Chapter 5.84
UTILITY BUSINESS TAX

Sections:

5.84.010    Authority.

5.84.020    License required.

5.84.030    Tax imposed.

5.84.040    Quarterly payment.

5.84.050    Deductions.

5.84.060    Records.

5.84.070    Refunds.

5.84.080    Annexation notice.

5.84.090    Penalty for violation.

5.84.010 Authority.

The provisions of this chapter shall be deemed to be an exercise of the power of the city to license for revenue. (Ord. 1903 § 1, 1981).

5.84.020 License required.

After January 1, 1982, no person, firm or corporation shall engage in or carry on any business, occupation, act or privilege for which a tax is imposed by PTMC 5.84.030 without first having obtained, and being the holder of, a license so to do, to be known as an occupation license. Each such person, firm or corporation shall promptly apply to the city clerk-treasurer for such license upon such forms as the clerk-treasurer shall prescribe, giving such information as the clerk-treasurer shall deem reasonably necessary to enable the clerk-treasurer’s office to administer and enforce this chapter; and, upon acceptance of such application by the clerk-treasurer, the clerk-treasurer thereupon shall issue the license to the applicant. The occupation license shall be personal and nontransferable and shall be valid as long as the licensee shall continue in said business and shall comply with this chapter. (Ord. 1903 § 2, 1981).

5.84.030 Tax imposed.

From and after January 1, 1982, there is levied upon, and there shall be collected from, every person, firm or corporation engaged in carrying on the following business for hire or for sale of a commodity or a privilege of so doing business as defined in this section:

A. Upon any telephone business there shall be levied a tax equal to six percent of the total gross operating revenues from intrastate toll, derived from the operation of such business within the city. Gross operating revenues for this purpose shall not include charges which are passed on to the subscribers by a telephone company pursuant to tariffs required by regulatory order to compensate for the cost to the company of the tax imposed by this chapter.

“Telephone business” means the business of providing access to a local telephone network, local telephone network switching service, toll service or coin telephone services, or providing telephonic, video, data or similar communication or transmission system. It includes cooperative or farmer line telephone companies or associations operating an exchange; “telephone business” does not include the providing of competitive telephone service, nor the providing of cable television service.

“Competitive telephone service” means the providing by any person of telephone equipment, apparatus or service, other than toll service, which is a type which can be provided by persons that are not subject to regulation as telephone companies under RCW Title 80 and for which a separate charge is made.

B. There is levied a tax on the sale, delivery or distribution of electricity and electrical energy and for the privilege of carrying on said business, such tax to be equal to six percent of the total gross operating revenue derived from sales of such electricity to ultimate uses within the city; provided, however, that there shall not be any tax levied for the installation charges of electrical units.

C. There is levied a tax on the sale of natural, manufactured or mixed gas for residential, commercial or industrial consumption and for the privilege of carrying on such business, such tax to be equal to four percent of gross operating revenues from such sale of natural, manufactured or mixed gas within the limits of the city.

D. There is levied on every person engaged in or carrying on the business of selling or furnishing water a fee or tax equal to 10 percent of the total gross income from such business in the city during the fiscal year next preceding the tax year for which the license is required.

E. There is levied on every person engaged in or carrying on the business of selling or furnishing sewage disposal a fee or tax equal to 10 percent of the total gross income from such business in the city during the fiscal year next preceding the tax year for which the license is required.

F. For the purposes of defining “sewage disposal” as used in subsection E of this section, the term shall not apply to those persons or firms engaged in the pumping of septic tanks, cesspools or holding tanks, and the hauling of materials thus pumped.

G. Effective January 1, 2019, through December 31, 2023, there is levied a fee or tax equal to 22 percent on the gross revenues of the following utilities:

1. The city’s storm and surface water utility established under Chapter 13.31 PTMC;

2. The city’s water system established as provided in Chapters 13.11 through 13.17 PTMC (the “water code”); and

3. The city’s sewer system established as provided in Chapters 13.21 through 13.24 PTMC (the “sewer code”).

Effective January 1, 2024, the fee or tax shall revert to 20 percent.

Funds shall be allocated as follows:

a. Revenues from first 10 percent and from the temporary two percent: general fund services;

b. Revenues from second 10 percent (amount collected in excess of the first 10 percent): 85 percent to street fund and 15 percent to public safety.

The capital surcharge component of the water, sewer, and storm and surface water rates is excluded from the city’s utility tax.

H. Effective January 1, 2019, through December 31, 2023, there is levied upon, and there shall be collected from, the city’s solid waste or garbage utility a fee or tax equal to 22 percent of the gross revenues of such utility established pursuant to Ordinance No. 1366 for the purposes as provided in Chapter 6.04 PTMC. Effective January 1, 2024, the fee or tax shall revert to 20 percent. The tax shall appear and be separately itemized on the monthly bill of each retail customer of the solid waste or garbage utility. Funds shall be allocated as follows:

1. Revenues from first 10 percent and the temporary two percent: general fund services;

2. Revenue from second 10 percent (amount collected in excess of the first 10 percent): 85 percent to street fund and 15 percent to public safety. (Ord. 3203 § 1, 2018; Ord. 3143 § 1, 2015; Ord. 3090 § 2, 2013; Ord. 2933 § 1, 2007; Ord. 2645 § 1, 1998; Ord. 2469 § 1, 1995; Ord. 2334 § 1, 1993; Ord. 2332 § 1, 1992; Ord. 2266 § 1, 1991; Ord. 2217 § 1, 1990; Ord. 2168 § 1, 1990; Ord. 2131-A § 1, 1988; Ord. 2090 § 1, 1987; Ord. 2048 § 1, 1986; Ord. 2018 § 1, 1985; Ord. 2004 § 1, 1984; Ord. 1970 § 1, 1983; Ord. 1965 § 1, 1983; Ord. 1931 § 1, 1982; Ord. 1903 § 3, 1981).

5.84.040 Quarterly payment.

The tax imposed by this chapter shall be due and payable in quarterly installments and remittance shall be made on or before the thirtieth day of the month next succeeding the end of the quarterly period in which the tax accrued. Such quarterly periods are as follows:

First quarter – January, February, March; Second quarter – April, May, June; Third quarter – July, August, September; Fourth quarter – October, November, December.

The first payment made hereunder shall be made by April 30, 1982 for the three-month period ending March 31, 1982. On or before said due date the taxpayer shall file with the city clerk-treasurer a written return, upon such form and setting forth such information as the clerk-treasurer shall reasonably require, together with the payment of the amount of the tax. (Ord. 1903 § 4, 1981).

5.84.050 Deductions.

In computing the tax there shall be deducted from said gross operating revenues the following items:

A. The amount of credit losses and uncollectibles actually sustained by the taxpayer;

B. Amounts derived from transactions in interstate or foreign commerce or from any business which the city is prohibited from taxing under the Constitutions of the United States or the state of Washington;

C. Amounts derived by the taxpayer from the city;

D. Any amount paid to the United States, the state of Washington, the city or to any political subdivision of the state, as excise taxes levied or imposed upon the sale or distribution of property or services;

E. Any person or entity subject to the payment of a license fee or tax under any other ordinance of the city on account of engaging in any activity for which the person or entity is liable to tax under the provisions of this chapter may deduct the amount of such fee or tax from the amount of fee or tax imposed by this chapter. (Ord. 2334 § 2, 1993; Ord. 1903 § 5, 1981).

5.84.060 Records.

Each taxpayer shall keep records reflecting the amount of his gross operating revenues, and such records shall be opened at all reasonable times to the inspection of the city clerk-treasurer, or his duly authorized subordinates, for verification of the tax returns or for the fixing of the tax of a taxpayer who fails to make such returns. (Ord. 1903 § 6, 1981).

5.84.070 Refunds.

Any 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 receipt of the taxpayer, be credited against any tax due or to become due from such taxpayer under this chapter or, upon the taxpayer’s ceasing to do business in the city, be refunded to the taxpayer. (Ord. 1903 § 8, 1981).

5.84.080 Annexation notice.

Whenever the boundaries of the city are extended by annexation, all persons, firms and corporations subject to this chapter will be provided copies of all annexation ordinances by the city. (Ord. 1903 § 9, 1981).

5.84.090 Penalty for violation.

If any person, firm or corporation subject to this chapter fails to pay any tax required by this chapter within 30 days after the due date thereof, there shall be added to such tax a penalty of 20 percent of the amount of such tax, and any tax due under this chapter and 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. 1903 § 7, 1981).