Chapter 3.68
UTILITY OCCUPATION TAX
Sections
3.68.010 Exercise of license revenue power.
3.68.020 Intent and construction.
3.68.030 Utility occupation tax.
3.68.050 Utility occupation license.
3.68.060 Occupations subject to tax – Amount.
3.68.090 Exceptions and deductions.
3.68.100 Monthly installments.
3.68.120 Applications and returns confidential.
3.68.130 Failure to make returns or to pay the tax in full.
3.68.140 Penalty for delinquent payment.
3.68.160 Noncompliance – Penalty.
3.68.170 Appeal to hearing examiner.
3.68.180 Finance director to make rules.
3.68.190 False returns – Penalty.
3.68.010 Exercise of license revenue power.
The provisions of this chapter shall be deemed an exercise of the power of the city to license for revenue. [Ord. 1144 § 63(11), 1995; Ord. 916 § 1, 1991. Formerly 3.61.010.]
3.68.020 Intent and construction.
It is the intent of this chapter that the tax imposed be applied to the widest scope of activities of such businesses as is permitted under state and federal law, and the chapter shall be so construed. [Ord. 1144 § 63(11), 1995; Ord. 916 § 2, 1991. Formerly 3.61.020.]
3.68.030 Utility occupation tax.
The business and occupation tax provided for in this chapter shall be known as the “utility occupation tax.” [Ord. 1144 § 63(11), 1995; Ord. 916 § 3, 1991. Formerly 3.61.030.]
3.68.040 Definitions.
(1) Use of Words and Phrases. As used in this chapter, unless the context or subject matter clearly requires otherwise, the words or phrases defined in this section shall have the indicated meanings.
(2) “Cellular telephone service” is a two-way voice and data telephone/communications system based in whole or substantially in part on wireless radio communications and which is not subject to regulation by the Washington Utilities and Transportation Commission (WUTC). This includes cellular mobile service. The definition of cellular mobile service includes other wireless radio communications services such as specialized mobile radio (SMR), personal communications services (PCS), and any other evolving wireless radio communications technology which accomplishes a purpose similar to cellular mobile service.
(3) Repealed by Ord. 1144.
(4) “Gross income” means the value proceeding or accruing from the performance of the particular public service or transportation business involved, excluding receipts or proceeds from the use or sale of tangible property and real property or any interest therein, proceeds from the sale of notes, bonds, mortgages, or other evidence of indebtedness, or stock and the like, receipts from rentals and the operations incidental to the performance of the particular public service or transportation business, and with a deduction on the amount of credit losses and uncollectibles actually sustained. [Ord. 1144 § 63(11), 1995; Ord. 1118 § 1, 1995: Ord. 916 § 4, 1991. Formerly 3.61.040.]
3.68.050 Utility occupation license.
No person shall engage in or carry on a business, occupation, or act or privilege for which DMMC 3.68.060 imposes a tax without first having obtained, and being the holder of a license known as a “utility occupation license.” Each person shall promptly apply to the finance director for a license upon the form the finance director shall prepare and provide, giving such information as the finance director shall determine reasonably necessary to enable the finance director to administer and enforce this chapter; and upon acceptance of such application, the finance director shall thereupon issue such a license to the applicant. A utility occupation license is personal and nontransferable. [Ord. 1144 § 63(11), 1995; Ord. 993 § 5, 1992: Ord. 916 § 5, 1991. Formerly 3.61.050.]
3.68.060 Occupations subject to tax – Amount.
There is levied upon, and shall be collected from a person because of certain business activities engaged in or carried on in the City, license fees or occupation taxes in the amount to be determined by the application of rates given against gross income as follows:
(1) Upon a person engaged in or carrying on the business of selling or furnishing electric energy, a fee or tax equal to six percent of the total gross income from such business in the City during the period for which the license fee or tax is due;
(2) Upon a person engaged in or carrying on the business of selling, furnishing, or transmitting natural gas for domestic, business, or industrial consumption, a fee or tax equal to six percent of the total gross income from such business in the City during the period for which the license fee or tax is due;
(3) Upon a person engaged in or carrying on the business of selling or furnishing telephone service, a fee or tax equal to six percent of the total gross income from such business in the City during the period for which a license or tax is due;
(4) Effective January 1, 2016, upon a person engaged in or carrying on the business of solid waste collection, a fee or tax equal to 18 percent of the total gross income from such business in the City during the period for which the license fee or tax is due. The 18 percent tax shall be allocated as follows: eight percent shall be allocated into the Des Moines general fund and 10 percent shall be allocated into the street fund;
(5) Effective January 1, 2016, upon a person engaged in or carrying on the business of transmitting television or audio services by cable or wire, a fee or tax equal to 10 percent of the total gross income from such business in the City during the period for which the fee or tax is due;
(6) Upon a person engaged in or carrying on the business of selling or furnishing cellular telephone service, a fee or tax equal to six percent of the total gross income from such business in the City during the period for which a license or tax is due, subject to the following additions:
(a) Service Address. Payments by a customer for the telephone service from telephones without a fixed location shall be allocated among taxing jurisdictions to the location of the customer’s principal service address during the period for which the tax applies.
(b) Presumption. There is a presumption that the service address a customer supplies to the taxpayer is current and accurate, unless the taxpayer has actual knowledge to the contrary.
(c) Roaming Phones. When the service is provided while a subscriber is roaming outside the subscriber’s normal cellular network area, the gross income shall be assigned consistent with the taxpayer’s accounting system to the location of the originating cell site of the call, or to the location of the main cellular switching office that switched the call.
(d) Dispute Resolution. If there is a dispute between or among the City and another city or cities as to the service address of a customer who is receiving cellular telephone services and the dispute is not resolved by negotiation among the parties, then the dispute shall be resolved by the City and the other city or cities by submitting the issue for settlement to the Association of Washington Cities (AWC). Once taxes on the disputed revenues have been paid to one of the contesting cities, the cellular telephone service company shall have no further liability with respect to additional taxes, penalties, or interest on the disputed revenues so long as it promptly changes its billing records for future revenues to comport with the settlement facilitated by AWC. [Ord. 1631 § 1, 2015; Ord. 1630 § 1, 2015; Ord. 1610 §§ 1, 2, 2014; Ord. 1609 §§ 1, 2, 2014; Ord. 1249 § 1, 2000: Ord. 1144 § 63(11), 1995; Ord. 1118 § 2, 1995: Ord. 1023 § 1, 1993. Prior: Ord. 1005 §§ 1, 2, 1993: Ord. 1004 § 1, 1993: Ord. 916 § 6, 1991. Formerly 3.61.060.]
3.68.070 Exemption.
The tax levied in this chapter is in lieu of an excise, privilege, or occupational tax under this code with respect to activities specifically within the provisions of this chapter. Nothing in this chapter shall be construed to exempt persons taxable under the provisions of this chapter from tax under this code with respect to activities other than those specifically within the provisions of this chapter. [Ord. 1144 § 63(11), 1995; Ord. 916 § 7, 1991. Formerly 3.61.070.]
3.68.080 License tax year.
All utility occupation licenses and the fee for the tax therefor shall be for the tax year for which issued and shall expire at the end of the tax year. The tax year shall commence January 1st and shall end on December 31st. [Ord. 1144 § 63(11), 1995; Ord. 916 § 8, 1991. Formerly 3.61.080.]
3.68.090 Exceptions and deductions.
There is excepted and deducted from the total gross income upon which the license fee or tax is computed, the following:
(1) So much of the total gross income as is derived from business which the city is prohibited from taxing under the Constitution or laws of the United States, and the constitution or laws of any state; and
(2) The utility occupations tax which is levied pursuant to DMMC 3.68.060. [Ord. 1144 § 63(11), 1995; Ord. 974 § 2, 1992: Ord. 916 § 9, 1991. Formerly 3.61.090.]
3.68.100 Monthly installments.
The tax imposed by DMMC 3.68.060 shall be due and payable in monthly installments, and remittance therefor shall be made on or before the last day of the month following the end of the monthly period in which the tax is accrued. On or before said due date, the taxpayer shall file with the finance director a written return upon such form and setting forth such information as the finance director shall reasonably require, together with the payment of the amount. [Ord. 1144 § 63(11), 1995; Ord. 916 § 10, 1991. Formerly 3.61.100.]
3.68.110 Taxpayer’s records.
Each taxpayer shall keep records reflecting the amount of the taxpayer’s gross income on sales and services within the city, and such records shall be open at all reasonable times to the inspection of the finance director, or the finance director’s duly authorized subordinates for verification of said tax returns or for the filing of the tax of a taxpayer who fails to make such return. [Ord. 1144 § 63(11), 1995; Ord. 916 § 11, 1991. Formerly 3.61.110.]
3.68.120 Applications and returns confidential.
The applications, statements, or returns made to the finance director pursuant to this chapter shall not be made public, nor shall they be subject to the inspection of a person except the city manager, city attorney, finance director, or authorized agent and to members of the city council; and it is unlawful for a person to make public or to inform any other person as to the contents of or any information contained in or to permit inspection of an application or return; provided, however, that the foregoing shall not be construed to prohibit the finance director from making known or revealing facts or information contained in a return to a taxpayer or disclosed in an investigation or examination of the taxpayer’s books and records to the State Department of Revenue, for official purposes, but only if the statutes of the state grant substantially similar privileges to the proper officers of the city. [Ord. 1144 § 63(11), 1995; Ord. 916 § 12, 1991. Formerly 3.61.120.]
3.68.130 Failure to make returns or to pay the tax in full.
If a taxpayer fails, neglects, or refuses to make his return as and when required in this chapter the finance director is authorized to determine the amount of the tax payable, and by mail to notify such taxpayer of the amount so determined. The amount so fixed shall thereupon be the tax and be immediately due and payable, together with penalty and interest. Delinquent taxes, including any penalty, are subject to an interest charge of 12 percent per year on the unpaid balance from the date the taxes became due as provided in DMMC 3.68.100. [Ord. 1144 § 63(11), 1995; Ord. 916 § 13, 1991. Formerly 3.61.130.]
3.68.140 Penalty for delinquent payment.
If a person subject to this tax fails to pay any tax required by this chapter within 15 days after the due date thereof, there shall be added to such tax a penalty of 10 percent of the amount of such tax, and any tax due under this chapter that is unpaid and all penalties thereon shall constitute a debt to the city and may be collected by court proceedings, which remedy shall be in addition to all other remedies. [Ord. 1144 § 63(11), 1995; Ord. 916 § 14, 1991. Formerly 3.61.140.]
3.68.150 Overpayment of tax.
Money paid to the city through error, or otherwise not in payment of the tax imposed by this chapter, or in excess of such tax, shall, upon the request of the taxpayer, be credited against any tax due or to become due from such taxpayer hereunder, or, upon the taxpayer ceasing to do business in the city, be refunded to the taxpayer. [Ord. 1144 § 63(11), 1995; Ord. 916 § 15, 1991. Formerly 3.61.150.]
3.68.160 Noncompliance – Penalty.
(1) No person subject to this chapter shall fail or refuse to apply for a utility occupation license or to make tax returns or to pay tax when due, or to make a false statement or representation in or in connection with any such application for a utility occupation license or tax return, or to otherwise violate or refuse to comply with this chapter.
(2) A violation of or failure to comply with this section is a class 1 civil infraction.
(3) Each day upon which a violation occurs constitutes a separate violation. [Ord. 1144 § 63(11), 1995; Ord. 1009 § 31, 1993: Ord. 916 § 16, 1991. Formerly 3.61.160.]
3.68.170 Appeal to hearing examiner.
A taxpayer aggrieved by the amount of the fee or tax determined by the finance director to be due under the provisions of this chapter may appeal such determination to the hearing examiner in accordance with the provisions of the hearing examiner code. [Ord. 1144 § 63(11), 1995; Ord. 916 § 17, 1991. Formerly 3.61.170.]
3.68.180 Finance director to make rules.
The finance director, under the direction of the city manager, shall have the power, and it shall be the duty of the finance director, from time to time, to adopt, publish, and enforce rules and regulations not inconsistent with this chapter or with the law for the purpose of carrying out the provisions thereof, and it is unlawful and a criminal offense to violate or fail to comply with such rule or regulation. [Ord. 1144 § 63(11), 1995; Ord. 916 § 18, 1991. Formerly 3.61.180.]
3.68.190 False returns – Penalty.
(1) No person subject to this chapter shall fail or refuse to make application or return for a license or to pay the fee or tax or installment thereof when due, or for a person to make a false or fraudulent application or return or a false statement or representation in, or in connection with such application or return, or to aid or abet another in an attempt to evade payment of the fee or tax, or any part thereof, or to testify falsely upon an investigation of the correctness of a return upon the hearing of an appeal, or in any manner hinder or delay the city or its officers in carrying out the provisions of this chapter.
(2) A violation of or failure to comply with this section is a class 1 civil infraction. [Ord. 1144 § 63(11), 1995; Ord. 1009 § 32, 1993: Ord. 916 § 19, 1991. Formerly 3.61.190.]