POINT ARENA CITY COUNCIL
AGENDA ITEM SUMMARY
AGENDA ITEM: VIII A
MEETING DATE: 9/27/2022
TITLE
Presentation: Measure O Library Special Transactions & Use Tax
RECOMMENDED ACTION
Receive presentation, ask questions, and direct staff
ANALYSIS
In 2011 county voters overwhelmingly supported a 1/8 cent sales tax (Measure A) that stabilized library funding. That tax expires soon. The libraries have serious maintenance needs, some deferred for too long.
Measure O will make the current 1/8 cent permanent and redirect another 1/8 cent of an expiring tax, together raising $4.2 million per year, 40% of which will go for capital repairs and improvements. The money goes into a special fund that can only be spent on the libraries.
Point Arena Library Advisory Board member Larry Riddle will be on hand for the presentation and available to answer questions. They are requesting City Council support for the initiative.
FISCAL IMPACT
None.
ATTACHMENTS
• Measure O Ballot Language
• Measure O Background from Library Advisory Board
CITY MANAGER SIGNATURE
_________________________________
Paul Andersen, City Manager
MENDOCINO COUNTY
FULL TEXT OF MEASURE O
ORDINANCE AMENDING CHAPTER 5.170 OF TITLE 5 TO THE
MENDOCINO COUNTY CODE EXPANDING A LIBRARY SPECIAL
TRANSACTIONS AND USE TAX
The citizens of the County of Mendocino ordain and direct the Board of Supervisors as follows:
Chapter 5.170 of Title 5 of the Mendocino County Code to be amended to read as follows:
LIBRARY SPECIAL TRANSACTIONS AND USE TAX
Section 5.170.000. Title. This ordinance shall be known as the County of Mendocino Library Special Transactions (Sales) and Use Tax Ordinance. The County of Mendocino shall hereinafter be called “County.” This ordinance shall be applicable in the incorporated and unincorporated territory of the County.
Section 5.170.010. Operative Date. “Operative Date” means the first day of the first calendar quarter commencing more than 110 days after the adoption of this ordinance, the date of such adoption being as set forth below.
Section 5.170.020. Purpose. This ordinance is adopted to achieve the following general purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:
A. To impose a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code and Section 7286.59 that authorizes the County to adopt this tax ordinance which shall be operative if a majority of the electors voting on the measure vote to approve the imposition of the tax at an election called for that purpose by petition of the voters of Mendocino County.
B. To enact a retail transactions and use tax ordinance that incorporates provisions identical to those of the Sales and Use Tax Law of the State of California insofar as those provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of Division 2 of the Revenue and Taxation Code.
C. To enact a retail transactions and use tax ordinance that imposes a tax and provides a measure therefor that can be administered and collected by the State Board of Equalization in a manner that adapts itself as fully as practicable to, and requires the least possible deviation from, the existing statutory and administrative procedures followed by the State Board of Equalization in administering and collecting the California State Sales and Use Taxes.
D. To enact a retail transactions and use tax ordinance that can be administered in a manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, minimize the cost of collecting the transactions and use taxes, and at the same time, minimize the burden of record keeping upon persons subject to taxation under the provisions of this ordinance.
Section 5.170.030. Restricted Use of the Tax.
A. Proceeds from this tax shall be deposited into the County Treasury in a special fund entitled “Library Special Tax Fund” (hereinafter the “fund”).
B. Monies deposited into the fund, together with any interest that accrues thereon, shall be used for maintaining and improving services at the existing libraries, upgrading and expansion of facilities, services, and collections; and extending branch library services to the unserved and under-served areas of the County.
C. The revenues collected from this tax shall be used only to supplement existing expenditures for public libraries and shall not be used to supplant existing funding for the support of public libraries.
MENDOCINO COUNTY
FULL TEXT OF MEASURE O
D. At least 40% of these proceeds are reserved for capital investment in Library facilities. Capital investment funds directed to a specific branch or project may be carried over to subsequent fiscal years to allow for accrual of sufficient funds for major capital expenditures.
The Mendocino County Library Advisory Board shall determine a fair and equitable distribution of funds to all areas of the County.
E. Proceeds from this tax shall be allocated by the Board of Supervisors acting in consideration of recommendations of the Mendocino County Library Advisory Board.
Section 5.170.040. Contract With State.
Prior to the operative date, the County shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of this transactions and use tax ordinance; provided, that if the County shall not have contracted with the State Board of Equalization prior to the operative date, it shall nevertheless so contract and in such a case the operative date shall be the first day of the first calendar quarter following the execution of such a contract.
Section 5.170.050. Transactions Tax Rate.
For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the incorporated and unincorporated territory of the County at the rate of one-quarter cent (0.25%) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in said territory on and after the operative date of this ordinance.
Section 5.170.060. Place Of Sale.
A. For the purposes of this ordinance, all retail sales are consummated at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination. The gross receipts from such sales shall include delivery charges, when such charges are subject to the state sales and use tax, regardless of the place to which delivery is made.
B. In the event a retailer has no permanent place of business in the State or has more than one place of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the State Board of Equalization.
Section 5.170.070. Use Tax Rate.
An excise tax is hereby imposed on the storage, use or other consumption in the County of tangible personal property purchased from any retailer on and after the operative date of this ordinance for storage, use or other consumption in said territory at the rate of one-quarter cent (0.25%) of the sales price of the property. The sales price shall include delivery charges when such charges are subject to state sales or use tax regardless of the place to which delivery is made.
Section 5.170.080. Adoption Of Provisions Of State Law.
Except as otherwise provided in this ordinance and except insofar as they are inconsistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this ordinance as though fully set forth herein.
Section 5.170.090. Limitations On Adoption Of State Law And Collection Of Use Taxes.
In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:
A. Whenever the State of California is named or referred to as the taxing agency, the name of this County shall be substituted therefor. However, the substitution shall not be made when:
1.The word “State” is used as a part of the title of the State Controller, State Treasurer, State Board of Control, State Board of Equalization, State Treasury, or the Constitution of the State of California;
2.The result of that substitution would require action to be taken by or against this County or any agency, officer, or employee thereof rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation of this Ordinance. 23O1
MENDOCINO COUNTY
FULL TEXT OF MEASURE O
3. In those sections, including, but not necessarily limited to sections referring to the exterior boundaries of the State of California, where the result of the substitution would be to:
(a.) Provide an exemption from this tax with respect to certain sales, storage, use or other consumption of tangible personal property which would not otherwise be exempt from this tax while such sales, storage, use or other consumption remains subject to tax by the State under the provisions of Part 1 of Division 2 of the Revenue and Taxation Code, or; (b.) Impose this tax with respect to certain sales, storage, use or other consumption of tangible personal property which would not be subject to tax by the state under the said provision of that code.
4. In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code.
B. The word “County” shall be substituted for the word “State” in the phrase “retailer engaged in business in this State” in Section 6203 and in the definition of that phrase in Section 6203.
Section 5.170.100 Permit Not Required.
If a seller’s permit has been issued to a retailer under Section 6067 of the Revenue and Taxation Code, an additional transactor’s permit shall not be required by this ordinance.
Section 5.170.110. Exemptions And Exclusions.
A. There shall be excluded from the measure of the transactions tax and the use tax the amount of any sales tax or use tax imposed by the State of California or by any city, city and county, or county pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax.
B. There are exempted from the computation of the amount of transactions tax the gross receipts from:
1. Sales of tangible personal property, other than fuel or petroleum products, to operators of aircraft to be used or consumed principally outside the County in which the sale is made and directly and exclusively in the use of such aircraft as common carriers of persons or property under the authority of the laws of this State, the United States, or any foreign government.
2. Sales of property to be used outside the County which is shipped to a point outside the County, pursuant to the contract of sale, by delivery to such point by the retailer or his agent, or by delivery by the retailer to a carrier for shipment to a consignee at such point. For the purposes of this paragraph, delivery to a point outside the County shall be satisfied:
(a.) With respect to vehicles (other than commercial vehicles) subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, and undocumented vessels registered under Division 3.5 (commencing with Section 9840) of the Vehicle Code by registration to an out-of-County address and by a declaration under penalty of perjury, signed by the buyer, stating that such address is, in fact, his or her principal place of residence; and (b.) With respect to commercial vehicles, by registration to a place of business out-of-County and declaration under penalty of perjury, signed by the buyer, that the vehicle will be operated from that address.
3. The sale of tangible personal property if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date of this ordinance.
4. A lease of tangible personal property which is a continuing sale of such property, for any period of time for which the lessor is obligated to lease the property for an amount fixed by the lease prior to the operative date of this ordinance.
MENDOCINO COUNTY
FULL TEXT OF MEASURE O
5. For the purposes of subparagraph (3) and (4) of this section, the sale or lease of tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.
C. There are exempted from the use tax imposed by this ordinance, the storage, use or other consumption in this County of tangible personal property:
1. The gross receipts from the sale of which have been subject to a transactions tax under any state administered transactions and use tax ordinance.
2. Other than fuel or petroleum products purchased by operators of aircraft and used or consumed by such operators directly and exclusively in the use of such aircraft as common carriers of persons or property for hire or compensation under a certificate of public convenience and necessity issued pursuant to the laws of this State, the United States, or any foreign government. This exemption is in addition to the exemptions provided in Sections 6366 and 6366.1 of the Revenue and Taxation Code of the State of California.
3. If the purchaser is obligated to purchase the property for a fixed price pursuant to a contract entered into prior to the operative date of this ordinance.
4. If the possession of, or the exercise of any right or power over, the tangible personal property arises under a lease which is a continuing purchase of such property for any period of time for which the lessee is obliged to lease the property for an amount fixed by a lease prior to the operative date of this ordinance.
5. For the purposes of subparagraphs (3) and (4) of this section, storage, use, or other consumption, or possession of, or exercise of any right or power over, tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.
6. Except as provided in subparagraph (7), a retailer engaged in business in the County shall not be required to collect use tax from the purchaser of tangible personal property, unless the retailer ships or delivers the property into the County or participates within the County in making the sale of the property, including, but not limited to, soliciting or receiving the order, either directly or indirectly, at a place of business of the retailer in the County or through any representative, agent, canvasser, solicitor, subsidiary, or person in the County under the authority of the retailer.
7. “A retailer engaged in business in the County” shall also include any retailer of any of the following: vehicles subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, or undocumented vessels registered under Division 3.5 commencing with Section 9840) of the Vehicle Code. That retailer shall be required to collect use tax from any purchaser who registers or licenses the vehicle, vessel, or aircraft at an address in the County.
D.Any person subject to use tax under this ordinance may credit against that tax any transactions tax or reimbursement for transactions tax paid to a County imposing, or retailer liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and Taxation Code with respect to the sale to the person of the property the storage, use or other consumption of which is subject to the use tax.
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MENDOCINO COUNTY
FULL TEXT OF MEASURE O
Section 5.170.120. Amendments.
All amendments subsequent to the effective date of this ordinance to Part 1 of Division 2 of the Revenue and Taxation Code relating to sales and use taxes and which are not inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically become a part of this ordinance, provided however, that no such amendment shall operate so as to affect the rate of tax imposed by this ordinance.
Section 5.170.130. Enjoining Collection Forbidden.
No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action or proceeding in any court against the State or the County, or against any officer of the State or the County, to prevent or enjoin the collection under this ordinance, or Part 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.
Section 5.170.140. Severability.
If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, the remainder of the ordinance and the application of such provision to other persons or circumstances shall not be affected thereby.
Section 5.170.150. Sunset.
The previous sunset provision of this Ordinance is revoked and the tax shall be permanent.
Section 5.170.160. Effective Date.
This ordinance shall take effect upon adoption by a majority vote of the electorate.
IMPARTIAL ANALYSIS
AN INITIATIVE TO ADD A ONE-QUARTER CENT (0.25%) SALES
TAX TO FUND LIBRARIES IN MENDOCINO COUNTY
MEASURE O
This ballot measure seeks the adoption of an ordinance which would replace the current special one-eighth cent (0.125%) transactions (sales) and use tax set to expire in 2027 with a one-quarter cent (0.25%) tax that would last until repealed. The tax would be applicable in both the unincorporated and incorporated areas in the County of Mendocino.
The specific projects for which the revenues from this tax may be expended are as follows: maintaining and improving services at existing libraries, upgrading and expansion of facilities, services and collections, and extending branch library services to the unserved and underserved areas of the County. At least forty percent (40%) of the proceeds are reserved for capital investment in Library facilities.
The tax will be administered by the California State Board of Equalization pursuant to a contract with the County. The tax will become effective immediately upon a vote of the electorate. This measure was placed on the ballot by a petition signed by the requisite number of voters.
The tax imposed by the ordinance will not expire and can only be repealed by the voters.
This measure requires voter approval by a majority vote of the qualified voters.
A “YES” vote will be a vote in favor of adoption of the proposed increase.
A “NO” vote will be a vote against the adoption of the proposed increase.
The above statement is an impartial analysis of the Ordinance or Measure O. If you desire a copy of the ordinance or measure, please call the elections official’s office at (707) 234-6819 and a copy will be mailed at no cost to you.
DATED: August 5, 2022
s/Christian M. Curtis
CHRISTIAN M. CURTIS
County Counsel
County of Mendocino
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ARGUMENT IN FAVOR OF MEASURE O
Before 2011, the libraries of Mendocino County were in dire straits. In 2011 county voters overwhelmingly supported a 1/8 cent sales tax (Measure A) that stabilized library funding. That 1/8 cent expires soon, causing real concern. Additionally, the libraries have serious maintenance needs, some deferred for too long. Measure O will make the current 1/8 cent permanent and add another 1/8 cent, together raising $4.2 million per year, 40% of which will go for capital repairs and improvements. Mendocino County provides the libraries with no general fund, a small amount of property tax and only occasional capital support.
Measure O will provide sustainable, smart funding for the branch libraries (Fort Bragg, Laytonville, Point Arena, Round Valley, Ukiah, Willits and the Bookmobile).
The sales tax in Measure O will not result in a net increase in sales tax in Mendocino County because 1/8 cent is a continuing tax and the additional 1/8 cent partially replaces a 3/8 cent sales tax that expires this year. It is a good time to provide secure funding for the libraries.
The money will be in a special, protected fund that can only be spent on the libraries. The Board of Supervisors will decide on allocation of funds, in consideration of the recommendations of the county Library Advisory Board (LAB). The LAB represents all the branches and regions of the county.
The libraries of Mendocino County are a vital community resource, providing education and entertainment and a wide array of programs for children, teens and adults. They have grown and kept up with the times, providing modern digital media as well as traditional print items.
Libraries are an excellent investment of our sales tax proceeds.
Vote YES on Measure O. Vote YES on Libraries. Thank you.
Citizens Committee for the Library Initiative 2022
s/ Carolyn Schneider, Chairperson
NO ARGUMENT AGAINST MEASURE O WAS SUBMITTED.
.
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From the Measure O Website (https://www.yesonlibraries.org/) What does Measure O do?
In 2011 county voters overwhelmingly supported a 1/8 cent sales tax (Measure A) that stabilized library funding. That 1/8 cent expires soon, causing real concern. Additionally, the libraries have serious maintenance needs, some deferred for too long. Measure O will make the current 1/8 cent permanent and redirect another 1/8 cent of an expiring tax, together raising $4.2 million per year, 40% of which will go for capital repairs and improvements. The money goes into a special fund that can only be spent on the libraries.
Don’t the libraries already have tax support – from Measure A in 2011? Yes, the libraries do have current tax support. Before 2011, the libraries of Mendocino County were in dire straits. In 2011, 78% of county votes supported a 1/8 cent sales tax (Measure A) that stabilized library funding. That 1/8 cent expires soon, which will leave the libraries in a tough spot. Measure O will make the current 1/8 cent permanent, providing stable funding for the years ahead.
I don’t like tax increases! Why should I vote for this? The sales tax in Measure O will not result in a net increase in sales tax in Mendocino County because 1/8 cent is a continuing tax and the additional 1/8 cent partially replaces a 3/8 cent sales tax that expires this year. It is a good time to provide secure funding for the libraries without increasing our taxes in the County.
With inflation and hard times why should I vote for a tax? Libraries are a great resource to fight inflation and to help family budgets in hard times. Families can get free books, free movies, free programs (like story time and crafts for kids, and music groups and topical talks for teens and adults) and libraries can help with web access and other vital resources. For a very small price (a fraction of a penny sales tax), the libraries in Mendocino County can continue to be an awesome free resource and can improve their programs and buildings. In times like these, libraries are an excellent investment for the community.
And importantly! Measure O does not result in a net increase in taxes; you won’t pay more and you get so much. And, a nice bonus! Sales tax is paid by all the many tourists who come to visit Mendocino County so we get some outside income as well to support our families in these times.
Why is 40% of the money for capital costs?
The libraries have serious maintenance needs, some deferred for too long. Roofs need repair or replacement, ventilation systems require upgrades, and many more such needs, but Mendocino County provides the libraries with no general fund, a small amount of property tax and only occasional capital support, insufficient to meet these needs. This will give the libraries a stable and smart source of income to keep facilities in good repair and to add infrastructure as appropriate.
What kinds of things are funded (and will be funded) at the libraries from tax money? The current tax money and 60% of the new total is used and can be used for things like books, audio books, DVDs, music CDs, newspapers, magazines, and electronic materials. The libraries also use these funds for programs for children, teens, adults - like crafts, story time, music, poetry, speakers, games, art, films, and book groups – whatever is good and needed for their communities.
40% of the new total can be used for things like computers, printers, (repair, upgrade and purchase), furniture, heating, cooling, ventilation, roofs, increased space, storage, community rooms and green technology – keeping the library safe and useful for people.
What if the Board of Supervisors decides to spend this money on something else? The County cannot spend this money on anything but libraries. Measure O creates a special fund for all the money and it is legally restricted to the libraries. The Board of Supervisors cannot change the code you approve when you vote for Measure O.
How does Measure O money get spent? Who decides? What’s ‘The LAB’? The needs and the requests of the branch libraries are first analyzed by the Library Advisory Board (The LAB). The LAB is the official advisory board to the Mendocino County Board of Supervisors (The BOS). The LAB represents all the branches and regions of the Mendocino County Library and is composed of people who know the libraries well. The LAB is responsible for ensuring that its recommendations reflect equitable distribution within the County. The LAB will make recommendations to the Board of Supervisors (BOS) and then BOS will make the final decisions on allocation, in consideration of the recommendations of the LAB.
Who put this on the ballot?
Measure O was developed and put on the ballot by The Citizens Committee for the Library Initiative 2022 - Measure O - FPPC # 1452309. This committee drafted the measure, shared it with people who support libraries in Mendocino County, wrote a final version, collected over 5000 signatures and successfully put Measure O on the ballot:
Carolyn Schneider, Chairperson Fort Bragg
Michael Schaeffer, Treasurer Comptche
Melinda Clark, Secretary Willits
Barbara Blake Ukiah
Lew Chichester Round Valley
Mary Gill Fort Bragg
Shawn Haven Laytonville
Patrick Hickey Ukiah
Victor Hoosac Ukiah
Janice Marcell Fort Bragg
Wayne Menger Ukiah
Larry Riddle Point Arena
Michele Savoy Hopland
Ed TePas Round Valley