Title 5
REVENUE, FINANCE AND TAXATION
This title is intended for those provisions of the Code which relate to City taxation, funds, budgeting and claims against the City.
| Chapters: | ||
| Subtitle I General Regulations* | ||
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Cross reference: Debt Management Policy Advisory Committee Ch. 3.76
For provisions regarding refunds of fees for blueprint or photography work and for certain Park and Recreation Department fees, see Chapter 3.106 of this Code.
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| 5.04 | Investment of City Funds | 5-3 |
| 5.06 | City Investments | 5-3 |
| 5.08 | Transfers Within Department Budgets | 5-4 |
| 5.09 | Opinion-Gathering Activities | 5-6 |
| 5.10 | Registration of Bonds | 5-9 |
| 5.12 | Accounting Procedure | 5-11 |
| 5.14 | Procedures and Documentation– City Moneys | 5-12 |
| 5.16 | Warrants | 5-13 |
| 5.20 | Bills by City Departments for Labor or Materials | 5-14 |
| 5.22 | Payments Via Credit and Debit Cards and Electronic Commerce | 5-15 |
| 5.24 | Claims for Injuries or Damages | 5-15 |
| 5.28 | Bonds in Civil Actions | 5-16.2 |
| 5.30 | Definitions | 5-16.2 |
| 5.32 | Revenue Code | 5-23 |
| 5.33 | Small Grants | 5-25 |
| 5.34 | Small Donations | 5-26 |
| Subtitle II Taxes | ||
| Chapters: | ||
| 5.35 | Commercial Parking Tax | 5-26 |
| 5.40 | Admission Tax | 5-27 |
| 5.45 | Business License Tax | 5-32 |
| 5.46 | Square Footage Tax | 5-40.4 |
| 5.48 | Business Tax– Utilities | 5-40.9 |
| 5.52 | Gambling Tax | 5-43 |
| 5.55 | General Administrative Provisions | 5-44 |
| 5.56 | Leasehold Excise Tax | 5-44.14 |
| 5.60 | Sales and Use Tax | 5-46 |
| 5.64 | Tax on Sale of Real Estate | 5-47 |
| 5.68 | Use Tax– Natural or Manufactured Gas | 5-48 |
| 5.72 | Multifamily Housing Property Tax Exemption | 5-49 |
| 5.73 | 2004 Multifamily Housing Property Tax Exemption Program | 5-50.19 |
| Subtitle III Funds | ||
| 5.76 | Table of Funds | 5-51 |
| 5.78 | Gift Catalogue | 5-55 |
| 5.80 | Cumulative Reserve Subfund | 5-59 |
Subtitle I
General Regulations
Chapter 5.04
INVESTMENT OF CITY FUNDS*
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Statutory Reference: For statutory provisions on investment of City funds, see RCW Ch. 35.39.
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Sections:
5.04.020 Property tax– Investment policy.
5.04.030 Property tax– Transfer from King County.
5.04.020 Property tax– Investment policy.
It shall be the policy of the City to receive collections of property taxes and abatement liens as soon as practical and to invest funds not required or available for immediate expenditure for the benefit of the City as authorized by law.
(Ord. 108998 § 1, 1980.)
5.04.030 Property tax– Transfer from King County.
King County is authorized and requested to distribute to the Director of Finance and Administrative Services for and on behalf of the City all property taxes and abatement liens collected as frequently as daily; and the Director of Finance and Administrative Services is authorized to deliver a receipt therefor whenever funds are delivered to the City. Delivery may be in money or as a transfer of an investment authorized by RCW 36.29.020 and made by King County for the City.
(Ord. 123361, § 113, 2010; Ord. 120794 § 78, 2002: Ord. 120181 § 26(part), 2000; Ord. 116368 § 120, 1992: Ord. 108998 § 2, 1980.)
Chapter 5.06 Sections:
5.06.010 Investment authority.
5.06.030 Fund investments– Interfund loans.
5.06.040 Investment policies.
5.06.050 Reports.
5.06.010 Investment authority.
A. As contemplated by RCW 35.39.032, the Director of Finance and Administrative Services, under the supervision of the Mayor, is authorized on behalf of the City to invest all moneys in the City Treasury which in his or her judgment are in excess of current City needs in:
1. United States bonds;
2. United States certificates of indebtedness;
3. Bonds or warrants of this state:
4. General obligation or utility revenue bonds or warrants of the City or of any other city or town in the state;
5. Bonds or warrants of a local improvement or condemnation award district of the City which is within the protection of the local improvement guaranty fund;
6. Repurchase agreements, reverse repurchase agreements, or bankers' acceptances;
7. The public funds investment account known as the local government investment pool in the State Treasury; and
8. Other investments authorized by law.
The Director of Finance and Administrative Services is authorized to hold such investments for the credit of the funds for which purchased.
B. The Director of Finance and Administrative Services is further authorized to convert any investments within the City Treasury into cash.
(Ord. 123361, § 115, 2010; Ord. 121028 § 3, 2002: Ord. 120794 § 80, 2002: Ord. 120467 § 1, 2001; Ord. 120181 § 26(part), 2000; Ord. 116368 § 123, 1992: Ord. 113830 § 1, 1988: Ord. 110749 § 1(part), 1982.)
5.06.030 Fund investments– Interfund loans.
The Director of Finance, after consulting with the Director of Finance and Administrative Services, the City Budget Director, and the Chair of the Finance and Budget Committee of the City Council may in his or her discretion:
A. Determine which funds shall be invested on an individual fund basis, and which funds shall participate within one or more common investment portfolio(s);
B. Apportion earnings and losses to those funds participating in a common investment portfolio. Trust and bond funds that are approved solely by the Director of Finance, and other funds approved by the Director of Finance after consulting with the Chair of the Finance and Budget Committee of the City Council, with the Director of Finance and Administrative Services, and with the City Budget Director, shall receive a return in proportion to the amount of money earned by each; and the remainder shall be allocated to the general fund, except that investment earnings attributable to the Capital Projects Account of the Cumulative Reserve Subfund shall be deposited in the Unrestricted Subaccount and South Lake Union Property Proceeds Subaccount within that Capital Projects Account, all as authorized by RCW 35.39.034 and Chapter 5.80;
C. Approve interfund loans for a duration up to 90 days, and establish a rate of interest thereon when appropriate, provided, any extension or renewal of such a loan shall require approval by ordinance;
D. Establish criteria for identifying when a substantial de facto loan from one fund to another occurs (e.g., an extended delay in making reimbursement without valid cause; a continuous overdrawn status) and, when appropriate, establish an interest charge to be paid to the lending fund;
E. Make loans to individual funds participating in a common investment portfolio by means of carrying funds in a negative cash position for a period of up to 90 days, or for longer period upon approval by ordinance, to the extent and for as long as (i) such loans can be prudently supported by the common investment portfolio and (ii) the borrowing fund is reasonably expected to be able to repay the loan. The Director of Finance, after consulting with the Director of Finance and Administrative Services may also charge interest at the common investment portfolio's rate of return to the borrowing fund.
(Ord. 123361, § 116, 2010; Ord. 120794 § 81, 2002: Ord. 120411 § 5, 2001; Ord. 120181 § 26(part), 2000; Ord. 119761 § 3, 1999; Ord. 118138 § 2, 1996; Ord. 117641 § 1, 1995: Ord. 116368 § 124, 1992: Ord. 110749 § 1(part), 1982.)
5.06.040 Investment policies.
A. The City's common investment portfolio(s) shall be managed to further this financial objective: to preserve principal while maintaining liquidity to meet the City's needs for cash and maximizing income.
B. Investment decisions should further the City's social policies established by ordinance or policy resolutions of the City Council. A City social policy shall take precedence over furthering the City's financial objective when expressly authorized by the City Council resolution or ordinance, except where otherwise provided by law or trust principles.
C. The Director of Finance and Administrative Services shall be guided by investment policies adopted from time to time by ordinance or resolution of the City Council.
(Ord. 123361, § 117, 2010; Ord. 120794 § 82, 2002: Ord. 120467 § 3, 2001; Ord. 120181 § 26 (part), 2000; Ord. 116368 § 125, 1992; Ord. 110749 § 1(part), 1982.)
5.06.050 Reports.
The Director of Finance and Administrative Services shall file a monthly report with the City Council on the performance of City investments for the preceding month and fiscal year-to-date. Each monthly report shall include a discussion of:
A. The current investment market;
B. Any material change in the City's investment portfolio and practices;
C. The City's investment return as compared to the City's benchmark return, which shall be the rate of return used by the City Council when estimating investment earnings for the purpose of adopting the current year's budget;
D. The average maturity of the City's investment portfolio; and
E. On a quarterly basis, this report will also include, as an attachment, a list of the contents of the City's investment portfolio.
(Ord. 123361, § 118, 2010; Ord. 120794 § 83, 2002: Ord. 120467 § 4, 2001: Ord. 120181 § 26, 2000; Ord. 116368 § 126, 1992: Ord. 110749 § 1(part), 1982.)
Chapter 5.08 ------------
Editor's Note: At the direction of the city, the title of Ch. 5.08 has been changed from "Transfers Between Department Budgets."
Statutory Reference: For statutory provisions on budgets in cities over three hundred thousand (300,000), see RCW Chapter 35.32A.
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Sections:
5.08.010 City Budget Director's authority.
5.08.020 Transfer between operating budget appropriations.
5.08.025 Transfer between capital budget appropriations.
5.08.040 Requests procedure.
5.08.010 City Budget Director's authority.
The City Budget Director's authority under RCW 35.32A.050 to approve transfers between allowances within the budget of a City department shall be exercised in accordance with regulations as set out in this chapter.
(Ord. 123361, § 119, 2010; Ord. 100895 § 1(part), 1972.)
5.08.020 Transfer between operating budget appropriations.
A. Within the operating budget of the City, the City Budget Director may approve only transfers of appropriations that meet all of the following criteria:
1. The appropriation was made for the same department to which the City Budget Director allows the appropriation to be transferred. For purposes of this subsection, a board or commission whose budget is not provided within the budget of a City department shall be deemed a department.
2. The amount of the appropriation transferred, together with all previous transfers during the same budget year to that budget item, does not exceed ten percent of the original budgeted allowance for the budget item to which the transfer is made.
3. The transfer will not result in a cumulative annual net transfer of more than $500,000 of appropriations into the budget for any one budget item.
4. The amount of the appropriation transferred, together with all previous transfers during the same budget year from that budget item, does not exceed 25 percent of the original budgeted allowance for the budget item from which the transfer is made.
5. The new purpose of the appropriation must be a legal use of that fund source, must comply with terms, conditions, and restrictions controlling the expenditure of the appropriation so transferred, and must not infringe any covenants or any obligations, agreements, or ordinances by which the City received the moneys.
6. The ordinance making the appropriation did not state that transfer of the appropriation is prohibited.
B. For purposes of this section:
1. All appropriations for purposes not included in the Capital Improvement Program are considered part of the City's operating budget;
2. The "original budgeted allowance" is that amount appearing beside that budget item in the adopted budget; and
3. A "budget item" is the object or purpose shown for a distinct dollar appropriation appearing in the adopted budget or in an amendment thereto. A budget item is the level at which the budget appropriates money, subject only to transfers consistent with this chapter of the Seattle Municipal Code.
(Ord. 123361, § 120, 2010; Ord. 120981 § 1, 2002: Ord. 100895 § 1(1), 1972.)
5.08.025 Transfer between capital budget appropriations.
A. The City Budget Director may approve the transfer of appropriations for purposes included in the Capital Improvement Program to other purposes included in the Capital Improvement Program only if those transfers meet all of the following criteria:
1. The appropriation was made for a budget item that is a project or program in the Capital Improvement Program of the same department to which the City Budget Director allows the appropriation to be transferred.
2. The amount of the appropriation transferred, together with all previous transfers during the same budget year to that budget item, does not exceed ten percent of the pending budgeted allowance for the budget item to which the transfer is made.
3. The transfer will not result in a cumulative annual net transfer of more than $500,000 of appropriations into the budget for any one budget item.
4. The amount of the appropriation transferred, together with all previous transfers during the same budget year from that budget item, does not exceed 25 percent of the pending budgeted allowance for the budget item from which the transfer is made.
5. The new purpose of the appropriation must be a legal use of that fund source, must comply with terms, conditions, and restrictions controlling the expenditure of the appropriation so transferred, and must not infringe any covenants or any obligations, agreements, or ordinances by which the City received the moneys.
6. The ordinance making the appropriation did not state that transfer of the appropriation is prohibited.
B. For purposes of this section:
1. The "pending budgeted allowance" is the sum of the current year's original appropriation appearing beside that budget item in the adopted budget plus unexpended balances carried forward from prior years' appropriations for that budget item; and
2. A "budget item" is a program or project within the Capital Improvement Program for which a distinct dollar appropriation appears in the adopted budget or in an amendment thereto. A budget item is the level at which the budget appropriates money, subject only to transfers consistent with this chapter of the Seattle Municipal Code.
(Ord. 123361, § 121, 2010; Ord. 120981 § 2, 2002.)
5.08.040 Requests procedure.
Requests for transfer between allowances within the budget of any City department shall be made in writing to the City Budget Director on forms provided by him or her, and if the City Budget Director shall approve the same, he or she shall forward a copy of such request with his or her approval in writing thereon to the Chair of the Budget Committee of the City Council and shall notify in like manner the Director of Finance and Administrative Services.
(Ord. 123361, § 122, 2010; Ord. 116368 § 127, 1992: Ord. 100895 § 1(3), 1972.)
Chapter 5.09 Sections:
5.09.010 Purpose.
5.09.020 Definitions.
5.09.030 Restriction; approval process.
5.09.040 Opinion-gathering required by ordinance, contract, collective bargaining agreement, or law.
5.09.050 Noncompliance.
5.09.060 Duration and evaluation.
5.09.010 Purpose.
The general purpose of this chapter is to establish a process that enables the Council to oversee the expenditures of appropriated funds on Opinion-gathering Activities so that such funds are being spent in a manner consistent with Council's intent, and that gives Departments a clear and consistent process for planning for, obtaining approval for, and administering Opinion-gathering Activities.
CITY INVESTMENTS
TRANSFERS WITHIN DEPARTMENT BUDGETS*
OPINION-GATHERING ACTIVITIES
| DATE & TIMELINE | DIVISION/ PROJECT NAME & MANAGER | SCOPE, PURPOSE AND/OR LOST OPPORTUNITY | TARGET AUDIENCE | TYPE OF RESULTS EXPECTED | RANGE OF ESTIMATED COSTS |
2. Departments are encouraged to plan Opinion-gathering Activities on a yearly basis and to bring all proposed Opinion-gathering Activities for a calendar year to the Chairperson and Members in one matrix during the first quarter of that budget year. In addition, a Department may submit to the Chairperson and Members a second matrix in the first quarter, one additional matrix in the second quarter, and one final matrix no later than August 31st of the third quarter, for a total of no more than 4 matrices per year. A Department may ask the Chairperson to grant an exception to the quantity and timing requirements of this subsection, which the Chairperson may grant if s/he believes that an exception is warranted and will not unduly burden the Committee.
3. The Chairperson and Members will review the proposed Opinion-gathering Activities and may request from the Department additional information about each proposed Opinion-gathering Activity until the Chairperson, in consultation with the Members, determines that s/he should approve or reject each Opinion-gathering Activity and its associated range of estimated Costs set forth in the matrix. During the initial approval stage, a Department will provide a Committee briefing on a proposed Opinion-gathering Activity only at the request of the Chairperson or a Member.
4. After the Chairperson communicates approval of an Opinion-gathering Activity, the Department may proceed to expend appropriated funds to develop or have developed the instrument or questions needed to undertake the Opinion-gathering Activity, but may not expend appropriated funds to administer the instrument or questions except as in described in subsection B of this section.
5. If the Chairperson communicates a rejection of an Opinion-gathering Activity, the Department may not expend appropriated funds to develop, have developed, administer, or otherwise proceed with the instrument or questions of the Opinion-gathering Activity. The Chairperson, in consultation with the Members, may, but is not required to, reconsider a rejection or consider a modification to a rejected Opinion-gathering Activity upon the request of the Department.
B. Final Approval.
1. Prior to administering the instrument or questions, the Department shall submit the Opinion-gathering Activity instrument or questions to the Chairperson and Members for their review.
2. The Chairperson and Members may request and suggest changes to the instrument or questions.
3. If the Chairperson gives final approval of the instrument or questions, the Department may spend or encumber appropriated funds up to the maximum Cost estimated in the matrix and may administer the Opinion-gathering Activity as described to the Chairperson and Members.
4. If the Chairperson rejects the instruments or questions, the Department shall not spend or encumber appropriated funds on the Opinion-gathering Activity.
5. A Department shall not spend or encumber appropriated funds for expenses in excess of the maximum Cost estimated in the matrix for an Opinion-gathering Activity unless the Department has first provided the Chairperson and Members with a justification for the excess expenditures and the Chairperson has approved the excess Cost.
C. Reporting of Results.
1. The Department shall transmit to the Chairperson and Members the Cost and a written copy of the Results of each Opinion-gathering Activity, within 30 days of preparing or receiving the final Results.
2. After transmitting the final Results, the Department may request an opportunity to brief the Relevant Committee. In addition, the Department shall provide an oral briefing upon the request of the Chairperson or a Member.
D. Exceptions.
1. A Department may undertake an Opinion-gathering Activity with a Cost below $2500 without obtaining the approvals required in subsections A and B of this section. Departments are encouraged to include Opinion-gathering Activities with a Cost below $2500 in the matrices they submit to the relevant Committee, even though Committee approval of such Opinion-gathering Activities is not required.
2. At the conclusion of any Opinion-gathering Activity undertaken pursuant to subsection 1 of this section, the Department must notify the Chairperson and Members in writing of the Cost and Results of each such Opinion-gathering Activity, and, if the Opinion-gathering Activity was never included in a matrix, describe its nature and scope. Opinion-gathering Activities that do not involve the expenditure of appropriated funds are exempt from the provisions of this subsection 2.
E. Changes to Approved Opinion-gathering Activities.
1. A Department shall not change the scope, purpose, target audience, range of estimated costs, or other aspect of an Opinion-gathering Activity for which the Chairperson has communicated initial approval pursuant to Section 5.09.030(A) of this chapter without first receiving the Chairperson's approval of such change.
2. Once an Opinion-gathering Activity has received final approval from the Chairperson pursuant to Section 5.09.030(B) of this chapter, a Department shall not change the substance of the instrument or add, remove, or modify questions without first receiving the Chairperson's approval of such change, addition, removal, or modification.
(Ord. 121424 § 2, 2004.)
5.09.040 Opinion-gathering required by ordinance, contract, collective bargaining agreement, or law.
Even though opinion-gathering activities required by ordinance, or by a contract or collective bargaining agreement approved by City ordinance, or otherwise required by law, are excluded from the definition of Opinion-gathering Activity pursuant to Section 5.09.020(I)(6) and are therefore not subject to the approval requirements of this chapter, no Department may spend or encumber appropriated funds on opinion-gathering activities that fall within Section 5.09.020(I)(6) without transmitting to the Chairperson and Members a written copy of the findings, results, data, analysis, report or other product of such opinion-gathering activity within 30 days of preparing or receiving them, along with a statement of the costs of the activity.
(Ord. 121424 § 2, 2004.)
5.09.050 Noncompliance.
A Chairperson may report any instances of noncompliance with this chapter to the Council President and to the Chairperson of the Finance and Budget Committee. Any such instances may be taken into consideration as part of the Council budget process.
(Ord. 121424 § 2, 2004.)
5.09.060 Duration and evaluation.
The Council will reexamine this chapter in 2007 and determine whether the chapter should be amended or repealed.
(Ord. 121424 § 2, 2004.)
Chapter 5.10 Sections:
5.10.010 Purpose.
5.10.020 Definitions.
5.10.030 Registration– Method– Effect.
5.10.040 Denominations of registered bonds and obligations.
5.10.050 System of registration– Contents.
5.10.060 Fiscal agents– Designation.
5.10.070 Director of Finance and Administrative Services as registrar.
5.10.080 Contracts with fiscal agency.
5.10.090 Statement of transfer restrictions.
5.10.010 Purpose.
This chapter implements RCW Chapter 39.46 (Chapter 167, Laws of Washington 1983) by providing for the registration of ownership of bonds and other interest bearing obligations of The City of Seattle. This chapter should be interpreted and applied in a manner to carry out state law and preserve the exemptions from federal income taxation of interest on City bonds and other obligations.
(Ord. 111724 § 1(part), 1984.)
5.10.020 Definitions.
As used in this chapter:
A. "Bond" and "obligation" shall have the meaning defined in RCW 39.46.020 (Section 2, Chapter 167, Laws of Washington 1983), as now or hereafter amended.
B. "Registrar" shall be the person or persons designated by The City of Seattle to register the ownership of bonds and other obligations as provided in this chapter.
C. "City" means The City of Seattle.
(Ord. 111724 § 1(part), 1984.)
5.10.030 Registration– Method– Effect.
A. All bonds and other obligations, which are issued or entered into by the City, bear or require the City to pay interest, have a maturity more than one (1) year, and on which interest is intended by the City to be exempt from federal income taxation, shall be registered as to both principal and interest as provided in this chapter.
B. Such registration may be carried out by:
1. A book entry system of recording the ownership of a bond or other obligation whether a physical instrument is issued or an obligation is merely entered on the books of the City or one (1) of the fiscal agencies of The State of Washington; or
2. Recording the ownership of a bond or other obligation together with a requirement that any transfer of ownership may be effected only by the surrender of the old bond or other obligation and either the reissuance of the old bond or other obligation or the issuance of a new bond or other obligation to the new owner.
C. No transfer of any such bonds or other obligations shall be effective until the name of the new owner and the new owner's mailing address, together with such other information required by the United States of America and such other additional information deemed appropriate by the Registrar, shall be recorded on the books of the Registrar of the City.
(Ord. 111724 § 1(part), 1984.)
5.10.040 Denominations of registered bonds and obligations.
Registered bonds or other obligations may be issued in any denomination. Registered bonds or other obligations may be issued in a denomination to represent several bonds or other obligations of smaller denominations.
(Ord. 111724 § 1(part), 1984.)
5.10.050 System of registration– Contents.
A. The Director of Finance and Administrative Services shall establish a system of registration for City bonds and other obligations, with a maturity more than one year, on which the interest is intended to be exempt from federal income taxation. The system of registration shall provide for any writing relating to a bond or other obligation that is not issued as a physical instrument; for identifying numbers or other designations; for a sufficient supply of certificates for subsequent transfers; for record and payment dates; for varying denominations; for communications to the owners of bonds or other obligations; for accounting, cancelled certificate destruction, registration and release of securing interests; and, for such other incidental matters pertaining to the registration of bonds or other obligations as appropriate to conform with the United States Internal Revenue Code.
B. Different methods or techniques may be used for separate bond issues and for diverse types of obligations. The method or technique used with respect to a particular bond or other obligation shall conform with the authorizing ordinance.
(Ord. 123361, § 124, 2010; Ord. 116368 § 128, 1992; Ord. 111724 § 1(part), 1984.)
5.10.060 Fiscal agents– Designation.
The City may by ordinance designate a fiscal agent to act as an authenticating trustee, transfer agent, registrar or paying agent for the City with respect to bonds or other obligations to be issued. In the absence of a designation by ordinance, the Director of Finance and Administrative Services may in accordance with RCW 39.46.030 designate one or more fiscal agents to act as an authenticating trustee, transfer agent, registrar or paying agent for the City with respect to registered bonds or other obligations which are usually subject to trading, assignment or transfer. Any fiscal agent designated by the City may be a fiscal agent of The State of Washington appointed in accordance with RCW Chapter 43.80.
(Ord. 123361, § 125, 2010; Ord. 118678 § 1, 1997: Ord. 111724 § 1(part), 1984.)
5.10.070 Director of Finance and Administrative Services as registrar.
The Director of Finance and Administrative Services may act as a registrar for leases, warrants, installment contracts and other obligations which provide for payment of interest that is intended to be exempt from federal income taxation and which are not usually subject to trading, assignment or transfer.
(Ord. 123361, § 126, 2010; Ord. 116368 § 130, 1992: Ord. 111724 § 1(part), 1984.)
5.10.080 Contracts with fiscal agency.
In accordance with RCW 39.46.030, the Director of Finance and Administrative Services is authorized to enter into contracts with one or more fiscal agents of The State of Washington or any other designated fiscal agents of the City in connection with the establishment and maintenance by such fiscal agents of a central depository system for the transfer or pledge of registered bonds or other obligations and for services as authenticating trustee, transfer agent, registrar or paying agent for such bonds and other obligations. Any such contract shall define the rights and duties of the designated fiscal agent and the means of compensation thereof and may adopt by reference relevant terms and conditions of a contract between that fiscal agent and the State Finance Committee of The State of Washington.
(Ord. 123361, § 127, 2010; Ord. 118678 § 2, 1997: Ord. 116368 § 131, 1992; Ord. 111724 § 1(part), 1984.)
5.10.090 Statement of transfer restrictions.
Any physical instrument issued or executed by the City subject to registration under the ordinance codified in this section shall state in a prominent manner on its face that it is registered.
(Ord. 111724 § 1(part), 1984.)
Chapter 5.12 ------------
Cross-reference: For provisions regarding the powers of the City Comptroller, see Charter Art. VIII.
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Sections:
5.12.010 Authority of Director of Finance and Administrative Services.
5.12.020 Monthly report.
5.12.030 Approval of report before publication.
5.12.040 Petty cash accounts– Establishment– Operation and expenditures.
5.12.050 Petty cash accounts– Administrative rules and regulations.
5.12.060 Billings under one dollar.
5.12.010 Authority of Director of Finance and Administrative Services.
When not otherwise prescribed pursuant to state law, the bookkeeping and accounting in all departments of the municipal government shall be done in the manner and form prescribed by, and subject to the approval of, the Director of Finance and Administrative Services.
(Ord. 123361, § 128, 2010; Ord. 120794 § 84, 2002: Ord. 116368 § 132, 1992: Ord. 39034 § 1, 1918.)
5.12.020 Monthly report.
Every department of the municipal government keeping financial accounts shall, on or before the tenth day of each and every month, transmit to the Director of Finance and Administrative Services, a statement and report, in form to be prescribed by the Director of Finance and Administrative Services, showing the financial transactions of the department during the previous month.
(Ord. 123361, § 129, 2010; Ord. 120794 § 85, 2002: Ord. 116368 § 133, 1992; Ord. 39034 § 2, 1918.)
5.12.030 Approval of report before publication.
No statement or report of financial transactions in any department or office shall constitute the official report of the City unless such statement or report shall first be submitted to, and approved by, the Director of Finance and Administrative Services.
(Ord. 123361, § 130, 2010; Ord. 120794 § 86, 2002: Ord. 116368 § 135, 1992; Ord. 39034 § 3, 1918.)
Statutory Reference: For statutory provisions regarding disclosure of public records, see RCW Ch. 42.17.
5.12.040 Petty cash accounts– Establishment– Operation and expenditures.
The Director of Finance and Administrative Services is authorized to establish petty cash accounts within the operating funds of City departments for the payment of miscellaneous items not payable by voucher and warrant. The establishment of petty cash accounts shall be requested in writing by the head of the department in the form and detail prescribed by the Director of Finance and Administrative Services. All expenditures from such accounts shall be made from appropriations and for purposes authorized by the department annual budget. The maximum amount of such accounts shall be set by the Director of Finance and Administrative Services in consultation with the City Auditor according to the needs of the petitioning department.
(Ord. 123361, § 131, 2010; Ord. 120794 § 87, 2002: Ord. 116368 § 135, 1992: Ord. 110413 § 1, 1982.)
5.12.050 Petty cash accounts– Administrative rules and regulations.
The Director of Finance and Administrative Services shall promulgate rules and regulations, consistent with this chapter and the Chapter 3.02, establishing standards and procedures for the proper administration of petty cash accounts.
(Ord. 123361, § 132, 2010; Ord. 120794 § 88, 2002: Ord. 117242 § 9, 1994: Ord. 110413 § 2, 1982.)
5.12.060 Billings under one dollar.
It is City policy to bill employees, citizens and businesses only when the billable amount exceeds One Dollar ($1). Whenever the billable amount is less than One Dollar ($1), the amount shall be added to the next billing. If no further billings are contemplated, the receivable and any related revenue shall be deemed waived.
(Ord. 113872 § 3, 1988.)
Chapter 5.14 Sections:
5.14.010 Purpose– Scope.
5.14.020 Authority in Director of Finance and Administrative Services.
5.14.030 Duties of City personnel.
5.14.040 Certification of receivers, cashiers and tellers.
5.14.050 Departmental functions.
5.14.060 Liability for loss as between department and Director of Finance and Administrative Services.
5.14.010 Purpose– Scope.
This chapter implements the City Charter, Article VIII, Sections 9 and 11.* When state statute directs a different procedure, state law controls. The term "City moneys" applies to cash and to checks and other negotiable instruments payable in money to the City.
(Ord. 116368 § 136, 1992: Ord. 114347 § 1(part), 1989.)
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Editor's Note: The Charter is set out at the front of this Code.
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5.14.020 Authority in Director of Finance and Administrative Services.
The Director of Finance and Administrative Services is authorized to promulgate rules in accordance with Chapter 3.02, for establishing procedures for the receipt, handling and deposit by City officers and employees of City moneys into the City Treasury; for the method of documentation on all such transactions; for regular reporting to the Director of Finance and Administrative Services; for certifying and decertifying by the Director of Finance and Administrative Services of all City officers and employees who are authorized to receive or handle City moneys in the regular course of their employment or departmental activities; for inspection of departmental cash records, including overages or shortages; for inspection of departmental practices and procedures in handling City moneys; and for contracting with agents to collect City moneys and their collection procedures. The Director of Finance and Administrative Services may enforce these rules through on-site inspection; by decertifying any officer or employee who fails to comply with the Director of Finance and Administrative Services' Rules; and, in the event of noncompliance by a department or office, requiring that payments to personnel be authorized by the Director of Finance and Administrative Services, or deposited at his or her office.
(Ord. 123361, § 133, 2010; Ord. 120794 § 89, 2002: Ord. 116368 § 137, 1992: Ord. 114347 § 1(part), 1989.)
5.14.030 Duties of City personnel.
Any City officer or employee, who receives moneys belonging to the City in the scope and course of his or her duties, shall:
A. Immediately deliver the same to the Director of Finance and Administrative Services or, when so authorized, deposit the moneys with a City depository designated by the Director of Finance and Administrative Services to the credit of the City. The delivery or deposit must be made within 24 hours after receipt unless otherwise authorized by the Director of Finance and Administrative Services;
B. Comply with rules promulgated by the Director of Finance and Administrative Services for handling and processing of City moneys and for documentation and dissemination of records, and with departmental internal procedures established in conformity with the Director of Finance and Administrative Services' rules; and
C. Notify the Seattle Police Department, the Director of Finance and Administrative Services, and the City Auditor of any loss or theft of City money immediately upon discovery. Written notice shall be given to them no later than 24 hours after discovery.
(Ord. 123361, § 134, 2010; Ord. 120794 § 90, 2002: Ord. 116368 § 138, 1992: Ord. 114347 § 1(part), 1989.)
5.14.040 Certification of receivers, cashiers and tellers.
Only persons who are certified by the Director of Finance and Administrative Services may receive and handle City moneys on a regular basis in the scope and course of their employment. As a condition to certification or maintenance of a certification, the Director of Finance and Administrative Services may require that the officer or employee complete a course of instruction or training and/or pass an examination on the secure processing of moneys, the Director of Finance and Administrative Services' rules, procedures and applicable departmental rules, and thereafter take refresher instruction or training at periodic intervals or when the need arises.
(Ord. 123361, § 135, 2010; Ord. 120794 § 91, 2002: Ord. 116368 § 139, 1992: Ord. 114347 § 1(part), 1989.)
5.14.050 Departmental functions.
The head of any City department or office who anticipates receiving City moneys on a regular basis in the course of its activities shall:
A. Contract with the Director of Finance and Administrative Services for cash collection services or, after the Director of Finance and Administrative Services' Rules take effect, assign the receiving and handling of City moneys only to those persons who are certified by the Director of Finance and Administrative Services for performing those functions;
B. Establish and maintain a system of procedures, documentation and reporting on receipts handling and deposit of City moneys satisfactory to the Director of Finance and Administrative Services;
C. Notify the Seattle Police Department, the Director of Finance and Administrative Services, and the City Auditor of any loss or theft of City money immediately upon discovery. Written notice shall be given no later than 24 hours after discovery;
D. Allow the Director of Finance and Administrative Services to make on-site inspections and observe the processing of City moneys, and to make inspections of departmental collection records.
(Ord. 123361, § 136, 2010; Ord. 120794 § 92, 2002: Ord. 116368 § 140, 1992: Ord. 114347 § 1(part), 1989.)
5.14.060 Liability for loss as between department and Director of Finance and Administrative Services.
A. As between a department and its officers and the Director of Finance and Administrative Services, the department has primary responsibility for care and liability for loss of City moneys in its custody until deposited in the City Treasury or entrusted to a cashier certified by the Director of Finance and Administrative Services. When deposit is made in an after-hours drop box of the City's public depository, or an armored car service making collection for the City, losses are assigned to the Director of Finance and Administrative Services if the Director of Finance and Administrative Services' instructions for making deposits have been followed, and to the department otherwise.
B. Compliance with the Director of Finance and Administrative Services' rules and procedures approved by the Director of Finance and Administrative Services establishes a presumption that a City department or office exercised due care in its custody and care of City moneys.
(Ord. 123361, § 137, 2010; Ord. 120794 § 93, 2002: Ord. 118397 § 81, 1996: Ord. 117242 § 10, 1994; Ord. 116368 § 141, 1992; Ord. 114347 § 1(part), 1989.)
Chapter 5.16 ------------
Statutory Reference: For statutory provisions on warrants, see RCW Ch. 39.56; for provisions on payment of warrants by the City Treasurer, see Charter Art. VIII § 9.
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Sections:
5.16.010 Cancellation of warrants.
5.16.030 Director of Finance and Administrative Services authorized to establish credit.
5.16.040 Lines of credit– Payment.
5.16.050 Warrant overdrafts.
5.16.010 Cancellation of warrants.
Any warrant which is not delivered to the payee within one year from the date of issuance shall be cancelled and the amounts for which said warrants are drawn shall be credited to the several funds against which they are drawn. The Director of Finance and Administrative Services shall keep a record of cancelled warrants.
(Ord. 123361, § 138, 2010; Ord. 120794 § 94, 2002: Ord. 116368 § 142, 1992: Ord. 96239 § 1, 1967: Ord. 3622 § 1, 1894.)
5.16.030 Director of Finance and Administrative Services authorized to establish credit.
As authorized by Section 43.09.2853 RCW, with the advice of the Debt Management Policy Advisory Committee, the Director of Finance and Administrative Services is authorized to establish a line of credit for the City with any qualified public depository for cashing City warrants and other financial purposes, to determine the amount of credit extended, to execute written agreements therefor with either a fixed rate of interest adjusted periodically or a fluctuating rate of interest, such rates not greater than 18 percent annually or the maximum rate allowed by law, whichever is less, and to pay interest and other finance or service charges. The total of all lines of credit with all qualified public depositories shall not exceed $10,000,000.
(Ord. 123361, § 139, 2010; Ord. 120794 § 95, 2002: Ord. 120012 § 1, 2000: Ord. 116368 § 143, 1992: Ord. 110305 § 1, 1981.)
5.16.040 Lines of credit– Payment.
The line or lines of credit established by the Director of Finance and Administrative Services pursuant to Section 5.16.030 shall be a general obligation of the City. The City hereby pledges its full faith, credit and resources to levy and collect taxes and other revenues sufficient for payment of the principal of, and interest on, the lines of credit extended, and to make prompt payment of the obligation, including interest thereon, as the same are due.
(Ord. 123361, § 140, 2010; Ord. 120794 § 96, 2002: Ord. 116368 § 144, 1992: Ord. 110585 § 1, 1982.)
5.16.050 Warrant overdrafts.
Subject to the following terms and conditions, the Director of Finance and Administrative Services is authorized to contract with the bank at which the City maintains its principal account for the bank to postpone presentment of City warrants until the City can provide for their full payment:
A. The amount of the warrants for which presentment is so delayed shall be aggregated as a warrant overdraft account;
B. The aggregate of the warrant overdrafts shall not exceed $20,000,000;
C. The fee charged by the bank shall not exceed that bank's current prime rate multiplied by 1.5, for the dates for which the credit is outstanding;
D. The Debt Management Policy Advisory Committee shall review the contract with the principal bank and, from time to time, advise the Director of Finance and Administrative Services thereon and on the aggregate of warrant overdrafts that may be outstanding;
E. Fees paid for deferment of presentment shall cease and the bank may present outstanding warrants should any other general fund warrant be presented to the Director of Finance and Administrative Services for payment and marked as presented but not paid for lack of funds.
(Ord. 123361, § 141, 2010; Ord. 120794 § 97, 2002: Ord. 120012 § 2, 2000: Ord. 116368 § 145, 1992: Ord. 115953 § 1, 1991: Ord. 115437 § 1, 1990: Ord. 115010 § 1, 1990.)
Chapter 5.20 ------------
Statutory Reference: for provisions regarding the State Accounting Act, see RCW 43.09.210; for provisions regarding payment of claims against municipal corporations for contractual purposes, see RCW 42.24.080.
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Sections:
5.20.010 Issuance of bill for labor or material.
5.20.020 Correction of bill by credit voucher.
5.20.030 Recordkeeping– Notification of payment.
5.20.040 Deduction of credit voucher.
5.20.050 Payments under one dollar.
5.20.010 Issuance of bill for labor or material.
When any department of the City shall furnish any labor or material to any person, the department shall render a bill for the labor or material as follows:
A. Bills of each department to be issued in triplicate and to bear consecutive numbers;
B. The original of the bill to be forwarded to the person receiving the labor or material;
C. The duplicate of the bill to be forwarded, forthwith to the Director of Finance and Administrative Services;
D. The triplicate of the bill to be retained by the department issuing the same.
(Ord. 123361, § 142, 2010; Ord. 120794 § 98, 2002: Ord. 116368 § 146, 1992; Ord. 16066 § 1, 1907.)
5.20.020 Correction of bill by credit voucher.
The head of the department issuing any of the bills described in Section 5.20.010 is authorized to correct the bills at any time prior to their payment by the issuance of credit vouchers directed to the Director of Finance and Administrative Services.
(Ord. 123361, § 143, 2010; Ord. 120794 § 99, 2002: Ord. 116368 § 147, 1992: Ord. 16066 § 2, 1907.)
5.20.030 Recordkeeping– Notification of payment.
The Director of Finance and Administrative Services is directed to preserve the duplicate bills and render proper accounting therefor and to notify each of the various departments as to the payment of the bills upon request of the department.
(Ord. 123361, § 144, 2010; Ord. 120794 § 100, 2002: Ord. 116368 § 148, 1992: Ord. 16066 § 3, 1907.)
5.20.040 Deduction of credit voucher.
When any credit voucher shall have been issued correcting any of the bills, the Director of Finance and Administrative Services is directed to deduct the amount of the credit voucher from the face of the bill and accept the remaining amount thereof as full payment.
(Ord. 123361, § 145, 2010; Ord. 120794 § 101, 2002: Ord. 116368 § 149, 1992: Ord. 16066 § 4, 1907.)
5.20.050 Payments under one dollar.
It shall be a term or condition of contracting with the City that payment warrants are drawn only for and checks shall be issued only for sums of One Dollar ($1) or more. If the sum due or owing to anyone providing services or materials to the City is less than One Dollar ($1), payment shall be made from petty cash to those who present themselves in person. Payment shall be deemed waived if more than ninety (90) days passes from the time payment is due without demand in person therefor.
(Ord. 120114 § 13, 2000: Ord. 113872 § 2, 1988.)
Chapter 5.22 ------------
Editor's Note: Section 1 of Ordinance 121364 change the title of Chapter 5.22 from "Convenience Fee for Electronic Payments Via Electronic Commerce Technology" to "Payments Via Credit and Debit Cards and Electronic Commerce."
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Sections:
5.22.010 Authorization for acceptance of credit cards, debit cards, and electronic commerce.
5.22.020 Fees for credit, debit, and electronic payments.
5.22.010 Authorization for acceptance of credit cards, debit cards, and electronic commerce.
All City departments are authorized to accept credit cards, debit cards, and electronic commerce for payment of City taxes, licenses, fees, and other services, but only if and to the extent approved by the Director of Finance and Administrative Services ("Director"). Before approving a City department's policies and procedures for the acceptance of credit cards, debit cards, or electronic commerce payments for City taxes, licenses, fees, or services, the Director shall consider whether sufficient provision has been made for internal financial controls and security. The Director is further authorized to establish City-wide policies and procedures for the acceptance of credit cards, debit cards, and electronic commerce for payment of City taxes, licenses, fees, and other services.
(Ord. 123361, § 146, 2010; Ord. 121364 § 2, 2003; Ord. 120794 § 102, 2002; Ord. 120181 § 93, 2000; Ord. 119283 § 1(part), 1998.)
5.22.020 Fees for credit, debit, and electronic payments.
With approval by the Director as to the type and amount of any convenience fee ("fee"), a City department may apply a fee and add it to each credit or debit card transaction, or to payments made electronically. The fees, which need not be the same for all departments or for all transactions, shall be established by the Director after consultation with the Head of each City Department that accepts payment through credit or debit cards, or through electronic commerce technology, shall be designed to recover no more than the City's overall costs in accepting and processing payments, and shall not exceed any applicable provision of federal, state, or local law. Upon approval by the Director, City departments may be authorized to absorb part or all of any charges imposed by a bank or other commercial provider in connection with the acceptance of credit and debit cards or payments made electronically.
(Ord. 121364 § 3, 2003; Ord. 119283 § 1(part), 1998.)
Chapter 5.24 ------------
Statutory Reference: For Charter provisions on claims for damages see Charter Art. IV § 24; for provisions on verification of claims, see Charter Art. VIII § 14; for statutory provisions on actions against political subdivisions, see RCW Ch. 4.96; for provisions on accident claims and funds, see RCW Ch. 35.31.
Cross-reference: For provisions regarding claims for medical expenses for citizens injured while aiding police, see Chapter 12A.62 of this Code.
Cases: A requirement that a claimant for damages against the City must state his residences for one (1) year last past is unreasonable and therefore void. Hase v. Seattle, 51 Wn. 174, 98 P. 370 (1908).
It is a reasonable and valid requirement that claims against a City for personal injuries shall be in writing and filed with the City Clerk within thirty (30) days. Cole v. Seattle, 64 Wn. 3, 116 P.257(1911).
Only the City Council can waive the requirements for presenting claims against the City, and some affirmative cognizance of the claim, other than rejection by the Council, is necessary to establish such waiver. Cole v. Seattle, 64 Wn. 3, 116 P. 257 (1911).
Nonclaim statutes which require that tort claims against the state or lesser governmental entities be presented within shorter periods of time than that allowed for commencing a tort action against private parties are arbitrary, have no substantial or rational basis, and are violative of the equal protection clauses of the state and federal constitutions. Equal protection requires that such claims be presented, and action commenced if necessary, within the same period allowed for commencing such actions against private parties. Hunter v. North Mason School District, 85 Wn.2d 810, 53d P.2d 845 (1975).
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Sections:
5.24.005 Claims for damages.
5.24.010 Judgment/Claims Subfund.
5.24.020 Payment of judgments.
5.24.030 Payment of claims.
5.24.035 Payment of claims under one dollar.
5.24.040 Advance payments– Grounds for payment.
5.24.010 Judgment/Claims Subfund.
There is established in the City Treasury, as a subfund of the General Fund, a Judgment/Claims Subfund, into which subfund shall be placed such amounts of money as shall be appropriated by the City Council and such funds as are reimbursements from proper source funds for judgments, claims payments, advance claims payments, and litigation expenses; and from which subfund shall be paid: all judgments as authorized by Section 5.24.020; all claims as authorized by Section 5.24.030; all advance payment claims as authorized by Section 5.24.040; and all litigation expenses as authorized by Section 5.24.060.
5.24.030 Payment of claims.
The Director of Finance and Administrative Services may authorize payment of any claim against the City, including claims brought in the small claims department of the district court pursuant to RCW Chapter 12.40. Prior to authorizing settlement of any claim for an amount over $100,000, the Director of Finance and Administrative Services and the City Attorney shall brief the City Council regarding the proposed settlement during executive session called pursuant to RCW 42.30.110. Prior to authorizing a settlement involving significant legal or policy issues, the Director of Finance and Administrative Services shall consult with the City Budget Director, the City Attorney and the head of the relevant department.
(Ord. 123361, § 149, 2010; Ord. 120794 § 105, 2002; Ord. 120521 § 3, 2001; Ord. 120114 § 15, 2000; Ord. 117977 § 2(part), 1995; Ord. 116368 § 152, 1992; Ord. 115538 § 1, 1991; Ord. 108657 § 3, 1979.)
5.24.035 Payments of claims under one dollar.
If the payment of any claim authorized by the City Attorney is less than One Dollar ($1), payment shall be made from petty cash to those who present themselves in person.
(Ord. 113872 § 4, 1988.)
5.24.040 Advance payments– Grounds for payment.
A. The City Attorney and the Director of Finance and Administrative Services are authorized to make periodic payments to a claimant pending settlement or other disposition of his or her claim equivalent to not more than the claimant's pre-injury net take-home pay if the City Attorney or the Director of Finance and Administrative Services finds the following conditions to exist:
1. The claimant has been physically disabled as a result of an act or omission by the City or its employees and agents and for which the City is legally obligated to respond in damages, which physical disability precludes the claimant from engaging in gainful employment;
2. The claimant's loss of employment results in financial hardship and the claimant is without alternate financial resources to provide for the necessary cost of living;
3. Circumstances exist which preclude the early settlement or other disposition of claimant's claim;
4. The best interest of the City and the claimant will be served by making such interim payments.
B. As a condition to commencing such payments, the City Attorney or the Director of Finance and Administrative Services shall secure from the claimant a written agreement that all payments made pursuant to this section shall be credited to the City against any settlement of the claim which may be arrived at, and shall be credited against any judgment which may be rendered against the City by reason of such claim in any court. The agreement may include such additional terms and conditions as the City Attorney or the Director of Finance and Administrative Services determines are appropriate to serve the best interests of the City.
C. In addition to the payments covering wage losses, the City Attorney or the Director of Finance and Administrative Services may, prior to settlement of the claimant's claim or prior to judgment, pay medical costs and provide necessary transportation and other expenses of treatment which the claimant may be required to pay; provided, that all such payments under this chapter shall cease at such time as the City Attorney or the Director of Finance and Administrative Services shall determine that one or more of the circumstances enumerated above have changed or that the total sum paid the claimant approximates the amount the claimant is likely to recover by reason of his or her injury.
(Ord. 123361, § 150, 2010; Ord. 120794, § 106, 2002; Ord. 120521, § 4, 2001; Ord. 108657, § 4, 1979.)
5.24.060 Litigation expenses.
The City Attorney and the Director of Finance and Administrative Services are authorized to make payment to private and/or public agencies, firms, and/or individuals who provide services to the City in support of any litigation and/or claim and/or threatened litigation or claim filed or contemplated against the City or where the City is a plaintiff or potential plaintiff in legal action.
(Ord. 123361, § 151, 2010; Ord. 120794, § 107, 2002; Ord. 120521, § 6, 2001; Ord. 108657, § 6, 1979.)
Chapter 5.28 Sections:
5.28.010 Execution by Mayor and Clerk.
5.28.010 Execution by Mayor and Clerk.
When any civil action is brought by or against the City requiring at any stage thereof its execution of a bond on the part of the City such bond shall be executed by the Mayor and Clerk in behalf of the City and sealed with its Corporate Seal of the City and the Mayor and Clerk are authorized and empowered to execute such bonds.
(Ord. 1177 § 1, 1889.)
Chapter 5.30 Sections:
5.30.010 Definition provisions.
5.30.020 Definitions, A– B.
5.30.025 Definitions, C– D.
5.30.030 Definitions, E– F.
5.30.035 Definitions, G– M.
5.30.040 Definitions, N– R.
5.30.050 Definitions, S.
5.30.060 Definitions, T– Z.
5.30.065 Defintions– References to Chapter 82.32 RCW.
5.30.070 Severability.
5.30.010 Definition provisions.
The definitions contained in this chapter shall apply to the following chapters of the Seattle Municipal Code: Chapters 5.32 (Amusement Devices), 5.35 (Commercial Parking Taxes), 5.37 (Employee Hours Taxes), 5.40 (Admission Taxes), 5.45 (Business License Taxes), 5.46 (Square Footage Business Tax), 5.48 (Utility Taxes), 5.52 (Gambling Taxes), and 5.55 (Administrative Provisions) unless expressly provided for otherwise therein, and shall also apply to other chapters and sections of the Seattle Municipal Code in the manner and to the extent expressly indicated in each chapter or section. Words in the singular number shall include the plural and the plural shall include the singular. Words in one gender shall include both genders.
(Ord. 123063, § 1, 2009; Ord. 122564, § 2, 2008; Ord. 122192, § 2, 2006; Ord. 122191, § 2, 2006; Ord. 120668 § 3(part), 2001.)
5.30.020 Definitions, A– B.
A. "Advance," "reimbursement."
1. "Advance" means money or credits received by a taxpayer from a customer or client with which the taxpayer is to pay costs or fees of the customer or client.
2. "Reimbursement" means money or credits received from a customer or client to repay the taxpayer for money or credits expended by the taxpayer in payment of costs or fees of the customer or client.
B. "Agricultural product," "farmer."
1. "Agricultural product" means any product of plant cultivation or animal husbandry including, but not limited to: A product of horticulture, grain cultivation, vermiculture, viticulture, or "aquaculture" as defined in RCW 15.85.020; plantation Christmas trees; turf; or any animal including but not limited to an animal that is a "private sector cultured aquatic product" as defined in RCW 15.85.020, or a bird, or insect, or the substances obtained from such an animal. "Agricultural product" does not include animals intended to be pets.
2. "Farmer" means any person engaged in the business of growing or producing, upon the person's own lands or upon the lands in which the person has a present right of possession, any agricultural product whatsoever for sale. "Farmer" does not include a person using such products as ingredients in a manufacturing process, or a person growing or producing such products for the person's own consumption. "Farmer" does not include a person selling any animal or substance obtained therefrom in connection with the person's business of operating a stockyard or a slaughter or packing house. "Farmer" does not include any person in respect to the business of taking, cultivating or raising timber.
C. "Amusement device." Any machine or device which provides recreation or entertainment for which a charge is made for use or play. It includes, but is not limited to, pool and billiard tables, shuffleboards, music machines, video games, pinball games, riding devices, panoram and peepshow devices, televisions and devices for display of pictures or views on film; provided, that it does not mean or include any machine or device used exclusively for the vending of merchandise.
D. "Artistic or cultural organization." The term "artistic or cultural organization" means an organization which is organized and operated exclusively for the purpose of providing "artistic or cultural exhibitions, presentations, or performances or cultural or art education programs," as defined in subsection (2), below, of this subsection, for viewing or attendance by the general public. The organization must be:
1. A not-for-profit corporation under RCW Chapter 24.03 that meets all of the following criteria:
a. The organization must be managed by a governing board of not less than eight (8) individuals none of whom is a paid employee of the organization or by a corporation sole under RCW Chapter 24.12.
b. No part of the organization's income may be paid directly or indirectly to its members, stockholders, officers, directors, or trustees except in the form of services rendered by the organization in accordance with its purposes and bylaws.
c. Salary or compensation paid to its officers and executives must be only for actual services rendered, and at levels comparable to the salary or compensation of like positions within the state.
d. Assets of the organization must be irrevocably dedicated to the activities for which the exemption is granted and, on the liquidation, dissolution, or abandonment by the organization, may not inure directly or indirectly to the benefit of any member or individual except a non-profit organization, association, or corporation which also would be entitled to the exemption.
e. The organization must be duly licensed or certified when licensing or certification is required by law or regulation.
f. The amounts received that qualify for exemption must be used for the activities for which the exemption is granted.
g. Services must be available regardless of race, color, national origin, or ancestry.
2. The term "artistic or cultural exhibitions, presentations, or performances or cultural or art education programs" is limited to:
a. An exhibition or presentation of works of art or objects of cultural or historical significance, such as those commonly displayed in art or history museums;
b. A musical or dramatic performance or series of performances;
c. An educational seminar or program, or series of such programs, offered by the organization to the general public on an artistic, cultural, or historical subject.
E. "Beneficial use" has the meaning given in SMC 21.36.010.
F. "Bona-fide charitable organization" means an organization that meets all of the requirements of RCW 9.46.0209, as now existing or hereafter amended, and is organized and operated primarily to provide charitable services as defined by WAC 230-02-160. This term is used in conjunction with the gambling tax provisions contained in SMC Chapter 5.52.
G. "Bona-fide nonprofit organization" means an organization that meets all of the requirements of RCW 9.46.0209. This term is used in conjunction with the gambling tax provisions contained in SMC Chapter 5.52.
H. "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.
I. "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.
(Ord. 123063, § 2, 2009; Ord. 122842, § 1, 2008; Ord. 121679 § 1, 2004; Ord. 121266 § 10, 2003; Ord. 120668 § 3(part), 2001.)
5.30.025 Definitions, C– D.
A. "Cash discount" means a deduction from the invoiced amount allowed by the seller if the invoice is paid within a certain time period or before a specified date.
B. "Cellular telephone service" is a voice or data telephone/telecommunications system based in whole or substantial part on wireless radio communications, whether or not the communications are subject to regulation by the Washington Utilities and Transportation Commission (WUTC). This includes cellular mobile service. 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 the same purpose as cellular mobile service.
C. "City" means the City of Seattle.
D. "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.
E. "Competitive telephone service" means the providing by any person of telecommunications equipment or apparatus, or service related to that equipment or apparatus such as repair or maintenance service, if the equipment or apparatus is of a type which may be provided by persons not subject to regulation as telephone companies under RCW Title 80, and for which a separate charge is made. Competitive telephone service also includes leasing of telephone street directories. Transmission of communication through cellular telephones is classified as "telephone business" rather than "competitive telephone service."
F. "Construction, Demolition and Land Clearing Waste" (or "CDL Waste") has the meaning given in Section 21.36.012.
G. "Consumer" means the following:
1. Any person who purchases, acquires, owns, holds, or uses any tangible or intangible personal property irrespective of the nature of the person's 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 a consumer other than for the purpose of:
a. Resale as tangible or intangible personal property in the regular course of business;
b. Incorporating such property as an ingredient or component of real or personal property when installing, repairing, cleaning, altering, imprinting, improving, constructing, or decorating such real or personal property of or for consumers;
c. Incorporating such property as an ingredient or component of a new product or as a chemical used in processing a new product when the primary purpose of such chemical is to create a chemical reaction directly through contact with an ingredient of a new product; or
d. Consuming the property 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;
2. Any person engaged in any business activity taxable under subsection 5.45.050.F and subsection 5.45.050.G;
3. Any person who purchases, acquires, or uses any competitive telephone service as herein defined, other than for resale in the regular course of business;
4. Any person who purchases, acquires, or uses any personal, business, or professional service defined as a retail sale in Section 5.30.050 other than for resale in the regular course of business;
5. Any person who is an end user of software;
6. Any person engaged in the business of "public road construction," as that term is defined in Section 5.30.040, in respect to tangible personal property when that person incorporates the tangible personal property as an ingredient or component of a publicly-owned street, place, road, highway, easement, right-of-way, mass public transportation terminal or parking facility, bridge, tunnel, or trestle by installing, placing or spreading the property in or upon the right-of-way of a publicly-owned street, place, road, highway, easement, bridge, tunnel, or trestle or in or upon the site of a publicly-owned mass public transportation terminal or parking facility;
7. Any person who is an owner, lessee or has the right of possession to or an easement in real property which is being constructed, repaired, decorated, improved, or otherwise altered by a person engaged in business;
8. Any person who is an owner, lessee, or has the right of possession, of personal property which is being constructed, repaired, improved, cleaned, imprinted, or otherwise altered by a person engaged in business;
9. Any person engaged in "government contracting," as that term is defined in Section 5.30.035. Any such person shall be a consumer within the meaning of this subsection in respect to tangible personal property incorporated into, installed in, or attached to such building or other structure by such person;
Nothing contained in this or any other subsection of this section shall be construed to modify any other definition of "consumer."
H. "Customer-owner," with respect to a distribution cooperative, means a person a) having an ownership interest in the distribution cooperative, b) who purchases merchandise for sale at retail from the distribution cooperative or its distribution affiliate, and c) who is entitled to distributions made by the distribution cooperative.
I. "Dangerous waste" has the same meaning as given in Section 21.36.012.
J. "Deficiency" means the amount of tax imposed by law less any tax reported by the taxpayer on a tax return.
K. "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 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 Seattle's business license tax.
L. "Director" means the Director of Finance and Administrative Services of the City or any officer, agent or employee of the City designated to act on the Director's behalf.
M. "Distribution affiliate" means a partnership, limited liability company or other entity that sells merchandise to the customer-owners of the distribution cooperative and which is owned 50 percent or more by the distribution cooperative.
N. "Distribution cooperative" means a person a) that itself sells, or owns 50 percent or more of a distribution affiliate that sells, merchandise to its customer-owners for resale at retail, b) in which two-thirds of the aggregate outstanding voting ownership interest is owned by its customer-owners, c) that makes distributions to its customer-owners at least partly on the basis of patronage, and d) that qualifies for federal income tax purposes under the provisions of subchapter T of the Internal Revenue Code of 1986, as amended.
(Ord. 123704, § 6, 2011; Ord. 123361, § 152, 2010; Ord. 123239, § 1, 2010; Ord. 122842, § 2, 2008; Ord. 122563, § 1, 2007; Ord. 121679 § 2, 2004; Ord. 121266 § 11, 2003; Ord. 120794 § 108, 2002; Ord. 120668 § 3(part), 2001.)
5.30.030 Definitions, E– F.
A. "Eligible gross receipts tax" means a tax which:
1. Is imposed on the act or privilege of engaging in business activities within SMC Section 5.45.050;
2. Is measured by the gross volume of business in terms of gross receipts, and is not an income tax or value added tax;
3. Is not, pursuant to law or custom, separately stated from the sales price;
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.
B. "Engaging in business."
1. The term "engaging in business activity" 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.
2. 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 subsection (1), above. If an activity is not listed, the issue of whether it constitutes engaging in business in the City shall be determined by considering all the facts and circumstances and applicable law.
3. 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 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, in connection with a business ativity;
b. Owning, renting, leasing, using, or maintaining, an office, place of business, or other establishment in the City in which business activities are conducted;
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;
g. Soliciting, negotiating, or approving franchise, license, or other similar agreements;
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;
l. 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 who sold the goods or another acting on its behalf; or
q. Accepting or executing a contract with the City, irrespective of whether the goods or services are delivered within or without the City, or whether the person's office or place of business is within or without the City.
4. 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;
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". Persons participating at a trade show shall review the City's trade show ordinance, SMC Chapter 6.20;
f. Conducting advertising through the mail;
g. Soliciting sales by phone from a location outside the City; or
h. Accepting or executing a contract with the City when:
1. The aggregate value of all City contracts with the person during the calendar year is Five Thousand Dollars ($5,000) or less and the person is engaged in no other business within the City; or
2. The person's only source of revenue consists of contracts with the City for neighborhood planning purposes, sister city associations, or Arts Commission grants, and is less than the taxable threshold amount provided in SMC Section 5.55.040D.
5. 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.
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.
C. "Extracting" means the activity engaged in by an extractor and is reportable under the extracting classification.
D. "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, or takes, cultivates, or raises 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; persons cultivating or raising fish entirely within confined rearing areas on the person's own land or on land in which the person has a present right of possession; or persons who fell, cut, or take plantation Christmas trees from the person's own land or from land in which the person has a present right of possession, or persons meeting the definition of farmer.
E. "Extractor for Hire" means a person who performs under contract necessary labor or mechanical services for an extractor.
F. "Freight Broker" shall mean persons who sell, provide for, or arrange transportation by a motor carrier for compensation. Freight brokers do not themselves transport or contract to transport property from origin to destination.
(Ord. 123063, § 3, 2009; Ord. 121679 § 3, 2004; Ord. 121266 § 12, 2003; Ord. 120668 § 3(part), 2001.)
5.30.035 Definitions, G– M.
A. "Garbage" has the meaning given in SMC Section 21.36.014.
B. "Government contracting" means 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 pursuant to RCW Chapter 35.82, 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. The term shall include 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.
C. "Gross gambling receipts" means the monetary value that would be due to any operator of a gambling activity for any chance taken, other participation fees, any rental or lease fees for amusement games received by a commercial amusement game operation, as evidenced by required records. The value shall be stated in U.S. currency, before any deductions for prizes or any other expenses. In the absence of records, gross gambling receipts shall be the maximum that would be due to an operator from that particular activity if operated at maximum capacity.
D. "Gross income of the business" means the value proceeding or accruing by reason of the transaction of the business activity 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.
E. "Gross proceeds of sales" means the value proceeding or accruing from the sale of tangible personal property or for 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.
F. "Hazardous substances" has the same meaning as given in SMC 21.36.014.
G. "In this City," "within this City." "In this City" or "within this City" includes all federal areas lying within the corporate city limits of the City.
H. "International Investment Management Services." A person is engaged in the business of providing international investment management services if such a person is engaged primarily in the business of providing investment management services and at least ten percent of the gross income of such person is derived from providing investment management services to any of the following: 1) persons or collective investment funds residing outside of the United States; or 2) persons or collective investment funds with at least ten percent of their investments located outside the United States. "Investment management services" means investment research, investment consulting, portfolio management, fund administration, fund distribution, investment transactions, or related investment services. "Collective investment funds" include: 1) a mutual fund or other regulated investment company, as defined in section 851(a) of the Internal Revenue Code of 1986, as amended; 2) an investment company as that term is used in Section 3(a) of the Investment Company Act of 1940, as well as any entity that would be an investment company for this purpose but for the exemptions contained in section 3(c)(1) or (11) of that act; 3) an employee benefit plan, which includes any plan, trust, commingled employee benefit trust, or custodial arrangement that is subject to the Employee Retirement Income Security Act of 1974, as amended, 29 U.S.C. Sec. 1001 et seq., or that is described in sections 125, 401, 403, 408, 457, and 501(c)(9) and (17) through (23) of the Internal Revenue Code of 1986, as amended, or a similar plan maintained by a state or local government, or a plan, trust, or custodial arrangement established to self-insure benefits required by federal, state, or local law; 4) a fund maintained by a tax-exempt organization as defined in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, for operating, quasi-endowment, or endowment purposes; 5) funds that are established for the benefit of such tax-exempt organizations, such as charitable remainder trusts, charitable lead trusts, charitable annuity trusts, or other similar trusts; or 6) collective investment funds similar to those described in 1) through 5) of this subsection created under the laws of a foreign jurisdiction. Investments are located outside of the United States if the underlying assets in which the investment constitutes a beneficial interest reside or are created, issued, or held outside the United States.
I. "Janitorial Services." The term "janitorial services" shall mean those cleaning and care taking 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 does not include painting, papering, repairing, furnace or septic tank cleaning, snow removal, sandblasting, or cleanup related to construction activities.
J. "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 twenty percent (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. A business not located in this City that is the owner of materials or ingredients processed for it in this City by a processor for hire shall be deemed to be engaged in business as a manufacturer in this City.
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 of tangible personal property is produced for sale or commercial or industrial use, and shall include:
a. The production of special-made articles 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 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.
K. "Motor Carrier" shall mean the carrier providing transportation for hire described in the definitions of "common carrier" and "contract carrier" as defined in RCW 81.80.010.
(Ord. 123099, § 1, 2009; Ord. 122842, § 3, 2008; Ord. 121679, § 4, 2004; Ord. 121266, § 13, 2003; Ord. 120794, § 109, 2002; Ord. 120668, § 3(part), 2001.)
Editor's note: The provisions of 123099 become effective January 10, 2010.
5.30.040 Definitions, N– R.
A. "Newspaper," "magazine," "periodical."
1. "Newspaper" means a publication offered for sale regularly at stated intervals at least once a week and printed on newsprint in tabloid or broadsheet format folded loosely together without stapling, glue, or any other binding of any kind.
2. "Magazine or periodical" means any printed publication, other than a newspaper, issued and offered for sale regularly at stated intervals at least once every three (3) months, including any supplement or special edition of the publication. Any publication meeting this definition qualifies regardless of its content.
B. "Net gambling receipts" means all gross gambling receipts from any gambling activity, less the monetary value or, in the case of merchandise, the actual cost, of any prizes that were awarded.
C. "Non-profit organization" means an organization in which no part of the income can be distributed to its members, directors, or officers and that holds a current tax exempt status as provided under Sec. 501(c)(3) of the Internal Revenue Code, as hereafter amended, or is specifically exempted from the requirement to apply for tax exempt status under Sec. 501(c)(3).
D. "Office," "place of business." "Office" or "place of business" means a fixed location or permanent facility where the regular business of the person is conducted and which is either owned by the person or over which the person exercises legal dominion and control. The regular business of the person is presumed conducted at a location:
1. Whose address the person uses as its business mailing address;
2. Where the place of primary use is shown on a telephone billing or a location containing a telephone line listed in a public telephone directory or other similar publication under the business name;
3. Where the person holds itself out to the general public as conducting its regular business through signage or other means; and
4. Where the person is required to obtain any appropriate state and local business license or registration unless exempted by law from such requirement.
A vehicle such as a pick-up, van, truck, boat or other motor vehicle is not an office or place of business. A post office box is not an office or place of business.
If a person has an office or place of business, the person's home is not an office or place of business unless it meets the criteria for office or place of business above. If a person has no office or place of business, the person's home or apartment within the City will be deemed the place of business.
E. "Pager Service" means service provided by means of an electronic device that has ability to send or receive voice or digital messages transmitted through the local telephone network, via satellite or any other form of voice or data transmission.
F. "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, nonprofit or otherwise and the United States or any instrumentality thereof.
G. "Precious metal bullion or monetized bullion."
1. "Precious metal bullion" means any precious metal which has been put a process of smelting or refining, including, but not limited to, gold, silver, platinum, rhodium, and palladium, and which is in such state or condition that its value depends upon its contents and not upon its form.
2. For purposes of this section, "monetized bullion" means coins or other forms of money manufactured from gold, silver or other metals and heretofore, now or hereafter used as a medium of exchange under the laws of this state, the United States or any foreign nation, but does not include coins or money sold to be manufactured into jewelry or works of art.
H. "Processing for hire" means the performance of labor and mechanical services upon materials or ingredients belonging to others so that as a result a new, different or useful product is produced for sale, or commercial or industrial use. A processor for hire is any person who would be a manufacturer if that person were performing the labor and mechanical services upon that person's own materials or ingredients. If a person furnishes, or sells to the customer prior to manufacture materials or ingredients equal to twenty (20) percent or more of the total value of all materials or ingredients that become a part of the finished product, the person will be deemed to be a manufacturer, and not a processor for hire.
I. "Product," "byproduct."
1. "Product" means tangible personal property, including articles, substances or commodities created, brought forth, extracted or manufactured by human or mechanical effort.
2. "Byproduct" means any additional product, other than the principal or intended product, which results from extracting or manufacturing activities and which has a market value, without regard to whether or not such additional product was an expected or intended result of the extracting or manufacturing activities.
J. "Public road construction" means 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 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.
K. "Recovered material" means a usable or marketable product or commodity that results from recycling or material owned or acquired from another, but excludes use for landfill or incineration.
L. "Recyclable materials" has the meaning given in SMC 21.36.016.
M. "Recycling" or "recycle." "Recycling" or "recycle" has the meaning given in SMC Section 21.36.016.
N. "Reporting period," "Monthly," "Quarterly," "Annual." The "reporting period" means one of the following:
1. A one-month period beginning the first day of each calendar month ("monthly");
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").
O. "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 (a) horticultural services provided to farmers and (b) 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.
P. "Retailing" means the activity of engaging in making sales at retail and is reported under the retailing classification.
Q. "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.
R. "Royalties" mean compensation for the use of intangible property, such as copyrights, patents, licenses, franchises, trademarks, tradenames and similar items.
S. "Rubbish" has the meaning given in SMC Section 21.36.016.
(Ord. 122842, § 4, 2008; Ord. 121679 § 5, 2004; Ord. 121266 § 14, 2003.)
5.30.050 Definitions, S.
A. "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.
2. "Casual or isolated sale" means a sale of tangible personal property made by a person who is not engaged in the business of selling the type of tangible personal property involved on a routine or continuous basis.
B. "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 (a), (b), (c), (d), or (e) of this subsection following such use.
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 subsections 5.45.050.F and 5.45.050.G.
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 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. The sale of or charge made for tangible personal property, labor and services to persons taxable under (a), (b), (c), (d), (e), and (f) of this subsection when such sales or charges are for property, labor and services which are used or consumed in 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 subsection B 3 shall be construed to modify subsection 1 of this subsection B, and nothing contained in subsection B 1 shall be construed to modify this subsection B 3.
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" shall also include the sale of canned 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, but shall not include custom software or the customization of canned software.
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. (Public road construction).
7. "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).
8. "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 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.
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. (This is reported under the service or other classification).
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 (this is reported under the service or other classification).
C. "Sale at wholesale," "wholesale sale." "Sale at wholesale" or "wholesale sale" means any sale of tangible personal property which is not a retail sale, and any charge made for labor and services rendered for persons who are not consumers, 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 for the purpose of resale, as contemplated by RCW 35.21.715.
Notwithstanding the above, "sale at wholesale" or "wholesale sale" shall specifically not include a distribution cooperative's or its distribution affiliate's sales of merchandise to a customer-owner of the distribution cooperative for the customer-owner's resale at retail. A distribution cooperative or a distribution affiliate is taxed on such sales pursuant to Section 5.45.050.G of the Seattle Municipal Code.
D. "Services." A definition of "services" will be adopted when the term is defined in RCW 82.04.
E. "Software," "prewritten software," "custom software," "customization of canned software," "master copies," "retained rights."
1. "Prewritten software," or "canned software" means computer software, including prewritten upgrades, that is not designed and developed by the author or other creator to the specifications of a specific purchaser. The combining of two or more prewritten computer software programs or prewritten portions thereof does not cause the combination to be other than prewritten computer software. Prewritten computer software includes software designed and developed by the author or other creator to the specifications of a specific purchaser when it is sold to a person other than such purchaser. Where a person modifies or enhances computer software of which such persons is not the author or creator, the person shall be deemed to be the author or creator only of the person's modifications or enhancements. Prewritten computer software or a prewritten portion thereof that is modified or enhanced to any degree, where such modification or enhancement is designed and developed to the specifications of a specific purchaser, remains prewritten computer software; however, where there is a reasonable, separately stated charge or an invoice or other statement of the price given to the purchaser for the modification or enhancement, the modification or enhancement shall not constitute prewritten computer software.
2. "Custom software" means software created for a single person.
3. "Customization of canned software" means any alteration, modification, or development of applications using or incorporating canned software to specific individualized requirements of a single person. Customization of canned software includes individualized configuration of software to work with other software and computer hardware but does not include routine installation. Customization of canned software does not change the underlying character or taxability of the original canned software.
4. "Master copies" of software means copies of software from which a software developer, author, inventor, publisher, licensor, sublicensor, or distributor makes copies for sale or license. The software encoded on a master copy and the media upon which the software resides are both ingredients of the master copy.
5. "Retained rights" means any and all rights, including intellectual property rights such as those rights arising from copyrights, patents, and trade secret laws, that are owned or are held under contract or license by a software developer, author, inventor, publisher, licensor, sublicensor, or distributor.
6. "Software" means any information, program, or routine, or any set of one (1) or more programs, routines, or collections of information used, or intended for use, to convey information that causes one (1) or more computers or pieces of computer-related peripheral equipment, or any combination thereof, to perform a task or set of tasks. "Software" includes the associated documentation, materials, or ingredients regardless of the media upon which that documentation is provided, that describes the code and its use, operation, and maintenance and that typically is delivered with the code to the consumer. All software is classified as either canned or custom.
F. "Solid waste" has the meaning given in SMC Section 21.36.016.
G. "Solid waste collection service" means collecting solid waste from customers for transfer, processing, treatment, storage, or disposal. Solid waste collection service includes, but is not limited to the activities of transferring, processing, treating, storing, or disposing of the solid waste collected. Solid waste collection service includes "property clean up services," defined as businesses that contract directly with residences and businesses to clean up property and remove solid waste. It does not include the operation of public or private dumps, transfer stations and similar operations.
H. "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.
(Ord. 123704, § 7, 2011; Ord. 123239, §§ 2, 3, 2010; Ord. 123063, § 4, 2009; Ord. 122842, § 5, 2008; Ord. 122563, § 2, 2007; Ord. 121679 § 6, 2004; Ord. 121266 § 15, 2003; Ord. 120668 § 3(part), 2001.)
5.30.060 Definitions, T– Z.
A. "Tax year," "taxable year." "Tax year" or "taxable year" means the calendar year.
B "Taxpayer" means any "person," as herein defined, required by Chapter 5.55 to have a business license, or liable for any license, tax or fee, or for the collection of any tax or fee, under Chapters 5.32 (Amusement Devices), 5.35 (Commercial Parking Taxes), 5.40 (Admission Taxes), 5.45 (Business License Tax), 5.46 (Square Footage Business Tax), 5.48 (Utility Tax), and 5.52 (Gambling Tax), or who engages in any business or who performs any act for which a tax or fee is imposed under those chapters.
C. "Telecommunications service" or "Telephone business" means the electronic transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point, or between or among points. It includes such transmission, conveyance, or routing in which computer processing applications are used to act on the form, code, or protocol of the content for purposes of transmission, conveyance, or routing without regard to whether such service is referred to as voice over internet protocol services or is classified by the federal communications commission as enhanced or value added. Telecommunication services or telephone business also includes ancillary services that are associated with or incidental to the provision of telecommunication services including, but not limited to conference bridging, detailed telecommunications billing, directory assistance, vertical service, or voice mail services as defined in RCW 82.04.065.
Telecommunication services or telephone business also includes those activities previously used to define telephone business such as the providing by any person of access to a local telephone network, local telephone network switching service, toll service, cellular or mobile telephone service, coin telephone services, pager service or the providing of telephonic, video, data, or similar communication or transmission for hire, via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. The term includes the provision of cooperative or farmer line telephone services or associations operating exchanges. The term also includes the provision of transmission to and from the site of an internet provider via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. "Telecommunication service or telephone business" does not include the providing of competitive telephone service, data processing, providing of cable television service, or other providing of broadcast services by radio or television stations.
D. "Tour operator business" means a business activity of purchasing various travel components, such as transportation, lodging, meals and other associated services and reselling the same to consumers where the purchaser/reseller is liable itself to pay the vendor of the components purchased and does not make payment solely as an agent for the consumer.
E. "Tuition fee" includes library, laboratory, health service and other special fees, and amounts charged for room and board by an educational institution when the property or service for which such charges are made is furnished exclusively to the students or faculty of such institution. "Educational institution," as used in this section, means only those institutions created or generally accredited as such by the state and includes educational programs that such educational institution cosponsors with a non-profit organization, as defined by Section 501(c)(3) of the Internal Revenue Code, as hereafter amended, if such educational institution grants college credit for coursework successfully completed through the educational program, or an approved branch campus of a foreign degree-granting institution in compliance with chapter 28B.90 RCW, and in accordance with RCW 82.04.4332 or defined as a degree-granting institution under RCW 28B.85.010(3) and accredited by an accrediting association recognized by the United States secretary of education, and offering to students an educational program of a general academic nature or those institutions which are not operated for profit and which are privately endowed under a deed of trust to offer instruction in trade, industry, and agriculture, but not including specialty schools, business colleges, other trade schools, or similar institutions.
F. "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 accrue 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.
G. "Value of products, how determined."
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 or 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 of Finance and Administrative Services may prescribe uniform and equitable rules for the purpose of ascertaining such values.
3. Notwithstanding subsection 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 incorporate into the prototype in cases in which the new or improved product is not offered for sale.
H. "Wholesaling" means engaging in the activity of making sales at wholesale, and is reported under the wholesaling classification.
I. "Yardwaste" has the meaning given in SMC Section 21.36.016.
(Ord. 123361, § 153, 2010; Ord. 123063, § 5, 2009; Ord. 122564, § 3, 2008; Ord. 122563, § 3, 2007; Ord. 121679 § 7, 2004; Ord. 121266 § 16, 2003; Ord. 120794 § 110, 2002; Ord. 120668 § 3(part), 2001.)
5.30.065 Definitions– References to Chapter 82.32 RCW.
Where provisions of Chapter 82.32 RCW are incorporated in Chapter 5.55 of this Title, "Department" as used in the RCW shall refer to the "Director" as defined in SMC 5.30.025 and "warrant" as used in the RCW shall mean "citation or criminal complaint."
(Ord. 122270, § 1, 2006.)
5.30.070 Severability.
If any part, provision or section of this chapter is held to be void or unconstitutional, all other parts, provisions, and sections of this chapter not expressly so held to be void or unconstitutional shall continue in full force and effect.
(Ord. 120668 § 3(part), 2001.)
Chapter 5.32 ------------
Severability: The invalidity of any section, subsection, provision, clause, or portion of this chapter, or the invalidity of the application thereof to any person or circumstance, shall not affect the validity of the remainder of this chapter or the validity of its application to other persons or circumstances.
(Ord. 106024 § 1.900, 1976.)
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Sections:
Subchapter I. General Provisions
5.32.020 Exercise of power to license for revenue.
Subchapter II. Amusement Devices
5.32.150 Amusement license required.
5.32.160 Exemptions.
5.32.170 License fees.
5.32.190 Records– Location of devices.
5.32.200 Unlawful acts.
Subchapter I 5.32.020 Exercise of power to license for revenue.
The provisions of this chapter shall be deemed an exercise of the power of the City to license for revenue and regulation. 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 to reconfirm tax computation procedures and remain in compliance with the City code.
(Ord. 120668 § 6, 2001: Ord. 118411 § 1, 1996: Ord. 106024 § 1.020, 1976.)
Subchapter II 5.32.150 Amusement license required.
It is unlawful for any person to own any amusement device, which is available for use by the public, without having first obtained an amusement device license issued in accordance with the provisions of this chapter. The license shall be attached to the amusement device at all times when in use or play or available for use or play so that it is readily visible. This license is in addition to the business license required in SMC Section 5.55.030.
(Ord. 120668 § 7, 2001: Ord. 106024 § 2.050, 1976.)
5.32.160 Exemptions.
No amusement device license is required under this chapter for an amusement device if:
A. An admissions tax is collected upon its use pursuant to Ordinance 72495, as now or hereafter amended; or
B. The maximum price for one (1) use or one (1) play is less than Twenty-five Cents ($.25).
(Ord. 120668 § 8, 2001: Ord. 120181 § 154, 2000; Ord. 118411 § 7, 1996: Ord. 114895 § 2, 1989: Ord. 106024 § 2.070, 1976.)
5.32.170 License fees.
A. The license fee for any amusement device which is operated or activated by the insertion of a coin, currency, token, credit card, debit card or other payment medium shall be based upon the minimum price levied for one (1) play or one (1) use of the device.1 The annual license fee shall be one hundred (100) times the price of one (1) play or use of the device rounded to the next highest Fifty Dollars ($50). The maximum license fee shall be Fifteen Hundred Dollars ($1,500) per device per year, with the following exceptions:
1. The license fee for a countertop device or electronic dart board shall not exceed Twenty-five Dollars ($25); and
2. The license fee for a pool table, billiard table, shuffle board, jukebox or other music device shall not exceed Fifty Dollars ($50).
B. The license fee for any amusement device which is not operated or activated by the insertion of a coin, currency, token, credit card, debit card or other payment medium shall be Five Hundred Dollars ($500) per year; except the license for a pool table, billiard table or shuffle board shall not exceed Fifty Dollars ($50) per year.
C. The operator of an event, not to exceed three (3) calendar days in length, may obtain a Special Event License in lieu of the amusement device license required under this chapter. The fee for the license shall be Five Dollars ($5) per device offered for play at such event; provided, the minimum fee shall be Twenty-five Dollars ($25) and the maximum fee shall be One Hundred Dollars ($100).
D. Revenue from the operation of devices, whether licensed or unlicensed, is subject to the provisions of Chapter 5.45 of the Seattle Municipal Code.
(Ord. 120668 § 9, 2001 Ord. 118411 § 8, 1996: Ord. 116468 § 1, 1992: Ord. 114436 § 1, 1989: Ord. 112039 § 1, 1984: Ord. 110891 § 1, 1982: Ord. 110579 § 1, 1982: Ord. 110421 § 1, 1982: Ord. 109499 § 1, 1980: Ord. 106024 § 2.100, 1976.)
1. Editor's Note: Ord. 112039 is further clarified by Ord. 112052 which is on file in the City Clerk's Office.
5.32.190 Records– Location of devices.
Any person licensed pursuant to this subchapter shall maintain records showing the location of each amusement device license issued to such person. Upon request of the Director, a list specifying the locations shall be provided.
(Ord. 106024 § 2.300, 1976.)
5.32.200 Unlawful acts.
In addition to the unlawful acts contained in SMC Section 5.55.220 the following are also unlawful acts.
A. It is unlawful for any person in charge of any place or location to permit or allow to be used or played in such place any amusement device not having attached thereto an amusement device license.
B. It is unlawful for the owner of any amusement device to fail to display his or her name and current address on each amusement device when in use or play or available for use or play.
C. It is unlawful for the any person in charge of any place or location to permit or allow to be used or played in such place any amusement device not having attached thereto the name and current address of the owner of the amusement device.
D. Remedial action by the City may include fines and imprisonment as provided for in SMC Section 5.55.220.
(Ord. 120668 § 10, 2001: Ord. 118411 § 9, 1996: Ord. 110579 § 2, 1982: Ord. 106024 § 2.700, 1976.)
Chapter 5.33 Sections:
5.33.010 Definitions
5.33.020 Small grants; acceptance
5.33.030 Certain conditions not allowed
5.33.040 Report
5.33.050 Expenditures
5.33.010 Definitions
1. Grant: For purposes of this Chapter, a grant means money that is conditionally provided to the City for a specific purpose, memorialized by a contract or other agreement between the grantor and the City.
2. Small Grant: For purposes of this Chapter, a small grant means an individual grant in an amount that does not exceed $15,000.
(Ord. 123157, § 1, 2009.)
5.33.020 Small grants; acceptance
The City Auditor, the Director of Finance and Administrative Services, the Director of Planning and Development, the City Attorney, the Superintendent of City Light, the Executive Director of the Employees' Retirement System, the Executive Director of the Ethics and Elections Commission, the Executive Secretary of the Firefighters' Pension System, the Administrative Director of the Legislative Department, the Mayor, the Presiding Judge of the Municipal Court, the Director of Personnel, the Executive Secretary of the Police Relief and Pension System, the Director of Transportation, the Fire Chief, the Director of the Human Services Department, the Chief Technology Officer, the Superintendent of Parks and Recreation, the Chief of Police, the Director of Seattle Center, the Seattle City Librarian, the Director of Seattle Public Utilities, the Director of the Department of Neighborhoods, the City Budget Director, and the directors of each of the offices other than commissions governed by SMC Chapter 3.14, are authorized to accept small grants from non-City sources for purposes that are consistent with the function and authority conferred upon the agency of each such respective officer, and to execute, deliver, and perform corresponding agreements.
(Ord. 123361, § 154, 2010; Ord. 123157, § 1, 2009.)
5.33.030 Certain conditions not allowed
The authority granted in Section 5.33.020 shall not apply to a grant the acceptance of which is conditioned upon the City's commitment to provide matching funds, or to expend additional City resources.
(Ord. 123157, § 1, 2009.)
5.33.040 Report
The Director of Finance and Administrative Services shall transmit a written report by December 31st of each year to the Chair of the City Council Finance and Budget Committee, which shall list all grants received under the authority granted in Section 5.33.020 and include for each grant the name of the grantor, the exact dollar amount of the grant, the receiving department, the fund or funds that the grant dollars were deposited into, and a brief description of the purpose of the grant.
(Ord. 123361, § 155, 2010; Ord. 123157, § 1, 2009.)
5.33.050 Expenditures
For each grant accepted pursuant to this Chapter 5.33, each of the officers identified in SMC 5.33.020 is authorized to direct expenditures of the funds obtained in accordance with the terms of the applicable grant.
(Ord. 123157, § 1, 2009.)
Chapter 5.34 The Director of Finance and Administrative Services is authorized, for amounts up to $15,000, to accept and deposit donations to the City for its trust accounts, accept anonymous donations of cash to the City, and accept restricted or unrestricted donations of funds from identified or unidentified donors. The Director shall keep and maintain a record of each such donation including the date of the donation, name (if identified) of the donor, the exact dollar amount of the donation, the receiving department, the fund or funds that the donation dollars were deposited into, and a brief description of the purpose of the donation, if any.
(Ord. 123361, § 387, 2010)
Subtitle II Chapter 5.35 Sections:
5.35.010 Administrative Provisions.
5.35.020 Definitions.
5.35.030 Parking Tax Imposed.
5.35.040 Measure of Tax: Parking Fee.
5.35.050 Exemptions from the Parking Tax.
5.35.060 Collection and Remittance Of Tax.
5.35.070 Use Of Revenues.
5.35.080 Receipts To Transportation Fund.
5.35.010 Administrative Provisions.
All of the provisions contained in Chapter 5.55 of the Seattle Municipal Code shall have full force and application with respect to taxes imposed under the provisions of this chapter except as may be expressly stated to the contrary herein.
(Ord. 122192, § 1, 2006)
5.35.020 Definitions.
The definitions contained in Chapter 5.30 of the Seattle Municipal Code shall be fully applicable to this chapter except as may be expressly stated to the contrary herein. The following additional definitions shall apply throughout this chapter:
A. "Commercial parking business" means the ownership, lease, operation, or management of a commercial parking lot in which fees are charged for the act or privilege of parking motor vehicles.
B. "Commercial parking lot" means a covered or uncovered area with stall used for the purpose of parking motor vehicles for a fee.
C. "Parking tax" means the commercial parking tax imposed by this chapter.
(Ord. 122192, § 1, 2006)
5.35.030 Parking Tax Imposed.
A. Pursuant to RCW 82.80.030, there is imposed on every person a tax for the act or privilege of parking a motor vehicle in a commercial parking lot within the City that is operated by a commercial parking business. The privilege of parking includes the right to park, whether or not the right is exercised.
B. The amount of the parking tax shall be equal to the parking fee multiplied by the parking tax rate. Effective July 1, 2009, the parking tax rate is imposed at ten percent (0.10). Effective January 1, 2011, the parking tax rate is imposed at 12.5 percent.
(Ord. 123396, § 1, 2010; Ord. 122192, § 1, 2006)
5.35.040 Measure of Tax: Parking Fee.
A. The measure of the parking tax is the parking fee. Parking fee means the fee paid or due for the act or privilege of parking a motor vehicle in a commercial parking lot.
B. If, in a lease of nonresidential space, a parking fee is combined with other payments, or is otherwise not separately stated, or does not result from an arm's length transaction, or does not fairly reflect the value of the act or privilege of parking, the parking fee shall be determined by the Director according to rules promulgated by the Director to establish the parking fee based on the fair market value of the act or privilege of parking.
C. It shall be conclusively presumed that the posted parking prices do not include the parking tax unless all the following conditions are met:
1. The fee is advertised as including the tax or that the commercial parking business is paying the tax;
2. The words "tax included" are stated immediately following the advertised or posted prices in print size at least half as large as the advertised or posted prices print size; and
3. All advertised or posted parking prices and the words "tax included" are stated in the same medium, whether oral or visual, and if oral, in substantially the same inflection and volume. If these conditions are satisfied, then price lists, reader boards, and other price information mediums need not show separately the parking fee and the actual amount of commercial parking tax being collected.
(Ord. 122192, § 1, 2006)
5.35.050 Exemptions from the Parking Tax.
The following are exempt from the parking tax:
A. Parking by a person in a stall reserved exclusively for that person for a period of 30 days or longer.
B. Parking of a motor vehicle owned or controlled by a natural person in a stall provided with that person's residence.
C. Parking at stadiums and exhibition centers which the City is precluded from taxing pursuant to RCW 36.38.040.
D. Parking on City of Seattle streets.
E. Parking of vehicles under federal government contracts that is exempt from the retail sales tax.
F. Parking charges directly billed to, and paid by, federal, state, or local government.
(Ord. 123063, § 6, 2009; Ord. 122192, § 1, 2006)
5.35.060 Collection and Remittance Of Tax.
A commercial parking business or person acting on its behalf shall collect the amount of the parking tax from the person paying the parking fee at the time payment is made. The parking tax shall be stated separately from the parking fee on all instruments evidencing the parking fee. Except when all requirements of section 5.35.040 B are satisfied, it shall be conclusively presumed that the parking fee does not include the parking tax. The presumption is not overcome by any oral or written agreement between the parties.
The person receiving payment of the parking fee shall remit the parking tax to the Director according to the provisions contained in SMC Chapter 5.55. The parking tax shall be deemed held in trust by the person required to collect the same until remitted to the Director. Any person who fails to collect the parking tax, or who collects the parking tax but fails to remit the parking tax to the Director, shall be liable to the City for the amount of such tax. Such person shall, unless the remittance is made as required in this section, be guilty of a violation of this chapter whether such failure be the result of the person's own act or the result of acts or conditions beyond its control.
(Ord. 122192, § 1, 2006)
5.35.070 Use Of Revenues.
The proceeds of the tax imposed herein shall be used for transportation purposes in accordance with RCW 82.80.070. To the extent permitted by applicable law the City may issue bonds, notes, or other evidences of indebtedness payable wholly or in part from the parking tax and may pledge and may apply such tax to the payment of principal of, interest on, and premium (if any) on such bonds, notes, or other evidences of indebtedness and to the payment of costs associated with them.
(Ord. 123396, § 2, 2010; Ord. 122192, § 1, 2006)
5.35.080 Receipts To Transportation Fund.
All receipts from the parking tax shall be placed in and segregated within the Transportation Fund. These receipts may be temporarily deposited or invested in such manner as may be lawful for the investment of City money and interest and other earnings shall be deposited in the Transportation Fund.
(Ord. 122192, § 1, 2006)
Chapter 5.40 Sections:
5.40.005 General administrative provisions apply.
5.40.010 Definitions.
5.40.020 Tax levied.
5.40.025 Tax exemptions– Minimum charge– Specific exemptions– Colleges– Universities– Nonprofit organizations.
5.40.028 Tax exemption– Musical venues.
5.40.030 Cabarets.
5.40.053 Complimentary admission.
5.40.056 Discount admission.
5.40.060 Ticket information and unlawful acts.
5.40.070 Remittance of tax.
5.40.080 Certificate of registration– Required– Application.
5.40.085 Certificate of exemption– Application, issuance– Cancellation– Proof of nonprofit status.
5.40.086 Elimination of exemptions.
5.40.090 Certificate of registration– Transitory events– Owner/lessee and promoter/conductor jointly and severally liable.
5.40.120 Receipts to General Subfund and Arts Account.
Severability: If any portion of this chapter shall be adjudged invalid, such invalidity shall not affect the portions which are not adjudged invalid.
(Ord. 72495 § 12, 1943.)
5.40.005 General administrative provisions apply.
The provisions of SMC Chapter 5.55 shall be fully applicable to the provisions of this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 11, 2001.)
5.40.010 Definitions.
For the purposes of this chapter, the words and terms contained in SMC Chapter 5.30 shall apply throughout this chapter unless expressly provided otherwise herein. The following additional definitions shall apply throughout this chapter:
A. "Admission charge" means the price required or paid for entering a premise or location and includes but is not limited in meaning to:
1. A charge made for season tickets or subscriptions;
2. A cover charge or a charge made for use of seats or tables, reserved or otherwise, and similar accommodations;
3. A charge made for food or refreshments in any place where any free entertainment, recreation or amusement is provided;
4. A charge made for rental or use of equipment or facilities for purposes of recreation or amusement and, where the rental of the equipment or facilities is necessary to the enjoyment of the privilege for which a general admission is charged, the combined charge shall be considered as the admission charge;
5. A charge made for entrance to any theater, dance hall, amphitheater, private club, auditorium, observation tower, stadium, athletic pavilion or field, baseball or athletic park, circus, side show, outdoor amusement park or any similar place; and includes equipment to which persons are admitted for purposes of recreation such as merry-go-rounds, ferris wheels, dodgems, roller coasters, go-carts and other rides whether such rides are restricted to tracks or not;
6. A charge made for automobile parking where the amount of the charge is determined according to the number of passengers in an automobile;
7. A charge made for entrance to any building, enclosure or area in which there is a swimming pool, skating rink, golf driving range, miniature golf course, short nine, or other golf course, or to gain entrance to such pool, rink or course itself, or for the use of the facilities thereof, or any rental paid by the person paying for such entry for the use of equipment and facilities supplied him and appropriate to the enjoyment of the privilege for which the admission is charged, or the aggregate thereof.
B. "Cabaret" means a room where musical entertainment is permitted in connection with a restaurant business.
C. "College" or "university" means any accredited public or private college, junior college or university, or the recognized student body association thereof insofar as the admission charges received by the college, university, or student body association are budgeted, and applied solely for exhibition, performance, study and/or teaching of the performing arts, visual arts, history or science. It specifically excludes any athletic department or division or activities of the college or university or of the recognized student body association thereof.
D. "Department" means the Department of Finance and Administrative Services of The City of Seattle, or its functional successor.
E. "Director" means the Director of Finance and Administrative Services of The City of Seattle, or his or her functional successor, and shall include the Director's authorized representatives.
F. "Market Price" means the price at which a seller is ready and willing to sell and a buyer is ready and willing to buy. Market price is a price that is acceptable to both buyer and seller and which might be different from the listed price.
G. "Nonprofit organization" means an organization in which no part of the income can be distributed to its members, director or officers and that holds a current tax exempt status as provided under Sec. 501(c)(3), (4) or (6) of the Internal Revenue Code of 1986, as amended, or is specifically exempted from the requirement to apply for tax exempt status under Sec. 501(c)(3).
(Ord. 123361, § 156, 2010; Ord. 121797 §§ 1, 5, 2005; Ord. 121253 § 1, 2003; Ord. 120794 § 111, 2002; Ord. 120668 § 12, 2001; Ord. 108608 § 1, 1979; Ord. 102719 § 1, 1973; Ord. 91775 § 1, 1963; Ord. 72495 § 1, 1943.)
Cases: The word "refreshment" as used in Seattle Ordinance No. 72495 includes alcoholic as well as nonalcoholic beverages. Ropo, Inc. v. Seattle, 67 Wn.2d 574, 409 P.2d 148 (1965.)
5.40.020 Tax levied.
A. There is levied and imposed a tax upon everyone, without regard to age, who pays an admission charge as defined in Section 5.40.010 or is admitted, without payment, where an admission charge is collected from other persons as contemplated by Section 5.40.053.
B. The tax here imposed shall be in the amount of five (5) percent on each admission charge or charge for season or series ticket. Any fraction of tax One-half Cent ($.005) or more shall result in a tax at the next highest full cent.
C. Amounts paid for admission by season ticket or subscription shall be exempt if the amount which would be charged to the holder or subscriber for a single admission is One Dollar and Fifty Cents ($1.50) or less.
D. Anyone having the use of a box or seat permanently or for a specified period, shall pay a tax in the amount of five (5) percent of the price of such box or seat, the same to be collected and remitted in the manner provided in Section 5.40.070 by the person selling such tickets.
E. If the ticket price is accompanied by a service charge, mailing fee or other ancillary payment, per ticket and/or per order, the admission tax shall be based upon the total sum of the admission price plus any such surcharge(s), whether or not they are printed on the ticket or order.
F. Anyone who is admitted free of charge or at reduced rates to any place for which other persons pay a charge or a regular higher charge for the same privileges or accommodations shall pay an admission tax as contemplated by Sections 5.40.053 and 5.40.056, respectively.
G. When entertainment or admission to an event or activity accompanies the sale of food, refreshments, merchandise, lodging or services, admission taxes are measured by the total price of the combined transaction, unless the admission price for the entertainment, amusement, rental or use of equipment is printed separately on the ticket or invitation and reflects its true market value as an independent element.
H. The tax levied in this chapter shall be paid by the person paying the admission charge and shall be collected and remitted by the person to whom the same is paid in the manner provided in Sections 5.40.070 and 5.40.090.
I. A discount admission shall be subject to tax as contemplated by Section 5.40.056 even though the discounted price is One Dollar and Fifty Cents ($1.50) or less, unless a criterion in Section 5.40.056 for applying the lower price is satisfied.
J. It is unlawful for any person to request a donation or contribution that effectively represents an admission charge at any event unless the event is held by an exempt organization pursuant to SMC 5.40.025. Donations or contributions requested by such organizations that would otherwise be subject to the admission tax pursuant to SMC 5.40.025 A11c (over 3100 seating capacity or attendance) or SMC 5.40.025 B (athletic or recreational activity) are not subject to the tax; provided, that people are admitted or allowed to remain in attendance without payment of such donation or contribution and the signage, invitation, advertisement, notice or other literature related to the event contains a statement, conspicuously posted, that such donation or contribution is not required for the privilege of entering, attending, or remaining in attendance at the event.
K. The amount subject to admission tax shall exclude dues, and initiation fees paid by a member for the privilege of joining or belonging to an organization. For purposes of this subsection, "dues" are those amounts periodically paid by members solely for the entitlement of those persons to continued membership in the organization or club, and "initiation fees" are amounts paid solely to admit a person as a member to an organization or club and represent the value of membership in the organization or club. However, where dues or initiation fees cover costs for services received by the members and no separate charge (including but not limited to green fees, entertainment costs such as cover charges, facility or equipment rentals, or charges for food and beverages) is imposed for such services, admission taxes will be assessed on the portion of dues or initiation fees that represent the value of those services. In determining the value subject to tax, comparable charges will be used.
(Ord. 121900 § 2, 2005; Ord. 121797 §§ 2, 5, 2005; Ord. 121253 § 2, 2003; Ord. 115957 § 1, 1991; Ord. 111449 § 1, 1983; Ord. 110374 § 1, 1982; Ord. 110275 § 1, 1981; Ord. 102719 § 2, 1973; Ord. 98403 § 1, 1969; Ord. 91775 § 2, 1963; Ord. 88748 § 1, 1959; Ord. 87103 § 1, 1958; Ord. 72495 § 2, 1943.)
Cases: The Seattle admission tax is not a municipal excise upon liquor as proscribed by the Washington State Liquor Act, since the sale of liquor and other "refreshments" is only a measure of the tax rather than its incidence. Ropo, Inc. v. Seattle, 67 Wn.2d 574, 409 P.2d 148 (1965).
5.40.025 Tax exemptions– Minimum charge– Specific exemptions– Colleges– Universities– Nonprofit organizations.
A. The admission tax as imposed in SMC Section 5.40.020 shall not apply to anyone paying an admission charge:
1. In the amount of One Dollar and Fifty Cents ($1.50) or less; or
2. To any activity of any elementary or secondary school as contemplated by RCW 35.21.280; or
3. To any activity of any Parent-Teacher-Student Association (PTSA), Parent-Teacher Association (PTA), or similar organization, provided that the proceeds of the activity are used to benefit an elementary or secondary school; or
4. To the annual Bumbershoot Festival held on Labor Day and the preceding Thursday, Friday, Saturday and Sunday; or
5. To the Woodland Park Zoo; or
6. To the Folklife Festival held on Memorial Day and the preceding Thursday, Friday, Saturday and Sunday; or
7. To the Fremont Fair held annually by the Fremont Public Association; or
8. To an organized athletic event such as tournaments, leagues, and other competitions intended for youth less than 19 years of age, sponsored and held by non-profit organizations; or
9. To the Children's Charity Bacon Bowl Football Game held annually by the Bacon Bowl Association; or
10. To actively participate in bowling or to rent bowling shoes or equipment; or
11. To an event sponsored by a college or university or nonprofit organization, when all of the following three (3) criteria are met:
a. A college or university or nonprofit organization, as both are defined in Section 5.40.010 and registered under Section 5.40.080, that meets one (1) or more of the following criteria:
i. Publicly sponsors and through its members, representatives, or personnel promotes, publicizes and distributes most of the tickets for admission; or
ii. Publicly sponsors and presents the event at a facility it owns or leases as lessee for a term of not less than one (1) month; or
iii. Publicly sponsors and:
(a). Performs a major portion of the performance, or
(b). Supplies a major portion of the materials on exhibition, or
(c). When the event is part of a season or series of performances or exhibitions, performs the major portion of the performances or exhibitions in the season or series; and
b. The college, university or nonprofit organization receives the use and benefit of admission charges collected; and
c. In the case of a performance, the seating capacity of the location where the event occurs is three thousand one hundred (3,100) people or less, or, in the case of an exhibition, no more than three thousand one hundred (3,100) people are permitted on the premises at any one (1) time.
B. Except as provided in subsections A2, A8, and A10 above, the exemption to the admission tax as provided in subsection A11 of this section shall not apply to:
1. The admission of spectators to an athletic event, including, but not limited to, football games, basketball games, or baseball games; or
2. The admission for recreational activities, including, but not limited to, golf, skating, or swimming; or
3. An event in which a college, university or nonprofit organization lends its name to an endorsement for an ineligible person for the purpose of invoking the tax exemption.
(Ord. 121900 § 1, 2005; Ord. 121797 §§ 3, 4, 2005; Ord. 121253 § 3, 2003; Ord. 120668 § 13, 2001; Ord. 116577 § 1, 1993; Ord. 115957 § 2, 1991; Ord. 114708 § 1(part), 1989; Ord. 113498 § 1(part), 1987; Ord. 112813 § 1(part), 1986; Ord. 111449 § 2(part), 1983.)
5.40.028 Tax exemption– Musical venues.
A. The admission tax as imposed in SMC Section 5.40.020 shall not apply to any person paying an admission charge to any premises or location for which the Director has issued a certificate of exemption pursuant to this Section; PROVIDED, however, that the admission tax shall be due for any and all admission charges paid prior to the issuance of a certificate of exemption, or paid after the Director has cancelled a certificate of exemption, or paid at any time during which a cancellation of a certificate of exemption could or should have been in effect under any one or more of paragraphs 1 through 6 of Subsection G of this Section.
B. A premises or location is eligible for a certificate of exemption if:
1. The premises or location has a certificate of occupancy of fewer than one thousand (1,000) persons; and
2. The person conducting or operating the premises or location or any other person authorized by such person hosts or presents live music on at least three (3) separate days per week at the premises or location on a regular schedule. For purposes of this Section, "live music" is defined as an active performance of music by an individual or individuals who, at the time of and during the performance, creates music or engages in an audible form of artistic expression, other than, or in addition to, any pre-recorded music, for an audience through the use or manipulation of voice, instruments, or electronic or computerized equipment or formats; and
3. The person or persons conducting or operating the premises or location or any other authorized person hires one (1) or more musicians to perform the equivalent of sixteen (16) individual performances per week at the premises or location. Repeat performances by the same individual or group shall each be counted. Where performances are by a duo, trio, band, ensemble or other performing group, the number of individual performances shall be determined by multiplying the number of performing group members by the number of performances by the group; and
4. The premises or location is current with all license and tax requirements.
C. A premises or location that has obtained more than three (3) violations of law concerning public health, public safety, noise, licensing, taxing or permitting related to the ownership, possession, occupation, operation, use or maintenance of the location or premises in any twelve (12) month period shall be ineligible for a certificate of exemption for a period of one year from the date of the last violation. For purposes of this Section a premises or location has obtained a violation if there is a legally binding final decision, order, citation, or other finding of violation entered by any court, adjudicative body or government agency against any legal owner, operator, manager, or employee of the premises or location, or any other person hosting or presenting live music at the premises or location.
D. Any person conducting or operating a premises or location seeking a certificate of exemption under this Section, who has not previously been issued a certificate of exemption for the same premises or location, shall present to the Director a copy of the certificate of occupancy required under paragraph B 1 of this Section, and shall submit a completed application for the certificate of exemption on forms and in a manner prescribed by the Director. The application shall contain a certification that the conditions set forth in Subsections B 2 and 3 of this Section will be satisfied during the period that the certificate of exemption is to be in effect, and a separate certification that the premises or location is not ineligible under Subsection C of this Section. The Director shall issue a certificate of exemption for the premises or location, unless the Director finds that the eligibility requirements of Subsections B and C of this Section cannot be met. A certificate of exemption is non-transferable, shall be valid only with respect to the original applicant, and shall apply only to the premises or location that is the subject of the application.
E. On a quarterly basis each person to whom a certificate of exemption has been issued shall report, on forms prescribed by the Director, information sufficient to verify that during the corresponding quarter, the premises or location was in compliance with the requirements of this Section, including, but not limited to, the requirements in Subsections B 2 and 3 of this Section, and that the premises or location can continue to meet the requirements. The Director shall establish by rule the information required. The report shall be due in accordance with the provisions pertaining to the quarterly due dates for remittance of tax under SMC Chapter 5.55.
F. Each person to whom a certificate of exemption has been issued shall immediately notify the Director if a premises or location for which a certificate of exemption has been issued fails to be eligible under Subsection C of this Section, or fails to be in compliance with any requirement contained in this Section or any rule or regulation of the Director implementing it, other than those contained in Subsections B 2 or 3 of this Section.
G. The Director shall cancel the certificate of exemption of a location or premises upon a determination by the Director:
1. That a person secured the certificate of exemption by making a false representation in the application for the certificate; or
2. That the premises or location is ineligible for a certificate of exemption under Subsection C of this Section; or
3. That the premises or location is not in compliance with any requirement contained in this Section or any rule or regulation of the Director implementing it other than the requirements contained in Subsections B 2 or 3 of this Section; or
4. That, during any quarterly period, the premises or location fails to host or present live music on at least 80% of the number of days that the premises is required to present live music under Subsection B 2 during that quarterly period; or
5. That, during any quarterly period, the premises or location fails to hire musicians to perform at least 80% of the number of individual performances required under Subsection B 3 during that quarterly period; or
6. That the person to whom the certificate of exemption has been issued no longer conducts or operates the premises or location that is the subject of the exemption.
A person whose certificate of exemption has been cancelled may re-apply for a certificate for the same premises or location, but no re-application shall be approved unless the person shows that the premises or location is eligible under the requirements of this Section and all rules and regulations of the Director implementing it at the time of the re-application, and further, that the location or premises has been in compliance with Subsections B 2 and 3 of this Section during the 30 day period prior to the re-application. Any person wishing to re-apply shall submit the material required in Subsection D of this Section, which material shall be current as of the date of the re-application, and, in addition, shall submit all information required by the Director as established by rule, including all information required to have been reported pursuant to Subsection E of this Section during any period of time, within the maximum period of limitation applicable under SMC Chapter 5.55 for the assessment of tax, that any previous certificate of exemption was in effect.
H. The Director shall not issue a certificate of exemption to any person who is found by the Director to have made a false representation on any application or re-application made under this Section.
I. Any person to whom a certificate of exemption has been issued shall promptly notify the Director of any change of address. If the Director has cancelled a certificate of exemption, the Director shall provide notice of the cancellation to the person to whom the certificate of exemption was issued by mailing such notice in writing to the address of the person as last reported to the Director. Any person whose certificate of exemption has been cancelled may contest the cancellation by filing a written request for hearing with the Hearing Examiner within ten (10) days after the mailing of the notice of cancellation. If the person whose certificate of exemption has been cancelled files a written request for hearing within the prescribed period, the Hearing Examiner shall schedule and conduct a hearing in accordance with the applicable Hearing Examiner rules.
(Ord. 122989, § 1, 2009)
5.40.030 Cabarets.
The admission charge to any cabaret, any private club conducting cabaret activities, or any similar place of entertainment is deemed to be the total amount charged as an admission charge, a cover charge, and/or a charge made for the use of seats and tables reserved or otherwise, and other similar accommodations.
(Ord. 94366 § 1, 1965: Ord. 91775 § 3, 1963: Ord. 88748 § 2, 1959: Ord. 77700 § 1, 1949: Ord. 72495 § 3, 1943.)
5.40.053 Complimentary admission.
Anyone who is admitted free of charge to any place or for any event for which other persons pay an admission charge shall pay an admission tax measured by the full admission charge, unless:
1. Admission is free to the public generally on the date or for the event; or
2. Admission is free to a general classification of the public (e.g., children, senior citizens, or military personnel in uniform) and the entrant is a member of the classification; or
3. The complimentary admissions are distributed for bona fide charitable purposes or through any bona fide charity, or are distributed through any elementary or secondary school; or
4. The persons so admitted are performers, people assisting in the performance or activity, or bona fide members of the press; or
5. The holder of the certificate of registration has paid the amount of the admission tax on the admission.
(Ord. 115957 § 3(part), 1991.)
5.40.056 Discount admission.
Anyone who is admitted at a reduced price to any place or for any event for which other persons pay a regular, higher admission charge shall pay an admission tax measured by the regular, higher admission charge, unless:
1. The reduced charge is based on the quantity sold or a payment made before a calendar date in advance of the event; or
2. The reduced charge is available to a general classification of the public identified in rates posted or published for the event (e.g., children, senior citizens, or military personnel); or
3. The event is scheduled at a time less convenient for the public (e.g., a matinee or midnight performance); or
4. The reduced charge is based on the presentment of a coupon distributed broadly as a notice or advertisement; or
5. The reduced charge results from the donation of tangible personal property (e.g., food, clothing or toys) at the place of admission as an organized collection for delivery to a bona fide charity.
In cases that satisfy one (1) or more of these conditions, the admission tax shall be measured based on the reduced charge actually paid for admission.
(Ord. 115957 § 3(part), 1991.)
5.40.060 Ticket information and unlawful acts.
A. Whenever a charge is made for admission to any place, a serially numbered or reserve seat ticket shall be furnished to the person paying such charge unless written approval has been obtained from the Director to use: (1) a turnstile or other counting device which will accurately count the number of paid admissions, or (2) any method established by administrative rule that determines the number of paid admissions for the purposes of this chapter. The established price, service charge, sales tax, City admission tax and total price at which every admission ticket is sold shall be separately, conspicuously and indelibly printed or written on the face or back of that part of the ticket which is to be collected by the management of the place to which admission is gained.
B. It shall be unlawful for a promoter, sponsor, venue, or anyone contractually related to a promoter, sponsor or venue, to sell an admission ticket or card on which the name of the person conducting the event and the price is not so printed, stamped or written, or to sell or offer to sell an admission ticket or card at a price in excess of the price printed, stamped or written thereon. Ticket sales that occur through a subsequent sale(s) of the ticket(s) by the initial purchaser who purchased the ticket(s) from the promoter, sponsor or venue, or any subsequent sale of such ticket(s), may be made at market price. No admission tax will be assessed by the City on the price of an admission ticket in a secondary market transaction, conducted by the initial purchaser or a subsequent purchaser thereof. However, vendors, and other persons regularly engaged in the business of reselling tickets or admissions into events must obtain a business license to do so pursuant to SMC 5.55.030.
For transactions between the promoter, sponsor, or venue and the original purchaser or customer, the admission tax due shall be based on the total sum of the established price plus any service charge printed on the ticket. When a charge is made for admission, a sign must be posted in a conspicuous place on the entrance or ticket office which breaks down the admission charge as follows:
Established Price
Service Charge (if any)
Sales Tax
City Admission Tax
Total Price
C. The Director or his/her designee, who has been commissioned as a Special Police Officer, or the Seattle Police Chief or his/her designee, is authorized to confiscate, seize or otherwise remove from sale, or offered sale, any ticket in violation of or offered for sale or sold in violation of this subsection.
(Ord. 121797 § 6, 2005; Ord. 121253 § 8, 2003; Ord. 120794 § 113, 2002; Ord. 120668 § 14, 2001; Ord. 117169 § 15, 1994; Ord. 106751 § 1, 1977; Ord. 105445 § 1, 1976; Ord. 104652 § 1, 1975; Ord. 102622 § 1, 1973; Ord. 91775 § 6, 1963; Ord. 72495 § 6, 1943.)
5.40.070 Remittance of tax.
Any person who receives any payment for any admission charge on which a tax is levied under this chapter shall collect the amount of the tax from the person making the admission payment at the time payment is made. The person receiving payment shall remit the same admission tax to the Director according to the provision contained in SMC Chapter 5.55 except where specifically provided herein. The tax collected under this chapter shall be deemed held in trust by the person required to collect the same until remitted to the Director. Persons failing to collect the admission tax, or who collects the tax but fails to remit the tax to the Director shall be liable to the City for the amount of such tax. Such person shall, unless the remittance be made as required in this section, be guilty of a violation of this chapter whether such failure be the result of his or its own act or the result of acts or conditions beyond his or its control. Anyone receiving any payment for admissions shall make out a return upon such forms and setting forth such information as the Director may require, showing the amount of the tax upon admissions for which he is liable for the preceding monthly period, and shall sign and transmit the same to the Director with a remittance for said amount. Whenever any theater, circus, show, exhibition, entertainment or amusement makes an admission charge which is subject to the tax levied in this chapter, and the same is of a temporary or transitory nature or there exists a reasonable question of financial responsibility, of which the Director shall be the judge, the Director may require the report and remittance of the admission tax immediately upon the collection of the same, at the conclusion of the performance or exhibition, or at the conclusion of the series of performances or exhibitions or at such other times as he or she shall determine. Failure to comply with any requirement of the Director as to report and remittance of the tax as required shall be a violation of this chapter. Everyone liable for the collection and payment of the tax imposed by this chapter shall keep and preserve for a period of five (5) years all unused tickets, ticket manifests, books and all other records from which can be determined the amount of admission tax which he or she was liable to remit under the provisions of this chapter, and all such tickets, books and records shall be open for examination and audit at all reasonable times by the Director or his or her duly authorized agent. Written permission may be granted by the Director to destroy unused tickets prior to the expiration of the five (5) year period.
(Ord. 120794 § 114, 2002: Ord. 120668 § 15, 2001: Ord. 117169 § 16, 1994: Ord. 114517 § 1, 1989: Ord. 102622 § 2, 1973: Ord. 91775 § 7, 1963: Ord. 88479 § 1, 1959: Ord. 77700 § 2, 1949: Ord. 72495 § 7, 1943.)
5.40.080 Certificate of registration– Required– Application.
Any person conducting or operating any place for entrance to which an admission charge is made shall, prior to the commencement of any such activity, and on a form prescribed by the Director, file an application with the Director to conduct or operate such activity. The application shall be filed whether or not the person has received an exemption from collecting the tax under the provision of this chapter. The Director shall then issue a business license with an admission tax endorsement. The endorsement shall continue valid for as long as the person maintains a valid business license. Failure of any person to obtain the endorsement for conducting any activity for which an admission charge is made within twenty (20) days after being notified of the requirement by the Director will result in a penalty of Two Hundred and Fifty Dollars ($250). This penalty is in addition to any tax and penalties due according to SMC 5.55.110 (A), if applicable.
(Ord. 121253 § 9, 2003; Ord. 120794 § 115, 2002; Ord. 120668 § 16, 2001; Ord. 117169 § 17, 1994; Ord. 111449 § 3, 1983; Ord. 102719 § 3(part), 1973; Ord. 102622 § 3(part), 1973; Ord 72495 § 8(part), 1943.)
5.40.085 Certificate of exemption– Application, issuance– Cancellation– Proof of nonprofit status.
A. Any person seeking to secure an exemption from the admission tax pursuant to Section 5.40.025 from the admission tax as provided in this chapter shall present, at the time of its application for a business license as described in SMC 5.55.030, official proof of its exemption from federal income taxation pursuant to Section 501 (c)(3), (4) or (6) of the Internal Revenue Code of 1986, as now existing or hereafter amended, or in the alternative, provide proof of its specific exemption from the requirement to file IRS Form 1023 in order to obtain tax exempt status. If the exemption applicant already has a business license, then the request for exemption and proof required above shall be filed prior to engaging in the activity which requires an admission. If the Director determines that persons paying such admission charge are not subject to the admission tax, the applicant shall receive a certification of such determination for the activity or series of activities, as the case may be.
B. The Director may cancel the certificate of exemption of any college, university, or nonprofit organization which (1) secures an exemption from the tax by making a false representation in its application, or (2) otherwise violates Section 5.40.025 or a rule or regulation of the Director implementing it.
C. If the Director has ordered a certificate of exemption cancelled, an aggrieved person may contest the cancellation by filing a notice of appeal and request for hearing with the hearing examiner within ten (10) days after service or mailing of the order. If a request for hearing is filed by the applicant within the prescribed period, a hearing shall be scheduled before the Hearing Examiner and shall be conducted by the Hearing Examiner according to the applicable Hearing Examiner rules.
D. Exempt persons shall reapply for their certificate of exemption on September 30th, five (5) years after the date the previous exemption was issued so that the Director may ensure that the agency still meets the criteria established for the exemption.
(Ord. 121253 § 10, 2003; Ord. 120794 § 116, 2002; Ord. 118141 § 1, 1996; Ord. 117169 § 18, 1994; Ord. 112813 § 2, 1986; Ord. 111449 § 4, 1983; Ord. 102719 § 3(part), 1973; Ord. 102622 § 3(part), 1973; Ord. 72495 § 8(part), 1943.)
5.40.086 Elimination of exemptions.
If any exemption from the admission tax is found to be unconstitutional because a court determines it wrongly exempts some events or entities but not others, then that exemption shall be eliminated in its entirety effective on the date of the court decision.
(Ord. 118141 § 2, 1996.)
5.40.090 Certificate of registration– Transitory events– Owner/lessee and promoter/conductor jointly and severally liable.
Whenever the applicant for a certificate of registration is not the owner, lessee, or custodian of the premises or location to which an admission fee is required to be paid, the owner, lessee or custodian of the premises or location shall be jointly and severally liable for the reporting and remittance of the admission tax. The applicant for a certificate of registration in any such case shall furnish the Director with the application, containing the name and address of the owner, lessee or custodian of the premises or location to which an admission fee is required to be paid, and such owner, lessee or custodian shall be notified by the Director of the issuance of such certificate and of his joint and several liability for collection and remittance of the tax.
(Ord. 121253 § 11, 2003; Ord. 120794 § 117, 2002; Ord. 117169 § 19, 1994; Ord. 102622 § 4, 1973; Ord. 91775 § 8, 1963; Ord. 72495 § 9, 1943.)
5.40.120 Receipts to General Subfund and Arts Account.
A. All receipts from the admission tax levied in this Chapter 5.40 shall be placed in the General Subfund of the General Fund, except that 75 percent of all admission tax receipts shall be deposited into the Arts Account of the General Subfund of the General Fund.
B. Money in the Arts Account of the General Subfund shall be annually appropriated to the Office of Arts and Cultural Affairs to support the following purposes:
1. Arts-related programs and one-time capital expenditures that keep artists living, working and creatively challenged in Seattle;
2. Initiatives and programs to build community through the arts and create opportunities for the public to intersect with artists and their work; and
3. Initiatives and programs that provide art opportunities for youth in and out of school.
C. Twenty-five percent of the funds appropriated to the Arts Account from admission tax receipts in 2011 and 2012 shall be directed to fund arts related programs conducted by the City's Department of Parks and Recreation that meet the funding criteria outlined in subsection B of this Section 5.40.120. This provision, designed to reflect temporary economic conditions, shall expire on December 31, 2012. The Director of the Office of Arts and Cultural Affairs shall be notified by the City's Budget Office when the transfer occurs.
D. By June 1, 2011, the Office of Arts and Cultural Affairs shall develop policies concerning the use of Arts Account funds, including one or more fiscal policies concerning the retention of revenues to ensure the long-term fiscal health of the Office of Arts and Cultural Affairs' program funding obligations. A draft of the policies shall be provided to the Seattle Arts Commission for comment, before being submitted to City Council in the form of a resolution for formal Council review and consideration. The policies shall be updated from time to time to ensure that the Office of Arts and Cultural Affairs' fiscal policies address ongoing budget needs and priorities. Any such update shall follow the same review process as defined in this Section 5.40.120.
(Ord. 123460, § 2, 2010; Ord. 123155, § 1, 2009; Ord. 121657 § 1, 2004; Ord. 121006 § 8, 2002: Ord. 120975 § 1, 2002: Ord. 120644 § 1, 2001: Ord. 120183 § 2, 2000: Ord. 106058 § 3, 1976: Ord. 79849 § 1, 1951: Ord. 72495 § 11-1, 1943.)
Chapter 5.45 Sections:
5.45.010 Exercise of revenue license power.
5.45.020 Administrative provisions.
5.45.030 Definitions.
5.45.040 Agency– Sales and services by agent, consignee, bailee, factor or auctioneer.
5.45.050 Imposition of the tax– Tax or fee levied
5.45.070 Multiple activities credit when activities take place in one or more cities with eligible gross receipt taxes.
5.45.075 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.
5.45.076 Assignment of gross income derived from intangibles.
5.45.080 Persons conducting business both within and without the City
5.45.081 Assignment of revenues
5.45.082 Ancillary activities of motor carriers and freight brokers
5.45.085 Related person transactions.
5.45.090 Exemptions.
5.45.100 Deductions
5.45.110 Application to City's business activities.
5.45.120 Tax part of operating overhead.
5.45.010 Exercise of revenue license power.
The provisions of this chapter shall be deemed an exercise of the power of the City to license or tax 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.
(Ord. 120668 § 2(part), 2001.)
5.45.020 Administrative provisions.
All of the provisions contained in Chapter 5.55 of the Seattle Municipal Code shall have full force and application with respect to taxes or license fees imposed under the provisions of this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 2(part), 2001.)
5.45.030 Definitions.
The definitions contained in Chapter 5.30 of the Seattle Municipal Code shall be fully applicable to this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 2(part), 2001.)
5.45.040 Agency– Sales and services by agent, consignee, bailee, factor or auctioneer.
A. Sales in Own Name– Sales or Purchases as Agent. Every person, including agents, consignees, bailees, factors or auctioneers, having either actual or constructive possession of tangible personal property or having possession of the documents of title thereto, with power to sell such tangible personal property in his or her or its own name and actually so selling shall be deemed the seller of such tangible personal property within the meaning of this chapter.
The burden shall be upon the taxpayer in every case to establish the fact that such taxpayer is not engaged in the business of selling tangible personal property but is acting merely as broker or agent in promoting sales or making purchases for a principal. Such claim will be recognized only when the contract or agreement between such persons clearly establishes the relationship of principal and agent and when the following conditions are complied with:
1. The books and records of the broker or agent show the transactions were made in the name and for the account of the principal, and show the name of the actual owner of the property for whom the sale was made, or the actual buyer for whom the purchase was made;
2. The books and records show the amount of the principal's gross sales, the amount of commissions and any other incidental income derived by the broker or agent from such sales. The principal's gross sales must not be reflected as the agent's income on any of the agent's books and records. Commissions must be computed according to a set percentage or amount, which is agreed upon in the agency agreement;
3. No ownership rights may be conferred to the agent unless the principal refuses to pay, or refuses to abide by the agency agreement. Sales or purchases of any goods by a person who has any ownership rights in such goods shall be taxed as retail or wholesale sales; and
4. Bulk goods sold or purchased on behalf of a principal must not be co-mingled with goods belonging to another principal or lose their identity as belonging to the particular principal. Sales or purchases of any goods which have been co-mingled or lost their identity as belonging to the principal shall be taxed as retail or wholesale sales.
B. If the requirements in subsection A above are not met, the consignor, bailor, principal or other shall be deemed a seller of such property to the agent, consignee, bailee, factor or auctioneer.
C. Services in Own Name– Procuring Services as Agent. For purposes of this subsection, SMC Section 5.45.040 C, an agent is a person who acts under the direction and control of the principal in procuring services on behalf of the principal that the person could not itself render or supply. Amounts received by an agent for the account of its principal as advances or reimbursements are exempted from the measure of the tax only when the agent is not primarily or secondarily liable to pay for the services procured.
Any person who claims to be acting merely as agent in obtaining services for a principal will have such claim recognized only when the contract or agreement between such persons clearly establishes the relationship of principal and agent and when the following conditions are complied with:
1. The books and records of the agent show that the services were obtained in the name and for the account of the principal, and show the actual principal for whom the purchase was made; and
2. The books and records show the amount of the service that was obtained for the principal, the amount of commissions and any other income derived by the agent for acting as such. Amounts received from the principal as advances and reimbursements must not be reflected as the agent's income on any of the agent's books and records. Commissions must be computed according to a set percentage or amount, which is agreed upon in the agency agreement.
(Ord. 120668 § 2(part), 2001.)
5.45.050 Imposition of the tax– Tax or fee levied
Except as provided in subsection 5.55.040.D.1, 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:
A. 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 .00215. 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.
B. 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 or processed within the City, multiplied by the rate of .00215. The measure of the tax is the value of the products, including by-products, so manufactured or processed, regardless of the place of sale or the fact that deliveries may be made to points outside the City.
C. Upon every person engaging within the City in the business of making sales of retail services, or making sales at wholesale or 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 .00215.
D. Upon every person engaging within the City in the business of:
1. Printing;
2. Both printing and publishing newspapers, magazines, periodicals, books, music, and other printed items;
3. Publishing newspapers, magazines and periodicals;
4. Extracting for hire;
5. Processing for hire; or
6. Conducting a tour operator business; 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 .00215.
E. Upon every motor carrier engaging within the City in the business of transporting freight for hire, as to such persons, the amount of the tax with respect to such business shall be equal to the gross income from the transport of freight picked up in the City multiplied by the rate of .00415. The business of transporting freight for hire includes the business of leasing or renting motor vehicles operated by the lessor, or by a person under the control of the lessor, to transport freight for hire.
F. Upon every person engaging within the City in the business of providing international investment management services, as to such persons, the amount of tax with respect to such business shall be equal to the gross income or gross proceeds of sales of the business multiplied by a rate of .0015.
G. 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 .00415. 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 software or of customizing canned software, producing royalties or commissions, persons engaged in the business of freight brokering, 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.
(Ord. 123704, § 1, 2011; Ord. 123099, § 2, 2009; Ord. 121679, § 8, 2004; Ord. 121266, § 1, 2003; Ord. 120668, § 2, 2001.)
Editor's note: The provisions of 123099 become effective January 10, 2010.
5.45.070 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 (2) or more subsections of SMC Section 5.45.050 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 and that the taxpayer paid the amount of tax sought to be credited.
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:
1. With respect to the manufacturing of the products sold in the City; and
2. 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 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.
(Ord. 121679 § 9, 2004; Ord. 121266 § 3, 2003; Ord. 120668 § 2(part), 2001.)
5.45.075 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 who 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 the City. 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.
(Ord. 122563, § 4, 2007; Ord. 121679 § 10, 2004; Ord. 121266 § 1, 2003.)
5.45.076 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).
(Ord. 121679 § 11, 2004)
5.45.080 Persons conducting business both within and without the City
This section instructs taxpayers which revenues will be assigned to the City as taxable for periods prior to January 1, 2008. Once the amount subject to tax in Seattle is determined according to this section, then the credit or deductions contained in 5.45.070 and 5.45.075 may be calculated, if applicable.
A. A person who maintains an office or place of business in the City shall be taxable on the gross income, gross proceeds of sales, or value of products derived from the business activities rendered by, generated from, or attributable to the office or place of business located within the City, unless specific deductions or exemptions apply.
B. A person engaging in business activities in the City who does not maintain an office or place of business in the City shall allocate to the City that portion of the taxpayer's gross income or gross proceeds of sales that are derived from business activities performed in the City.
C. A person who maintains an office or place of business in the City and also elsewhere:
1) Shall be taxable on that portion of his gross income or gross proceeds of sales, or value of products that is derived from business activity rendered by, generated from, or attributable to the office or place of business located within the City, unless specific deductions or exemptions apply; and
2) Shall allocate to the City and be taxable on gross income, or gross proceeds of sales, from business activities performed in the City but supported by the office or place of business located outside the City, where the business activity performed in the City is a significant factor in making or holding the market for the goods or services sold, and
(a) Delivery of product or the performance of services occurs in Seattle; or
(b) The customer is located in Seattle.
Allocations of amounts 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.
D. If the Director determines that the allocation of gross income from business activities for a person subject to subsection C above and taxable under the "other business activities" classification subsection 5.45.050.G does not fairly reflect gross income derived from business activities within the City, the Director shall determine such gross income by either of the following methods: (a) by a fair and equitable formula agreed upon by the Director and the taxpayer after a consideration of the facts; or (b) by the ratio that the cost of doing business within the City bears to the cost of doing business both within and without the City. For apportionment purposes, all costs must be assigned to an office location.
E. This section does not apply to allocate gross income of motor carriers included in the measure of the tax pursuant to subsection 5.45.050 E of the Seattle Municipal Code. This section may apply to allocate gross receipts of motor carriers included in the measure of the tax pursuant to any other subsection of Section 5.45.050.
(Ord. 123704, § 2, 2011; Ord. 123239, § 4, 2010; Ord. 122563, § 5, 2007; Ord. 121266 § 5, 2003; Ord. 120668 § 2(part), 2001.)
5.45.081 Assignment of revenues
Beginning on January 1, 2008, and with the exception of those persons subject to the provisions of chapter 82.14A RCW, this section will be used to assign revenue for purposes of the business license tax imposed under Section 5.45.050.
A. Gross income derived from all activities other than those taxed under subsections 5.45.050.E, 5.45.050.F, and 5.45.050.G shall be assigned to the location where the activity takes place.
B. For sales of tangible personal property, the activity takes place where delivery to the buyer occurs.
C. Gross income derived from international investment management services taxed under subsection 5.45.050.F and from service and other business activity taxed under subsection 5.45.050.G shall be apportioned to the City by multiplying apportionable income by a fraction, the numerator of which is the payroll factor plus the service and other business activity 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 for compensation in the city during the tax period by the taxpayer 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 or employee 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 fifty percent (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 fifty percent (50%) or more of his or her service in any city, and the employee resides in the city.
2. The service and other business activity income factor is a fraction, the numerator of which is the total service and other business activity income of the taxpayer in the city during the tax period, and the denominator of which is the total service and other business activity income of the taxpayer everywhere during the tax period. Service and other business activity income is in the city if:
a. The customer location is in the city; or
b. The income-producing activity is performed in more than one (1) location and a greater proportion of the service-income-producing activity is performed in the city than in any other location, based on costs of performance, and the taxpayer is not taxable at the customer location; or
c. The service and other business activity income producing activity is performed within the city, and the taxpayer is not taxable in the customer location.
3. If the allocation and apportionment provisions of this subsection do not fairly represent the extent of the taxpayer's business activity in the city or cities in which the taxpayer does business, the taxpayer may petition for or the tax administrators may jointly require, in respect to all or any part of the taxpayer's business activity, that one of the following methods be used jointly by the cities to allocate or apportion gross income, if reasonable:
a. Separate accounting;
b. The use of a single factor;
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.
D. The definitions in this subsection apply throughout this section.
1. "Apportionable income" means the gross income of the business taxable under the service and other business activity classification, including income received from activities outside the city if the income would be taxable under the service and other business activity classification if received from activities within the city, less any exemptions or deductions available.
2. "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.
3. "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.
4. "Customer location" means the city or unincorporated area of a county where the majority of the contacts between the taxpayer and the customer take place.
5. "Primarily assigned" means the business location of the taxpayer where the individual performs his or her duties.
6. "Service-taxable income" or "service income" means gross income of the business subject to tax under the service and other business activity classification, including but not limited to royalty income.
7. "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.
8. "Taxable in the customer location" means either that a taxpayer is subject to a gross receipts tax in the customer location for the privilege of doing business, or that the government where the customer is located has the authority to subject the taxpayer to gross receipts tax regardless of whether, in fact, the government does so.
E. 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.
F. This section does not apply to allocate gross income of motor carriers included in the measure of the tax pursuant to subsection 5.45.050.E of the Seattle Municipal Code. However, this section does apply to allocate gross receipts of motor carriers included in the measure of the tax pursuant to any other subsection of Section 5.45.050.
(Ord. 123704, § 3, 2011; Ord. 123239, § 5, 2010; Ord. 122563, § 6, 2007.)
5.45.082 Ancillary activities of motor carriers and freight brokers
A. Ancillary activities of motor carriers include but are not limited to stevedoring, separately billed charges for loading, unloading, sorting, storage, consolidation charges, and other charges not representing the actual transportation charge. The charges for ancillary activities shall be recorded separately from the transportation charges and reported under the "other business activity" classification (Subsection 5.45.050.G).
B. Freight brokers should report revenue from brokering activities under the "other business activity" classification (Subsection 5.45.050.G).
C. Gross receipts from the activities contained in subsections 5.45.082.A and 5.45.082.B above are subject to the apportionment provisions contained in Section 5.45.080.
(Ord. 123704, § 4, 2011; Ord. 123239, § 6, 2010; Ord. 121266 § 6, 2003.)
5.45.085 Related person transactions.
A. When the relationship between related, controlled or affiliated persons is such that the gross income from business activities between such persons is not indicative of the market value of the activities or transactions, the Director shall determine the market value upon which the Seattle business license tax shall be levied.
The purpose of this section is to ensure taxpayers clearly reflect their true gross income attributable to business activities or transactions between related, controlled or affiliated persons, and to prevent the avoidance of taxes in regards to such activities or transactions. Business activities or transactions between one related, controlled or affiliated person and another will be subject to special scrutiny by the Director to ascertain whether common control is being used to reduce, avoid, or escape taxes. The authority of the Director to determine true taxable income extends to any case in which either by inadvertence, sham, or design the taxable income of a related, controlled or affiliated person is other than it would have been had the person, in the conduct of its affairs, been dealing at arm's length with an unrelated, uncontrolled or unaffiliated person. The Director will consider whether the persons are motivated by business purposes other than tax avoidance or are principally motivated by the desire to avoid taxes.
B. The Director will consider the following to determine whether an arrangement between related, controlled, or affiliated persons results in an improper or inaccurate valuation of the activity:
1. Whether the persons are motivated by business purposes other than tax avoidance or are principally motivated by tax avoidance. In no case shall the mere evasion or avoidance of taxation be regarded as a business purpose.
2. Whether the separate businesses of the related, controlled or affiliated persons have economic substance because a reasonable possibility of obtaining a profit exists, apart from achieving tax benefits.
3. Whether one person has a significant amount of capital gains, interest, dividend or similar income, but minimal capital, activity, or expenses, because essential business functions are performed for the person by another without arm's length consideration.
4. In determining whether the related persons or entities are motivated by tax avoidance or whether they possess economic substance, the Director shall consider the following:
a. The related person has an identifiable place of business with supporting business records.
b. The related person maintains books and related accounting records.
c. The related person has a staff of employees or has engaged independent contractors adequate in number and with sufficient expertise to conduct its business activities.
d. The controlling person so controls and dominates the finances, policy and business activities of the related person that the related person has virtually no separate existence.
e. The form employed for conducting business is a sham.
C. The Director will use the following methods to assign a value to business activities or transactions between related, controlled, or affiliated persons when the Director determines that a true or market value has not been reported on a tax return:
1. Fair market valuation. A value determined by comparing charges made for similar goods or services of like quality and character, in similar quantities, under comparable conditions of sale, to comparable unrelated party purchasers, including subsidies and bonuses.
2. Cost basis. If no comparable goods or services can guide the Director in ascertaining the value, then such value may be determined upon a cost plus margin basis. All costs - including direct and indirect overhead costs - attributable to the particular article, good or service shall be included. An appropriate profit margin shall also be added to the costs.
3. Amount of dividends or loans received. If a parent corporation or controlling person provides services that are more than general oversight duties to a subsidiary or controlled person and receives no payments, or such payments are not at market value, but then receives dividends or loans from the subsidiary or controlled person for the services rendered, the Director shall deem the dividends or loans received to be compensation for the services rendered. If the total amount received from the subsidiary or controlled person, including such dividends or loans, is less than the market value of such service, the Director will tax the services rendered at the market value. If the amount of dividends or loans can be shown to be higher than the market value of the services then the market value will be used.
General oversight duties of a parent corporation include high level management direction, strategic planning, stewardship duties or assisting in the financing of the controlled persons. These duties can be provided without taxation of the dividends, loans or compensation from subsidiaries or controlled persons. However, providing services for a subsidiary's or controlled person's customers, or providing accounting and administrative services, or providing marketing services, or providing other lower level management duties for a subsidiary or controlled person, or any similar activities will be subject to a market value determination and taxation.
D. The following definitions apply within this section:
1. "Market value" or "arms length consideration" is the amount that would be paid or received for similar activities or transactions of like quantity, quality, or character under similar circumstances and conditions by other persons where no common interest exists between the persons involved in the activities or transactions.
2. "Related, controlled or affiliated person" means a person or entity that controls, or is controlled as the case may be, through common ownership. "Related," "controlled" and "affiliated" are used interchangeably when describing a subsidiary, however, related and affiliated can also mean the parent entity. The degree of ownership is unimportant, however the ability to control or influence the related, controlled or affiliated person is important in establishing whether relationships and transactions serve a business purpose, produce income, or merely avoid taxes.
(Ord. 123063, § 9, 2009.)
5.45.090 Exemptions.
The provisions of this Chapter 5.45 and the licensing requirement in SMC 5.55.030 shall not apply to the following:
A. Adult Family Homes. This chapter does not apply to adult family homes which are licensed as such, or which are specifically exempt from licensing, under rules of the Washington State Department of Social and Health Services.
B. Day Care Provided By Churches. This chapter shall not apply to amounts derived by a church that is exempt from property tax under RCW 84.36.020 from the provision of care for children for periods of less than twenty-four (24) hours.
C. Child Care Resource and Referral Services by Nonprofit Organizations. This chapter does not apply to nonprofit organizations in respect to amounts derived from the provision of child-care resource and referral services.
D. Non-Profit Organizations That are Guarantee Agencies, Issue Debt, or Provide Guarantees for Student Loans. This chapter does not apply to gross income received by non-profit organizations exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code, as hereafter amended, that:
1. Are guarantee agencies under the federal guaranteed student loan program or that issue debt to provide or acquire student loans; or
2. Provide guarantees for student loans made through programs other than the federal guaranteed student loan program.
E. Nonprofit Organizations– Credit and Debt Services. This chapter does not apply to nonprofit organizations in respect to amounts derived from provision of the following services:
1. Presenting individual and community credit education programs including credit and debt counseling;
2. Obtaining creditor cooperation allowing a debtor to repay debt in an orderly manner;
3. Establishing and administering negotiated repayment programs for debtors; or
4. Providing advice or assistance to a debtor with regard to 1, 2, or 3, above, of this subsection (E).
F. Certain fraternal and beneficiary organizations. This chapter shall not apply to fraternal benefit societies or fraternal fire insurance associations, as described in Title 48 RCW; nor to beneficiary corporations or societies organized under and existing by virtue of Title 24 RCW, if such beneficiary corporations or societies provide in their bylaws for the payment of death benefits. This exemption is limited, however, to gross income from premiums, fees, assessments, dues or other charges directly attributable to the insurance or death benefits provided by such societies, associations, or corporations.
G. Certain Corporations Furnishing Aid and Relief. This chapter shall not apply to the gross sales or the gross income received by corporations which have been incorporated under any act of the congress of the United States of America and whose principal purposes are to furnish volunteer aid to members of the armed forces of the United States and also to carry on a system of national and international relief and to apply the same in mitigating the sufferings caused by pestilence, famine, fire, floods, and other national calamities and to devise and carry on measures for preventing the same.
H. Operation of Sheltered Workshops. This chapter shall not apply to income received from the Department of Social and Health Services for the cost of care, maintenance, support and training of persons with developmental disabilities at nonprofit group training homes as defined by RCW Chapter 71 A.22 or to the business activities of nonprofit organizations from the operation of sheltered workshops. For the purposes of this subsection, SMC 5.45.090 H, "the operation of sheltered workshops" means performance of business activities of any kind on or off the premises of such nonprofit organizations which are performed for the primary purpose of:
1. Providing gainful employment or rehabilitation services to the handicapped or disabled as an interim step in the rehabilitation process for those who cannot be readily absorbed in the competitive labor market or during such time as employment opportunities for them in the competitive labor market do not exist; or
2. Providing evaluation and work adjustment services for handicapped or disabled individuals.
I. 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, provided that, dividends subject to tax pursuant to SMC 5.45.085 will not be exempt.
J. Certain Hospitals and Clinics. This chapter shall not apply to the gross income received by the United States or any instrumentality thereof by the state, or any municipal subdivision thereof, or by any religious society, religious association or religious corporation, through the operation of any hospital, clinic, resort or other institution devoted exclusively to the care or healing of human beings; provided, that no exemption is granted where the income therefrom inures to the benefit of any physician, surgeon, stockholder or individual by virtue of ownership or control of such hospital, clinic, resort or other institution.
K. Gross Receipts Taxed Under Other Seattle Municipal Code (SMC) Sections. 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 SMC Chapter 5.48 or SMC subsections 5.52.030 B1 and B3 (bona fide charitable or nonprofit organization gambling activity, bingo, raffle and fundraising activities), as amended.
L. Credit Unions. This chapter shall not apply to the gross income of credit unions organized under the laws of this state, any other state, or the United States.
M. International Banking Facilities. This chapter shall not apply to the gross receipts of an international banking facility. As used in this subsection, SMC 5.45.090 M, an "international banking facility" means a facility represented by a set of asset and liability accounts segregated on the books and records of a commercial bank, the principal office of which is located in this state, and which is incorporated and doing business under the laws of the United States or of this state, a United States branch or agency of a foreign bank, an Edge corporation organized under Section 25(A) of the Federal Reserve Act, 12 United States Code 611-631, or an Agreement corporation having an agreement or undertaking with the Board of Governors of the Federal Reserve System under Section 25 of the Federal Reserve Act, 12 United States Code 11 601-604(a), that includes only international banking facility time deposits (as defined in subsection (a)(2) of Section 204.8 of Regulation D (12 CFR Part 204), as promulgated by the Board of Governors of the Federal Reserve System), and international banking facility extensions of credit (as defined in subsection (a)(3) of Section 204.8 of Regulation D).
N. Insurance Business. This chapter shall not apply to amounts received by any person who is an insurer upon which a tax based on gross premiums is paid to the state pursuant to RCW 48.14.020, nor shall this chapter apply to amounts received by an agent as defined in RCW 48.17.010; provided that the provisions of this subsection shall not exempt any person engaging in the business of insurance as a broker as defined in RCW 48.17.020 or as a solicitor as defined in RCW 48.17.030; 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.
O. Farmers– Agriculture. This chapter shall not apply to any farmer in respect to amounts received from selling fruits, vegetables, berries, butter, eggs, fish, milk poultry, meats or any other agricultural product that is raised, caught, produced or manufactured by such persons.
P. Athletic Exhibitions. This chapter shall not apply to any person in respect to the business of conducting boxing contests and sparring or wrestling matches and exhibitions for the conduct of which a license must be secured from the State Boxing Commission.
Q. Racing. This chapter shall not apply to any person in respect to the business of conducting race meets for the conduct of which a license must be secured from the Washington State Horse Racing Commission.
R. Ride Sharing. This chapter does not apply to any funds received in the course of commuter ride sharing or ride sharing for persons with special transportation needs in accordance with RCW 46.74.010.
S. Employees. This chapter shall not apply to any person in respect to his or her employment in the capacity as an employee or servant as distinguished from that of an independent contractor. For the purposes of this subsection, SMC 5.45.090 (S) the definition of employee shall include those persons that are defined in section 3121(d)(3)(B) of the Internal Revenue Code, as hereafter amended. For purposes of this Chapter, a booth renter, as defined by RCW 18.16.020, is an independent contractor.
T. 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.
U. 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.
V. 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 82.36.010 and exempted under RCW 82.36.440, 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.
W. 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 exempted in RCW 66.08.120.
X. Casual and Isolated Sales. This chapter shall not apply to the gross proceeds derived from casual or isolated sales.
Y. Health Maintenance Organization, Health Care Service Contractor, Certified Health Plan. Beginning on January 1, 2000, this chapter does not apply to any health maintenance organization, health care service contractor, or certified health plan in respect to premiums or prepayments that are taxable under RCW 48.14.0201. This exemption is limited to premiums and payments for health benefit plans offered by health care service contractors under RCW Chapter 48.44 and health maintenance organizations under RCW chapter 48.46 and does not apply to health care services directly delivered by the employees of a health maintenance organization under RCW Chapter 48.46.
Z. 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 his 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 (14) days to reimburse in kind a previous accommodation sale by the buyer to the seller.
Provided, that where the seller holds himself or herself out as being regularly engaged in the business of making sales at wholesale of such property, such sales shall be included in his principal business activity, and not exempt from tax.
AA. Real Estate Brokers and Associated Brokers, Agents, or Salesmen. This chapter does not apply to that portion of a real estate commission assigned to another brokerage office pursuant to the division of revenue between the originating brokerage office and a cooperating brokerage office on a particular transaction. Each brokerage office shall pay the tax upon its respective revenue share of the transaction. Furthermore, where a brokerage office has paid the business license tax on the gross commission earned by that brokerage office, associate brokers, salesmen or agents within the same office shall not be required to pay the tax upon their share of the commission from the same transaction.
BB. 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, commercial parking tax, and admission tax.
(Ord. 123063, § 10, 2009; Ord. 122842, § 6, 2008; Ord. 122192, § 13, 2006; Ord. 121679 § 12, 2004; Ord. 121266 § 7, 2003; Ord. 120668 § 2(part), 2001.)
5.45.100 Deductions.
In computing the license fee or tax, the following may be deducted from the measure of tax:
A. Membership Fees and Certain Service Fees by Nonprofit Youth Organization. For purposes of this subsection, "nonprofit youth organization" means a nonprofit organization engaged in character building of youth which is exempt from property tax under RCW 84.36.030. In computing tax due under this chapter, there may be deducted from the measure of tax all amounts received by a nonprofit youth organization:
1. As membership fees or dues, irrespective of the fact that the payment of the membership fees or dues to the organization may entitle its members, in addition to other rights or privileges, to receive services from the organization or to use the organization's facilities; or
2. From members of the organization for camping and recreational services provided by the organization or for the use of the organization's camping and recreational facilities.
B. Fees, Dues, Charges. In computing tax, there may be deducted from the measure of tax amounts derived from bona fide:
1. Initiation fees;
2. Dues;
3. Contributions;
4. Donations;
5. Tuition fees;
6. Charges made by a nonprofit trade or professional organization for attending or occupying space at a trade show, convention, or educational seminar sponsored by the nonprofit trade or professional organization, which trade show, convention, or educational seminar is not open to the general public;
7. Charges made for operation of privately operated kindergartens; and
8. Endowment funds.
Subsection SMC 5.45.100.B, shall not be construed to exempt any person, association, or society from tax liability upon selling tangible personal property or upon providing facilities or services for which a special charge is made to members or others. If dues are in exchange for any significant amount of goods or services rendered by the recipient thereof to members without any additional charge to the member, or if the dues are graduated upon the amount of goods or services rendered, the value of such goods or services shall not be considered as a deduction under this subsection.
C. Artistic and Cultural Organizations– Income From Business Activities. In computing tax, there may be deducted from the measure of tax those amounts received by artistic or cultural organizations, as defined in Section 5.30.020, which represent:
1. Income derived from business activities conducted by the organization, provided that this deduction does not apply to retail sales made by artistic and cultural organizations (the rental of space and the casual sales of props and fixtures used in or culture productions will be exempt from tax);
2. Amounts received from the United States or any instrumentality thereof or from the State of Washington or any municipal corporation or subdivision thereof as compensation for, or to support, artistic or cultural exhibitions, performances, or programs provided by an artistic or cultural organization for attendance or viewing by the general public; or
3. Amounts received as tuition charges collected for the privilege of attending artistic or cultural education programs.
D. Artistic or Cultural Organization– Deduction for Tax Under the Manufacturing Classification– Value of Articles for Use in Displaying Art Objects or Presenting Artistic or Cultural Exhibitions, Performances, or Programs. In computing tax, there may be deducted from the measure of tax by persons subject to payment of the tax under the manufacturing classification, the value of articles to the extent manufacturing activities are undertaken by an artistic or cultural organization, as defined in Section 5.30.020, solely for the purpose of manufacturing articles for use by the organization in displaying art objects or presenting artistic or cultural exhibitions, performances, or programs for attendance or viewing by the general public.
E. Day Care Activities. In computing tax, nursery schools, preschools, child care providers and privately operated kindergartens may deduct from the measure of tax amounts derived from the care or education, for periods less than 24 hours, of children who are under eight years of age and not enrolled in or above the first grade. Such persons are, however, subject to the tax upon the gross proceeds derived from providing child care to children who are eight years of age or older or enrolled in or above the first grade. Amounts derived from selling, altering or repairing tangible personal property shall not be deductible.
F. Compensation from Public Entities for Health or Social Welfare Services– Exception. In computing tax, there may be deducted from the measure of tax amounts received from the United States or any instrumentality thereof or from the State of Washington or any municipal corporation or political subdivision thereof as compensation for, or to support, health or social welfare services rendered by a health or social welfare organization (as defined in RCW 82.04.431) or by a municipal corporation or political subdivision, except deductions are not allowed under this section for amounts that are received under an employee benefit plan. For purposes of this subsection, "employee benefit plan" includes the military benefits program authorized in 10 U.S.C. Sec. 1071 et seq., as amended, or amounts payable pursuant thereto.
G. Interest on Investments or Loans Secured by Mortgages or Deeds of Trust. In computing tax, 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.
H. Interest on Obligations of the State, its Political Subdivisions, and Municipal Corporations. In computing tax, there may be deducted from the measure of tax by those engaged in banking, loan, security or other financial businesses, amounts derived from interest paid on all obligations of the State of Washington, its political subdivisions, and municipal corporations organized pursuant to the laws thereof.
I. Interest on loans to farmers and ranchers, producers or harvesters of aquatic products, or their cooperatives. In computing tax, there may be deducted from the measure of tax amounts derived as interest on loans to bona fide farmers and ranchers, producers or harvesters of aquatic products, or their cooperatives by a lending institution which is owned exclusively by its borrowers or members and which is engaged solely in the business of making loans and providing finance-related services to bona fide farmers and ranchers, producers or harvesters of aquatic products, their cooperatives, rural residents for housing, or persons engaged in furnishing farm-related or aquatic-related services to these individuals or entities.
J. Receipts From the Sale of 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 by the seller to the buyer or the buyer's representative at a location outside the State of Washington.
K. Cash Discount Taken by Purchaser. In computing tax, there may be deducted from the measure of tax the amount of cash discount 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.
L. 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.
M. Repair, Maintenance, Replacement, etc., of Residential Structures and Commonly Held Property– Eligible Organizations.
1. In computing tax, there may be deducted from the measure of tax amounts used solely for repair, maintenance, replacement, management, or improvement of the residential structures and commonly held property, but excluding property where fees or charges are made for use by the public who are not guests accompanied by a member, which are derived by:
a. A cooperative housing association, corporation, or partnership from a person who resides in a structure owned by the cooperative housing association, corporation, or partnership;
b. An "association of apartment owners", as defined in RCW 64.32.010, as now or hereafter amended, from a person who is an "apartment owner" as defined in RCW 64.32.010; or
c. An association of owners of residential property from a person who is a member of the association. "Association of owners of residential property" means any organization of all the owners of residential property in a defined area who all hold the same property in common within the area.
2. For the purposes of this subsection "commonly held property" includes areas required for common access such as reception areas, halls, stairways, parking, etc., and may include recreation rooms, swimming pools and small parks or recreation areas; but is not intended to include more grounds than are normally required in a residential area, or to include such extensive areas as required for golf courses, campgrounds, hiking and riding areas, boating areas, etc.
3. To qualify for the deductions under this subsection:
a. The salary or compensation paid to officers, managers, or employees must be only for actual services rendered and at levels comparable to the salary or compensation of like positions within the county wherein the property is located;
b. Dues, fees, or assessments in excess of amounts needed for the purposes for which the deduction is allowed must be rebated to the members of the association; and
c. Assets of the association or organization must be distributable to all members and must not inure to the benefit of any single member or group of members.
N. Sales at Wholesale or Retail of Precious Metal Bullion and Monetized Bullion. In computing tax, there may be deducted from the measure of the tax amounts derived from the sale at wholesale or retail of precious metal bullion and monetized bullion. However, no deduction is allowed of amounts received as commissions upon transactions for the accounts of customers over and above the amount paid to other dealers associated in such transactions, and no deduction or offset is allowed against such commissions on account of salaries or commissions paid to salesmen or other employees.
O. Radio and Television Broadcasting– Advertising Agency Fees– National, Regional, and Network Advertising– Interstate Allocations. In computing tax, there may be deducted from the measure of the tax by radio and television broadcasters amounts representing the following:
1. Advertising agencies' fees when such fees or allowances are shown as a discount or price reduction in the billing or that the billing is on a net basis, i.e., less the discount;
2. Actual gross receipts from national network, and regional advertising or a "standard deduction" as provided by RCW 82.04.280; and
3. Local advertising revenue that represents advertising which is intended to reach potential customers of the advertiser who are located outside the State of Washington. The Director of Finance and Administrative Services may issue a rule that provides detailed guidance as to how these deductions are to be calculated.
P. 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.
Q. Distribution Affiliate or Cooperative. In computing tax, there may be deducted from the measure of the tax an amount equal to the actual cost of the merchandise that a distribution cooperative or its distribution affiliate sells to a customer-owner of the distribution cooperative for the customer-owner's resale at retail. Actual cost means the cost actually paid by the distribution cooperative or distribution affiliate after taking into account all cash discounts and other price reductions.
R. In computing tax imposed by subsection 5.45.050.E, there may be deducted from the measure of the tax gross income from the transport of empty containers picked up in the City if 1) a full container transported from outside the City is exchanged for the empty container at the time of pick-up, and 2) the job is billed to the customer as a round trip charge.
S. Interstate Trucking. The tax imposed on motor carriers under subsection 5.45.050.E shall not apply to gross income from freight picked up in the City and transported by the taxpayer to a location outside the State of Washington. A motor carrier that does not transport freight across the state boundary is not entitled to a deduction, even though the freight is destined for and is ultimately transported to a location outside Washington.
T. Sales of Water to Water Districts, Municipalities and other Political Subdivisions of the State of Washington for Resale. In computing tax, there may be deducted from the measure of the tax under the wholesaling classification, amounts derived from the sale of water to any water district, municipality or other political subdivision of the State of Washington.
U. Sales of Electricity for Resale. In computing tax, there may be deducted from the measure of the tax amounts derived from the sale of electricity to any purchaser of electricity for resale.
V. Receipts From the Sale of Tangible Personal Property or Retail Services Delivered Outside the City but Within Washington. Effective January 1, 2008, amounts included in the gross receipts reported on the tax return and which are derived from the sale of tangible personal property or retail services 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 or wholesaling classifications. Retail services include those services defined as such pursuant to Section 5.30.040.
(Ord. 123704, § 5, 2011; Ord. 123361, § 157, 2010; Ord. 123063, § 12, 2009; Ord. 123063, § 11, 2009; Ord. 122842, § 7, 2008; Ord. 122563, § 7, 2007; Ord. 122322, § 1, 2007; Ord. 121987 § 1, 2005; Ord. 121266 § 8, 2003; Ord. 120794 § 118, 2002; Ord. 120668 § 2(part), 2001.)
5.45.110 Application to City's business activities.
Any department, division, employee association or other subsection of the City that engages in any business activity which if engaged in by any person would, under this chapter or SMC Chapter 5.55, require a business license and the payment of any tax or fee shall make application, file returns and pay any taxes or fees imposed by this chapter or SMC Chapter 5.55.
(Ord. 120668 § 2(part), 2001.)
5.45.120 Tax part of operating 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 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 operating overhead or cost of doing business of such persons.
(Ord. 120668 § 2(part), 2001.)
Chapter 5.46 Sections:
5.46.010 Administrative Provisions.
5.46.020 Definitions.
5.46.030 Tax Imposed– Measure of the Tax.
5.46.040 Square footage business tax– When due.
5.46.050 Exemptions, credits and deductions from the square footage business tax.
5.46.060 Maximum Square Footage Business Tax Credit.
5.46.070 Tax In Addition To Other License Fees Or Taxes.
5.46.010 Administrative Provisions.
All of the provisions contained in Chapter 5.55 of the Seattle Municipal Code shall have full force and application with respect to taxes imposed under the provisions of this chapter except as may be expressly stated to the contrary herein.
(Ord. 122564, § 1, 11-26-07)
5.46.020 Definitions.
The definitions contained in Chapter 5.30 of the Seattle Municipal Code shall be fully applicable to this chapter except as may be expressly stated to the contrary herein. The following additional definitions shall apply throughout this Chapter:
A. "Business floor space" means rentable square feet of an office or place of business and includes the proportionate share of the building service areas such as lobbies, corridors and other common areas in a building. The rentable square footage shall be computed by measuring to the inside finish of permanent outer building walls and shall include space used by columns and projections necessary to the building. Business floor space does not include vertical penetrations through the building such as stairs, elevators, or heating, ventilation, air conditioning, utility, or telephone systems. Business floor space does not include other floor space as defined in subsection B below. If the business floor space is owned by the taxpayer, the business floor space will be calculated in the same manner as above and as if the area was rented.
B. "Other floor space" means rentable square feet used for dining areas, exercise areas, or warehouse space.
1. "Dining area" means any space used exclusively by employees for the purpose of purchasing, preparing, or consuming meals.
2. "Exercise area" means any space used exclusively by employees for the purpose of physical exercise not related to an employee's normal job duties.
3. "Warehouse space" means any space used exclusively for the storage of merchandise or commodities.
Other floor space will be measured in the same manner as business floor space whether owned or rented.
(Ord. 122564, § 1, 11-26-07)
5.46.030 Tax Imposed– Measure of the Tax.
A. A square footage business tax for the act or privilege of engaging in business activities within the city is hereby levied upon and shall be collected from every person that leases, owns, occupies or otherwise maintains an office or place of business within the city.
The tax shall be measured by the number of square feet of business floor space and other floor space for each office or place of business leased, owned, occupied or otherwise maintained within the city during the reporting period.
B. The amount of the tax due shall be equal to the sum of the number of square feet of business floor space for each office or place of business leased, owned, occupied or otherwise maintained within the city multiplied by the rate of $0.39 quarterly ($1.56 annually), and the number of square feet of other floor space for each office or place of business leased, owned, occupied or otherwise maintained within the city multiplied by the rate of $0.13 quarterly ($0.52 annually). The Director will adjust the square footage business tax rate annually for inflation as follows: the tax rate for a year will be equal to the tax rate for the previous year increased (or decreased) by the percentage change in the annual Seattle-Tacoma-Bremerton, WA consumer price index for all urban consumers (CPI-U) for the previous year.
C. Persons with more than one office or place of business must include all business floor space and other floor space for all locations. When a person rents space to another person, the person occupying the rental space is responsible for the square footage business tax on that rental space only if the renter has exclusive right of possession in the space as against the landlord. Space rented for the storage of goods in a warehouse where no walls separate the goods, and where the exclusive right of possession in the space is not held by the person to whom the space is rented, shall be included in the other floor space of the person that operates the warehouse business, and not by the business renting the warehouse space.
D. Persons whose business floor space, other floor space, or period of occupancy changes during a reporting period shall prorate the business floor space or other floor space for the reporting period. A change in the period of occupancy during the reporting period shall be prorated using a ratio of the number of days of occupancy during the reporting period compared to the total number of days within the reporting period. If the amount of business floor space or other floor space changes during the reporting period, floor space for the period shall be computed as a weighted average of the rentable space occupied during different segments of the reporting period. Weighting will be based upon the percentage of the reporting period that a given amount of space was leased, owned, occupied, or otherwise maintained within the city.
E. Any person required to pay the square footage business tax imposed in this chapter that also pays the business license tax as imposed in Section 5.45.050 may take a credit against the square footage business tax computed as follows:
1. The credit is equal to the square footage business tax owed for the reporting period multiplied by the ratio of adjusted gross income derived from the Seattle business location(s) for the reporting period to the total gross income derived from the Seattle business location(s) for the reporting period.
2. For the purpose of this section, "total gross income derived from the Seattle business location(s)" is equal to the total gross income derived from the business activities rendered by, generated from, or attributable to the place(s) of business located within the city.
3. For the purpose of this section, "adjusted gross income derived from the Seattle business location(s)" shall include total gross income derived from the Seattle business location(s) less:
(a) income derived from the sales of tangible personal property and retail services by the Seattle business location(s) delivered to a location within the State of Washington where no local jurisdiction imposes an eligible gross receipts tax; and
(b) the gross income of the Seattle business location(s) subject to the business license tax under subsection 5.45.050.G as determined by Section 5.45.060 through Section 5.45.080 less the gross income of the Seattle business location(s) subject to the business license tax under subsection 5.45.050.G as determined by Section 5.45.060 through Section 5.45.076 and Section 5.45.081.
When the change in income calculated in subsection 3(b) is a negative number, the amount so calculated shall reduce the amount calculated in subsection 3(a); however, if the sum of the totals calculated under subsections 3(a) and 3(b) is a negative number, then the adjusted gross income derived from the Seattle business location(s) shall be equal to the total gross income derived from the Seattle business location(s).
4. In computing the tax credit, any gross receipts from manufacturing, extracting, and printing, and also subject to a selling tax (such as retailing and wholesaling) according to the Multiple Activity Tax Credit (Section 5.45.070), shall be included in the gross income and the adjusted gross income only once.
(Ord. 123704, § 8, 2011; Ord. 123239, § 7, 2010; Ord. 123063, § 12, 2009; Ord. 122564, § 1, 11-26-07)
5.46.040 Square footage business tax– When due.
The tax imposed by this chapter shall be due and payable in accordance with SMC 5.55.040 in the same manner as the business license tax under SMC 5.45. Taxpayers filing their business license tax on a quarterly basis shall file the square footage business tax on a quarterly basis and taxpayers filing their business license tax on an annual basis shall file the square footage business tax on an annual basis on forms prescribed by the Director. Persons discontinuing their business activities in Seattle shall report and pay the square footage business tax at the same time as they file their final business license tax return.
(Ord. 123063, § 13, 2009; Ord. 122564, § 1, 11-26-07)
5.46.050 Exemptions, credits and deductions from the square footage business tax.
A. The following persons are exempt from the square footage business tax:
1. Persons that are exempted from taxation by cities pursuant to federal or state statutes or regulations, including, but not limited to, the following:
(a) Insurance businesses and their agents as defined by RCW 48.01.050 and 48.17.010, respectively, and whose total revenue is exempt from the business license tax per SMC 5.45;
(b) Businesses that only sell, manufacture, or distribute motor vehicle fuel as defined in RCW 82.36.010 and exempted under RCW 82.36.440;
(c) Businesses that distribute or sell only liquor as defined in RCW 66.04.010 and exempted in RCW 66.08.120; and
(d) Banks, whose income is apportioned according to WAC Chapter 458-28.
B. The following persons may take a one hundred percent credit against the square footage business tax:
1. A person not engaged in any business activity during the reporting period.
2. Any person qualifying under the annual business license tax threshold pursuant to SMC 5.55.040 D 1, provided that the person's taxable gross income was not reduced below the threshold by the intrastate deduction allowed in SMC 5.45.100 V or by using the two-factor formula pursuant to SMC 5.45.081 C. If the person's taxable gross income was reduced under the threshold by the intrastate deduction or two-factor formula, the person must compute its square footage business tax using the tax credits available under SMC 5.46.030 E and SMC 5.46.060.
3. Persons owing no business license tax during the reporting period pursuant to SMC 5.45.050 due to exemptions or deductions contained in SMC 5.45.090 or SMC 5.45.100 may take a credit against the square footage business tax for the total amount of the tax, provided that the person's taxable gross income was not reduced by the intrastate deduction allowed in SMC 5.45.100 V or reduced by using the two-factor formula pursuant to SMC 5.45.081 C. If such a reduction was claimed, the person must compute its square footage business tax using the tax credits available under SMC 5.46.030 E and SMC 5.46.060.
C. The portion of the business floor space and other floor space that is used exclusively to administer and manage other offices or places of business outside of Seattle shall be considered headquarters activities and shall not be included in the square footage business tax calculation.
D. Persons taxable under the utility tax pursuant to SMC 5.48 are exempt from the square footage business tax provided they generate no gross income from activities taxable under SMC 5.45.050. If taxpayers subject to the utility tax generate gross income from activities taxable under SMC 5.45.050, only the floor space used in generating such gross income will be subject to the square footage business tax provisions of this chapter.
E. Persons may exempt from the square footage business tax computations the square footage they use in conducting their business activities taxable under the manufacturing, printing and publishing, tour operators, transporting freight for hire, and processor for hire tax classifications of the business license tax.
(Ord. 123063, § 14, 2009; Ord. 122564, § 1, 11-26-07)
5.46.060 Maximum Square Footage Business Tax Credit.
After application of the square footage business tax credit provided in SMC 5.46.030 E, if the gross receipts business license tax assessed under SMC Chapter 5.45 and the square footage business tax assessed under SMC Chapter 5.46 combine to result in a tax increase for the taxpayer when compared to the amount of tax that would have been due under the requirements of SMC Chapter 5.45 in effect prior to the implementation of RCW 35.102.130 on January 1, 2008, then an additional credit may be taken against the square footage business tax for the amount of such tax increase.
(Ord. 123063, § 15, 2009; Ord. 122564, § 1, 11-26-07)
5.46.070 Tax In Addition To Other License Fees Or Taxes.
The tax imposed herein shall be in addition to any license fee or tax imposed or levied under any other law, statute or ordinance whether imposed or levied by the City, State or other governmental entity or political subdivision.
(Ord. 122564, § 1, 11-26-07)
Chapter 5.48 Sections:
5.48.010 Exercise of revenue license power.
5.48.015 Administrative provisions.
5.48.020 Definitions.
5.48.050 Occupations subject to tax– Amount.
5.48.055 Solid waste activities subject to tax– Amount.
5.48.060 City of Seattle subject to tax.
5.48.070 Exceptions and deductions.
5.48.260 Allocation of revenues– Cellular telephone service.
Severability: If any provision or section of this chapter shall be held void or unconstitutional, all other parts, provisions and sections of this chapter not expressly so held to be void or unconstitutional shall continue in full force and effect.
(Ord. 62662 § 23, 1932.)
Cases: A city excise tax which makes a distinction between national banks and the chattel loan business is not unreasonable. Austin v. Seattle, 176 Wn. 654, 30 P.2d 646 (1934).
5.48.010 Exercise of revenue license power.
The provisions of this chapter shall be deemed an exercise of the power of The City of Seattle 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 taxpayer to reconfirm tax computation procedures and remain in compliance with the City code.
(Ord. 118315 § 1, 1996: Ord. 62662 § 1, 1932.)
5.48.015 Administrative provisions.
The provisions contained in SMC Chapter 5.55 shall have full force and application with respect to taxes imposed under the provisions of this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 17, 2001.)
5.48.020 Definitions.
A. The definitions contained in SMC 5.30 shall be fully applicable to the provisions of this chapter unless otherwise expressly defined in this chapter.
B. "Gross income" means the value proceeding or accruing from the sale of tangible property or service, and receipts (including all sums earned or charged, whether received or not), by reason of the investment of capital in the business engaged in, including rentals, royalties, fees or other emoluments, however designated (excluding receipts or proceeds from the use or sale of real property or any interest therein, and proceeds from the sale of notes, bonds, mortgages or other evidences of indebtedness, or stocks and the like) and without any deduction on account of the cost of the property sold, the cost of materials used, labor costs, interest or discount paid, or any expense whatsoever, and without any deduction on account of losses, including the amount of credit losses actually sustained by the taxpayer whose regular books or accounts are kept upon an accrual basis.
(Ord. 120794 § 119, 2002; Ord. 120668 § 18, 2001: Ord. 120182 §§ 1, 2, 2000; Ord. 120181 § 97, 2000; Ord. 118397 § 84, 1996; Ord. 118315 § 2, 1996: Ord. 117401 § 1, 1994; Ord. 117169 § 44, 1994; Ord. 116955 § 1, 1993: Ord. 115908 § 2, 1991; Ord. 115756 § 1, 1991: Ord. 113690 § 5, 1987: Ord. 112111 § 1, 1985: Ord. 112022 § 1, 1984: Ord. 110274 § 1, 1981: Ord. 102620 § 1, 1973: Ord. 62662 § 2, 1932.)
5.48.050 Occupations subject to tax– Amount.
There are levied upon, and shall be collected from everyone, including the City of Seattle, on account of certain business activities engaged in or carried on, annual license fees or occupation taxes in the amount to be determined by the application of rates given against gross income as follows:
A. Upon everyone engaged in or carrying on a telecommunications service or telephone business, a fee or tax equal to six (6) percent of the total gross income from such business provided to customers within the City. The tax liability imposed under this section shall not apply for that portion of gross income derived from charges to another telecommunications company, as defined in RCW 80.04.010, for connecting fees, switching charges, or carrier access charges relating to intrastate toll telephone services, or for access to, or charges for, interstate services, or charges for telecommunication service or telephone business that is purchased for the purpose of resale. (Such charges, except for interstate service, shall be taxed under SMC Chapter 5.45.) The total gross income shall also include all charges by the provider of cellular or cellular mobile telephone services provided to its customers in any taxing jurisdiction (intrastate or interstate), which are billed to a "place of primary use" located in Seattle by or for the home service provider, irrespective of whether the services are provided by the home service provider.
B. Upon everyone engaged in or carrying on the business of selling, brokering, or furnishing gas for hire, a fee or tax equal to six (6) percent of the total gross income from such business in the City.
C. Upon everyone, including The City of Seattle, engaged in or carrying on the business of selling or furnishing water for hire to consumers, a fee or tax equal to the total gross income from such retail business in the City multiplied by the following rates:
Effective through March 30, 2009, a rate of fifteen and fifty-four one hundredths (15.54) percent;
Effective March 31, 2009 through December 31, 2010, a rate of nineteen and eighty-seven one hundredths (19.87) percent; and
Effective January 1, 2011, a rate of fifteen and fifty-four one hundredths (15.54) percent;
Provided that as to The City of Seattle in the conduct of its municipal water utility, such tax shall be applicable to the business of such utility done without, as well as within, the City.
D. Upon everyone, including The City of Seattle, engaged in or carrying on the business of selling or furnishing electric light and power to consumers, a fee or tax equal to six (6) percent of the total gross income from such business in the City. The fee or tax imposed upon the municipal light and power system of the City shall be applicable to the business of such system both within and without the City.
E. Upon everyone conducting or engaged in the business of supplying steam heat or power to consumers, a fee or tax equal to six (6) percent of the total gross income from such business in the City.
F. Upon The City of Seattle in respect to the conduct, maintenance, and operation of its municipal drainage system as a public utility a fee or tax equal to eleven and one-half (11.5) percent of the total gross income from the drainage charges provided for under City ordinances.
G. Upon The City of Seattle in respect to the conduct, maintenance, and operation of its municipal wastewater system as a public utility a fee or tax equal to twelve (12) percent of the total gross income from the wastewater charges provided for under City ordinances.
H. As to solid waste, see Section 5.48.055.
I. Upon everyone engaged in the business of operating or conducting a cable television system (CATV), a fee or tax equal to ten (10) percent of the total gross income from gross subscriber revenues. For purposes of this chapter, "gross subscriber revenues" means and includes those revenues derived from the supplying of subscription service, that is, installation fees, disconnect and reconnect fees, fees for regular cable benefits including the transmission of broadcast signals and access and origination channels and per-program or per-channel charges; provided the tax liability imposed under this section shall not include leased channel revenue, advertising revenues, or any other income derived from the system, which shall be taxed under SMC Chapter 5.45. The business of operating or conducting a cable television system (CATV) does not include the provision of interactive two-way communications over cable. Such activities shall be reported under the telecommunication service or telephone business classification.
(Ord. 122916, § 1, 2009; Ord. 122563, § 8, 2007; Ord. 121987 § 2, 2005; Ord. 121673 § 1, 2004; Ord. 121672 § 1, 2004; Ord. 121671 § 1, 2004; Ord. 121266 § 31, 2003; Ord. 120668 § 19, 2001; Ord. 120647 § 1, 2001; Ord. 119860 § 1, 2000; Ord. 118315 § 4, 1996; Ord. 117183 § 1(part), 1994; Ord. 116955 § 2, 1993; Ord. 116460 § 1, 1992; Ord. 116429 § 1, 1992; Ord. 116186 § 1, 1992; Ord. 115954 §§ 1-4, 1991; Ord. 115908 § 1, 1991; Ord. 115756 § 2, 1991; Ord. 115549 § 1, 1991; Ord. 115422 § 1, 1990; Ord. 115386 § 1, 1990; Ord. 115055 § 1, 1990; Ord. 114779 § 1, 1989; Ord. 114371 § 1, 1989; Ord. 114212 § 1, 1988; Ord. 114155 § 9, 1988; Ord. 113714 § 1, 1987; Ord. 113690 § 6, 1987; Ord. 113375 § 1, 1987; Ord. 113172 § 1, 1986; Ord. 112943 § 1, 1986; Ord. 112552 § 1, 1985; Ord. 112021 § 1, 1984; Ord. 111432 § 1, 1983; Ord. 110843 § 1, 1982; Ord. 110590 § 1, 1982; Ord. 110274 § 2, 1981; Ord. 108886 § 1, 1980; Ord. 108639 § 1, 1979; Ord. 106526 § 1, 1977; Ord. 106088 § 1, 1976; Ord. 106041 § 1, 1976; Ord. 104434 § 1, 1975; Ord. 104357 § 1, 1975; Ord. 104033 § 1, 1974; Ord. 98423 § 2, 1969; Ord. 97288 § 1, 1968; Ord. 94116 § 1, 1965; Ord. 90511 § 1, 1961; Ord. 87623 § 1, 1958; Ord. 85885 § 1, 1957; Ord. 84414 § 1, 1955; Ord. 62662 § 5, 1932.)
Cases: A City ordinance which subjects a private public utility company to a license or excise tax based on gross income, while leaving untaxed a competing business operated by the City, is not unconstitutional as a denial of equal protection or as a taking of property without due process of law. Puget Sound Power and Light Co. v. Seattle, 219 U.S. 620, 54 S.Ct. 542, 78 L.Ed. 1028 (1934), aff'g 172 Wn. 668, 21 P.2d 727 (1933).
Ordinance 62662, an excise tax measured by the gross income derived from business within the City, is not so vague and indefinite as to violate the due process clause of the Fourteenth Amendment, as applied to a foreign telephone company doing business within and without the City. Pacific Teleph. & Teleg. Co. v. Seattle, 291 U.S. 300 (1934) aff'g 172 Wn. 649, 21 P.2d 721 (1933).
Ordinance 62662, which requires burglar alarm system businesses to pay a higher tax rate than other types of burglar prevention services, held not to violate the equal protection clause of Article 1, Section 12 of the State Constitution. Sonitrol Northwest v. Seattle, 84 Wn.2d 588, 528 P.2d 474 (1974).
5.48.055 Solid waste activities subject to tax– Amount.
There is levied upon, and shall be collected from everyone including The City of Seattle, on account of the following business activities engaged in or carried on with respect to solid waste, an annual license fee or occupation tax in the amount to be determined by the application of the rates given below:
A. Transfer tax. There is imposed upon everyone engaged in or carrying on the business of operating a solid waste transfer station or upon the business of transferring solid waste generated in or outside of Seattle from one (1) mode of transportation to another a transfer tax equal to the solid waste tons handled for transportation or transported for landfill or incineration disposal purposes multiplied by the following rates. Effective January 1, 2010 a rate of Eight Dollars and Fifty Cents ($8.50) per ton. Effective January 1, 2011 a rate of Eight Dollars and Sixty Nine Cents ($8.69). To prevent pyramiding of the tax under this subsection when two (2) or more transfers occur in Seattle, the tax is imposed only upon the last transferor and shall not apply to earlier transfers. Solid waste is transferred from one (1) mode of transportation equipment to another, whenever it is moved from a motor vehicle (including, for example, landgrading or earthmoving equipment), barge, train or other carrier to another motor vehicle (including landgrading or earthmoving equipment), barge, train or other carrier, irrespective of whether or not temporary storage occurs in the process. Solid waste shall not be considered transferred if the solid waste was generated and placed in a sealed shipping container outside of the city prior to being moved from one mode of transportation to another within the city or the solid waste was put into a sealed shipping container at a transfer station and subjected to the transfer tax prior to being delivered to the railhead. Beginning January 1, 2009, the transfer tax shall also be imposed on the last transfer in the city of construction, demolition, and landclearing solid waste placed into an intermodal container at the construction, demolition, or landclearing site and transported for landfill or incineration disposal outside of the city. Solid waste transported for recycling, reuse, yard and food waste destined for composting, items to be scrapped for salvage, solid waste used for beneficial use as approved by Seattle Public Utilities, soils, dangerous waste and hazardous substances, and sand and gravel for construction of a public improvement shall not be included in the tonnage by which the transfer tax is measured. The measure of the transfer tax is the actual tonnage of the last in-city transfer of solid waste materials destined for landfill, or incineration disposal unless excluded above, and it is the intent of this subsection that all solid waste generated within the City, unless excluded above, destined to a landfill or incineration disposal be subject to this transfer tax.
B. Upon everyone, including The City of Seattle, engaged in or carrying on the business of solid waste collection services, a tax measured by the following:
1. A tax measured by gross income from solid waste collection services in Seattle which includes any charges to customers for transferring, processing, treating, storage, or disposal:
a. Prior to April 1, 2005, ten (10) percent of the total gross income from solid waste collection services in Seattle, less income derived from the activities identified in subsection C of this section.
b. Effective April 1, 2005, eleven and one-half (11.5) percent of the total gross income from solid waste collection services in Seattle, less income derived from the activities identified in subsection C of this section.
2. A tax measured by solid waste tonnage collected:
a. Effective through December 31, 2006, Twelve Dollars and Forty Cents ($12.40) per ton of solid waste collected in Seattle, excluding the tonnage from recycling when such recycling contains no more than ten (10) percent non-recyclable material by volume, yard and food waste destined for composting, items to be reused or scrapped for salvage, and/or sand and gravel for construction of a public improvement.
b. Effective January 1, 2007 through December 31, 2009, Thirteen Dollars and Sixty Five Cents ($13.65) per ton of solid waste collected in Seattle, excluding the tonnage from recycling, yard and food waste destined for composting, items to be reused or scrapped for salvage, solid waste used for beneficial use as approved by Seattle Public Utilities, soils, and/or sand and gravel for construction of a public improvement.
c. After December 31, 2009 the collection tax measured by the tons of solid waste as imposed in this subsection SMC 5.48.055 B 2 is eliminated.
C. The gross income identified in subsection B of this section above shall exclude income derived from:
1. Collection and/or sale of recycled materials and/or recovered materials, including charges for the lease or rental of containers used in the collection of recycled/recovered materials;
2. Collection and/or sale after processing of yard and food waste products, including charges for the lease or rental of containers used in the collection of yard and food waste products;
3. Sale of containers used for collection of residential solid waste;
4. Collection of solid waste used for beneficial use as approved by Seattle Public Utilities, and soils;
5. Grants and contracts from governmental agencies;
6. The City of Seattle for collecting or disposing of residential garbage and other solid waste;
7. The portion of the City's solid waste collection receipts expended for collection of recyclable materials and yard and food waste; and
8. Transportation or deposit of sand and gravel for construction or a public improvement.
D. The tax imposed under subsection A of this section applies to transferring in the city of all solid waste generated in or outside the city and the tax imposed under subsection B of this section applies only to solid waste collection services within the city. The taxes imposed under subsections A and B of this section are cumulative as to solid waste collected and/or transferred in the city, even though the same tonnage of solid waste may be involved at each successive stage in the disposal process, and the economic burden of the two (2) taxes may aggregate.
E. Gross income derived from activities excluded from the taxes imposed in subsections A and B and those activities contained in subsection C of this section above shall be taxed under SMC Chapter 5.45.
(Ord. 123450, § 1, 2010; Ord. 122842, § 8, 2008; Ord. 122256, § 1, 2006; Ord. 121987 § 3, 2005; Ord. 121670 § 1, 2004; Ord. 121000 § 1, 2002; Ord. 120668 § 26, 2001; Ord. 119737 § 7, 1999; Ord. 118315 § 5, 1996; Ord. 117183 § 1(part), 1994; Ord. 116955 § 2, 1993; Ord. 116460 § 1, 1992; Ord. 116429 § 1, 1992; Ord. 116186 § 1, 1992; Ord. 115954 §§ 1-4, 1991; Ord. 115908 § 1, 1991; Ord. 115756 § 2, 1991; Ord. 115549 § 1, 1991; Ord. 115422 § 1, 1990; Ord. 115386 § 1, 1990; Ord. 115055 § 1, 1990; Ord. 114779 § 1, 1989; Ord. 114371 § 1, 1989; Ord. 114212 § 1, 1988; Ord. 114155 § 9, 1988; Ord. 113714 § 1, 1987; Ord. 113690 § 6, 1987; Ord. 113375 § 1, 1987; Ord. 113172 § 1, 1986; Ord. 112943 § 1, 1986; Ord. 112552 § 1, 1985; Ord. 112021 § 1, 1984; Ord. 111432 § 1, 1983; Ord. 110843 § 1, 1982; Ord. 110590 § 1, 1982; Ord. 110274 § 2, 1981; Ord. 108886 § 1, 1980; Ord. 108639 § 1, 1979; Ord. 106526 § 1, 1977; Ord. 106088 § 1, 1976; Ord. 106041 § 1, 1976; Ord. 104434 § 1, 1975; Ord. 104357 § 1, 1975; Ord. 104033 § 1, 1974; Ord. 98423 § 2, 1969; Ord. 97288 § 1, 1968; Ord. 94116 § 1, 1965; Ord. 90511 § 1, 1961; Ord. 87623 § 1, 1958; Ord. 85885 § 1, 1957; Ord. 84414 § 1, 1955; Ord. 62662 § 5, 1932.)
5.48.060 City of Seattle subject to tax.
Subsections 5.48.050 C, D, and F, Section 5.48.055, and Sections 5.55.050 C, 5.55.090 A and B, and 5.55.110 shall, so far as permitted by law, be applicable to The City of Seattle, except that the City shall not, as a taxpayer, be required to conform to the other provisions of this chapter.
(Ord. 120668 § 28, 2001; Ord. 118315 § 6, 1996; Ord. 117183 § 2, 1994; Ord. 116460 § 2, 1992; Ord. 104802 § 1, 1975; Ord. 99524 § 1, 1970; Ord. 84414 § 2, 1955; Ord. 62662 § 6, 1932.)
5.48.070 Exceptions and deductions.
A. There shall be excepted and deducted from the total gross income upon which the license fee or tax is computed, amounts derived from business which the City is prohibited from taxing under the Constitution or laws of the United States, the Constitution or laws of the state, or the Charter of the City; and any amounts collected by the taxpayer as an excise tax (trust funds) and remitted to the taxing authority, including but not limited to the leasehold excise tax, retail sales and use tax, State's refuse collection tax and admission tax.
B. A taxpayer engaged in a telephone business shall exclude from the total taxable gross income taxed under this chapter charges to another telecommunications company, for such fees and charges as are excluded under SMC Section 5.48.050 A. This excluded revenue shall be recorded and taxed under SMC Chapter 5.45.
C. A deduction from gross income shall be allowed, only to cellular telephone service companies who keep their regular books of account on an accrual basis, for credit losses actually sustained by a taxpayer as a result of cellular telephone service business.
(Ord. 121987 § 4, 2005; Ord. 120668 §§ 20, 27, 2001; Ord. 118315 § 7, 1996; Ord. 116951 § 4, 1993; Ord. 116462 § 1, 1992; Ord. 114850 § 1, 1989; Ord. 112943 § 2, 1986; Ord. 100327 § 1, 1971; Ord. 62662 § 9, 1932.)
Cases: Since the exactions levied under Seattle Ordinance 62662 and the corresponding state law are not "taxes imposed or levied upon the sale or distribution of property or services," the amounts paid pursuant to the terms of such ordinance and state law are not deductible under Section 9 of Ordinance 62662. Seattle Gas Co. v. Seattle, 192 Wn. 456, 73 P.2d 1312 (1937).
5.48.260 Allocation of revenues– Cellular telephone service.
A. In determining the total gross income from telephone business in the City for purposes of Section 5.48.050 A, there shall be included all gross income from cellular telephone service (including roaming charges incurred by Seattle customers outside this state) provided to customers whose "place of primary use" is in the City, regardless of the location of the facilities used to provide the service. The customer's "place of primary use" is, with respect to each telephone: (a) the customer's address; or (b) the customer's place of residence if the telephone is for personal use, and in both cases must be located within the licensed service area of the home service provider. Roaming charges and cellular telephone charges to customer whose principal service address is outside Seattle will not be taxable even though those mobile services are provided within Seattle.
B. There is a rebuttable presumption that the "place of primary use" address shown on the cellular telephone service company's records is accurate. If the cellular telephone service company knows or should have known that a customer's place of primary use address for a telephone is within the City then the gross revenue from cellular telephone service provided to that customer with respect to that telephone is to be included in the company's gross income.
(Ord. 120668 § 21, 2001; Ord. 117401 § 2(part), 1994.)
Chapter 5.52 ------------
Statutory Reference: For statutory provisions authorizing cities to tax certain gambling activities, see RCW 9.46.110.
Severability: If any clause, sentence, paragraph or part of this chapter, or the application thereof to any person or circumstances, shall for any reason be adjudged by a court of competent jurisdiction to be invalid, such judgment shall not affect, impair or invalidate the remainder of this chapter.
(Ord. 107278 § 5, 1978: Ord. 102459 § 6, 1973.)
------------
Sections:
5.52.005 Administrative provisions.
5.52.010 Definitions.
5.52.020 Filing of intent to conduct activity.
5.52.030 Tax levied.
5.52.005 Administrative provisions.
All of the provisions contained in SMC Chapter 5.55 shall have full force and application with respect to taxes imposed under the provisions of this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 22, 2001.)
5.52.010 Definitions.
The definitions contained in SMC Chapter 5.30 shall be fully applicable to the provisions of this chapter except as expressly stated to the contrary herein or defined otherwise in RCW Chapter 9.46.
(Ord. 120794 § 120, 2002; Ord. 120668 § 23, 2001: Ord. 120181 § 98, 2000; Ord. 118313 § 1, 1996.)
5.52.020 Filing of intent to conduct activity.
Any person, corporation, association, organization or bona fide charitable or nonprofit organization intending to conduct or operation in the City any such gambling activity or fundraising event as authorized by or under RCW Chapter 9.46, as now existing and hereafter amended, and subject to the tax imposed by Section 5.52.030 shall, prior to the commencement of any such activity, file with the Director a sworn declaration of intent to conduct or operate such activity. A copy of the state license issued in accordance with RCW Chapter 9.46, if such is required, shall accompany such declaration.
(Ord. 118313 § 2, 1996.)
5.52.030 Tax levied.
A. In accordance with RCW Chapter 9.46, as amended, a tax or fee is levied upon all persons, corporations, associations, or organizations conducting or operating within the City any of the following gambling activities authorized by RCW 9.46.010, as amended, and RCW 9.46.033, as follows:
1. For the conduct of amusement games, a tax equal to two percent of the net gambling receipts; and
2. For punch boards and pull-tabs, as defined in RCW 9.46.0273, except for those punch boards and pull-tabs taxed under subsection B2 of this section below, a tax equal to five percent of the gross gambling receipts.
B. In accordance with RCW Chapter 9.46, as amended, a tax or fee is levied on all bona fide charitable or nonprofit organizations, as defined in RCW 9.46.0209, conducting or operating in the City any of the following gambling activities, as follows:
1. Upon and for the conduct of bingo games, as defined in RCW 9.46.0205, and raffles, as defined in RCW 9.46.0277, a tax equal to five percent of the net gambling receipts; and
2. For punch boards and pull-tabs, as defined in RCW 9.46.0273, a tax equal to ten percent of the net gambling receipts; and
3. Upon and for the conduct of a fund-raising event, as defined in RCW 9.46.0233, a tax equal to ten percent of the net gambling receipts.
C. Except, no tax shall be imposed:
1. On bingo or amusement games when such activity, or any combination thereof, is conducted by a bona fide charitable or nonprofit organization as defined in RCW 9.46.0209, when such organization has no paid operating or management personnel and when net gambling receipts from bingo or amusement games or any combination thereof, do not exceed Five Thousand Dollars per year;
2. On the first Ten Thousand Dollars of net gambling receipts from raffles conducted by any bona fide charitable or nonprofit organization as defined in this chapter;
3. On the conduct of amusement games at the Seattle Center pursuant to a concession agreement with the City.
(Ord. 123063, §§ 16, 17, 2009; Ord. 118665 § 1, 1997; Ord. 118313 § 3, 1996: Ord. 115916 § 2, 1991: Ord. 107278 § 1, 1978: Ord. 104087 § 2, 1974: Ord. 103598 § 1, 1974: Ord. 103016 § 1, 1974: Ord. 102835 § 9(part), 1973: Ord. 102459 § 1, 1973.)
Cases: A tax upon gambling revenues to include those received a short time prior to enactment of the tax is not unconstitutional. Drum & Bugle Corps. v. Seattle, 14 Wn. App. 845, 545 P.2d 1235 (1976).
Chapter 5.55 Sections:
5.55.010 Application of chapter stated.
5.55.020 Definitions.
5.55.030 License requirements.
5.55.040 When due and payable– Reporting periods– Monthly, quarterly, and annual returns– Threshold provisions– Computing time periods– Failure to file returns.
5.55.050 Payment methods– Mailing returns or remittances– Time extension– Deposits– Recording payments– Payment must accompany return– NSF checks.
5.55.060 Records to be preserved– Examination– Inspection– Search warrants– Estoppel to question assessment.
5.55.070 Accounting methods.
5.55.080 City contracts– Payment of fee and tax before final payment for work.
5.55.090 Interest on underpayment of tax.
5.55.095 Time in which assessment may be made.
5.55.100 Overpayment of tax, penalty, or interest– Credit or refund– Interest rate– Statute of limitations.
5.55.110 Late payment– Disregard of written instructions– Evasion– Penalties.
5.55.120 Cancellation of penalties.
5.55.125 Amnesty
5.55.130 Taxpayer quitting business– Liability of successor.
5.55.140 Review of Director's assessment or denial of refund.
5.55.150 Appeal to the Hearing Examiner.
5.55.160 Judicial Review of the Hearing Examiner's decision.
5.55.165 Director of Finance and Administrative Services to make rules.
5.55.170 Ancillary authority of Director.
5.55.180 Mailing of notices.
5.55.190 Tax declared additional.
5.55.200 Public disclosure– Confidentiality– Information sharing.
5.55.210 Tax constitutes debt.
5.55.220 Unlawful actions– Violation– Penalties.
5.55.225 Police powers of special commissioned officers.
5.55.230 Refusal to issue, revocation of, or refusal to renew business license
5.55.235 License not obtained.
5.55.240 Closing agreement provisions.
5.55.250 Charge-off of uncollectible taxes.
5.55.260 Personal liability of persons in control of admission and commercial parking taxes.
5.55.270 Severability.
5.55.010 Application of chapter stated.
Unless expressly stated to the contrary in each chapter, the provisions of this chapter shall apply with respect to the licenses and taxes imposed under this chapter and SMC Chapters 5.32 (Amusement Devices), 5.35 (Commercial Parking Taxes), 5.37 (Employee Hours Taxes), 5.40 (Admission Tax), 5.45 (Business License Tax), 5.46 (Square Footage Business Tax), 5.48 (Utility Tax), and 5.52 (Gambling Tax) and under other titles, chapters and sections in such manner and to such extent as indicated in each such title, chapter or section.
(Ord. 123063, § 18, 2009; Ord. 122564, § 4, 2008; Ord. 122192, § 3, 2006; Ord. No. 122191, § 3, 2006; Ord. 120668 § 4(part), 2001.)
5.55.020 Definitions.
The definitions contained in Chapter 5.30 of the Seattle Municipal Code shall be fully applicable to this chapter except as expressly stated to the contrary herein.
(Ord. 120668 § 4(part), 2001.)
5.55.030 License requirements.
A. No person, unless specifically exempted, shall engage in any business activity, profession, trade or occupation in the City without having first obtained and being the holder of a valid and subsisting license to do so, to be known as a "business license." The fee for the business license shall be $90.00 for persons with worldwide gross income of the business and value of products of more than $20,000 in the current calendar year that engage in any business activity, profession, trade or occupation in the City prior to July 1st and $45.00 for persons beginning their activity on or after July 1st. The business license fee for persons with worldwide gross income of the business and value of products of $20,000 or less in the current calendar year will be $45.00 if prior to July 1st and $22.50 for persons beginning their activity on or after July 1st. The fee shall accompany the application for the license.
The business license shall expire at the end of the calendar year for which it is issued. The business license shall be personal and nontransferable except as provided in subsection G, below. Applications for the business license shall be made to the Director of Finance and Administrative Services on forms provided by the Director. Each business license shall be numbered, shall show the name, place and character of the business of the licensee, and such other information as the Director deems necessary, and shall at all times be conspicuously posted in the place of business for which it is issued.
If the licensee changes the place of business, the licensee shall return the business license to the Director and a new license shall be issued for the new place of business free of charge.
B. When business is transacted at two or more separate places by one taxpayer, a separate business license for each place at which business is transacted with the public shall be required. A $10 license fee shall be imposed and accompany each application for the business license required for each additional business location.
C. No person to whom a business license has been issued pursuant to this chapter shall suffer or allow any other person for whom a separate license is required to operate under or display his or her license; nor shall such other person operate under or display such license.
D. As provided in Section 6.20.040, a participant at an event, identified in the list supplied by the promoter or organizer, shall be exempt from the business license fee established by subsection A, above, or the fee for a separate business location established by subsection B, above, on account of business activities at the licensed event for the duration of the event license; provided however, that such participant is not otherwise engaging in business in the City as such term is defined in Section 5.30.030.B2.
E. Any business license may be renewed by the payment for the ensuing year of the license fee herein prescribed on or before the date of the expiration of such license. Any licensee who fails to make payment on or prior to the expiration date of said business license shall be subject to penalties in the following amounts:
1. Ten Dollars if not received on or before the last day of the month following the expiration date.
2. Twenty Dollars if not received on or before the last day of the second month following the expiration date.
3. All business licenses issued subsequent to the initial license period shall be deemed renewal licenses if there has been no discontinuance of the licensee's operations or activities. Nonpayment by the licensee of taxes or business license fees other than those due upon expiration for the renewal of a license, when due during the term of any license shall constitute grounds for revocation of or the refusal to renew said license.
F. Licenses for amusement devices will be in addition to this business license and will be assessed pursuant to Section 5.32.170. It is unlawful for any person to own any amusement device, which is available for use by the public, without having first obtained an amusement device license issued in accordance with the provisions of this chapter and Chapter 5.32. The license shall be attached to the amusement device at all times when in use or play or available for use or play so that it is readily visible. The amusement device license will be prorated semi-annually in the same manner as the business license; however, the amusement device license expires annually on November 30th.
G. A business license or amusement device license cannot be assigned or transferred, except that a license may be transferred:
1. To the surviving or new corporation, whenever the licensed corporation is merged or consolidated pursuant to RCW Chapter 23B.11, as now or hereafter amended;
2. To the surviving partner, or to a new partnership which consists exclusively of the surviving partners, whenever one partner of a licensed partnership dies;
3. To the surviving spouse, whenever one spouse of a licensed marital community dies;
4. To any one or more former partners, whenever a licensed partnership is dissolved and one or more of the former partners of the licensed partnership continue the operation of the business as an individual proprietorship or partnership without the addition of any new partner, and all of the other former partners consent in writing to the transfer of the license, which written consent shall be filed with the application for such transfer;
5. To one spouse, whenever a licensed marital community is dissolved and the other spouse consents in writing to the transfer of the license, which written consent shall be filed with the application for such transfer;
6. In case of the death of any licensee before the expiration of his or her license, his or her administrator or executor, duly appointed as such by order of court, may continue to act under said license for the unexpired term thereof upon filing with the City proof of such appointment.
As used in this subsection, the term "partnership" includes joint venture, and the term "partner" includes a co-venturer.
(Ord. 123361, § 158, 2010; Ord. 123152, § 1, 2009; Ord. 121679 § 13, 2004; Ord. 121118 § 1, 2003; Ord. 120966 § 1, 2002; Ord. 120668 § 4(part), 2001.)
5.55.040 When due and payable– Reporting periods– Monthly, quarterly, and annual returns– Threshold provisions– 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 SMC Chapters 5.32 (Amusement Devices), 5.35 (Commercial Parking Tax), 5.40 (Admission Tax), 5.45 (Business License Tax), 5.46 (Square Footage Business Tax), 5.48 (Utility Tax), and 5.52 (Gambling Tax), shall be due and payable in quarterly installments. The Director may use his or her discretion to assign businesses to a monthly or annual reporting period depending on the tax amount owing or type of tax. Taxes imposed by SMC Section 5.52.030 A2 and B2 for punchboards and pulltabs shall be due and payable in monthly installments. Tax returns and payments are due on or before the last day of the next month following the end of the assigned reporting period covered by the return.
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 true and complete.
C. Tax returns must be filed and taxes must be paid on or before the last day of the next month following the end of the assigned reporting period covered by the return. Tax returns must be filed whether or not any tax is owed. Returns not received on or before the due date are subject to penalties and interest in accordance with this chapter, in addition to any other civil or criminal sanction or remedy that may be available.
D. 1. For purposes of the tax imposed by SMC Chapter 5.45, 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 subject to tax after all allowable deductions, is less than the tax threshold amount defined in subsection D 3, below, in the current calendar year, shall complete and 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.
2. Any person who reasonably estimates that the 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 subject to tax after all allowable deductions, will be less than the tax threshold amount defined in subsection D 3 below, in the current calendar year may file a declaration so stating on a form supplied by the Director at the same time he or she files his or her application for a business license or a renewal. The Director may assign any person who files such declaration to an annual reporting period.
3. For calendar years prior to 2008, the Business and Occupation tax threshold amount shall remain at Fifty Thousand Dollars ($50,000) as established under Ordinance 116945. For calendar years 2008 and thereafter, the Business and Occupation tax threshold amount shall be Eighty Thousand Dollars ($80,000).
Editor's note: Ord. 123039, § 1, of 2009 amended subsection D.3., effective January 1, 2010, to read as follows:
3. For calendar years prior to 2008, the Business and Occupation tax threshold amount shall remain at Fifty Thousand Dollars ($50,000) as established under Ordinance 116945. For calendar years 2008 and 2009, the Business and Occupation tax threshold amount shall be Eighty Thousand Dollars ($80,000). For calendar years 2010 and thereafter, the Business and Occupation tax threshold amount shall be One Hundred Thousand Dollars ($100,000).
E. A taxpayer who 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 he or she is engaged in business activity subject to the conditions set forth in subsection D, above.
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 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 file his or her return as and when required in this chapter, the Director is authorized to determine the amount of the tax or fees due by obtaining facts and information upon which to base his or her 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.
(Ord. 123063, § 19, 2009; Ord. 123039, § 1, 2009; Ord. 122764, § 1, 2008; Ord. 122564, § 5, 2008; Ord. 122567, § 1, 2007; Ord. 122192, § 4, 2006; Ord. 122191, § 4, 2006; Ord. 121679 § 14, 2004; Ord. 121266 § 17, 2003; Ord. 120668 § 4(part), 2001.)
5.55.050 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 which 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 remittance from any taxpayer. A return or remittance that 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 therefor 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 license fees, then penalties, then interest owing, and finally 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 Twenty Dollars ($20) is received by the 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 Fee of Twenty Dollars ($20)) 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.
(Ord. 120668 § 4(part), 2001.)
5.55.060 Records to be preserved– Examination– Inspection– Search warrants– Estoppel to question assessment.
A. Every person liable for any fee or tax imposed by this chapter, Chapters 5.32, 5.35, 5.40, 5.45, 5.46, 5.48, and 5.52 shall keep and preserve, for a period of five 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, ticket stubs, vendor lists, gambling games and payout information, inventories, stocks of merchandise, and other data, including federal income tax and state tax returns, and reports needed to determine the accuracy of any taxes due, shall be open for inspection or examination at any time by the Director or a duly authorized agent. Every person's business premises shall be open for inspection or examination by the Director or a duly authorized agent.
B. If a person does not keep the necessary books and records within the City, it shall be sufficient if such person:
1. Produces within the City such books and records as may be required by the Director, or
2. 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.
C. 1. The Director and Department employees that have been commissioned as special police officers pursuant to Section 5.55.225 shall have the right to enter any premises or establishment at reasonable times in order to determine whether a violation constituting a gross misdemeanor under Section 5.55.220 has occurred, is occurring or may occur.
2. If the Director or his agent is denied access to any premises or establishment, the Director or his agent may apply for a search warrant to any court official of a court of competent jurisdiction authorized to issue a criminal search warrant. A search warrant may be issued for the purposes of inspecting or examining property, buildings, premises, places, books, records, or other physical evidence in order to determine compliance with law and rules administered by the Department. The warrant shall be issued upon probable cause.
D. 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 based upon any period for which such records have not been provided, made available or kept and preserved, or in respect to 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 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.
(Ord. 123361, § 159, 2010; Ord. 122564, § 6, 2008; Ord. 122192, § 5, 2006; Ord. No. 122191, § 5, 2006; Ord. 121266 § 18, 2003; Ord. 120668 § 4(part), 2001.)
5.55.070 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 who 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.
REGISTRATION OF BONDS
ACCOUNTING PROCEDURE*
PROCEDURES AND DOCUMENTATION– CITY MONEYS
WARRANTS*
BILLS BY CITY DEPARTMENTS FOR LABOR OR MATERIALS*
PAYMENTS VIA CREDIT AND DEBIT CARDS AND ELECTRONIC COMMERCE*
CLAIMS FOR INJURIES OR DAMAGES*
BONDS IN CIVIL ACTIONS
DEFINITIONS
REVENUE CODE*
General Provisions
Amusement Devices
SMALL GRANTS
SMALL DONATIONS
Taxes
COMMERCIAL PARKING TAX
ADMISSION TAX
BUSINESS LICENSE TAX
SQUARE FOOTAGE TAX
BUSINESS TAX– UTILITIES
GAMBLING TAX*
GENERAL ADMINISTRATIVE PROVISIONS