Chapter 3.24 - UTILITY TAXES

In construing the provisions of this chapter, save when otherwise plainly declared or clearly apparent from the context, the following definitions shall be applied:

"Gross income" means the value proceeding or accruing from the sale of tangible property or service, and receipts (including all sums earned or charged, whether received or not) by reason of the investment of capital in the business engaged in, including rentals, royalties, fees or other emoluments, however designated (excluding receipts or proceeds from the use or sale of real property or any interest therein, and proceeds from the sale of notes, bonds, mortgages, or other evidence of indebtedness, or stock and the like) and without any deduction on account of losses.

"Person" or "persons" means person of either sex, firms, corporations, copartnerships, and other associations of natural persons, whether acting by themselves or by servants, agents or employees.

"Tax year" or "taxable year" means the year commencing January 1st and ending December 31st of the same year, or, in lieu thereof, the taxpayer's fiscal year when permission is obtained from the town mayor or his/her designee to use the same as the tax year.

"Uncollectible debt" means monies owed to a utility occupation provider which the utility occupation provider has made unsuccessful commercially reasonable attempts to collect. This shall also include, but not be limited to, debt discharged by bankruptcy or other legal proceedings.

(Ord. 501 (part), 1999; Ord. 476 § 2, 1998)

3.24.030 - Occupation license required.

No person, firm or corporation shall engage in or carry on any business, occupation, pursuit or privilege for which a license fee or tax is imposed by this chapter without first having obtained, and being the holder of, a valid and subsisting license to do so, to be known as a utility occupation license. Each person, firm or corporation shall promptly apply to the town clerk/treasurer for a license upon the appropriate form provided by the town clerk/treasurer, giving such information as reasonably necessary to enable the administration and enforcement of this chapter; and upon acceptance, the town clerk/treasurer shall thereupon issue such a license to the applicant. A utility occupation license shall be personal and nontransferable.

(Ord. 476 § 3, 1998)

3.24.040 - Occupation license posted.

All licenses issued pursuant to the provisions of this chapter shall be kept posted by the licensee in a conspicuous place in his or her principal place of business located in the town. No person to whom a license has been issued shall suffer or allow any other persons chargeable with a separate license to operate under or display his or her license, nor shall such other person operate under or display such license.

(Ord. 476 § 4, 1998)

3.24.050 - Occupation subject to tax— Amount.

There is levied upon, and shall be collected from persons, including the town, on account of certain business activities engaged in or carried on, license fees or occupation taxes in the amount to be determined by the application of rates given against gross income as follows:

A. Upon every person engaged in or carrying on the business of selling or furnishing electric energy, a fee or tax equal to six percent of the total gross income derived from such business in the town during the period for which the license fee or tax is due;

B. Upon every person engaged in or carrying on a telephone business, a fee or tax equal to six percent of the total gross income, excluding revenues from interstate toll, derived from such business in the town during the period for which the license fee or tax is due. "Telephone business" means the business of providing access to a local telephone network, local telephone switching service, toll service, cellular telephone services, coin telephone services, telephonic, video, data, or similar communication, or transmission for hire, via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. The term includes cooperative or farmer line telephone companies or associations operating exchanges. For the purpose of this subsection, "gross income" does not include charges which are passed on to the subscriber by a telephone company pursuant to tariffs required by regulatory order to compensate for the cost to the company of the tax imposed by this section, nor competitive telephone service which is a type that can be provided by persons that are not subject to regulation as telephone companies under RCW Title 80 and for which a separate charge is made;

C. Upon every person engaged in or carrying on the business of transmitting television by cable, a fee or tax equal to four percent of the total gross income derived from such business in the town during the period for which the license fee or tax is due;

D. Upon every person, including the town, engaged in or carrying on the business of operating or conducting a water system for domestic, business or industrial consumption, a fee or tax equal to six percent of the total gross income derived from such business in the town during the period for which the license fee or tax is due;

E. Upon every person, including the town, engaged in or carrying on the business of operating or conducting a sewerage system for domestic, business or industrial use, a fee or tax equal to three percent of the total gross income derived from such business in the town during the period for which the license fee or tax is due;

F. Upon every person, including the town, engaged in or carrying on the business of operating or conducting a garbage or solid waste refuse collection system for domestic, business or industrial use, a fee or tax equal to six percent of the total gross income derived from such business in the town during the period for which the license fee or tax is due.

(Ord. 493 §1, 1999; Ord. 476 § 5, 1998)

3.24.060 - License tax year.

All utility occupation licenses and the fee for the tax therefor shall be for the tax year for which issued and shall expire at the end of the tax year.

(Ord. 476 § 6, 1998)

3.24.070 - Customer tax base limit.

The rates of tax set forth in this chapter shall be measured against a maximum of the first two thousand dollars ($2,000.00) of total gross income derived from any one customer account, metered service, or other separately identified billing account in any one month or fraction thereof. This customer tax base applicability shall only apply to the businesses specifically mentioned in Section 3.24.050(A), (B) and (C), namely the furnishing of electricity, telephone business, and the transmission of television by cable. All other utility occupations subject to this tax shall not be limited by said customer account base limitation and shall apply the tax upon gross income without limitation.

(Ord. 476 § 7, 1998)

3.24.080 - Exception and deductions.

There shall be excepted and deducted from the total gross income upon which the license fee or tax is computed so much thereof as is derived from transactions in interstate or foreign commerce, or from business done for the government of the United States, its officers or agents, or any amount paid to the federal, state and local governmental entities as excise taxes levied or imposed upon the sale or distribution of property or services, or business which the town is prohibited from taxing under the Constitution or laws of the state of Washington. There shall also be excepted and deducted from the total gross income upon which the license fee or tax is computed any uncollectible debt due to the person or persons providing the taxable business services.

(Ord. 501 (part), 1999: Ord. 476 § 8, 1998)

3.24.090 - Remittance required quarterly.

Commencing with January 1st of the tax year, each three-month period constitutes a quarterly period, at which on or before the last day of the month following the end of such quarterly period the license fee or tax for said quarterly period is due. A monthly installment is permissible with the approval of the town clerk/treasurer provided that said installments are likewise due on or before the last day of the succeeding month, and further that said monthly installments may not be converted to quarterly period installments except upon January 1st of the tax year.

(Ord. 476 § 9, 1998)

3.24.100 - Remittance authorized for public funds.

The remittance due by town-operated utility occupations subject to this tax shall be receipted into the water/sewer fund of the town.

(Ord. 476 § 10, 1998)

3.24.110 - Remittance upon sale or transfer of business.

Upon the sale or transfer during any tax year of a business on account of which a fee or tax is required by this chapter, the purchaser or transferee shall, if the fee or tax has not been paid in full for the year by the seller, be responsible for the entire outstanding payment owing, and remit the liability to the town prior to receiving a new utility occupation license.

(Ord. 476 § 11, 1998)

3.24.120 - Taxpayer records.

Each taxpayer shall keep accurate records reflecting the amount of gross income on services and disclosing all information necessary to determine the taxpayer's tax liability under this chapter during each tax base period. Such records shall be kept and maintained for a period of not less than three years. All books, records and other items required to be kept under this section shall be subject to and immediately made available for inspection and audit at any time, with or without notice, at the place where such records are kept, by the town clerk/treasurer or his/her designee, for the purpose of enforcing the provisions of this taxing chapter.

(Ord. 476 § 12, 1998)

3.24.130 - Applications and returns confidential.

The applications, statements or returns made to the town pursuant to this chapter shall not be made public, nor shall they be subject to inspection of any person except the mayor, town attorney, town supervisor, town clerk/ treasurer or his/her designee, and members of the town council; provided, that this section does not prohibit the town clerk/treasurer from making known or revealing facts contained in any return or disclosed in any examination for official purposes.

(Ord. 476 § 13, 1998)

3.24.140 - Enforcement.

The town clerk/treasurer shall have the authority, and it shall be his/her duty from time to time, to publish and enforce rules and regulations consistent with this chapter or with the law for the purpose of carrying out the provisions thereof. It is unlawful to violate or fail to comply with any such rule or regulation.

(Ord. 476 § 14, 1998)

3.24.150 - Failure to make returns or pay full tax.

If any taxpayer fails, neglects or refuses to apply for a license, or make his or her return, or pay the tax in full as required in this chapter, the town clerk/treasurer is authorized to determine the amount of the tax payable, and by mail to notify such taxpayer of the amount so determined. The amounts so affixed shall thereupon be the tax and be immediately due and payable. Failure to comply with the provisions of this chapter will subject the taxpayer to provisions contained in the delinquent penalty sections of this chapter.

(Ord. 476 § 15, 1998)

3.24.160 - Overpayment or underpayment of tax.

If upon application by a taxpayer for a refund or for an audit of his or her records, or upon any examination of the returns of any taxpayer, it is determined by the town clerk/ treasurer that within three years immediately preceding the application or examination an error has occurred, then:

A. If a tax or other fee has been paid in excess of that properly due, the total excess paid over all amounts due to the town within a period of three years shall be credited to the taxpayer's account or shall be paid directly to the taxpayer at the town's option;

B. If a tax or other fee has been paid which is less than that properly due, or no tax or fee has been paid, the town clerk/treasurer shall mail a statement to the taxpayer showing the balance due, including the tax amount and penalty assessments and fees, and it is a separate, additional violation of this chapter, both civil and criminal, if the taxpayer fails to make such payment in full within ten calendar days of mailing, or fails to appeal the payment per the provisions of Section 3.24.220.

(Ord. 476 § 16, 1998)

3.24.170 - Delinquent payment— Penalty.

For each quarterly or monthly period payment due under the provisions of this chapter, if such payment is not made by the persons subject to the tax by the due date thereof, there shall be added a penalty as follows:

A. If payment in full is received within thirty (30) days from the due date, five percent of the accrued tax;

B. If payment in full is received between thirty-one (31) and fifty-nine (59) days from the due date, ten percent of the accrued tax;

C. If payment in full is received beyond sixty (60) days from the due date, twenty (20) percent of the accrued tax.

(Ord. 476 § 17, 1998)

3.24.180 - Taxes, penalties and fees constitute debt to municipality.

Any tax due and unpaid under this chapter, and all penalties or fees unpaid, shall constitute a debt to the town, a municipal corporation, and may be collected by court proceedings the same as any other debt in like amount which shall be in addition to all other existing remedies. On any civil action the town shall recover reasonable attorney fees and audit costs if the town is the prevailing party.

(Ord. 476 § 18, 1998)

3.24.190 - Limitation on right to recovery.

The right to recovery by the town from the taxpayer for any tax provided hereunder shall be barred after the expiration of three calendar years from the date said tax became due. The right of recovery against the town because of overpayment of tax by any taxpayer shall be barred after the expiration of three calendar years from the date such payment was made.

(Ord. 476 § 19, 1998)

3.24.200 - False returns.

It is unlawful for any person subject to this chapter to fail or refuse to make application or return for a license or to pay the fee or tax or installment thereof when due, or for any person to make any false or fraudulent application or return or any false statement or representation in, or in connection with any such application or return, or to aid or abet another in any attempt to evade payment of the fee or tax, or any part thereof, or to fail to appear at or testify falsely upon any investigation of the correctness of a return or upon the hearing of any appeal or in any manner to hinder or delay the town or any of its officers in carrying out the provisions of this chapter.

(Ord. 476 § 20, 1998)

3.24.210 - Noncompliance—Penalty.

Any person subject to this chapter who fails or refuses to apply for a utility occupation license or to make tax returns or pay the tax or penalties when due, or who makes any false statement or representation in or in connection with any such application, or who otherwise violates or refuses to comply with the provision of this chapter, shall be deemed guilty of a misdemeanor, and each such person is guilty of a separate offense for each and every day or portion thereof during which any violation of any of the provisions of this chapter is committed, continued or permitted, and upon any conviction of any such violation, such person shall be punished by a fine not to exceed five hundred dollars ($500.00) for each day or portion thereof which such person is found guilty of noncompliance with the provisions of this chapter.

(Ord. 476 § 21, 1998)

3.24.220 - Appeals to council.

Any taxpayer aggrieved by the amount of the fee or tax found by the town clerk/treasurer to be required under the provisions of this chapter may appeal to the town council from such finding by filing a written notice of appeal with the town clerk/treasurer within seven days from the time such taxpayer was given notice of such amount. The town clerk/ treasurer shall, as soon as practicable, fix a time and place for the hearing of such appeal, and he/she shall cause a notice of the time and place thereof to be delivered or mailed to the appellant. At such hearing the taxpayer shall be entitled to be heard and to introduce evidence on his or her own behalf. The town council shall thereupon ascertain the correct amount of the fee or tax by resolution and the town clerk/treasurer shall immediately notify the appellant thereof, which amount together with the costs of appeal, if such applicant is unsuccessful therein, must be paid within five days after such notice is given. The mayor of the town may, by subpoena, require the attendance thereat of any person, and may also require him or her to produce any pertinent books and records. Any person served with such subpoena shall appear at the time and place therein stated, produce the records required, if any, and shall testify truthfully under oath administered by the mayor as to any matter required of him or her pertinent to the appeal, and it is unlawful for him or her to fail or refuse so to do.

(Ord. 476 § 22, 1998)