appeal Fee in
accordance with the fee schedule adopted by resolution of the City Council.
C. Upon timely filing of a notice of appeal, the Finance Director shall schedule a
hearing on the appeal before the City's Hearing Examiner. The hearing shall be
conducted no later than 30 days from the date of the notice of appeal, unless an
extension is agreed to by the appellant or otherwise ordered by the Hearing Examiner
for good cause shown. Notice of the hearing and the appeal shall be given to the
appellant by certified mail at least five days prior to the date of the hearing.
D. The hearing shall be governed by the City of Tukwila Hearing Examiner's
procedural rules. The hearing shall be de novo. The decision of the City's Hearing
Examiner or other hearing body shall be based upon a preponderance of the evidence.
The burden of proof shall be on the appellant. The Hearing Examiner or other hearing
body may affirm, reverse or modify the Finance Director's decision.
E. Within 20 business days, excluding holidays recognized by the City of Tukwila,
from the date of the hearing on an appeal under this section, the Hearing Examiner
shall issue a written decision which shall set forth the reasons therefor.
Section 34. Regulations Established. A new TMC Section 3.27.260 is hereby
established to read as follows:
3.27.260 Severability
If any provision of this chapter or its application to any person or circumstance is held
invalid, the remainder of the chapter or the application of the provision to other persons
or circumstances shall not be affected.
Section 35. Referendum. This ordinance is subject to referendum as set forth in RCW
35.21.706. A referendum petition to repeal this ordinance may be filed with the City Clerk
within 7 days of adoption of this ordinance. Within 10 days of such filing, the City Clerk shall
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confer with the petitioner concerning form and style of the petition, issue the petition and
identifications number, and secure an accurate, concise, and positive ballot title from the
City Attorney. The petitioner shall then have 30 days in which to secure the signatures of
not less than 15% of the City's registered voters as of the last municipal general election
upon petition forms which contain the ballot title and the full text of the measures to be
referred. The City Clerk shall verify the sufficiency of the signatures and, if sufficient valid
signatures are properly submitted, shall certify the referendum measure to the next election
ballot within the City or at a special election ballot as provided pursuant to RCW
35.17.260(2).
Section 36. Corrections by City Clerk or Code Reviser Authorized. 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
Section 37. 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 38. 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 on January
1, 2024, 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 , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
Allan Ekberg, Mayor
Filed with the City Clerk:
Passed by the City Council:
Published:
Effective Date:
Ordinance Number:
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Attachment: Comparison of Deviations from Core Model B&O Provisions and City of
Tukwila Provisions
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94
Comparison of Deviations from Core Model Ordinance Provisions
City of Tukwila
B&O TAX
PROVISION:
Summary of Change from Model B&O Tax Ordinance:
.050 Imposition of
(2) The gross receipts tax imposed in this section shall not apply to any
the tax — tax or fee
person whose gross proceeds of sales, gross income of the business,
levied.
and value of products, including by-products, as the case may be, from
all activities conducted within the City during any calendar year is equal
to or less than $750,000, or is equal to or less than $187,500 during
any quarter if on a quarterly reporting basis.
.090 Exemptions.
• Nonprofit organizations exempt from federal income tax under
Section 501(c)(3) of the Internal Revenue code (except retail
sales)
• Businesses operating as a casino
• Amateur/Professional/Semi-Professional sports teams
95
96
W
i City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Finance & Governance Committee
FROM: Laurel Humphrey, Legislative Analyst
DATE: October 17, 2022
SUBJECT: City Council Compensation Ordinance
ISSUE
Ordinance setting City Council compensation for 2023-2026.
BACKGROUND
City Council compensation is adopted by ordinance and codified at Tukwila Municipal Code
2.05. In 2022, the City Council requested a City Council compensation review as part of the
biennial budget process. The Washington State Constitution prohibits any salary increase or
decrease during the term of office for officials who set their own salary, so the earliest
compensation could be adjusted for any City Council position is 2024.
TMC 2.05 provides that if "at any time the Tukwila City Council compensation rate of increase
falls significantly below the cost -of -living increase," it will be re-evaluated and possibly
adjusted. The current compensation of $1250 per month for all positions has been in place
since 2014. The inflation rate per the Seattle -Tacoma -Bellevue CPI -U has increased $31.91 in
that time (June to June).
Retirement Plan
Per WAC 415-108-570, in order to earn service credit in a state retirement plan, elected
officials must earn at least 90 times the state minimum wage each month. The current
Council compensation rate of $1250 per month has fallen behind. With the increase in the
state minimum wage to $14.49 per hour in 2022, Councilmembers must earn at least $1304.10
per month to earn service credit.
Proposal
Staff suggests that the City Council consider a modest increase to its compensation for four
reasons:
1) To reflect that the cost of living has significantly increased since 2014
2) To more reasonably reflect the time and effort involved in serving as a Councilmember
3) To help encourage diverse members of the Tukwila community to pursue elected
office
4) To resume earning service credits for those participating in a state retirement plan
97
INFORMATIONAL MEMO
Page 2
The table below reflects a monthly increase of $200 per month beginning in 2024 for positions
2, 4 and 6, and in 2026 for positions 1, 3, 5 and 7. This represents a 16% increase, roughly half
of the actual cost of living increase since the current compensation was adopted in 2014.
The Finance & Governance Committee agreed with this proposal at its August 8, 2022 meeting
and the draft ordinance has been prepared in accordance with this direction.
RECOMMENDATION
Staff is seeking a committee recommendation to forward to the November 14, 2022
Committee of the Whole along with other budget -related legislation.
98
Positions 1, 3, 5, 7
Positions 2, 4, 6
Year
Term Ends: 12/31/25
Term Ends: 12/31/23
2023
1250
1250
2024
1250
1450
2025
1250
1450
2026
1450
1450
The Finance & Governance Committee agreed with this proposal at its August 8, 2022 meeting
and the draft ordinance has been prepared in accordance with this direction.
RECOMMENDATION
Staff is seeking a committee recommendation to forward to the November 14, 2022
Committee of the Whole along with other budget -related legislation.
98
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, AMENDING TUKWILA MUNICIPAL
CODE SECTION 2.05.010 TO FIX THE AMOUNT OF
COMPENSATION FOR COUNCILMEMBERS FOR YEARS
2023 THROUGH 2026; REPEALING ORDINANCE NO. 2668;
PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN
EFFECTIVE DATE.
WHEREAS, Ordinance No. 2668 set City Council compensation levels for the years
2022 and 2023; and
WHEREAS, City Council compensation has not changed since 2014; and
WHEREAS, the cost of living as measured by the Seattle -Tacoma -Bellevue
Consumer Price Index (CPI -U) has risen by 32% since 2014; and
WHEREAS, public service should be adequately compensated to attract
participation from a diverse community; and
WHEREAS, RCW 35A.12.070 requires that no Councilmember may increase or
decrease the salary during the current term of office; and
WHEREAS, the City Council wishes to retain a conservative compensation;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY ORDAINS AS FOLLOWS:
Section 1. TMC Chapter 2.05 Amended. Chapter 2.05 of the Tukwila Municipal
Code is hereby amended to read as follows:
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2.05.010 Council Compensation
A. Monthly compensation levels. Pursuant to the provisions of RCW
35A.12.070, members of the Tukwila City Council shall receive the following monthly
compensation during the years listed here according to their position and the date their
term of office commences:
B. Compensation review. At any time the Tukwila City Council compensation
rate of increase falls significantly below the cost of living increase as measured by the
Seattle -Tacoma -Bellevue Consumer Price Index (CPI -U), Tukwila the City Council will
review the stipends and may increase the City Council stipend compensation
accordingly.
Section 2. Repealer. Ordinance No. 2668 is hereby repealed.
Section 3. Corrections by City Clerk or Code Reviser. Authorized 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
Section 4. 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 5. 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.
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Page 2 of 3
POSITIONS 1, 3, 5, 7
POSITIONS 2, 4, 6
YEAR
Current Term of Office:
Current Term of Office:
1/1/22 — 12/31/25
1/1/20 — 12/31/23
2023
$1,250/month
$1,250/month
2024
$1,250/month
$1,450/month
2025
$1,250/month
$1,450/month
2026
$1,450/month
$1,450/month
B. Compensation review. At any time the Tukwila City Council compensation
rate of increase falls significantly below the cost of living increase as measured by the
Seattle -Tacoma -Bellevue Consumer Price Index (CPI -U), Tukwila the City Council will
review the stipends and may increase the City Council stipend compensation
accordingly.
Section 2. Repealer. Ordinance No. 2668 is hereby repealed.
Section 3. Corrections by City Clerk or Code Reviser. Authorized 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;
references to other local, state or federal laws, codes, rules, or regulations; or ordinance
numbering and section/subsection numbering.
Section 4. 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 5. 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.
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Page 2 of 3
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2022.
ATTEST/AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk
APPROVED AS TO FORM BY:
Office of the City Attorney
Allan Ekberg, Mayor
Filed with the City Clerk:
Passed by the City Council:
Published:
Effective Date:
Ordinance Number:
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101
102
T0:
City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
Mayor Ekberg
Finance & Governance Committee
FROM: David Cline, City Administrator
BY: Cheryl Thompson, Executive Assistant
DATE: October 17, 2022
SUBJECT: Contract for City Attorney Services
ISSUE
The current contract for City Attorney Services provided by Ogden Murphy Wallace expires
December 31, 2022. The proposed contract for 2023-2024 is attached.
DISCUSSION
Ogden Murphy Wallace began providing City Attorney Services to the City of Tukwila in April
2020. Under the proposed 2023-2024 contract, general City Attorney services are maintained
at 28 hours per week at the flat monthly rate of $33,000 per month for 2023 with an increase
of the flat monthly rate to $35,000 per month in 2024. Litigation, contested administrative
proceedings, and special services are subject to prior approval and are billed at the hourly
rates of the staff involved. Hourly rates are listed in Exhibit B to the contract.
RECOMMENDATION
The Committee is being asked to move this contract forward to the November 14, 2022
Committee of the Whole Meeting for discussion
ATTACHMENTS
Draft 2023-2024 Contract for Legal Services
103
104
KARI SAND
206.447.2250
ksand@omwlaw.com
September 23, 2022
SENT VIA E-MAIL ONLY
Mayor Allan Ekberg
City of Tukwila
6200 Southcenter Boulevard
Tukwila, WA 98188
Alan.Ekberg@TukwilaWA.gov
Re: Engagement Letter for City Attorney Services through December 31, 2024
Dear Mayor Ekberg:
My team at OMW and I appreciate the opportunity to be of continued service providing City
Attorney services for the City of Tukwila from January 1, 2023 through December 31, 2024. The
purpose of this letter is to confirm how our services will be provided.
Terms of Engagement
In our representation of clients, we think it is critical that our clients and the firm share the same
understanding of the attorney-client relationship. To that end, enclosed is a copy of our Standard
Terms of Engagement. This engagement letter and the enclosed Standard Terms of Engagement
set forth our agreement with you. Please review them carefully and let me know if you have any
questions regarding the proposed terms.
Legal Fees
We will provide City Attorney services up to approximately 28 -hours per week consistent with
Exhibit A, the Scope of Services. I will serve as City Attorney and will be available, either in-person
or remotely, as needed. Associates Emily Miner and Andrew Tsoming will be otherwise available,
either on-site or remotely, as appropriate, as well as any other Member of my firm whose expertise
may be needed, such as Member Karen Sutherland. Invoice statements will be sent monthly via
regular mail or e-mail, unless you request otherwise. As supervising attorney, I will be responsible
for seeing that the work is carried out in an efficient and economical manner. I will be assisted by
other attorneys and legal assistants in our office. They are all bound to you by the same duties of
loyalty and confidentiality that binds me.
Ogden Murphy Wallace City Attorney Services 2023-2024
105
Mayor Allan Ekberg
September 23, 2022
Page 2
Hours of Work
Staffing Model
General Services Rate
Flat monthly rate of
$33,000 in 2023;
Approx. 28
KLS = Supervising Lead City Attorney
flat monthly rate of
hours per week
EFM & ADT = Assistant City Attorneys
$35,000 in 2024; and
(varies)
other fees for separate
& special services, as
explained below.
The flat monthly billing rate will be $33,000 per month for City Attorney "General Services," as
specified in Exhibits A (Scope of Services) and B (Compensation and Method of Payment). For
representation on "Separate Services," such as administrative and judicial appeals, litigation, and
other project/site-specific land use work, as specified in Exhibits A and B, the Member billing rate
will be $350 per hour, and the Associate billing rate will be $275 per hour. For representation on
"Special Services" that are eligible for reimbursement to the City from an applicant (e.g., franchise),
as well as telecommunications work (e.g., small cell ROW agreements, pole leases, etc.) will be billed
at $385 per hour for Members and $285 per hour for Associates. We will not bill for travel time to
and from Tukwila City Hall. Travel to other locations for City -related business outside of regular
office hours will be billed at applicable hourly rates (e.g., travel to the Kent Regional Justice Center
or the King County Courthouse for the Friday motion calendar).
We appreciate your expression of confidence in Ogden Murphy Wallace, P.L.L.C. and would like to
assure you that we will do our best to provide you with high quality legal services. If you have any
questions or concerns during the course of our relationship, we encourage you to raise them with me
or our Managing Member, Geoffrey J. Bridgman or our Chair, Donald W. Black. If you agree with
the provisions of this engagement letter and the attached Terms and Conditions, please sign where
indicated below and return to me. We look forward to working with you.
Very truly yours,
OGDEN MURPHY WALLACE, P.L.L.C.
Kari L. Sand
KLS/ljv
Enclosure — OMW Standard Terms of Engagement
cc: Vicki Carlsen, Finance Director
106 Ogden Murphy Wallace City Attorney Services 2023-2024
Mayor Allan Ekberg
September 23, 2022
Page 3
I HEREBY ACCEPT AND AGREE TO the foregoing letter and the attached Standard Terms of
Engagement this day of November, 2022.
By:
Print Name: Allan Ekberg
Its: Mayor
Ogden Murphy Wallace City Attorney Services 2023-2024
107
Mayor Allan Ekberg
September 23, 2022
Page 4
OGDEN MURPHY WALLACE, P.L.L.C.
STANDARD TERMS OF ENGAGEMENT
General Rates
The usual basis for determining our fees is the time expended by attorneys, paralegals, and legal
assistants of the firm. The rates for our services presently range from $175 to $635 per hour and
are subject to change from time to time. Our current rate schedule is always available upon request.
Whenever it is appropriate, we will use associate attorneys, law clerks or legal assistants in our
office.
Other Factors in Rates
Although time expended and costs incurred are usually the sole basis for determining our fees, by
mutual agreement billings to you for legal services may, in some instances, be based on a more
comprehensive evaluation of the reasonable value of the firm's services. The firm is committed to
charging reasonable fees for its services. In certain situations, factors other than the amount of
time required will have a significant bearing on the reasonable value of the services performed.
Such factors include: the novelty and complexity of the questions involved; the skill required to
provide proper legal representation; familiarity with the specific areas of law involved; the
preclusion of other engagements caused by your work; the magnitude of the matter; the results
achieved; customary fees for similar legal services; time limitations imposed by you or by
circumstances; and the extent to which office forms and procedures have produced a high quality
product efficiently. There may be some activity that we can do on a contingent or other basis;
however, we will handle matters on a contingency or other basis only when and to the extent
specifically agreed in writing in advance of the work.
In circumstances where our fees will be based on or include factors other than our normal hourly
charges and costs, we will notify you promptly and prior to proceeding. Any basic document fee
that we may charge you has been and will be set in light of these various factors.
Billing Fees and Costs
The City will not be charged for normal clerical or secretarial work, the expense of which has been
calculated into our hourly rates for attorneys. Reimbursement will be made by the City for
expenditures related to court costs and fees, copying, postage, computer-aided legal research when
conducted on behalf of the City, mileage, and parking. Other expenses shall be reimbursed when
authorized in advance by the City.
We will bill the City monthly for services performed. Our bill will show the service provided, the
date, the person providing the service, and the time expended in tenths of an hour.
We will work with the City to develop and implement a billing and invoicing framework that meets
the City's needs. At the City's preference, individual billing numbers can be established for each
1 08 Ogden Murphy Wallace City Attorney Services 2023-2024
Mayor Allan Ekberg
September 23, 2022
Page 5
department, as well as for any specialty matter (e.g. litigation, contract negotiations, etc.) that
arises.
Legal services would be billed monthly, and each invoice would include a billing narrative for
every time entry sensitive to protecting the attorney/client privilege.
Payment; Interest
You agree to make payment within thirty (30) days of receipt of our monthly statement.
Outstanding balances that are not paid when due will accrue interest at the rate of one percent
compounded monthly from the date of invoice until paid.
Termination
You may terminate our representation at any time, with or without cause, by notifying us. Upon
such action, all fees and expenses incurred before the termination are due to the firm. If such
termination occurs, your original papers will be returned to you promptly upon receipt of payment
for outstanding fees and costs. If you wish to have a paper or electronic copy of your file at the
conclusion of our representation, we will provide it to you at the current copy rate per page then
in effect.
Confidentiality and Electronic Communications
Ogden Murphy Wallace is committed to maintaining the security of our system and the
communications with our clients. Unless you otherwise instruct us in writing, we intend to use
various communications devices in the normal course (which may include wired or wireless
devices, e-mail, cellular telephones, voice over Internet, texting, and electronic data/document web
sites) to communicate with and send or make available documents to you and others. Though
encryption is a security tool that we utilize, not all communications are encrypted. By signing this
letter, you consent to the usage of a variety of communication methods even if such methods are
not encrypted.
It is important for us to maintain open communication with each other throughout the engagement.
We will regularly keep you informed of the status of the matter and will promptly notify you of
any major case developments. We will consult with you whenever appropriate.
You agree to communicate with and provide us with complete and accurate information as needed
to further the case. Further, you will timely notify us of any changes in the structure of your
organization, changes to the personal information or residence of any individuals related to this
matter, or any extended periods of time when you will be unavailable.
Ogden Murphy Wallace City Attorney Services 2023-2024
109
Mayor Allan Ekberg
September 23, 2022
Page 6
Dispute Resolution
If you disagree with the amount of our fee, please take up the question with your principal attorney
contact or with the firm's managing member. Typically, such disagreements are resolved to the
satisfaction of both sides with little inconvenience or formality. Any disputes relating to these
Terms of Engagement or the accompanying engagement letter (collectively this "agreement") or
the amount of legal fees related thereto, will be submitted to arbitration through the American
Arbitration Association (the "AAA") in Seattle, Washington, according to its then -effective rules,
and to Ogden Murphy Wallace, P.L.L.C. and you agree to be bound by the results of such
arbitration. Please be aware that by agreeing to arbitration, you are waiving the right to a trial by
jury and your right to appeal. Although the arbitrator will be authorized to award any damages or
relief that a court of law having jurisdiction over the dispute could award, the arbitrator will be
bound by the AAA rules and not by state or federal court rules, and discovery will be limited to
what is allowed under the AAA rules. The grounds for appeal of an arbitration award are limited
as compared to a court judgment or jury verdict. Arbitration fees and expenses shall be borne
equally by the parties. In the event of non-payment such that we must pursue collection of your
account, you agree to pay the costs of collecting the debt, including court costs and fees, and a
reasonable attorney's fee.
The law of the state of Washington will apply to any such dispute.
Withdrawal
We reserve the right to withdraw from representing you if, for any reason, our fees are not timely
paid in accordance with this agreement, or for any other appropriate reason, as determined by the
firm in accordance with applicable law and the Rules of Professional Conduct.
Client Documents
During the engagement, we will maintain certain documents relevant to this representation. At the
conclusion of this engagement, we will retain your original documents for a period of ten years
unless you request that they be returned to you. If you have not requested possession of the file or
any of its contents at the end of ten years, the file may be destroyed in accordance with our record
retention program.
We may store some or all of your electronic files on a variety of platforms, including third -party
cloud -based servers. You specifically consent to the use of these services for document storage
and management, and to the conversion of all paper documents in your file to electronic form. You
recognize that technology is ever evolving and that electronic communications cannot be fully
protected from unauthorized interception. You acknowledge that our email system may be
unencrypted, and you covenant and agree to proactively notify us in writing if you require that any
of your deliverables or emails be sent to you with encryption. We caution you not to send or access
any email or other electronic message to or from us, respectively, via any public or semi-public
network, or network or devices owned or controlled by any third party. Nonetheless, for efficiency
110 Ogden Murphy Wallace City Attorney Services 2023-2024
Mayor Allan Ekberg
September 23, 2022
Page 7
purposes, you authorize us to transmit information, including information of a confidential nature,
to you (or your designated representative) by email to any address which you may provide to us
for such purposes, including responding to the sending address of any such message that we may
receive from you. In addition, you authorize our use of third -party cloud, back-up, client
management, timekeeping, and file -sharing services, including, but not limited to, ShareFile,
Dropbox, DocuSign, Carpe Diem, Mimecast, and SurePoint, in the course of our representation.
You acknowledge that we may be bound by certain third party terms and conditions related to the
use of such services and that our use of such services is not without risks (and you agree to assume
such risks).
Please note that if we represent you in a matter in litigation, you have an obligation to preserve all
documents that may be relevant to this matter.
Disclaimer
You acknowledge that we have made no guarantees regarding the disposition, outcome, or results
of your legal or business matters, and all expressions we have made relevant thereto are only our
opinions as lawyers based upon the information available to us at the time.
Independent Advice
Since the Engagement Agreement is legally binding and affects your legal rights, you may wish to
seek the advice of independent counsel prior to executing it.
Conclusion
Thank you for retaining our firm. We look forward to working with you.
Ogden Murphy Wallace City Attorney Services 2023-2024
111
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September 23, 2022
Page 8
EXHIBIT A -SCOPE OF SERVICES
Contractor agrees to provide a level of service equal to or greater than the level of service provided
by an in-house city attorney working approximately 28 hours per week. Kari L. Sand is the
designated member of Ogden Murphy Wallace that will serve as the City Attorney. Any changes
in this position must be approved in advance by the City.
1. Flat Rate Fee for City Attorney General Services
Contractor agrees to provide general city attorney services, for a flat fee, including but
not limited to:
A. Attending regular meetings of the City Council and executive sessions scheduled
for regular meetings of the City Council and, upon request, attending special
meetings of the City Council, meetings of the Committee of the Whole, other
Committee meetings, and meetings of City Boards and Commissions.
B. Preparation and/or legal review of contracts, interlocal agreements, resolutions and
ordinances and other city documents or materials as requested.
C. Practice "preventative law" in the form of regular consultation with Mayor, City
Councilmembers, City Administrator, and staff.
D. Except as set forth in Section 2, defend and manage (for WCIA-related matters)
litigation brought against the City.
E. Providing legal advice relating to the Public Records Act and public records
requests, including review and redaction of records and preparation and review of
exemption logs, as requested.
F. As requested, providing special classes and/or seminars for staff, elected officials,
Boards, and Commissions on issues including, but not limited to, the PRA, OPMA,
ethics, conflicts of interest, and the appearance of fairness doctrine.
G. Such other general city attorney matters as are assigned.
H. Work up to approximately 28 hours per week on average.
I. Maintain comprehensive Internet and remote access capability, including e-mail,
linking Contractor's office with City Hall.
J. It is incumbent upon the City, in partnership with the City Attorney, to manage the
general services within the estimated 28 -hour work week staffing model.
112 Ogden Murphy Wallace City Attorney Services 2023-2024
Mayor Allan Ekberg
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Page 9
2. Separate Matter Services
Contractor agrees to provide City Attorney Separate Matter Services for litigation and
contested administrative proceedings, which include but are not limited to:
A. Each individual civil action filed by or against the City, except matters for which WCIA
has assigned primary, lead defense counsel, which the City Attorney shall manage as
part of general city attorney services, and except that multiple condemnation lawsuits
related to the same project shall constitute only one Separate Matter;
B. All Code Enforcement matters conducted before the Hearing Examiner or in Court, but
not including general code enforcement services, which shall be included in
Contractor's flat monthly fee; and
C. All drug or other forfeiture matters collectively filed by or against the City.
For each such Separate Matter, Contractor shall be paid hourly rates for 2023-2024 as set forth
in Exhibit B, Section 2.
3. Special Services
Contractor agrees to provide City Attorney Special Services, which include but are not
limited to:
Other specialized municipal law services, including but not limited to franchise
negotiations and telecommunications work (e.g., small cell ROW agreements, pole
leases, etc.); provided, however, that any such Special Services shall first be
authorized by the City.
For such Special Services, Contractor shall be paid hourly rates for 2023-2024 as set forth
in Exhibit B, Section 3.
It is understood and agreed that the City Attorney shall not provide private legal services to
any employee of the City of Tukwila during the term of this Agreement.
Ogden Murphy Wallace City Attorney Services 2023-2024
113
Mayor Allan Ekberg
September 23, 2022
Page 10
EXHIBIT B -COMPENSATION AND METHOD OF PAYMENT
1. City Attorney General Services
For 2023, all city attorney general services set forth in Section 1 of Exhibit A, Contractor
shall be paid a flat monthly fee of $33,000, plus extraordinary expenses. For 2024, all city
attorney general services set forth in Section 1 of Exhibit A, Contractor shall be paid a flat
monthly fee of $35,000, plus extraordinary expenses.
Extraordinary expenses shall include court filing fees, deposition and other discovery costs,
parking, mileage costs other than to and from City Hall or other locations within the City,
and other similar expenses advanced by Contractor on City's behalf. Extraordinary
expenses shall not include routine photocopying, fax, or long-distance telephone charges.
2. City -Attorney Separate Matter Services
All litigation and administrative proceeding services set forth in Section 2 of Exhibit A
shall be considered Separate Matter Services. Contractor shall maintain its current
practice of providing individual monthly billing statements for each Separate Matter.
2023-2024 Hourly Rates for Separate Services
Member $350/hour
Associates $275/hour
3. City -Attorney Special Services
Special Services shall first be authorized by the City. Contractor shall be paid hourly rates
for 2023-2024 as set forth below for authorized Special Services.
2023-2024 Hourly Rates for Special Services
Member $385/hour
Associates $285/hour
Paralegal services for all matters will be billed at $140/hour.
114 Ogden Murphy Wallace City Attorney Services 2023-2024
T0:
City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
Mayor Ekberg
Finance & Governance Committee
FROM: David Cline, City Administrator
BY: Cheryl Thompson, Executive Assistant
DATE: October 17, 2022
SUBJECT: Contract for Public Defense Services
ISSUE
The current contract for public defender services provided by Kirshenbaum & Goss expires
December 31, 2022. The proposed contract for 2023-2024 is attached.
BACKGROUND
The Sixth Amendment of the United States Constitution requires that people accused of
serious crimes who cannot afford to pay for private counsel be provided with an attorney.
Responsibility for upholding the mandate of the Sixth Amendment lies with the states
although in Washington State this responsibility has been delegated to counties and
municipalities that have judicial branches. The City of Tukwila contracts for public defense
services to provide legal representation for indigent criminal defendants who qualify for
appointment of counsel. Representation is provided from the time of screening for eligibility
through trial, sentencing and appeals to the superior court, if necessary.
Two significant occurrences have impacted the provision of public defense services in the
recent past: 1) Effective January 1, 2015, Public Defense Standards were adopted by the
Washington State Supreme Court. These standards delineate the number of cases each
attorney can handle per year and mandates that compensation include administrative and
training costs. 2) The federal court decision, Wilbur v. Mt. Vernon provided additional
emphasis on requirements for timely contact with clients, provision of support services for
public defense attorneys to provide adequate representation like investigation services,
interpreter services and expert witnesses, and reasonable compensation.
The City has developed a Public Defense program that fully complies with the Public Defense
Standards and Wilbur v. Mt. Vernon.
DISCUSSION
The City has historically contracted with Kirshenbaum & Goss, Inc. P.S. for the provision of
public defense services. In September 2022 the City advertised a Request for Proposals for the
115
INFORMATIONAL MEMO
Page 2
provision of public defense services. Kirshenbaum & Goss was the only firm to submit a
proposal. The proposal requests a modest increase to the monthly base compensation with
provisions for additional compensation if the quarterly caseload exceeds 240 cases, and if a
case is appealed to King County Superior Court.
In 2021-2022 we paid a flat rate of $29,100 per month for public defense services with $27,600
per month being paid from the general fund and $1,500 per month from the Office of Public
Defense (OPD) grant funds as allowed by the OPD Grant Agreement. The proposed Base
Compensation rate for 2023-2024 is $29,500 per month, with an additional $400 per case for
each case assigned over the 240 quarterly caseload and an additional $800 for any case that is
appealed to King County Superior Court where the firm has to prepare and submit a brief.
This represents a minimum annual increase of $4,800 to the general fund. We do not
anticipate exceeding 240 case assignments per quarter and the City has averaged less than
one appeal per year to Superior Court in the past five years.
The Agreement allows for compensation review in two circumstances: 1) When the City
receives notice from the Office of Public Defense regarding the 2024-2025 Grant Application,
to adjust compensation, if needed; and 2) If the Tukwila Municipal Court implements a
Community Court during the term of the Agreement, the impact to provision of public defense
services for the Community Court will be assessed and compensation may be adjusted
accordingly.
RECOMMENDATION
The Committee is being asked to move this item forward to the November 14, 2022
Committee of the Whole meeting for further discussion.
ATTACHMENTS
Draft Contract for Public Defense Services for 2023-2024
116
City of Tukwila
6200 Southcenter Boulevard, Tukwila WA 98188
Contract Number:
CONTRACT FOR PUBLIC DEFENSE SERVICES
This Agreement is entered into by and between the CITY OF TUKWILA, Washington, a non -charter
optional municipal code city hereinafter referred to as "the City," and Kirshenbaum & Goss, Inc. P.S., a
Washington Corporation, hereinafter referred to as "the Contractor" (collectively, "the Parties").
WHEREAS, the City has a need to have legal services available for those charged with a crime in
Tukwila Municipal Court who are deemed indigent and are entitled to the effective assistance of counsel
at the public expense; and
WHEREAS, the Federal Court decision Wilbur v. Mt. Vernon emphasizes the need for the City to
provide indigent defense services to clients of the Tukwila Municipal Court in a manner which fully
complies with the City's obligations under the Sixth Amendment to the United States Constitution; and
WHEREAS, the City desires to have the Contractor perform such services pursuant to certain terms
and conditions; now, therefore,
IN CONSIDERATION OF the mutual benefits and conditions hereinafter contained, the Parties
hereto agree as follows:
1. Scope and Schedule of Services to be Performed by Contractor. The Contractor shall perform
those services described on Exhibit A attached hereto and incorporated herein by this reference
as if fully set forth. In performing such services, the Contractor shall at all times comply with all
federal, state, and local statutes, rules and ordinances applicable to the performance of such
services and the handling of any funds used in connection therewith, including the provisions of
Washington Supreme Court Order 25700-A-1013 and the public defense standards adopted by
the City pursuant to TMC 2.70. Compliance with these standards goes to the essence of this
Agreement. The Contractor shall request and obtain prior written approval from the City if the
scope of work or schedule of services is to be modified in any way.
2. Compensation and Method of Payment. The City shall pay the Contractor for services rendered
according to the rate and method set forth on Exhibit B attached hereto and incorporated herein by
this reference. Base Compensation is in consideration of a caseload not to exceed 960 cases per
year. In compliance with the public defense standards, the case counts include the Contractor's
appearance at 48 arraignment calendars per year.
3. Duration of Agreement. This Agreement shall be in full force and effect for a period commencing
January 1, 2023 and ending December 31, 2024 unless sooner terminated under the provisions
hereinafter specified.
Kirshenbaum & Goss 2023-2024 Page 1 of 10
117
4. Independent Contractor. Contractor and City agree that Contractor is an independent contractor
with respect to the services provided pursuant to this Agreement. Nothing in this Agreement shall
be considered to create the relationship of employer and employee between the parties hereto.
Neither Contractor nor any employee of Contractor shall be entitled to any benefits accorded City
employees by virtue of the services provided under this Agreement. The City shall not be
responsible for withholding or otherwise deducting federal income tax or social security or
contributing to the State Industrial Insurance Program, or otherwise assuming the duties of an
employer with respect to the Contractor, or any employee of the Contractor.
5. Indemnification. The Contractor shall defend, indemnify and hold the City, its officers, agents,
officials, employees and volunteers harmless from any and all claims, injuries, damages, losses
or suits including attorney fees, arising out of or in connection with the performance of this
Agreement, except for injuries and damages caused by the sole negligence of the City. 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 Contractor and the City,
its officers, officials, employees, and volunteers, the Contractor's liability hereunder shall be only
to the extent of the Contractor's negligence. It is further specifically and expressly understood
that the indemnification provided herein constitutes the Contractor's waiver of immunity under
Industrial Insurance, Title 51 RCW, solely for the purposes of this indemnification. This waiver
has been mutually negotiated by the parties. The provisions of this section shall survive the
expiration or termination of this Agreement.
6. Insurance. The Contractor 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 Contractor, their agents,
representatives, employees or subcontractors. Contractor's maintenance of insurance, its scope
of coverage and limits as required herein shall not be construed to limit the liability of the
Contractor to the coverage provided by such insurance, or otherwise limit the City's recourse to
any remedy available at law or in equity.
A. Minimum Scope of Insurance. Contractor shall obtain insurance of the types and with the
limits described below:
1. Automobile Liability: The Contractor shall procure and maintain in full force throughout
the duration of this Agreement Automobile Liability insurance with a minimum combined
single limit for bodily injury and property damage of $1,000,000 per accident. Automobile
liability insurance shall cover all owned, non -owned, hired, and leased vehicles. Coverage
shall be written on Insurance Services Office (ISO) form CA 00 01 or a substitute form
providing equivalent liability coverage. If necessary, the policy shall be endorsed to
provide contractual liability coverage.
2. Commercial General Liability: The Contractor shall procure and maintain in full force
throughout the duration of this Agreement Commercial General Liability insurance with
1 1 8Kirshenbaum & Goss 2023-2024 Page 2 of 10
limits no less than $2,000,000 each occurrence, $2,000,000 general aggregate, and
$2,000,000 products -completed operations aggregate limit. Commercial General Liability
insurance shall be written on ISO occurrence form CG 00 01 and shall cover liability
arising from premises, operations, stop -gap independent contractors, personal injury and
advertising injury. The City shall be named as an insured under the Contractor's
Commercial General Liability insurance policy with respect to the work performed for the
City using ISO Additional Insured endorsement CG 20 26.
3. Workers' Compensation: The Contractor shall procure and maintain Workers'
Compensation coverage as required by the Industrial Insurance laws of the State of
Washington.
4. Professional Liability Insurance: The Contractor shall procure and maintain in full force
throughout the duration of this Agreement Professional Liability insurance with a
minimum coverage of $2,000,000 per claim and $2,000,000 aggregate. Contractor shall
provide evidence of such coverage in a manner and form acceptable to the City in the
City's sole discretion. Cancellation of the required insurance shall automatically result in
termination of this Agreement.
B. Other Insurance Provision. The Contractor's Automobile Liability and Commercial General
Liability insurance policies are to contain, or be endorsed to contain, that they shall be
primary insurance with respect to the City. Any insurance, self-insurance, or insurance pool
coverage maintained by the City shall be excess of the Contractor's insurance and shall not
contribute with it.
C. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best
rating of not less than A: VII.
D. Verification of Coverage. Contractor 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 Contractor
before commencement of the work.
E. Notice of Cancellation. The Contractor shall provide the City and all Additional Insureds for
this work with written notice of any policy cancellation, within two business days of their
receipt of such notice.
7. Record Keeping and Reporting.
A. The Contractor shall maintain accounts and records, including personnel, property, financial
and programmatic records which sufficiently and properly reflect all direct and indirect costs
of any nature expended and services performed in the performance of this Agreement and
other such records as may be deemed necessary by the City to ensure the performance of
this Agreement.
Kirshenbaum & Goss 2023-2024 Page 3 of 10
119
B. These records shall be maintained for a period of seven (7) years after termination hereof
unless permission to destroy them is granted by the office of the archivist in accordance with
RCW Chapter 40.14 and by the City.
8. Termination. This Agreement may at any time be terminated by the City giving to the Contractor
thirty (30) days written notice of the City's intention to terminate the same. If the Contractor's
insurance coverage is canceled for any reason, the City shall have the right to terminate this
Agreement immediately.
9. Discrimination Prohibited. The Contractor, with regard to the work performed by it under this
Agreement, will not discriminate on the grounds of race, religion, creed, color, national origin,
age, veteran status, sex, sexual orientation, gender identity, marital status, political affiliation,
the presence of any disability, or any other protected class status under state or federal law, in
the selection and retention of employees or procurement of materials or supplies.
10. Assignment and Subcontract. The Contractor shall not assign or subcontract any portion of the
services contemplated by this Agreement without the written consent of the City.
11. Entire Agreement. This Agreement, together with attachments or addenda, represents the
entire and integrated Agreement between the City and the Contractor and supersedes all prior
negotiations, representations, or agreements written or oral. No amendment or modification of
this Agreement shall be of any force or effect unless it is in writing and signed by the parties.
12. Notices.
Notices to the City of Tukwila shall be sent to the following address:
City Clerk
City of Tukwila
6200 Southcenter Blvd.
Tukwila, Washington 98188
Notices to the Contractor shall be sent to the following address:
Kirshenbaum & Goss, Inc. P.S.
1314 Central Ave S Ste. 101
Kent, WA 98032-7430
13. Severability and Survival. If any term, condition, or provision of this Agreement is declared void or
unenforceable or limited in its application or effect, such event shall not affect any other provisions
hereof and all other provisions shall remain fully enforceable. The provisions of this Agreement,
which by their sense and context are reasonably intended to survive the completion, expiration or
cancellation of this Agreement, shall survive termination of this Agreement.
12 crirshen bau m & Goss 2023-2024 Page 4 of 10
14. Applicable Law, Venue, Attorney's Fees. This Agreement shall be governed by and construed in
accordance with the laws of the State of Washington. In the event any suit, arbitration, or other
proceeding is instituted to enforce any term of this Agreement, the parties specifically understand
and agree that venue shall be properly laid in King County, Washington. The prevailing party in any
such action shall be entitled to its attorney's fees and costs of suit.
DATED this day of , 2022.
CITY OF TUKWILA CONTRACTOR:
Allan Ekberg, Mayor David Kirshenbaum
Attest/Authenticated: Approved as to Form:
Christy O'Flaherty, City Clerk Kari L. Sand, City Attorney
Kirshenbaum & Goss 2023-2024 Page 5 of 10
121
EXHIBIT A - SCOPE OF SERVICES
1. General Scope of Representation. Provide legal representation services in accordance with the
standards adopted by the City in TMC 2.70, the standards set forth by the Washington State Bar
Association Standards for Indigent Defense Services, the Rules of Professional Conduct, Wilbur v.
Mt. Vernon, other related case law and applicable court rules defining the duties of counsel and
the rights of defendants in criminal cases for all indigent criminal defendants charged with a
misdemeanor or gross misdemeanor under ordinances of the City who qualify for appointment of
counsel. The Contractor agrees to attempt to contact the client within 72 hours of notification of
appointment. The Contractor shall provide legal representation for each of these defendants from
time of screening for eligibility through trial, sentencing and appeals to the superior court, if
necessa ry.
2. Video Court Services. Provide daily video court public defense services to defendants charged under
ordinances of the City who are detained at the SCORE Jail and qualify for public defense services in a
manner consistent with the accepted practices for similar services, performed to the City's
satisfaction.
3. Attorney of the Day Services. Provide an attorney for weekly arraignment calendars, available to all
unrepresented defendants for consultation.
4. Screening. Determination of indigency for eligibility for appointed counsel under this Agreement
shall be determined by an independent screening process established by the City. Should the
Contractor determine a defendant is not eligible for assigned counsel prior to the establishment of
the attorney/client privilege, the Contractor shall so advise the City to reconsider the screening of
that particular individual.
5. 24 -Hour Contact Information. The Contractor shall provide to the City Police Department, a
telephone number or numbers at which an attorney may be reached 24 -hours each day for "critical
stage" advice to the defendants during the course of police investigations and/or arrest for
misdemeanor violations of City Ordinances.
6. Authority to practice. Any counsel associated with or employed by the Contractor shall have the
authority to perform the services called for herein and the Contractor may employ associate counsel
to assist him/her at the Contractor's expense and with written consent from the City in compliance
with Section 11 of this Agreement. The Contractor and any other attorneys retained pursuant to
this section shall be admitted to practice pursuant to the rules of the Supreme Court of the State
of Washington and shall have read and be fully familiar with the provisions of the Washington
Supreme Court rule and the standards adopted by the City pursuant to TMC 2.70, as well as the
Wilbur v. Mt. Vernon decision.
7. Conflicts. In the event representation of a defendant hereunder raises a conflict of interest such
that the Contractor cannot ethically represent the defendant, said defendant shall be referred
1 22Kirshenbaum & Goss 2023-2024 Page 6 of 10
back to the City for further assignment, without being included in the caseload assignments for
the Contractor.
8. Discovery. The City shall provide to the Contractor, at no cost, one copy of all discoverable
material concerning each assigned case. Such material shall include, where relevant, a copy of
the abstract of the defendant's driving record.
9. Training. Contractor agrees to attend seven (7) hours of criminal defense training each year. The
training must be approved by the Washington State Office of Public Defense (OPD) in compliance
with the OPD Improvement Program Training requirements. This requirement also applies to all
associate counsel. Each attorney will submit a copy of their Continuing Legal Education (CLE) Credits
transcript from the Washington State Bar Association (WSBA) with the Annual Report.
10. Case management. Pursuant to TMC 2.70.050 Standard 8, the Contractor shall maintain a case
reporting and case management system that includes number & type of cases, attorney hours and
disposition.
11. Reporting. Contractor agrees to submit the following reports:
• Monthly Case Assignment List: Includes Cause Number, Name, Charges, Date of Assignment and
Date of First Effort to Contact;
• Monthly Statistics Report: This report shall take substantially the same form as that attached
hereto as Exhibit C and shall be submitted with the monthly invoice;
• Quarterly Certification of Compliance: The Contractor shall certify compliance with the
standards required by CrRLJ 3.1. The Certification shall take substantially the same form as
that attached hereto as Exhibit D and shall be filed quarterly with the Tukwila Municipal Court
on the following dates: January 1, April 1, July 1, and October 1, or the next court day, if the
filing day falls on a weekend or holiday;
• Annual Report: Detailing the number of other public defense contracts including jurisdiction, the
number and type of non-public defense cases handled, and the total hours billed for non-public
defense cases.
12. Client Contact Prior to Court Hearings. Contact all clients 1-2 business days prior to their court
hearing to confirm access to and knowledge of how to utilize the necessary technology to appear
before the court.
13. Additional Coverage for Review Calendars. Provide a minimum of two attorneys at each review
calendar to expedite efficient hearings.
Kirshenbaum & Goss 2023-2024 Page 7 of 10
123
EXHIBIT B - COMPENSATION AND METHOD OF PAYMENT
1. Base Compensation Rate. Effective January 1, 2023 for all public defense services set forth in Exhibit
A, Contractor shall be paid a flat monthly fee of $29,500, which includes $1,500 per month Office of
Public Defense (OPD) grant funds to compensate for additional services provided as outlined in
Exhibit A Sections 12 & 13. Should provision of the additional services be modified in any way,
compensation will be adjusted accordingly. OPD grant funds have been awarded for 2023. If needed,
a mid -contract review will be conducted to adjust compensation based on grant funding.
2. Caseload Compensation. Caseload assignments will be evaluated on a quarterly basis. For each case
per quarter over 240 cases additional compensation will be provided at the rate of $375 per case.
3. Appeals. The City shall pay the Attorney an additional sum of $800 per RALJ appeal filed with the
King County Superior Court in which a brief has been filed by the Contractor.
4. Community Court. The Tukwila Municipal Court is researching implementation of a cross -
jurisdictional Community Court. If a Community Court is implemented during the term of this
contract, the impact to provision of public defense services for the Community Court will be
assessed and compensation will be adjusted accordingly.
5. Preauthorized Non -Routine Expenses. Non -routine case expenses requested by Attorney and
preauthorized by order of the Tukwila Municipal Court. Non -Routine expenses include, but are not
limited to:
a. Medical and psychiatric evaluations;
b. Expert witness fees and expenses;
c. Interpreters for languages not commonly spoken in the city or interpreters for services
other than attorney/client communication;
d. Investigation expenses;
e. Medical, school, birth, DMV, 911, emergency communication recordings and logs, and
other similar records when the cost of an individual item does not exceed $75; and
f. Any other non -routine expenses the Tukwila Municipal Court finds necessary and proper
for the investigation, preparation, and presentation of a case.
6. Invoices. The Contractor shall invoice the City by the fifth day of the month for all cases assigned to
him/her for the previous month. The bill shall delineate the following:
• City compensation;
• Miscellaneous Charges: Copies of invoices and or receipts for miscellaneous charges shall be
attached to the bill; and
• A list of the cases assigned for the month including the defendant's full name, case
number, charges, date of assignment & date of first contact.
1 24Kirshenbaum & Goss 2023-2024 Page 8 of 10
EXHIBIT C - PUBLIC DEFENSE MONTHLY REPORT - Kirshenbaum & Goss
CLIENT CONTACT
# per month
Jail Visits
Out of Court Meetings
Phone Calls
Email Correspondence
MOTIONS PRACTICE
Motions
RESOURCES UTILIZED
Expert Consulted
Immigration Case Assistance/Resources (WDA)
Interpreter (out of court)
Investigator
Referred for Mental Health/Competency Evaluation
Social Services Liaison
COMPLAINTS
Complaint Forms Received from Clients
Complaints Filed with the WSBA
TRAINING (in hours)
WDA
WACDL
Other
Kirshenbaum & Goss 2023-2024 Page 9 of 10
125
EXHIBIT D - CERTIFICATION OF COMPLIANCE
MUNICIPAL COURT FOR
CITY OF TUKWILA
STATE OF WASHINGTON
CERTIFICATION BY:
FOR THE
CALENDAR QUARTER OF
[ 1 No.:
[ 1 Administrative Filing
CERTIFICATION OF APPOINTED COUNSEL OF
COMPLIANCE WITH STANDARDS REQUIRED BY CrR
3.1/CrRLJ 3.1/JuCR 9.2
The undersigned attorney hereby certifies that for the past quarter and for the remainder of the year:
1. Approximately % of my practice time is devoted to indigent defense cases for the City of Tukwila.
Approximately % of my practice is devoted to indigent defense cases for the following
jurisdictions:
Approximately % of my practice is devoted to private practice.
2. I am familiar with the applicable Standards adopted by the Supreme Court for attorneys appointed to
represent indigent persons and certify that:
a. Basic Qualifications: I meet the minimum basic professional qualifications in Standard 14.1.
b. Office: I have access to an office that accommodates confidential meetings with clients, and I have
a postal address and adequate telephone services to ensure prompt response to client contact, in
compliance with Standard 5.2.
c. Investigators: I have investigators available to me and will use investigation services as
appropriate, in compliance with Standard 6.1.
d. Caseload: I will comply with Standard 3.2 during representation of the defendant in my cases. I will
not accept a greater number of cases than specified in Standard 3.4, prorated if the amount of time
spent for indigent defense is less than full time.
e. Case Specific Qualifications: I am familiar with the specific case qualifications in Standard 14.2,
Sections B -K and will not accept appointment in a case as lead counsel unless I meet the
qualifications for that case.
f. Training: I will attend seven (7) hours of criminal defense training approved by the Washington
State Office of Public Defense (OPD) in compliance with the OPD Improvement Program Training
requirements each calendar year.
Attorney, WSBA No. Date
1 26Kirshenbaum & Goss 2023-2024 Page 10 of 10
wq
z City of Tukwila
Allan Ekberg, Mayor
INFORMATIONAL MEMORANDUM
TO: Finance & Governance Committee
FROM: Tony Cullerton, Deputy Finance Director
CC: Mayor Ekberg
DATE: October 24, 2022
SUBJECT: August 2022 General Fund Departmental Budget -to -Actuals Report
Summary
The purpose of the August 2022 General Fund Financial Report is to summarize for the City Council the general
state of departmental expenditures and to highlight significant items. The following provides a high-level
summary of the departmental financial performance.
The August 2022 report is based on financial data available as of October 1, 2022, for the period ending August
31, 2022. Additional details can be found within the included financial report.
Expenditures
General Fund departmental expenditures totaled $40.7 million through August, which is $97,234 less than the
allocated budget of $40.8 million. Department 20, which is transfers to other funds, totaled $2.68 million, which
is $1.9 million less than the allocated budget. This underbudgeted amount is due to pending transfers from Non -
Departmental to the Debt Service Fund. The allocated budget is calculated to reflect year-to-date spending
patterns of the previous year. Transfers to capital project funds are transferred to capital project funds as needed
for cash flow purposes. Debt service transfers are done quarterly.
In total, the General Fund reported expenditures of $43.4million, which is equivalent to 58.2% of the annual
budget at the completion of 66.67% of the year. While the General Fund as a whole is currently tracking
expenditures below the YTD annual budget, three departments are trending slightly higher than 66.67% of the
annual budget at the completion of August.
Fire expenditures totaled 67% of annual budget at the completion of 66.67% of the year. The overage of 0.35%
($213,962) is reflected in YTD overtime. There is an expectation that Fire will exceed total budget, resulting in
the need for a budget amendment. Parks Maintenance reported expenditures of 70.85% of budget at the end
of August. The 4.2% overage equated to $71,317. In prior months the increase was primarily due to higher
contracted services compared to the prior year. In this case, the increase is attributed to expenses that will be
reimbursed by the SEEK grant. Parks will be receiving a revenue -backed budget amendment and is expected
to end the year within their allocated budget. Street Maintenance reported department expenditures of 71.35%
of annual budget. While this is 4.68% over the targeted 66.67%, Street Maintenance is $18,633 less than their
allocated budget, suggesting the variance is related to expenditure timing issues. Street is also expected to be
below budget by the end of the year.
1
127
I•
INFORMATIONAL MEMO
Page 2
Departmental Variances
Year to Date Department Expenditures Compared to Allocated Budget Through August 2022:
001 1 City Council
003 (Mayor's Office
004 1 Administrative Services
005 1 Finance Department
007 1 Recreation Department
0081 Community Development (DCD)
009 1 Municipal Court
010 1 Police Department
011 1 Fire Department
013 1 Public Works Dept
015 1 Park Maintenance Dept
0161 Street Maintenance Dept
020 1 Non Departmental
0991 Gen Fd General Revenues
Measures
•Actuals •Allocated
128
■
■
1 1 1
$0 $1,000 $2,000 $3,000 $4,000 55,000 $6,000 $7,000 $8,000 59,000 $10,000 $11,000 $12,000 513,000
Thousands
BUDGET
ACTUAL
COMPARISON OF RESULTS
2022
2022
2020
2021
2022
Allocated Budgel
vs Actual
% Actual Yea -Over-Year
Expended $ Change % Change $ Change
% Change
EXPENDITURES BY DEPARTMEr
Annual
Allocated
OVER/(UNDER)
2020/2021
2021/2022
001 City Council
385,826
236,281
229,807
222,681
231,966
(4,315)
60.12%
(7,126)
-3.10%
9,285
4.17%
003 Mayor's Office
2,565,927
1,517,302
1,378,052
1,287,985
1,331,644
(185,658)
51.90%
(90,067)
-6.54%
43,660
3.39%
004 Administrative Services
5,869,141
3,624,148
2,828,064
3,185,419
3,196,410
(427,738)
54.46%
357,355
12.64%
10,991
0.35%
005 Finance Department
3,347,587
2,002,245
1,721,251
1,789,333
2,203,236
200,991
65.82%
68,081
3.96%
413,903
23.13%
007 Recreation Department
3,233,011
1,845,104
1,693,740
1,710,524
1,978,148
133,044
61.19%
16,783
0.99%
267,624
15.65%
008 Community Development (DCD
4,662,212
2,691,866
2,059,536
2,526,548
2,674,794
(17,072)
57.37%
467,012
22.68%
148,247
5.87%
009 Municipal Court
1,597,482
950,350
838,250
802,203
1,027,546
77,196
64.32%
(36,046)
-4.30%
225,343
28.09%
010 Police Department
19,844,123
12,491,545
11,646,339
11,653,368
12,415,548
(75,997)
62.57%
7,028
0.06%
762,180
6.54%
011 Fire Department
14,297,033
9,367,645
8,188,951
9,000,611
9,581,607
213,962
67.02%
811,660
9.91%
580,996
6.46%
013 Public Works Dept
3,982,685
2,476,987
2,372,804
2,258,072
2,412,657
(64,330)
60.58%
(114,732)
-4.84%
154,585
6.85%
015 Park Maintenance Dept
1,726,097
1,151,594
1,021,381
1,051,591
1,222,911
71,317
70.85%
30,210
2.96%
171,320
16.29%
016 Street Maintenance Dept
3,452,085
2,481,525
2,177,709
2,290,739
2,462,892
(18,633)
71.35%
113,030
5.19%
172,153
7.52%
Subtotal
64,963,209
40,836,592
36,155,884
37,779,072
40,739,358
(97,234)
62.71%
1,623,188
4.49%
2,960,286
7.84%
020 Non Departmental
9,619,291
4,569,953
2,068,215
2,732,130
2,683,765
(1,886,188)
27.90%
663,915
32.10%
(48,365)
-1.77%
Total Expenditures
74,582,500
45,406,545
38,224,099
40,511,202
43,423,123
(1,983,422)
58.22%
2,287,103
5.98%
2,911,921
7.19%
%of Year 66.67%
001 1 City Council
003 (Mayor's Office
004 1 Administrative Services
005 1 Finance Department
007 1 Recreation Department
0081 Community Development (DCD)
009 1 Municipal Court
010 1 Police Department
011 1 Fire Department
013 1 Public Works Dept
015 1 Park Maintenance Dept
0161 Street Maintenance Dept
020 1 Non Departmental
0991 Gen Fd General Revenues
Measures
•Actuals •Allocated
128
■
■
1 1 1
$0 $1,000 $2,000 $3,000 $4,000 55,000 $6,000 $7,000 $8,000 59,000 $10,000 $11,000 $12,000 513,000
Thousands
INFORMATIONAL MEMO
Page 3
General Fund
City of Tukwila
General Fund Expenditures
Year -to -Date as of Aug 31, 2022
129
BUDGET
ACTUAL
COMPARISON OF RESULTS
2022
Annual
2022
Allocated
2020
2021
2022
Allocated Budget
vs Actuals Expended
OVER/(UNDER)
% % Change
2020/2021
2021/2022
511
Salaries
32,802,451
20,731,432
18,803,202
18,541,097
19,906,019
(825,413)
60.7%
(1.4%)
7.4%
512
Extra Labor
584,220
122,923
121,661
109,036
314,988
192,065
53.9%
(10.4%)
188.9%
513
Overtime
2,000,115
1,357,040
735,246
1,478,149
1,717,114
360,074
85.9%
101.0%
16.2%
515
Holiday Pay
515,500
78,815
65,888
78,815
84,116
5,301
16.3%
19.6%
6.7%
521
FICA
2,151,955
1,318,105
1,171,380
1,177,800
1,293,563
(24,542)
60.1%
0.5%
9.8%
522
Pension-LEOFF
920,517
664,883
722,756
649,939
690,043
25,160
75.0%
(10.1%)
6.2%
523
Pension-PERS/PSERS
1,494,905
967,993
1,114,465
1,056,362
976,085
8,092
65.3%
(5.2%)
(7.6%)
524
Industrial Insurance
876,892
613,725
596,511
612,975
496,267
(117,458)
56.6%
2.8%
(19.0%)
525
Medical & Dental
7,551,216
4,903,604
4,162,551
4,483,393
4,901,442
(2,162)
64.9%
7.7%
9.3%
526
Unemployment
0
0
27,319
20,710
31,615
31,615-
(24.2%)
52.6%
528
Uniform/Clothing
8,525
2,124
1,334
2,124
1,511
(613)
17.7%
59.3%
(28.9%)
Total Salaries & Benefits
48,906,296
30,760,646
27,522,312
28,210,402
30,412,764
(347,882)
62.2%
25%
7.8%
531
Supplies
890,636
355,972
291,274
350,017
192,208
(163,763)
21.6%
20.2%
(45.1%)
532
Repairs & Maint Supplies
299,025
160,356
208,632
140,246
214,559
54,203
71.8%
(32.8%)
53.0%
534
Resale Supplies
10,000
0
235
0
128
128
1.3%
(100.0°%)
-
535
Small Tools
41,250
34,271
51,044
35,933
34,799
527
84.4%
(29.698)
(3.298)
536
Technology Supplies
13,000
13,000
31,457
32,220
20,174
7,174
155.2%
2.4%
(37.4%)
537
Fleet Supplies
3,000
2,289
11,193
2,289
3,932
1,643
131.1%
(79.598)
71.8%
Total Supplies
1,256,911
565,888
593,835
560,705
465,801
(100,088)
37.1%
(5.698)
(16.998)
541
Professional Services
7,391,918
4,740,855
4,123,553
4,590,387
4,709,089
(31,766)
63.7%
11.3%
2.6%
542
Communications
458,739
288,902
317,424
288,902
276,452
(12,450)
60.3%
(9.0%)
(4.3%)
543
Professional Development
252,921
252,921
186,186
268,831
216,631
(36,290)
85.7%
44.4%
(19.4°%)
544
Advertising
40,250
4,551
9,836
4,834
9,673
5,122
24.0%
(50.9%)
100.1%
545
Rentals
478,484
311,400
274,768
338,887
235,469
(75,931)
49.2%
23.3%
(30.598)
546
Technology Services
348,291
300,762
509,401
312,402
388,895
88,133
111.7%
(38.798)
24.5%
547
Utilities
2,034,285
1,789,480
1,540,786
1,751,795
1,872,086
82,606
92.0%
13.7%
6.9%
548
Repairs & Mai nt Services
2,185,367
1,374,143
829,320
1,313,477
1,456,667
82,523
66.7%
58.4%
10.9%
549
Miscellaneous
879,747
76,535
242,968
62,267
444,788
368,253
50.6%
(74.4%)
614.3%
Total Services
14,070,002
9,139,549
8,034,243
8,931,782
9,609,749
470,200
68.3%
11.2%
7.6%
564
Machinery & Equipment
730,000
103,629
5,495
76,184
251,046
147,416
34.4%
1,286.5%
229.5%
Total Capital Outlay
730,000
103,629
5,495
76,184
251,046
147,416
34.4%
1,286.5%
229.5%
750
Transfers Out
9,619,291
4,836,834
2,068,215
2,732,130
2,683,765
(2,153,069)
27.9%
32.1%
(1.8%)
Total Non Operating Expense
9,619,291
4,836,834
2,068,215
2,732,130
2,683,765
(2,153,069)
27.9%
32.1%
(1.8%)
TOTAL EXPENDITURES
74,582500
45,406,546
38,224,099
40,511,202
43,423,123
(1,983,422)
58.2%
6.0%
7.2%
129
130