Chapter 6.70
GAMBLING TAX

Sections:

6.70.010  Gambling activities and tax.

6.70.020  Administration and collection.

6.70.030  Filing of declaration of intent.

6.70.040  Tax due.

6.70.050  Exceptions.

6.70.060  Administration and collection of tax.

6.70.070  Method of payment.

6.70.080  Failure to make timely payment of tax or fee.

6.70.090  Records required.

6.70.100  Overpayment or underpayment of tax.

6.70.110  Failure to file return.

6.70.120  Tax additional to others.

6.70.130  Finance director/treasurer to make rules.

6.70.140  Taxes, penalties, and fees constitute debt to municipality.

6.70.150  Appeals.

6.70.160  Violation – Penalty.

6.70.010 Gambling activities and tax.

A. Tax Imposed. In accordance with the provisions of Chapter 9.46 RCW and RCW 9.46.110 as the same now exist or may hereafter be amended, there is levied upon all persons, associations, and organizations a tax on all gambling activities occurring within the city of Ellensburg as permitted by state law at the following rates:

1. Bingo and Raffles. Beginning January 1, 2002, these activities shall be taxed at a rate of one percent of the gross receipts received therefrom less the amount awarded as cash or merchandise prizes. On January 1, 2003, the rate shall automatically increase to two percent of the gross receipts received therefrom less the amount awarded as cash or merchandise prizes.

2. Amusement Games. Beginning January 1, 2002, these activities shall be taxed at a rate of one percent of the gross receipts from any such amusement games less the amount awarded as prizes, which is an amount less than the actual amount of costs of enforcement by the city of the provisions of Chapter 9.46 RCW. On January 1, 2003, the rate shall automatically increase to two percent of the gross receipts from any such amusement games less the amount awarded as prizes, which is an amount less than the actual amount of costs of enforcement by the city of the provisions of Chapter 9.46 RCW.

3. Charitable or Nonprofit Operators – Punch Boards and Pull-Tabs. Beginning January 1, 2002, these activities shall be taxed at a rate of one percent based on the gross receipts directly from the operation of the punch boards or pull-tabs less the amount awarded as cash or merchandise prizes. On January 1, 2003, the rate shall automatically increase to two percent based on the gross receipts directly from the operation of the punch boards or pull-tabs less the amount awarded as cash or merchandise prizes.

4. Commercial Operators – Punch Boards and Pull-Tabs. Beginning January 1, 2002, these activities shall be taxed at a rate of one percent based on the gross receipts directly from the operation of the punch boards or pull-tabs themselves. On January 1, 2003, the rate shall automatically increase to two percent based on the gross receipts directly from the operation of the punch boards or pull-tabs themselves.

5. Social Card Games. Beginning July 1, 2001, these activities shall be taxed at a rate of three percent of the gross revenue from such games. On January 1, 2002, the rate shall automatically increase to six percent of the gross revenue from such games; and on January 1, 2003, the rate shall automatically increase to eight percent of the gross revenue from such games.

B. Definitions. For the purposes of this chapter, the words and terms used herein shall have the same meaning given to each pursuant to Chapter 9.46 RCW, as the same exists or may from time to time be amended; and as set forth under the rules of the Washington State Gambling Commission, WAC Title 230, as the same exists or may hereafter be amended, unless otherwise specifically provided herein.

C. Exemptions from Tax. No tax shall be imposed under the authority of this chapter on bingo or amusement games when such activities or any combination thereof are conducted by any bona fide charitable or nonprofit organization as defined in Chapter 9.46 RCW, which organization has no paid operating or management personnel for the gambling activities and has gross receipts from bingo or amusement games, or any combination thereof, not exceeding $5,000 per year less the amount awarded as cash or merchandise prizes. No tax shall be imposed on the first $10,000 of net proceeds from raffles conducted by bona fide charitable or nonprofit organizations. [Ord. 4274, 2001.]

6.70.020 Administration and collection.

The administration and collection of the tax imposed by this chapter shall be by the city finance director/treasurer, pursuant to the rules and regulations of the Washington State Gambling Commission. The finance director/treasurer shall adopt and publish such rules and regulations as may be reasonably necessary for the purpose of carrying out the provisions of this chapter and to enable the collection of the tax imposed herein. [Ord. 4274, 2001.]

6.70.030 Filing of declaration of intent.

In order that the city may identify those persons who are subject to taxation under this chapter, each person, association or organization shall file with the finance director/treasurer a sworn declaration of intent to conduct any activity taxable as herein provided. The declaration of intent shall be on a form to be prescribed by the finance director/treasurer, and shall be submitted with a copy of the license issued by the Washington State Gambling Commission. The filing shall be made not later than 10 days prior to conducting or operating a taxable activity, or 20 days after the effective date of the ordinance codified in this chapter if the activity is being conducted prior to its adoption. No fee shall be charged for such filing, which filing is not for the purpose of regulation of this activity but for the purposes of administration of this taxing chapter only. Failure to timely file shall not excuse any person, association or organization from any tax liability. [Ord. 4274, 2001.]

6.70.040 Tax due.

Except as otherwise provided in this chapter, the taxes imposed by this chapter shall be computed on the basis of activity during each calendar quarter, shall be due and payable in quarterly installments and remittance therefor, together with the return forms, and shall be made to the finance director/treasurer on or before the final day of the month immediately succeeding the quarterly period in which the tax accrued. Such payments shall be due on January 31st, April 30th, July 31st, and October 31st of each respective year. [Ord. 4274, 2001.]

6.70.050 Exceptions.

A. Except as provided in subsection (B) of this section, whenever any person, association or organization taxed under this chapter discontinues operation of the taxable activity for a period of more than four weeks, or quits business, sells out or otherwise disposes of its business, or terminates the business, any tax due shall become due and payable immediately, and such taxpayer shall, within 10 days thereafter, make a return and pay the tax due.

B. It is recognized that some bona fide charitable or bona fide nonprofit organization taxpayers will be conducting or operating taxable activities only upon an occasional and random basis. Except as provided in subsection (C) of this section, when such a taxpayer conducts only one taxable activity during any calendar quarter, and the duration of each such activity does not exceed 15 consecutive calendar days, and the gross receipts therefrom do not exceed $2,000 per quarter, that taxpayer need not remit the tax due with a return therefor until on or before January 31st of the year following that year in which the activity took place. The returns shall be made upon a special form to be supplied by the city finance department.

C. Whenever it appears to the finance director/treasurer that the collection of taxes from any person, association or organization may be in jeopardy, the finance director/treasurer, after not less than 10 days' notice to the taxpayer, is authorized to require that the taxpayer remit taxes due and returns at such shorter intervals than otherwise provided herein, as the finance director/treasurer deems appropriate under the circumstances. [Ord. 4274, 2001.]

6.70.060 Administration and collection of tax.

A. Administration and collection of the various taxes imposed by this chapter shall be the responsibility of the finance director/treasurer. Remittance of the amount due shall be accompanied by a completed return form prescribed and provided by the finance director/treasurer. The taxpayer shall be required to swear and affirm that the information given in the return is true, accurate and complete.

B. The finance director/treasurer is authorized, but not required, to mail to taxpayers forms for returns. Failure of the taxpayer to receive such a form shall not excuse the taxpayer from making the return and timely paying all taxes due. The finance director/treasurer shall have forms available to the public in reasonable numbers at the City Hall finance department during regular business hours.

C. In addition to the return form, a copy of the taxpayer's quarterly report to the Washington State Gambling Commission required by Chapter 230‑08 WAC for the period in which the tax accrued shall accompany remittance of the tax amount due. [Ord. 4274, 2001.]

6.70.070 Method of payment.

Taxes payable under this chapter shall be remitted to the office of the finance director/treasurer on or before the time required by bank draft, certified check, cashier's check, personal check, money order, or cash. If payment is made by draft or check, the tax shall not be deemed paid until the draft or check is honored in the usual course of business, nor shall the acceptance of any sum by the finance director/treasurer be an acquittance or discharge of the tax unless the amount paid is the full amount due. The return and copy of the quarterly report to the Washington State Gambling Commission shall be filed in the office of the finance director/treasurer after notation by that office upon the return of the amount actually received from the taxpayer. [Ord. 4274, 2001.]

6.70.080 Failure to make timely payment of tax or fee.

A. For each payment due under this chapter, if full payment is not made by the due date thereof, there shall be added a penalty as follows:

1. One to 10 days late: five percent of the total tax due with a minimum penalty of $10.00.

2. Eleven to 20 days late: 10 percent of the total tax due with a minimum penalty of $20.00.

3. Twenty-one to 30 days late: 15 percent of the total tax due with a minimum penalty of $30.00.

4. Thirty-one to 60 days late: 20 percent of the total tax due with a minimum penalty of $50.00.

B. In addition to this penalty, the finance director/treasurer may charge the taxpayer interest of 12 percent per annum on all taxes, penalties and fees.

C. Failure to make full payment of all tax amounts and penalties within 60 days following the day the tax amount initially became due shall be both a criminal and civil violation of this chapter. [Ord. 4274, 2001.]

6.70.090 Records required.

A. Each person, association, or organization engaging in an activity taxable under this chapter shall maintain records respecting that activity which truly, completely, and accurately disclose all information necessary to determine the taxpayer's tax liability hereunder during each base tax period. Such records shall be kept and maintained for a period of not less than three years. In addition, all information and items required by the Washington State Gambling Commission under Chapter 230‑08 WAC, and the United States Internal Revenue Service, respecting taxation shall be kept and maintained for the periods required by those agencies.

B. All books, records and other items required to be kept and maintained under this section shall be subject to and immediately made available for inspection and audit at any time, with or without notice, at the place where such records are kept. Inspection shall be made upon the demand of the finance director/treasurer or his designee at the place where the records are kept for the purpose of enforcing the provisions of this chapter.

C. Where the taxpayer does not keep all of the books, records or items required to be kept or maintained under this section within the jurisdiction of the city so that the finance director/treasurer may examine them conveniently, the taxpayer shall either:

1. Produce and make available for inspection in this jurisdiction all of the required books, records, or other items within 10 days following a request by the finance director/treasurer that he do so; or

2. Bear the actual cost of inspection by the finance director/treasurer or his designee at the location of which such books, records or items are located; provided, that a taxpayer choosing to bear these costs shall pay in advance to the finance director/treasurer the estimated costs thereof, including, but not limited to, round trip fare by the most rapid means, lodging, meals and incidental expenses. The actual amounts due, or to be refunded, for expenses shall be determined following the examination of the records.

D. A taxpayer who fails, neglects, or refuses to produce such books and records either within or without this jurisdiction, in addition to being subject to other civil and criminal penalties provided by this chapter, shall be subject to a jeopardy fee or tax assessment by the finance director/treasurer, which penalty fee or jeopardy assessment shall be deemed prima facie correct and shall be the amount of the fee or tax owing by the taxpayer unless he can prove otherwise. The taxpayer shall be notified by the finance director/treasurer by posting in the mail of the United States, addressed to the taxpayer to the last address on file with the finance department, a statement of the amount of tax so determined by jeopardy assessment, together with any penalty and/or interest, and the total of such amounts shall thereupon become immediately due and payable. [Ord. 4274, 2001.]

6.70.100 Overpayment or underpayment of tax.

A. If, upon application by a taxpayer for a refund or for an audit of his records, or upon any examination of the returns or records of any taxpayer, it is determined by the finance director/treasurer that within three years immediately preceding receipt by the finance director/treasurer of the application by the taxpayer for a refund or an audit, or in the absence of such an application, within three years immediately preceding the commencement by the finance director/treasurer or such examination:

1. A tax or other fee has been paid in excess of that properly due, the total excess paid over all amounts due to the city within such period of three years shall be credited to the taxpayer's account or shall be credited to the taxpayer at the taxpayer's option. Subject to the further limitation of subsection (B) of this section, no refund or credit shall be allowed for any excess paid more than three years before the date of such application or examination.

2. A tax or other fee has been paid which is less than that properly due, or no tax or other fee has been paid, the finance director/treasurer shall mail a statement to the taxpayer showing the balance due, including the tax amount or penalty assessments and fees, and it shall be a separate, additional violation of this chapter, both civil and criminal, if the taxpayer fails to make payment in full within 10 calendar days of such mailing.

B. The right of recovery by the city of Ellensburg from the taxpayer for any tax provided under this chapter shall be barred after the expiration of three calendar years from the date the tax became due. The right of recovery against the city of Ellensburg because of overpayment by any taxpayer shall be barred after the expiration of three calendar years from the date the payment was made. [Ord. 4274, 2001.]

6.70.110 Failure to file return.

If any taxpayer fails, neglects or refuses to make and file his return as and when required under this chapter, the finance director/treasurer is authorized to determine the amount of tax payable, together with any penalty and/or interest assessed under the provisions of this chapter, and by mail to notify such taxpayer of the amount so determined, which amount shall thereupon become the tax and penalty and/or interest and shall become immediately due and payable. [Ord. 4274, 2001.]

6.70.120 Tax additional to others.

The taxes levied herein shall be additional to any license fee or tax imposed or levied under any law or other ordinance of the city except as otherwise herein expressly provided. [Ord. 4274, 2001.]

6.70.130 Finance director/treasurer to make rules.

The finance director/treasurer shall have the power, and it shall be his or her duty, from time to time, to adopt, publish and enforce rules and regulations not inconsistent with this chapter or other applicable laws for the purpose of carrying out the provisions of this chapter, and it is unlawful to violate or fail to comply with any such rule or regulation. [Ord. 4274, 2001.]

6.70.140 Taxes, penalties, and fees constitute debt to municipality.

Any tax due and unpaid under this chapter, and all penalties or fees, shall constitute a debt to the city of Ellensburg, a municipal corporation, and may be collected by court proceedings the same as any other debt in like amount which shall be in addition to all other existing remedies. [Ord. 4274, 2001.]

6.70.150 Appeals.

Any person aggrieved by a decision or determination of the finance director/treasurer shall have the right to appeal such determination to the city council by filing a notice of appeal within 10 days after the determination is made, and the city council has the power to affirm, reverse or modify such administrative determination and any person aggrieved by any determination of the city council has the right of appeal to the superior court of Kittitas County in accordance with applicable law. [Ord. 4274, 2001.]

6.70.160 Violation – Penalty.

A. Any person violating or failing to comply with any of the provisions of this chapter or any lawful rule or regulation adopted by the finance director/treasurer pursuant thereto shall be guilty of a misdemeanor, and upon conviction thereof shall be punished by a fine not to exceed $1,000, or by imprisonment for a term not exceeding 90 days, or by both such fine and imprisonment.

B. Each day during which a gambling activity subject to a tax under this chapter is engaged in or carried on without having complied with the provisions of this chapter shall constitute a separate violation of this chapter.

C. Any such fine shall be in addition to the tax required. Officers, directors and managers of any organization conducting gambling activities shall be jointly and severally liable for the payment of the tax and for the payment of any fine, penalty or assessment imposed under this chapter. [Ord. 4274, 2001.]