HomeMy WebLinkAboutOrd2008-016Sponsored by: Oates
Introduction: June 23, 2008
Public Hearing: July 14, 2008
Enactment: July 14, 2008
CITY OF SEWARD, ALASKA
ORDINANCE 2008-016
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, RESCINDING ORDINANCE 2008-001 AND RETAINING A
SALES TAX CAP OF $500
WHEREAS, the Seward City Council approved Ordinance 2007-10 on December 10, 2007,
increasing the sales tax cap from $500 to $1,000, effective April 1, 2008; and
WHEREAS, Ordinance 2008-001 approved on January 28, 2008 subsequently repealed
Ordinance 2007-010 in order to extend the effective date of the tax cap increase from April 1, 2008 to
January 1, 2009; and
WHEREAS, a subsequent motion for reconsideration of Ordinance 2008-001 failed, but the
City Council requested a substitute Ordinance be brought back for consideration which would repeal
the increase in the sales tax cap in its entirety, effectively reverting back to the tax cap of $500; and
WHEREAS, substitute Ordinance 2008-002 was brought forward, which would have rescinded
the above ordinances and eliminated the $1000 sales tax cap increase, bringing the cap back to $500;
and
WHEREAS, Ordinance 2008-002 failed on March 10, 2008, keeping the sales tax cap increase
to $1000 effective January 1, 2009; and
WHEREAS, after further consideration and a work session, the City Council wishes to rescind
the prior actions eliminating the proposed increase in the sales tax cap, and retain the sales tax cap at
the original $500 amount; and
WHEREAS, Seward City Code 5.35.035 provides authority for the imposition of sales tax and
requires that sales taxes be collected and remitted to the Kenai Peninsula Borough in accordance with
AS 29.35.170 and Chapter 5.18 of the Kenai Peninsula Borough Code; and
WHEREAS, Seward City Code 5.35.045, as amended to be effective January 1, 2009, specifies
the amount of tax to be applied on the first $500 of each separate sale, rent, or service transaction, with
said amount being generally identified as the "sales tax cap" and this ordinance would decrease that
sales tax cap from $1000 back to $500.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,
HEREBY ORDAINS that:
CITY OF SEWARD, ALASKA
ORDINANCE 2008-016
Section 1. Seward City Code Section 5.35.045 is amended as follows:
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The tax shall be applied only to the first ~l-,~98 $500 of each separate sale, rent or
service transaction. The payment of rent, whether for real or personal property, in
excess of X1;989 $500 and for more than one month shall be treated as several separate
transactions covering the rental for one month each. A transaction involving payment
for services or personal property to be rendered or delivered over a period of more than
one month for a consideration in excess of x;988 $500 shall be treated as several
separate transactions occurring one each month over the period of time that the service
or property is rendered or delivered.
Section 2. Ordinance 2008-001 is hereby repealed.
Section 3. This ordinance shall take effect 10 days following its enactment.
ENACTED by the City Council of the City of Seward, Alaska, this 14`h day of July, 2008.
THE CITY OF SEWARD, ALASKA
Clark Corbridge, May
AYES: Dunham, Bardarson, Amberg, Smith, Corbridge
NOES: Valdatta
ABSENT: Kellar
ABSTAIN: None
ATTEST:
~ J
Je Lewis, M
Ci Clerk
(City Seal) ••.•~•~'l~, ,~ O~~q,~~
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Council Agenda Statement
Meeting Date: June 11, 2008
Through: Phillip Oates, City Manager
From: Jean Lewis, City Cler
RE: Rescinding the sales tax cap increase from $1000 to $500
BACKGROUND & JUSTIFICATION:
The Seward City Council approved Ordinance 2007-10 on December 10, 2007, with an effective date of April
1, 2008. This ordinance authorized an increase in the sales tax cap from $500 to $1,000. Subsequently, the
City Council approved Ordinance 2008-01, repealing Ordinance 2007-10 and setting a new effective date for
the sales tax cap increase to January 1, 2009.
At its meeting of February 11, 2008, a motion to reconsider Ordinance 2008-01 failed since this would not
repeal the tax cap increase, but would only roll the effective date of the increase forward from January 1, 2009
to April 1, 2008 -which could have an adverse effect on businesses in the city. The City Council requested
Administration forward a substitute ordinance at the next meeting which would roll back the sales tax cap
increase and revert back to the $500 tax cap, but on March 10, 2008, that Ordinance 2008-002 failed.
After further considerations and a work session held on the subject, the city council asked administration to
bring this ordinance rescinding the sales tax cap increase from $1000 back to the original $500 amount.
The intent of Ordinance 2008-016 is to eliminate the increase in the sales tax cap, which would result in the tax
cap remaining at $500, where it has been since it was implemented in 1965.
CONSISTENCY CHECKLIST
Where applicable, this agenda statement is consistent with the Seward City Code, Charter, Comprehensive Plans,
Land Use Plans, Strategic Plan and City Council Rules of Procedures.
Other:
FISCAL NOTE:
The 2008 Budget was approved with the expectation that approximately $70,000 would be generated by an
increase in the sales tax cap. Elimination of the sales tax cap increase results in an adverse budgetary impact of
$70,000.
RECOMMENDATION:
Introduce, and after public hearing, approve Ordinance 2008-016 which would rescind ordinance 2008-001 and
eliminate the sales tax cap increase to $1000, thus retaining the sales tax cap at $500.