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1 CITY OF HOMER
2 HOMER,ALASKA
3 City Manager
4 RESOLUTION 19-077
5
6 A RESOLUTION OF THE CITY COUNCIL OF HOMER, ALASKA,
7 AUTHORIZING THE CITY OF HOMER TO JOIN THE ALASKA REMOTE
8 SELLER SALES TAX COMMISSION FOR THE PURPOSE OF
9 DEVELOPING, IMPLEMENTING, AND ENFORCING A REMOTE
10 SELLER SALES TAX CODE AND DESIGNATING THE COMMISSION
11 REPRESENTATIVE
12
13 WHEREAS, The inability to effectively collect sales tax on sales of personal property,
14 products or services transferred or delivered into Alaska by a remote seller in response to
15 orders placed electronically by local consumers is eroding the sales tax base of Alaska
16 communities and resulting in revenue losses that is causing imminent harm to residents
17 through the loss of critical funding for local education; and
18
19 WHEREAS, The harm from the loss of revenue is especially problematic in Alaska
20 because the state has no broad-based tax, and sales tax revenues are essential in funding the
21 provision of services by local governments; and
22
23 WHEREAS,The failure to collect tax on remote sales creates artificial market distortions
24 and competitive advantages for remote sellers by perpetuating tax shelters for businesses that
25 limit their physical presence in the state or its municipalities but still sell goods and services to
26 local consumers,something that becomes easier and more prevalent as technology continues
27 to advance; and
28
29 WHEREAS,The structural advantages for remote sellers,including the absence of point-
30 of-sale tax collection, combined with the general growth of online retail, means that the
31 erosion of the sales tax base is a growing problem that will only worsen in the near future if the
32 borough is not able to legally collect remote seller sales tax within the framework of current
33 United States Supreme Court case law; and
34
35 WHEREAS, The recent decision by the United States Supreme Court in South Dakota v.
36 Wayfair allows for the amendment of the sales tax code to account for remote sellers who do
37 not have a physical presence in either the State of Alaska or within the Kenai Peninsula
38 Borough, but do have a taxable connection with those jurisdictions; and
39
40 WHEREAS, The decision in South Dakota v. Wayfair provided guidance that included the
41 defensibility of a single-level statewide administration of remote sales tax collection and
42 remittance; and
43
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RESOLUTION 19-077
CITY OF HOMER
44 WHEREAS, Remote sellers who make a substantial number of deliveries into or have
45 large gross revenues from Alaska benefit extensively from the Alaska market, affecting the
46 economy generally, as well as local infrastructure; and
47
48 WHEREAS, Modern computing and software options ensure that it is neither unusually
49 difficult nor a substantial burden for remote sellers to collect and remit sales taxes associated
50 with sales into Alaska taxing jurisdictions; and
51
52 WHEREAS, In order to implement a single-level statewide sales tax administration, it is
53 the intent of numerous local taxing jurisdictions within Alaska to establish an
54 intergovernmental entity known as the Alaska Remote Seller Sales Tax Commission (the
55 "Commission"); and
56
57 WHEREAS, The function and powers of the Commission will be set forth in the Alaska
58 Intergovernmental Remote Seller Sales Tax Agreement (the "Agreement"), a cooperative
59 agreement between Commission members;and
60
61 WHEREAS,Under the terms of the Agreement, in order to maintain membership in the
62 Commission, the borough will be required to adopt certain uniform code provisions for the
63 collection and remittance of municipal sales tax applicable to sales made by remote sellers;
64 and
65
66 WHEREAS, The uniform remote sales tax code will be presented to the assembly for
67 consideration once adopted by the Commission to comply with guidance found in the Wayfair
68 decision; and
69
70 WHEREAS, If adopted,the administration of remote sales tax collection and remittance
71 will be delegated to the Commission; and
72
73 WHEREAS,The intent of the Agreement is to enable Alaska's taxing jurisdictions to levy
74 their municipal sales tax to the maximum limit of federal and state constitutional doctrines;
75 and
76
77 WHEREAS,Article X, Section 13 of the Alaska Constitution authorizes local government
78 to enter into agreements for the cooperative or joint administration of any function or power,
79 unless otherwise prohibited by law or charter;
80
81 WHEREAS, In addition AS 29.35.010(13) provides authority for the borough to enter into
82 intergovernmental cooperative agreements for the joint administration of a borough function
83 or power;
84
85 WHEREAS,The purpose of being an early member of the Commission is to have a voice
86 during the formation process while not committing to any future obligation or action; and
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CITY OF HOMER
87
88 WHEREAS, A member will be able to withdraw from the Commission if the adopted
89 bylaws, uniform code,or fees are not acceptable to the member municipality.
90
91 NOW,THEREFORE,BE IT RESOLVED that the City Council of Homer,Alaska,that the City
92 Manager or their designee is authorized to negotiate, execute, and submit all necessary
93 documents to obtain and maintain membership in the Alaska Remote Seller Sales Tax
94 Commission, including the Alaska Intergovernmental Remote Seller Sales Tax Agreement
95 included as Attachment A.
96
97 BE IT FURTHER RESOLVED the City Manager or designee is designated as the city's
98 representative on the Commission.
99
100 PASSED AND ADOPTED by the Homer City Council this 28th day of October, 2019.
101
102 CITY OF HOMER
103
104
105
106 KEN CASTNER, MAYOR
107 ATTEST:
108
109
110
111 MELISSA JAC EN, MMC, CITY CLERK
112 `®
113 Fiscal Note: N/A o014.9
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