ORDINANCE NO. 2026-XXX
AN ORDINANCE OF THE CITY OF UNION CITY AMENDING CHAPTER
3.28 OF THE UNION CITY MUNICIPAL CODE RELATING TO THE
UTILITY USERS TAX
WHEREAS, the City of Union City (the “City”) is authorized to levy a Utility Users Tax (“UUT”); and
WHEREAS, Chapter 3.28 of the Union City Municipal Code establishes a UUT of five percent (5%) within the City; and
WHEREAS, the UUT is paid by recipients of telecommunications, video (including all means and methods of transmission), electric, and gas utility services, collected by the utilities as part of regular billing, and remitted to the City; and WHEREAS, the UUT will automatically expire on December 31, 2028; and WHEREAS, the UUT generates approximately seven million dollars ($7,000,000) annually for the City’s General Fund; and
WHEREAS, the City wishes to maintain vital services for thousands of Union City citizens every year; and
WHEREAS, extending voter-approved locally controlled funding with no increase in tax rate will maintain public safety, pothole repair and street maintenance, crime prevention, parks and recreation programs, and other city services with funding that cannot be taken by the State; and
WHEREAS, the public has indicated that maintaining 9-1-1 emergency response times and fire protection is a top priority; and
WHEREAS, continuing this local funding will help keep community police officers on the streets to maintain successful crime-fighting efforts that keep Union City residents safe; and
WHEREAS, Council wishes to prevent serious cuts to City services, which it would have to consider if another revenue source is not identified; and WHEREAS, voter-approved, locally controlled funding has helped maintain the City’s emergency reserves and fiscal stability; and
WHEREAS, by law, all funds from an extension of existing, voter-approved local funding must continue to stay in Union City to maintain local services – no funds can be taken by Sacramento or the federal government; and
WHEREAS, UUT revenues will continue to be included in the City’s annual financial statements and subject to an annual independent financial audit, with the audit made available to the public; and
Ordinance No. 2026-XXX
Amending Chapter 3.28 of UCMC Relating to the Utility Users Tax
WHEREAS, Union City voters approved the UUT in November 2020; and WHEREAS, the UUT is and was always intended to apply to all means of transmission for video services, including transmission via the internet and streaming services. The immediately preceding sentence is declarative of existing law; and WHEREAS, the People of the City of Union City desire to extend the term of the UUT, without a rate increase, for an additional nine (9) year period.
NOW, THEREFORE, the People of the City of Union City do ordain as follows:
Section 1. Recitals.
The above recitals are true and correct and made a part of this Ordinance.
Section 2. Municipal Code Amendments.
Section 3.28.050, “Video users tax”, Subsection (A) “Video Users Tax Rate”, of the Union City Municipal Code is hereby amended to read as follows (deletions in strikethrough; additions in italics):
3.28.050 - Video users tax.
A. Video Users Tax Rate. There is hereby imposed a tax upon every person in the City using video services from a video provider video service supplier. The tax imposed by this section shall be at the rate of five percent of the charges made for such services and shall be collected from the service user by the video service supplier or its billing agent. There is a rebuttable presumption that video services that are billed to a billing or service address in the City are used, in whole or in part, within the City's boundaries, and such services are subject to taxation under this chapter. If the billing address of the service user is different from the service address, the service address of the service user shall be used for purposes of imposing the tax.
Section 3.28.250, “Termination of utility users tax” of the Union City Municipal Code is hereby amended to read as follows (deletions in strikethrough; additions in italics):
3.28.250 - Termination of utility users tax.
The levy of taxes as provided in this chapter shall expire on December 31, 2037, unless reenacted by a separate ordinance approved by a vote of the People of the City of Union City conducted pursuant to law. The termination of the levy of taxes as provided herein shall not terminate the obligation to pay taxes levied on services used prior to such date. Taxes levied prior to December 31, 2037, shall remain a debt payable to the City. All provisions of this chapter, except those relating to the levy of taxes, shall continue in full force and effect after such date.
Section 3. Severability.
If any provision of this Ordinance or the application thereof to any person or circumstance is held invalid, the remainder of the Ordinance, including the application of such part or Ordinance No. 2026-XXX
Amending Chapter 3.28 of UCMC Relating to the Utility Users Tax
provision to other persons or circumstances, shall not be affected thereby and shall continue in full force and effect. To this end, provisions of this Ordinance are severable.
The People of the City of Union City hereby declare that they would have passed each section, subsection, subdivision, paragraph, sentence, clause, or phrase hereof irrespective of the fact that any one or more sections, subsections, subdivisions, paragraphs, sentences, clauses, or phrases be held unconstitutional, invalid, or unenforceable.
Section 4. Amendment or Repeal.
Chapter 3.28 of Title 3 of the Union City Municipal Code may be repealed or amended by the City Council without a vote of the People. However, as required by Article XIII C of the California Constitution, voter approval is required for any amendment provision that would increase the rate of any tax levied pursuant to this Ordinance. The People of the City of Union City affirm that the following actions shall not constitute an increase of the rate of a tax:
A. The restoration of the rate of the tax to a rate that is no higher than that set by this Ordinance if the City Council has acted to reduce the rate of the tax; B. An action that interprets or clarifies the methodology of the tax or any definition applicable to the tax, so long as interpretation or clarification (even if contrary to some prior interpretation or clarification) is not inconsistent with the language of this Ordinance;
C. The establishment of a class of persons that is exempt or excepted from the tax or the discontinuation of any such exemption or exception other than the discontinuation of an exemption or exception specifically set forth in this Ordinance; and,
D. The collection of the tax imposed by this Ordinance, even if the City had for some period of time failed to collect the tax.
Section 5. Codification.
Following voter approval of this Ordinance, the City Clerk, in consultation with the City Attorney, is authorized and directed to codify the applicable provisions of this Ordinance in the Union City Municipal Code.
Section 6. Publication and Effective Date.
If this Ordinance is approved by a majority of the voters voting on the measure at the November 3, 2026, election, the Ordinance shall be considered adopted on the date the City Council declares the election results and shall take effect ten (10) days thereafter, pursuant to Elections Code Section 9217. Within fifteen (15) days after adoption, the City Clerk shall cause this Ordinance to be published once in The Fremont Argus, a newspaper of general circulation in Alameda County and circulated in the City of Union City, in accordance with Government Code Section 36933.