AGENDA REPORT
Meeting Date:
Item Number:
To:
From:
Subject:
Attachments: 1. Proposed Ordinance (Clean)
2. Urgency Ordinance No. 20-O-2818
RECOMMENDATION
The Director of Finance recommends the City Council approve an ordinance amending Ordinance No. 20-O-2818 in connection with emergency regulations related to suspending business tax penalties and interest (Ordinance) (Attachment 1). Urgency Ordinance 20-O-2818 is attached as Attachment 2.
INTRODUCTION
As businesses have continued to recover from the COVID-19 pandemic and as emergency regulations are lifted, staff believes it is appropriate for the City Council to repeal the suspension of penalties and interest on business taxes owed to the City effective with the next annual renewal season.
DISCUSSION
On March 15, 2020, Beverly Hills City Manager George Chavez, in his role as Director of Emergency Services, declared a local emergency in response to the ongoing public health concerns surrounding COVID-19. On March 16, 2020, the City Council ratified the local emergency declaration and adopted Urgency Ordinance No. 20-O-2805. From time to time, the City Council has adopted superseding ordinances, and the current ordinance related to the suspension of penalties and interest on business taxes is Ordinance No. 20- September 12, 2022
D-3
Honorable Mayor & City Council
Jeff Muir, Director of Finance
Tatiana Szerwinski, Assistant Director of Finance
Emily Armstrong, Revenue Services Manager
AN ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING
ORDINANCE NO. 20-O-2818 IN CONNECTION WITH EMERGENCY
REGULATIONS RELATED TO THE SUSPENSION OF
BUSINESS TAX PENALTIES AND INTEREST
Meeting Date: September 12, 2022
O-2818, which the City Council adopted on September 1, 2020 (“Urgency Ordinance”) (Attachment 3).
On June 15, 2021, both the State of California and Los Angeles County relaxed and repealed most of the health officer orders related to COVID-19. In Los Angeles County, there are still health officer orders in place for large indoor gatherings, large outdoor gatherings, day camps, overnight organized / children’s camps, K-12 schools, community care facilities, and skilled nursing facilities. All other economic sector-based restrictions have been rescinded.
On July 15, 2021, the City Council reviewed the urgency ordinance to consider repealing and/or amending certain provisions, including the suspension on business tax penalties and interest, and decided to postpone making a decision on the items.
Now that all businesses have been reopened for some time with over a year to financially recover, staff recommends reinstating penalties and interest on business taxes beginning February 1, 2023, coinciding with the next business tax renewal season.
After adoption of this ordinance, staff in the Finance Department will prepare and send letters and/or email notifications to those affected businesses in the City notifying them the accrual of penalties and interest on unpaid business taxes will be resuming in the upcoming year.
FISCAL IMPACT
Staff is proposing that penalties and interest for unpaid business taxes begin accruing February 1, 2023. It is unknown how much additional revenue may be realized, as penalties and interest are irrelevant to businesses that file and pay on time. Historically, penalties and interest on business tax has been a relatively immaterial amount.
Jeff Muir,
Director of Finance
Approved By
Attachment 1
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ORDINANCE NO. 22-O- _____
AN ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING
ORDINANCE NO. 20-O-2818 IN CONNECTION WITH EMERGENCY
REGULATIONS RELATED TO THE SUSPENSION OF BUSINESS
TAX PENALTIES AND INTEREST
WHEREAS, on March 15, 2020, the City Manager, in his role as the Director of Emergency Services, proclaimed the existence of a local emergency pursuant to Section 2- 4-107 of the Beverly Hills Municipal Code to ensure the availability of mutual aid and an effective City response to the novel coronavirus ("COVID-19") and that state of emergency was ratified by the City Council on March 16, 2020; and WHEREAS, in the interest of the public peace, health and safety, as affected by the emergency caused by the spread of COVID-19, it was necessary for the City Council to exercise its authority to issue certain regulations related to the protection of the public peace, health and safety; and
WHEREAS, the City of Beverly Hills adopted measures to try to mitigate the impacts of the pandemic on businesses in the City by waiving interest and penalties on outstanding business taxes; and
WHEREAS, with the proliferation of vaccine availability and with the decreasing rate of spread of the COVID-19 virus, the State of California has repealed many of its regulations that were enacted to ease financial burdens and slow the spread of the virus; and WHEREAS, after two years of the regulation waiving penalties and interest on business tax being in place, the City of Beverly Hills believes that, with proper notice, it is time to repeal the regulation.
NOW THEREFORE, the City Council of the City of Beverly Hills does ordains as follows:
Section 1. Repeal. Section 8 of Beverly Hills Ordinance No. 20-O-2818 regarding the suspension of penalties and interest on outstanding business tax is hereby repealed, effective January 31, 2023, such that any accounts with past due amounts starting February 1, 2023 shall be charged penalties and interest pursuant to Beverly Hills Municipal Code Section 3-1-207.
City staff shall give at least 60 days’ notice of the upcoming repeal.
Section 2. Severability. If any provision of this Ordinance is held invalid by a court of competent jurisdiction, such provision shall be considered a separate, distinct and independent provision and such holding shall not affect the validity and enforceability of the other provisions of this Ordinance.
Section 3. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the city within fifteen ‐2‐ B0785‐0001\2706068v2.doc
(15) days after its passage in accordance with Section 36933 of the Government Code, shall certify to the adoption of this Ordinance and shall cause this Ordinance and the City Clerk’s certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City.
Section 4. Operative Date. Section 1 of this Ordinance shall become operative on January 31, 2023.
Section 5. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (31st) day after its passage.
Adopted:
Effective: LILI BOSSE
Mayor of the City of Beverly Hills,
California
ATTEST:
(SEAL)
HUMA AHMED
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:
LAURENCE S. WIENER GEORGE CHAVEZ
City Attorney City Manager
Attachment 2
ORDINANCE NO. 20-0- 2818
AN URGENCY ORDINANCE OF THE CITY OF BEVERLY HILLS
ADOPTING EMERGENCY REGULATIONS RELATED TO RESIDENTIAL
AND COMMERCIAL TENANT EVICTIONS, AND OTHER MEASURES,
REPEALING ORDINANCE NO. 20-0-2817, AND DECLARING THE
URGENCY THEREOF
THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:
WHEREAS, international, national, state, and local health and governmental authorities are responding to an outbreak ofrespiratory disease caused by a novel coronavirus named "SARSCoV-2," and the disease it causes has been named "coronavirus disease 2019," abbreviated COVID-19, ("COVID-19"); and
WHEREAS, on March 4, 2020, the Los Angeles County Board of Supervisors and Department ofPublic Health declared a local emergency and local public health emergency to aid the regional healthcare and governmental community in responding to COVID-19; and WHEREAS, on March 4, 2020, the Governor ofthe State ofCalifornia declared a state of emergency to make additional resources available, formalize emergency actions already underway across multiple state agencies and departments, and help the state prepare for the broader spread ofCOVID-19; and
WHEREAS, on March 13, 2020, the President ofthe United States of America declared a national emergency and announced that the federal government would make emergency funding available to assist state and local governments in preventing the spread and addressing the effects ofCOVID-19; and
WHEREAS, on March 15, 2020, the City Manager, in his role as the Director of Emergency Services, proclaimed the existence of a local emergency pursuant to Section 2-4-107 ofthe Beverly Hills Municipal Code to ensure the availability ofmutual aid and an effective City response to the novel coronavirus ("COVID-19") and that state of emergency was ratified by the City Council on March 16, 2020; and
WHEREAS, the Califomia Department of Public Health and the Los Angeles County Department ofPublic Health have all issued orders including, but not limited to, social distancing, staying home ifsick, canceling or postponing large group events, working from home, and other precautions to protect public health and prevent transmission ofthis communicable virus; and -1-
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WHEREAS, as a result ofthe public health emergency and the precautions recommended by health authorities, many tenants in Beverly Hills have experienced or expect soon to experience sudden and unexpected income loss; and
WHEREAS, the Governor ofthe State ofCalifornia has stated that individuals exposed to COVID-19 may be temporarily unable to report to work due to illness caused by COVID-19 or quarantines related to COVID-19, and individuals directly affected by COVID-19 may experience loss of income, health care and medical coverage, and ability to pay for housing and basic needs, thereby placing increased demands on already strained regional and local health and safety resources, including shelters and food banks; and
WHEREAS, further economic impacts are anticipated, leaving tenants vulnerable to eviction; and
WHEREAS, the City of Beverly Hills is redoubling its efforts to maintain hand hygiene, respiratory etiquette, and social distancing. It is absolutely critical that the City does everything possible to slow the pace of community spread and avoid unnecessary strain on our medical system. To aid in these efforts, the City Council is ordering a series oftemporary restrictions be placed on certain establishments throughout the City in which large numbers of people tend to gather and remain in close proximity and is requiring the wearing offace coverings; and WHEREAS, during this local emergency, and in the interest ofprotecting the public health and preventing transmission of COVID-19, it is essential to avoid unnecessary housing displacement, to protect the City's affordable housing stock, and to prevent housed individuals from falling into homelessness; and
WHEREAS, commercial tenants who operate businesses within the City may have to close their businesses in response to emergency orders, which will substantially decrease or eliminate their income, and businesses that are permitted to remain open also are likely to experience a significant loss ofincome while the emergency orders are in effect; and WHEREAS, restaurants were prohibited from offering dine-in service, limiting restaurants to delivery and takeout offerings only, which has placed a sudden and severe financial strain on many restaurants, particularly those that are small businesses that already operate on thin margins, adding to financial pressures in the industry that predate the COVID-19 crisis; and WHEREAS, it is in the public interest to take action to maximize restaurant revenue from the takeout and delivery orders that to assist restaurants in surviving this crisis and remain as sources of employment and neighborhood vitality in the City; and WHEREAS, many consumers use third-party applications and websites to place orders with restaurants for delivery and takeout, and such third-party platforms charge restaurants fees ranging from 30% to 40% ofthe purchase price per order; and WHEREAS, restaurants, and particularly restaurants that are small businesses with few locations, have limited bargaining power to negotiate lower fees with third-party platforms, given -2-
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the high market saturation of third-party platforms, and the dire financial straits small business restaurants are facing in this COVID-19 emergency; and
WHEREAS, temporarily capping the per-order fees will accomplish the legitimate public purpose of easing the financial burden on struggling restaurants during this emergency while not unduly burdening third-party platforms that have seen an increase in demand; and WHEREAS, in the interest ofpublic peace, health and safety, as affected by the emergency caused by the spread ofCOVID-19, it is necessary for the City Council to exercise its authority to issue these regulations related to the protection ofthe public peace, health or safety.
Section 1. The City Council ofthe City ofBeverly Hills does adopt the recitals and the following emergency regulations which shall take effect immediately:
1. A temporary moratorium on eviction for non-pa3anent of rent by residential tenants substantially impacted by the COVID-19 crisis is imposed as follows:
a. During the period of local emergency declared in response to COVID19, no landlord shall endeavor to evict a tenant in either of the following situations: (1) for nonpayment ofrent ifthe tenant demonstrates that the tenant is unable to pay rent due to substantial financial impacts related to COVID-19, or (2) for a no-fault eviction, unless necessary for the health and safety oftenants, neighbors, or the landlord, other than based on illness ofthe tenant or any other occupant of the residential rental unit. A landlord who receives notice that a tenant cannot pay some or all of the rent temporarily for the reasons set forth above shall not serve a notice pursuant to Code ofCivil Procedure section 1161(2), file or prosecute an unlawful detainer action based on a 3-day pay or quit notice, or otherwise seek to evict for nonpayment of rent. A landlord receives notice of a tenant's inability to pay rent within the meaning ofthis Ordinance if the tenant, within seven (7) days after the date that rent is due, notifies the landlord in writing, of lost income or extraordinary expenses related to COVID-19 and inability to pay fiill rent due to substantial financial impacts related to COVID-19, and within thirty (30) days after the date the rent is due, provides written documentation to the landlord to support the claim, using the form provided by the City. A copy of both the seven-day notice and the documentation to support the claim shall also be provided by email (or if email is not feasible by mail along with notification by telephone) to the City's Rent Stabilization office. For purposes of this Ordinance, "in writing" includes email or text communications to a landlord or the landlord's representative ifthat is the method of written communication that has been used previously, or correspondence by regular mail, ifthat is the method ofwritten communication that has been used previously and the parties have not agreed to use email or text messaging. Any medical or financial information provided to the landlord shall be held in confidence, and shall be used only for evaluating the tenant's claim. b. Nothing in this Ordinance shall relieve the tenant of liability for the unpaid rent, which the landlord may seek after expiration ofthe local emergency, and which the tenant must pay in ftill within one year of the expiration of the local emergency. One year after the end ofthe emergency, unless ifthe rent is paid in ftill, a landlord may charge or collect a late fee for rent that is delayed for the reasons stated in this Ordinance; or a landlord may seek rent that -3-
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is delayed for the reasons stated in this Ordinance through the eviction or other appropriate legal process. No fee for the late payment of rent shall be charged by a landlord during the period of the emergency or one year after the end ofthe emergency. If a landlord makes an accommodation with respect to rent forbearance from a tenant pursuant to subsection l.a, and the tenant is in conformance with the tenant's obligations under that subsection, then the landlord shall not make a negative report to a credit bureau so long as the tenant remains in compliance with those obligations.
c. For purposes ofthis Section 1, "financial impacts related to COVID-19" include, but are not limited to, lost household income or extraordinary expenses as a result of any ofthe following: (1) being sick with COVID-19, or caring for a household or family member who is sick with COVID-19; (2) lay-off, loss of hours, or other substantial income reduction resulting from business closure or other economic or employer impacts ofCOVID-19 including for tenants who are salaried employees or self-employed; (3) compliance with a recorrmiendation from a government health authority to stay home, self-quarantine, or avoid congregating with others during the state of emergency; (4) extraordinary out-of-pocket medical expenses related to COVID-19; or (5) child care needs arising from school closures related to COVID-19. d. For purposes ofthis Ordinance, "no-fault eviction" refers to any eviction for which the notice to terminate tenancy is not based on alleged fault by the tenant, including but not limited to, eviction notices served pursuant to Code of Civil Procedure sections 1161(1), 1161(5), or 1161b, use by landlord or relatives as specified in Beverly Hills Municipal Code Chapters 5 and 6, demolition or condominium conversion, major remodeling, and the Ellis Act, which is called withdrawal of residential rental structure from the rental market in the Beverly Hills Municipal Code.
e. During this emergency, any notice served by a landlord on a tenant under Section 4-5-513 or Section 4-6-6 L ofthe Beverly Hills Municipal Code is hereby tolled. f. This Ordinance applies to nonpayment eviction notices, no-fault eviction notices, and unlawful detainer actions based on such notices, served or filed on or after the date on which a local emergency was proclaimed on March 15, 2020. g. For purposes ofthis Section 1, "substantial" shall be defined as a material decrease ofmonthly income, the incurring ofextraordinary expenses related to COVID-19, or any other circumstance which causes an unusual and significant financial impact on the tenant. h. Because some tenants may not be aware ofthis Ordinance's provisions, the Deputy Director ofthe Rent Stabilization may extend the seven (7) day deadline for notifying the landlord for up to thirty (30) days.
2. If a landlord disagrees with the residential tenant's assertion regarding: (1) whether a substantial financial impact exists; (2) whether the substantial financial impact is related to COVID-19; or (3) the amount ofrent that the tenant will pay, then the landlord shall notify the tenant ofthe disagreement in writing within ten (10) days ofreceipt ofthe written documentation -4-
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from the tenant. The residential tenant may file a written appeal to the City, on a form provided by the City, within ten (10) days ofreceipt ofthe landlord's writtendeterminationand shall provide a copy of the appeal to the landlord. Appealswill be heard by the StandingCommittee ofthe City Council appointed to hear disruptive tenant hearings or other Members of the City Council as designated by the Mayor, to make a final determinationofthe dispute, until fifteen (15) days after the Rent Stabilization Commission is appointed and sworn into office, in which case the Rent Stabilization Commission shall make a final determination ofthe dispute. Ifthe Rent Stabilization Commission cannot render a decision by a majority vote, then the Standing Committee or other Members ofthe City Council, as designated by the Mayor, will make a final determination ofthe dispute. Final Decisions ofthe Subcommittee, Council Members designated by the Mayor, or the Rent Stabilization Commission are subject to judicial review filed pursuant to Section 1094.6 of the California Code of Civil Procedure. The hearing procedures shall be established by the City Attorney.
Section 2. The following regulations shall apply to commercial tenancies:
1. The following definitions shall apply to this Section 2:
"Affiliate" shall mean the commercial tenant and any other entity that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the commercial tenant.
"Amnesty Date" shall mean August 1,2020 for Large Commercial Tenants, and September 1, 2020 for all other commercial tenants. "Large Commercial Tenants" shall mean a business that, together with its Affiliates, (1) employs more than 100 employees, or (2) has average annual gross receipts ofmore than $15 million over the previous three years, or (3) has business operations, other than sales conducted solely through online channels, in three or more countries, including the United States; or (4) a business whose payment of rent is guaranteed by a business falling within the scope of subsections (1) or (2) or (3) ofthis subsection.
"Rent Recommencement Date" shall mean August 1, 2020 for Large Commercial Tenants and October 1, 2020 for all other commercial tenants. "Repayment Date" shall mean the date by which all forborne rent shall be due.
2. Landlords and their commercial tenants shall work together during this time of emergencycaused by the spreadofCOVID-19 to make a good faith attempt to developa payment strategy for rent that accounts for the substantial financial impacts relatedto COVID-19 that may be faced by some tenants. Any payment strategynegotiatedbetween a landlord and a commercial tenant shalltake precedenceover the provisionsofthis Ordinance. Absent such a payment strategy, commercial tenants shallbe requiredto paytheir rent underthe following provisionsofthis Section
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The following paragraphs (a) through (d) ofthis Section 2, subsection 2 shall not apply to Large Commercial Tenants.
a. In order to assure that the landlords and commercial tenants will meet to attempt to develop a payment strategy for rent that accounts for the substantial financial impacts related to COVID-19, the landlord shall send a notice to any commercial tenant who has not agreed to a payment strategy with the landlord or who is not otherwise paying full rent, substantiallyin the form provided by the City, and by certifiedmail with return receipt, overnightcourier service, or by any other delivery method that provides written evidence of receipt, which informs the commercial tenant of the requirement to meet and requesting that the tenant contact the landlord within ten (10) days to arrange a meeting and meet with the landlord within forty five (45) days to discuss a payment strategy that accounts for the substantial financial impacts related to COVID19. A copy of this notice shall be provided to the City. This notice must be mailed by July 10, 2020.
b. Ifthe landlord fails to send the notice or otherwise fails to meet with the commercial tenant, then the Repayment Date shall be September 1,2021. c. If the commercial tenant fails to contact the landlord in response to the notice or otherwise fails to meet with the landlord, then the Repayment Date shall be December 1, 2020.
d. If either party has attempted to schedule a meeting, but the other party appears to be unwilling to meet, eitherpartymay callthe RentStabilization Office of the Cityof Beverly Hills and a City staff member will schedule such meeting or will determine that one or both parties are unwilling to meet. If the Rent Stabilization Office determines that eitheror both parties are unwilling to meet than the parties shall follow the provisions set forth below in this Section 2. The Rent Stabilization Office's determination that either or both parties are unable to meetshall create a rebuttable presumption in any unlawful detainer action or other actionwhich seeks to recover rent.
3. A temporary moratorium on eviction for non-payment of rent by commercial tenants andLarge Commercial Tenants substantially impacted bytheCOVID-19 crisis isimposed as follows:
a. During the period of local emergency declared in response to COVID19, and up until the date described in subsection d below, no landlord shall endeavor to evict a commercial tenant or Large Commercial Tenant in either of the following situations: (1) for nonpayment ofsome or allof therentifsuch commercial tenant demonstrates thatthecommercial tenant is unable to pay rent due to substantial financial impacts related to COVID-19; or (2) for a no-fault eviction unless necessary for the health and safety of tenants, neighbors, or the landlord, other than based on illness of the tenant, the tenant's family or any of tenant's employees. A landlord who receives notice that a commercial tenant cannot pay some or all of the rent temporarily for the reasons setforth above shall not serve a notice or otherwise seek to evict a tenant for nonpayment ofrent.
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b. A landlord receives notice of a commercial tenant's inability to pay rent within the meaning of this Ordinance ifthe commercialtenant, within seven (7) days after the date that rent is due, notifies the landlord in writing oflost income or extraordinary expenses related to COVID-19 and inability to pay full rent due to substantial financial impacts related to COVID-19, and within thirty (30) days after the date the rent is due, provides written documentation to the landlord to support the claim. Any medical or financial information provided to the landlord shall be held in confidence, and only used for evaluating the commercial tenant's claim. For purposes of this Ordinance, "in writing" includes email or text communications to a landlord or the landlord's representative if that is the method of written communication that has been used previously, or correspondenceby regular mail, ifthat is the method ofwritten communicationthat has been used previously and the parties have not agreed to use email or text messaging. c. Nothing in this Ordinance shall relieve any commercial tenant or Large Commercial Tenant ofliability for the unpaid rent,
d. Forbearance ofrent shall end on the Rent Recommencement Date. e. A Large Commercial Tenant must pay forborne rent on September 1, 2020 and all other commercial tenants must pay forborne rent on March 1,2021 ifsuch commercial tenant and the landlord have met pursuant to this Section 2 but have not come to an agreement regarding a payment strategy.
f. For Large Commercial Tenants, with regard to forborne rent a landlord may charge eitherthe late fee or the interest that is provided in the leasebetween the landlord and the tenant from the time that the first rental payment was missed until the forborne rent is paid. No other late fee, interest or other penalty shall be charged by the landlord during the emergency or before the Repayment Date. After the Repayment Date, and if the forborne rent has not been repaid, a landlord may charge the full amount of the late fee, interest and other penalty that is provided inthe leasebeginning on theRepayment Date. However, the fullamount of the latefees, interest and other penalty shall only run from the Repayment Date.
For all other commercial tenants, with regard to the forborne rent, a landlord may charge one half the amount of eitherthe late fee or the interest that is provided in the lease between the landlord and the tenant capped at five percent (5%) from the time that the first rental payment was missed until the forborne rent is paid. No other late fee, interest or other penalty shall be charged by the landlord during the emergency or before the Repayment Date. After the Repayment Date, and if the forborne rent has not been repaid, a landlord may charge the full amount of the late fee, interest and other penalty that is provided in the lease beginning on the Repayment Date. However, the full amount of the late fees, interest and otherpenalty shall only run fi'om the Repayment Date.
g. Foranycommercial tenant who is covered bythisOrdinance andwishes to avoidthe payment of late fees or interest on the tenant's forborne rent,the tenantmaypay some or all oftheir forborne rent, with no late fees, interest or other penalties, no later than the Amnesty -7-
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Date. Ifthe tenant pays all forborne rent by that Amnesty Date, the landlord shall not charge any late fees, interest, or other penalty.
h. For purposes ofthis Section 2, "financial impacts related to COVID-19" include, but are not limited to, a tenant who lost substantial business income or has extraordinary expenses as a resuh of any of the following: (1) being sick with COVID-19, or caring for a household or family member who is sick with COVID-19; (2) income reduction resulting from business closure or other economic or employer impacts of COVID-19; (3) compliance with a recommendation from a government health authority to stay home, self-quarantine, or avoid congregating with others during the state of emergency; (4) extraordinary out-of-pocket medical expenses related to COVID-19; or (5) child care needs arising from school closures related to COVID-19.
i. For purposes ofthis Section 2, "substantial" shall be defined as a material decrease ofmonthly income, the incurring ofextraordinary expenses related to COVID-19, or any other circumstance which causes an unusual and significant financial impact on the tenant. j. This Ordinance shall not apply to any commercial tenant that is a publicly traded entity, an entity that is listed on the Fortune 1000, or any entity that employs more than 500 employees or any commercial tenant that owned by another entity that is publicly traded, listed on the Fortune 1000 or combined with the commercial tenant and other subsidiaries employs more than 500 employees. As used in the preceding sentence, the term "owned" shall mean ownership of a majority ofthe ownership interest ofthe commercial tenant. This exemption shall not apply to a franchisee or similar small business owner who is the responsible tenant on the lease unless such small business owner meets the criteria ofthis exemption. (1) Any commercial tenant covered by the exemption set forth in this subsectionj, and who otherwise complied with this Ordinance, shall have until 10 days, after the tenant has received notice as provided below, to pay all forborne rent that became due since March 16,2020. The landlord shall not charge a late fee or interest in connection with such unpaid rent. If a commercial tenant fails to pay all forborne rent within 10 days after the tenant has received written notice delivered by certified mail with return receipt, overnight courier service, or by any other delivery method and provides written evidence ofreceipt, the landlord may charge a late fee or interest from that date.
(2) A landlord may give notice to any commercial tenant covered by the exemption set forth in this subsection j at any time. k. A dispute as to whether the commercial tenant has demonstrated facts sufficient to result in a temporary payment reduction or other legal remedy shall be determined according to civil law.
Section 3. In addition to the requirements ofthe Governor's Executive Order and the requirements of the Los Angeles County Department of Health order, the following regulations -8-
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related to businesses, located in the City of Beverly Hills are adopted in order to implement recommended practices as a result ofthe COVID-19 pandemic:
a. Business located in the City with self-service unwrapped food items such as buffets are prohibited.
b. Enforcement ofCity codes and regulations may be relaxed as City staff deems appropriate in connection with commercial signs and banners displayed on or adjacent to restaurants, bars or other businesses that are permitted to remain open pursuant to this Ordinance. c. The City shall provide for additional loading zones near businesses that are authorized to be open in order to facilitate curbside pickup. d. The City shall waive fees associated with a Special Event Permit for temporary outdoor dining and shall waive the minimum ten (10) day period for filing an application for a Special Event Permit for temporary outdoor dining. e. The City Manager is authorized to issue street closure permits and any other permits necessary to allow for temporary outdoor dining. f. To the extent that Beverly Hills Municipal Code Sections 5-10-2 through 5-10-7 prohibit retail establishments from providing without charge reusable bags or recycled paperbagsto customers at the pointofsale, Beverly HillsMunicipal Code Sections 5-10-2 through 5-10-7 are hereby suspended.
Section4. During the period of local emergency declared by the Director of Emergency Services on March 15,2020 and affirmed by the CityCouncil on March 16,2020, in response to the COVID-19 pandemic, a temporary moratorium is hereby imposed on the annual rent increases authorized by Sections 4-5-303(c) and 4-6-3 of the BeverlyHills Municipal Code.
This moratoriumon rent increases shall be applied to any rent increase scheduled to take effect on or after March 15, 2020. Nothingin this Ordinance shallalter the date of annualrent increases in future years.
Section 5. During the period of local emergency declared by the City Council on March 16, 2020, in response to the COVID-19 pandemic, there shall be no increase in Internet access fees or reduction in service.
Section 6. For those establishments offering food pickup options, and other essential businesses, proprietors are directed to establish social distancing practices for thosepatrons in the queue for pickup and otherreasons, as well those allowed in the premises or otherwise working.
Such restaurants and essential businesses shall establish health and safety measures for their employees and customers, including but not limitedto appropriate glovesand masks.
Section 7. Face Coverings. All persons shall wear face coverings that cover their mouth and nose openings such asscarves (dense fabric, without holes), bandannas, neck gaiters, or other fabric face coverings, when they leave their homes or places of residence for essential activities, such astaking a walk through their neighborhood, if that person has potential to come -9-
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within six feet of another person not a member of their household. All persons, including nonmedical essential workers are discouraged from using Personal Protective Equipment (PPE), such as N95 masks, for non-medical reasons.
Exceptions: These following exceptions will apply to this Section 6:
(1) Children under the age of 2 are not required to wear face coverings. (2) Persons who must remove the face covering in order to receive medical services. (3) Persons who are directed to remove the face covering by a law enforcement officer.
For the purposes ofthis Ordinance, the terms "essential business," "essential workers," and "essential activity" shall have the same meanings as they do under State law.
Section 8. Business Tax. No penalties or interest shall accrue on outstanding business tax during the period that the City ofBeverly Hills has declared an emergency related to the COVID-19 pandemic. The Director of Finance is authorized in his sole discretion to waive any penalties and/or interest on business tax imposed prior to the March 15, 2020 declaration of emergency, upon a request by a business owner and a demonstration by the business ovmer of economic hardship due to COVID-19.
Section 9. Hoarding. The City Council urges residents not to hoard essential goods such as hand sanitizer, cleaning supplies, toilet paper, canned food, frozen food and other needed supplies. The CityCouncil strongly condemns hoarding. Retail establishments located in the City shall be responsible for limiting the sales of such items, as they see fit to provide greater accessibility to a larger group of customers.
Section 10. Third Partv Food Delivery Service Commission.
1. Definitions. For purposes ofthis Section, the following definitions apply:
"Delivery Fee" meansa fee chargedby a Third-partyFood DeliveryService for providing a Retail Food Establishment with a service that delivers food and beverages from such establishment to customers. The term does not include any other fee or cost that may be charged by a Third-Party Food Delivery Service to a Retail Food Establishment, such asfees for listing or advertising the Retail Food Establishment on the Third-party Food Delivery Service platform or fees related to processing the online order including, but not limited to service fees, fees for facilitating Online Orders for pick-up, and credit card processing fees. "Online Order" means an order placed by a customer, including a phone order, for delivery or pick-up from a restaurant located within the City. "Purchase Price" means the menu price ofthe items contained in an Online Order, minus any applicable coupon or promotional discount provided to the customer by the restaurant through the Third-Party Food Delivery Service. Such term therefore excludes taxes. -10-
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gratuities and any other fees or costs that may make up the total amount charged to the customer of an Online Order.
"Retail Food Establishment" means a restaurant, delicatessen bakery, coffee shop, or other eat-in or carry-out service of processed or prepared raw and ready-to-eat food or beverages.
"Third-Party Food Delivery Service" means any website, mobile application or other internet service that offers or arranges for the sale of food and beverages prepared by, and the delivery or pick-up offood and beverages from, no fewer than 20 separately owned and operated food service establishments.
2. Prohibitions. So long as the local emergency is in effect, it shall be unlawful for a Third-party Food Delivery Service to do the following:
a. charge a Retail Food Establishment a Delivery Fee that totals more than fifteen percent (15%) ofthe Purchase Price of each Online Order. b. charge a Retail Food Establishment any amount designated as a Delivery Fee for an Online Order that does not involve the delivery offood or beverages. c. charge a Retail Food Establishment any combination of fees, commissions, or costs for the Retail Food Establishment's use ofthe Third-party Food Delivery Service that is greater than five percent (5%) of the Purchase Price of each Online Order or to charge any amount of fees, commissions, or costs for the Retail Food Establishment's use ofthe Third-Party Food Delivery Service unless the contract between the Retail Food Establishment and the Third-Party Food Delivery Service allows for fees, commissions, and costs other than a Delivery Fee. For the purpose of this subsection c, fees, commissions, or costs do not include the Delivery Fee, which is capped at fifteen percent (15%). d. charge a Retail Food Establishment any fee, commission, or cost other than as permitted in subsections a through c, above.
e. charge a customer any Purchase Price for a food or beverage item that is higher than the price imposed by the Retail Food Establishmenton the Third-PartyFood Delivery Service or, if no price is imposed by the Retail Food Establishment on the Third-Party Food Delivery Service, the price listed on the Retail Food Establishment's own menu.
f retain any portion of amounts designated as a tip or gratuity. Any tip or gratuity shall be paid by the Third-party Food Delivery Service, in its entirety, to the person delivering the food or beverages.
3. Disclosures. The Third-party Food Delivery Service shall disclose to the customer an accurate, clearly identified, and itemized cost breakdown of each transaction, including, but not limited to the following:
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a. the Purchase Price ofthe food and beverages at the cost Ustedon the Retail Food Establishment's menu;
b. the Delivery Fee charged to the Retail Food Establishment; c. each fee, commission, or cost, other than a Delivery Fee, charged to the Retail Food Establishment;
d. each fee, commission, or cost, other than the Delivery Fee or the Purchase Price ofthe food, charged to the customer by the Third-party Food Delivery Service; e. any tip or gratuity that will be paid to the person delivering the food or beverages.
4. A Third-Party Food Delivery Service shall not be found in violation of this Section if between June 17, 2020 and June 24, 2020, it imposes a Delivery Fee per Online Order that totals more than fifteen percent (15%), and other fees, commissions, and costs that total more than five percent (5%), ofthe Purchase Price ofsuch Online Order, provided that the Third-Party Food DeliveryServicerefundsthe portionof the fee that exceedsthose amountsto the Retail Food Establishment prior to July 3, 2020.
5. If a Third-Party Food Delivery Servicecharges a Retail Food Establishmentfees that violate this Section, the Retail Food Establishment shall provide written notice to the ThirdParty Food Delivery Service requesting a refund within seven days. If the Third-Party Food Delivery Service does not provide the refund requested after seven days or the Third-PartyFood Delivery Service continues to charge fees in violation of this Section after the initial notice and seven-day cure period, a Retail FoodEstablishment may enforce this Section by means of a civil action seeking damages and injunctive relief. The prevailing party in any such action shall be entitled to an award ofreasonable attorney fees.
Section 11. Violations. Violations ofthis Ordinance shall be punishable as set forth in Section2-4-111 and Chapter3 of Title 1 of the Beverly HillsMunicipal Codeexceptviolations of Section 7, which shall be solely subject to the administrative citation process set forth in Chapter 3 of Title 1 of the Beverly HillsMunicipal Code. Violations of anypublichealthorderduly issued by the Los Angeles County Public Health Officer may be cited andprosecuted as an infraction or may besubject to theadministrative citation process setforth inChapter 3 ofTitle 1oftheBeverly Hills Municipal Code. In addition, this Ordinance provides a defense to a tenant, in the eventthat an unlawful detainer action is commenced in violation ofthis Ordinance.
Section 12. Remain in Effect. This Ordinance shall remain in effect for the duration of the local emergency.
Section 13. Ordinance No. 20-0-2817 is hereby repealed and replaced by this Ordinance.
Section 14. Uncodified. This Ordinance shall not be codified. -12-
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Section 15, Severabilitv. If any provision ofthis Ordinance is held invalid by a court of competent jurisdiction, such provision shall be considered a separate, distinct and independent provision and such holding shall not affect the validity and enforceability ofthe other provisions ofthis Ordinance.
Section 16.. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the city within fifteen (15) days after its passage in accordance with Section 36933 ofthe Government Code, shall certify to the adoption ofthis Ordinance and shall cause this Ordinance and the City Clerk's certification, together with proof of publication, to be entered in the Book of Ordinances ofthe Council ofthis City.
Section 17. Effective Date. This Ordinance is adopted as an urgency ordinance for the immediate preservation ofthe public peace, health and safety within the meaning of Government Code Section 36937(b), and therefore shall be passed immediately upon its introduction and shall become effective at 12:01 a.m., September 2, 2020 upon its adoption by a minimum 4/5 vote of the City Council.
Section 18. Duration. This Ordinance shall remain in effect until it is superseded by another Ordinance adopted by the City Council.
Section 19. Certification. The City Clerk shall certify to the adoption ofthis Ordinance.
Adopted: September 1, 2020
Effective: September 2, 2020
ATTEST:
lUkXiA
HUMA AHMED
City Clerk
APPROVED AS TO FORM:
LAURENCE S. WIENER
City Attorney
B0785-1672\2451529v4.doc
(SEAL)
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LESTER J. FRIEDMAN
Mayor ofthe City ofBeverly Hills,
California
APPROVED AS TO CONTENT:
GEOROrcmVEZ
City Manager