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HomeMy WebLinkAbout2013 Ordinance No. 039.,.._, • • • • ORDINANCE NO. lfl SERIES OF 2013 BY AUTHORITY COUNCIL BILL NO . 38 INTRODUCED BY COUNCIL MEMBER WOODWARD AN ORDINANCE AMENDING TITLE 4, CHAPTER 4, SECTION 2, OF THE ENGLEWOOD MUNICIPAL CODE 2000 RELATING TO BUILDING USE TAXES WHEREAS, the code provisions allowing periodic payments of building use tax has not been amended since the 1985 code; and WHEREAS, the Englewood Municipal Code requires a deposit for building use taxes for small projects and allows larger projects to pay building use taxes on a periodic basis; and WHEREAS, the current threshold is $200,000 (two hundred thousand dollars) which was reasonable in 1985 but is low today because most projects easily exceed that amount and so those projects valued at $200,000 (two hundred thousand dollars) or below should be treated as other smaller projects; and WHEREAS, the changes clarify current code language in describing what is subject to the building use tax; and WHEREAS, the Director of Finance and Administrative Services met with the Englewood City Council to discuss this matter at the July 1, 2013 Study Session. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ENGLEWOOD, COLORADO, AS FOLLOWS: Section 1. The City Council of the City of Englewood, Colorado hereby authorizes amending Title 4, Chapter 4, Section 2, entitled "Definitions" of the Englewood Municipal Code 2000, by inserting the following terms in alphabetical order, to read as follows: 4-4-2: Definitions. When used in this Chapter, the following words and phrases shall have the following meanings, unless from the context it clearly appears that a different meaning is indicated: Realty: Includes land and anything fixed. immovable. or permanently attached to it such as buildings. walls. fixtures. improvements. roads. trees. shrubs. fences. sewers. structures, and utility systems. Section 2. The City Council of the City of Englewood, Colorado hereby authorizes amending Title 4, Chapter 4, Section 5 Subsection 3, of the Englewood Municipal Code 2000, entitled Payment and Collection of Use Tax to read as follows: 1 9 b iv 4-4-5-3: Payment and Collection of Use Tax. [EDITORS NOTE: 4-4-5-3(A) contains no changes and is therefore not included here.] B. Payment and Collection on Specific Items: The following special provision shall apply to the payment of any use tax due on the use, consumption or storage of the following items: 2. Building and Construction Materials and Supplies : Any person 1.vho does not maintain a permanent place ofbusiE:ess within the boundaries of the City and who shall build, construct or improve any building, dwelling or other structure or improvement to realty whatsoever (including but not limited to structures. and site work such as landscaping. utility infrastructure, curb/gutter installation. parking lot resurfacing. etc.) within the City shall, upon application for a building permit for improvement to realty. oay as a deposit for payment of the tax levied by Section 4-4-5-1 an amount equal to three and one-half percent (3 .5%) of fifty percent ( 50%) of the estimated cost or total contract price of the structure improvement or three and one-half (3 .5%) of forty percent ( 40%) of the estimated cost of the improvement other than to the structure.: provided, hov,re•,rer, that lf the estimated cost or the total contract price of the improvement to realty is in excess of tv,ro hundred thousand dollars ($200,000.00) three million dollars ($3.000.000.00) or as set by City Council Resolution. the City Manager or designee. at his/her discretion and upon application to it, may authorize a waiver of said deposit and accept the payment of said tax on a monthly, quarterly or other basis, based upon actual purchases of materials, supplies and equipment for such tax may be due, subject to such rules and regulations as the said City may adopt. In all cases where the deposit required by the provisions of this • Section is made, if it is determined at the time of the completion of the building, • dwelling or other structure of improvement from the invoices and statements reflecting the purchase therefor, that the deposit made as herein required, together with the actual payments to the City as a sales tax, is in excess of the actual tax due therefor, the person making said deposit or paying said tax may make application to the City for refund of any amount paid in excess of the actual taxes due, in which event it shall be the duty of the person making such application to furnish all necessary bills and invoices evidencing over-payment of the tax, and, if the said City is satisfied that there has been such overpayment, it shall refund such overpayment to the taxpayer. Section 3. Safety Clauses. The City Council hereby finds, determines, and declares that this Ordinance is promulgated under the general police power of the City of Englewood, that it is promulgated for the health, safety, and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The City Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 4. Severability. If any clause, sentence, paragraph, or part ofthis Ordinance or the application thereof to any person or circumstances shall for any reason be adjudged by a court of competent jurisdiction invalid, such judgment shall not affect, impair or invalidate the remainder of this Ordinance or it application to other persons or circumstances. Section 5. Inconsistent Ordinances. All other Ordinances or portions thereof inconsistent or conflicting with this Ordinance or any portion hereof are hereby repealed to the extent of such inconsistency or conflict. 2 • • Section 6. Effect of repeal or modification. The repeal or modification of any provision of • • the Code of the City of Englewood by this Ordinance shall not release, extinguish, alter, modify, or change in whole or in part any penalty, forfeiture, or liability, either civil or criminal, which shall have been incurred under such provision, and each provision shall be treated and held as still remaining in force for the purposes of sustaining any and all proper actions, suits, proceedings, and prosecutions for the enforcement of the penalty, forfeiture, or liability, as well as for the purpose of sustaining any judgment, decree, or order which can or may be rendered, entered, or made in such actions, suits, proceedings, or prosecutions. Section 7. Penalty. The Penalty Provision of Section 1-4-1 EMC shall apply to each and every violation of this Ordinance. Introduced, read in full, and passed on first reading on the 5th day of August, 2013. Published by Title as a Bill for an Ordinance in the City's official newspaper on the 9th day of August, 2013. Published as a Bill for an Ordinance on the City's official website beginning on the 7th day of August, 2013 for thirty (30) days. Read by title and passed on final reading on the 19th day of August, 2013. Published by title in the City's official newspaper as Ordinance No.f!Z_, Series of 2013, on the 23 rd day of August, 2013 . Published by title on the City's official website beginning on the 21 st day of August, 2013 for thirty (30) days. This Ordinance shall take effect thirty (30) days after publication following final passage. Penn, Mayor I , Loucrishia A. Ellis, City Clerk of the City of Englewood, Colorado, hereby certify that the above and foregoing i~e copy of the Ordinance passed on final reading and published by title as Ordinance No .4-, Series of 2013 . 3 • • • COUNCIL COMMUNICATION Date: Agenda Item: Subject: August 5, 2013 9 a iii A Bill for an Ordinance Making Changes to 4-4-2 of the Englewood Municipal Code (Building Use Taxes) Initiated By: Staff Source: Finance and Administrative Services Department Frank Gryglewicz, Director COUNCIL GOAL AND PREVIOUS COUNCIL ACTION City Council discussed this issue with staff at the stud y session on Jul y 1, 2013. Council requested staff prepare a bill for an ordinance making changes that will clarify language, add a definition for "Real Estate" in the Code, as well as update language regarding the m inimum amount a project must be to before being allowed to make payments . RECOMMENDED ACTION Staff recommends Council approve the attached bill for an ordinance making changes to 4-4-2 of the Englewood Municipal Code as noted in the following section . BACKGROUND, ANALYSIS, AND ALTERNATIVES IDENTIFIED Generally, a contractor issued a permit for work in the City of Englewood is subject to building use ta x on half the contract price times 3 .5 percent. Under the current Code, a contractor can make payments if the project is over $200,000. This amount may have been relevant when the language was written but is far too low, as even small projects easily exceed $200,000. Current Code language is vague regarding what is subject to the building use tax. All building materials used in the "footprint" of the building as well as "site work." Site work includes construction materials but also landscaping, utility installation, curb and gutter, parking lot materials, etc. The proposed changes are shown below: 4-4-2: -Definitions. Realty: Includes land and anything fixed. immovable, or permanently attached to it such as buildings, walls. fixtures, improvements, roads. trees, shrubs. fences, sewers, structures, and utility systems. 4-4-5-3-8-2 Building/Construction Materials and Supplies: An y person -..•,'ho does not maintain a permanent place of business within the boundaries of the City and who shall build, construct or improve an y building, dwelling or other structure or improvement to realty whatsoever (including but not limited to structures, and site work such as landscaping, utility infrastructure, curb/gutter installation. parking lot resurfacing. etc.) within the City shall, upon application for a building permit for improvement to realty, pay as a deposit for payment of the tax levied by Section 4-4-5-1 an amount equal to three and one-half percent {3.5%) of fifty percent (50%} of the estimated cost or total contract price of the structure improvement or three and one-half percent (3.5%} of forty percent ( 40%} of the estimated cost of the improvement other than to the structure.; provided, however, that !f the estimated cost or the total contract price of the improvement to realty is in excess of two hundred thousand dollars ($200,000.00} three million dollars ($3,000,000.00) or as set by City Council Resolution. the City Manager or designee, at his/her discretion and upon applicati on to it, may authorize a waiver of said deposit and accept the payment of said tax on a monthly, quarterly or other basis, based upon actual purchases of materials, supplies and equipment for which such tax may be due, subject to such rules and regulations as the said City may adopt. In all cases where the deposit required by the provisions of this Section is made, if it is determined at the time of the completion of the building, dwelling or other structure of improvement from the invoices and statements reflecting the purchase therefor, that the deposit made as herein required, together with the actual payments to the City as a sales tax, is in excess of the actual tax due therefor, the person making said deposit or paying said tax may make application to the City for refund of any amount paid in excess of the actual taxes due, in which event it shall be the duty of the person making such application to furnish all necessary bills and invoices evidencing over- payment of the tax, and, if the said City is satisfied that there has been such overpayment, it shall refund such overpayment to the taxpayer. FINANCIAL IMPACT These changes to the Code will better inform contractors of the materials they use that are subject to the Building Use Tax. Revenues could increase in the future as collection of taxes will be made on all materials used for a project including the building footprint and any work on the site. Increasing the amount that a project must exceed before being allowed to go on a payment plan will insure the City of Englewood collects more Building Use Tax when the building permit is issued instead of collecting taxes over a period of time. LIST OF ATTACHMENTS Proposed bill for an ordinance • • •