HomeMy WebLinkAbout55B - RESO - BOE UUTREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
AUGUST 18, 2015
TITLE:
RESOLUTION AUTHORIZING EXECUTION OF
CERTAIN DOCUMENTS REQUIRED BY THE
CALIFORNIA BOARD OF EQUALIZATION TO
COLLECT THE CITY'S UTILITY USERS' TAX
ON PREPAID WIRELESS SERVICE
(STRgATEGIC PLAN NO. 4,3A)
i
CITY MANA ER
RECOMMENDED ACTION
CLERK OF COUNCIL USE ONLY:
APPROVED
❑ As Recommended
❑ As Amended
❑ Ordinance on 1" Reading
❑ Ordinance on 2 "d Reading
❑ Implementing Resolution
❑ Set Public Hearing For
CONTINUED TO
FILE NUMBER
Adopt a Resolution Authorizing the City Manager and Clerk of the Council to execute a
contract and related certification statement with the California Board of Equalization to
perform functions incidental to the administration and collection of prepaid mobile telephony
services surcharge and local charges.
2. Authorize the City Manager and Clerk of the Council to execute a Local Charge Agreement
with the California Board of Equalization, subject to non - substantive changes approved by
the City Manager and City Attorney.
3. Authorize the City Attorney and Clerk of the Council to execute an accompanying certification
statement required by the California Board of Equalization, subject to non - substantive
changes approved by the City Manager and City Attorney.
DISCUSSION
As a result of the passage of Assembly Bill 1717 ( "AB 1717') a new methodology was established
regarding the assessment and collection of a variety of surcharges on phone services, specifically
Prepaid Mobile Telephony Services ( "MTS "). In addition, AB 1717 also mandates local
jurisdictions contract with the California Board of Equalization ( "BOE ") in order to receive revenue
imposed on consumers of Prepaid Mobile Telephony Services ( "MTS ") which becomes effective
on January 1, 2016.
5513-1
Resolution Authorizing the Execution of Certain Documents Required by the California Board of
Equalization to Collect The City's Utility Users' Tax on Prepaid Wireless Service
August 18, 2015
Page 2
The BOE provided notification to local jurisdictions, via a press release on July 29, 2015,
requiring local public agencies to enter into a contract with the BOE by September 1, 2015 to
ensure uninterrupted collection of these local revenues. Additionally, as indicated by the BOE,
failure to enter into the contract would result in the City of Santa Ana Utility Users' Tax ( "UUT ")
imposed upon MTS not to be collected by the sellers. Consequently, the City will not receive the
Utility Users' Tax revenue from prepaid MTS providers.
Furthermore, if local jurisdictions fail to enter into the above - referenced contract by September 1,
2015, the next opportunity to enter into a contract with the BOE will be December 1, 2015. Delay
in entering into a contract would result in the BOE not collecting charges imposed upon MTS until
April 1, 2016. Thus, cities would forfeit revenues for the period January 1, 2016 through March
31, 2016.
STRATEGIC PLAN ALIGNMENT
Approval of this item allows the City to meet Goal No. 4 City Financial Stability, Objective No. 3
(Achieve a structurally balanced budget with appropriate reserve levels), Strategy A (Modernize
and adopt the City's utility user's tax ordinance by June 2014).
FISCAL IMPACT
There is no fiscal impact associated with this action.
Francisco Gutierrez
Executive Director
Finance & Management Services Agency
Exhibit 1
Resolution
Exhibit 2
Local Charge Agreement
Exhibit 3
Certification Statement
Exhibit 4
California Board of Equalization Press Release
SV/WH
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8.12.15 LS
RESOLUTION NO. 2015-
A RESOLUTION OF THE CITY OF SANTA ANA
AUTHORIZING THE CITY MANAGER AND THE CITY
ATTORNEY TO EXECUTE AGREEMENT WITH THE
STATE BOARD OF EQUALIZATION FOR
IMPLEMENTATION OF THE LOCAL PREPAID MOBILE
TELEPHONY SERVICES COLLECTION ACT
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA, AS
FOLLOWS:
Section 1: The City Council of the City of Santa Ana hereby finds, determines
and declares as follows:
A. Pursuant to Utility Users' Tax Ordinance No. NS -2860 of the City of Santa
Ana and the California "Local Prepaid Mobile Telephony Services Collection Act ", the
City of Santa Ana, wishes to enter into a contract with the State Board of Equalization
for implementation of the Local Prepaid Mobile Telephony Services Collection Act.
B. The State Board of Equalization requires that City of Santa Ana take the
following actions: 1) enter into a contract with the State Board of Equalization by
September 1, 2015 for implementation of the Local Prepaid Mobile Telephony Services
Collection Act; and 2) certify the City of Santa Ana's Utility Users' Tax ordinance, its
applicable rate, and its applicability to prepaid mobile telephony services.
NOW, THEREFORE IT IS RESOLVED AND ORDERED AS FOLLOWS:
Section 2:
WHEREAS, on August 18, 2015, the City of Santa Ana hereby certifies that
Ordinance No. NS -2860 applies the City of Santa Ana's local utility users' tax charge to
prepaid mobile telephony services; and
WHEREAS, the Local Prepaid Mobile Telephony Services Collection Act
mandates the Board of Equalization (BOARD) to administer and collect the local
charges for all applicable local jurisdictions (Rev. & Tax Code section 42103); and
WHEREAS, the BOARD will perform all functions incident to administration and
collection of the local charges for the City of Santa Ana; and
WHEREAS, the BOARD requires that the City of Santa Ana enter into an
"Agreement for State Collection and Administration of Local Charges" prior to
implementation of the Local Prepaid Mobile Telephony Services Collection Act; and
EXHIBIT 1
55B -3
8.12.15 LS
Whereas, the BOARD requires that the City of Santa Ana authorize the
agreement.
NOW, THEREFORE IT IS RESOLVED AND ORDERED AS FOLLOWS:
Section 3. The City Council of the City of Santa Ana hereby agrees that the
attached "Agreement for State Collection and Administration of Local Charges" is hereby
approved, and the City Manager is hereby authorized to execute the agreement, as
approved to form by the City Attorney, including any other related documents required
by the BOARD to perform all functions incident to the administration and collection of
the City of Santa Ana's local utility users' tax charge as applicable to prepaid mobile
telephony services.
Section 4. The City Attorney is hereby authorized to sign on behalf of the City
of Santa Ana a certification required by the BOARD certifying certain information
regarding the City of Santa Ana's utility users' tax ordinance, the applicable rate, and
that it applies to prepaid mobile telephony services.
Section 5. This Resolution shall take effect immediately upon its adoption by
the City Council, and the Clerk of the Council shall attest to and certify the vote adopting
this Resolution.
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8.12.15 LS
ADOPTED this day of 2015.
Miguel A. Pulido
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
By
Lisa E. Storck
Assistant City Attorney
AYES: Councilmembers:
NOES: Councilmembers:
ABSTAIN: Councilmembers:
NOT PRESENT: Councilmembers:
CERTIFICATION OF ATTESTATION AND ORIGINALITY
I, MARIA D. HUIZAR, Clerk of Council, do hereby attest to and certify the attached
Resolution No. 2015- to be the original resolution adopted by the City Council of
the City of Santa Ana on 2015.
Date:
Clerk of Council
City of Santa Ana
3
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Local Jurisdiction City of Santa Ana
AGREEMENT FOR STATE COLLECTION AND ADMINISTRATION OF
LOCAL CHARGES
This Agreement is for the purpose of implementing the Local Prepaid Mobile Telephony
Services Collection Act (Part 21.1, commencing with Section 42100) of Division 2 of the
Revenue and Taxation Code), hereinafter referred to as the Local Charge Act. The
City of Santa Ana and the State Board of Equalization, hereinafter called
�,,.y��o���„��, �W ..«u... „n.
the Board, do agree as follows:
ARTICLE I
DEFINITIONS
Unless the context requires otherwise, wherever the following terms appear in this
Agreement they shall be interpreted to mean the following:
A. "Administrative Expenses” means all expenses incurred by the Board in the
administration and collection of the local charges, including preparation and wind down
costs which are reimbursable to the Board from the revenues dollected by the Board on
behalf of the local jurisdiction.
B. "Contingent Fee" includes, but is not limited to, a fee that is based on a
percentage of the tax liability reported on a return, a fee that is based on a percentage of
the taxes owed, or a fee that depends on the specific tax result attained.
C. "Direct Seller" means a prepaid Mobile Telephony Service (MTS) provider or
service supplier, as defined in section 41007, that makes a sale of prepaid mobile
telephony services directly to a prepaid consumer for any purpose other than resale in the
regular course of business. A direct seller includes, but is not limited to, a telephone
corporation, a person that provides an interconnected Voice over Internet Protocol (Vole)
service, and a retailer as described in section 42004(b)(1).
D. "Local Charges" means a utility user tax imposed on the consumption of
prepaid mobile telephony services, as described in section 42102, and charges for access
to communication services or to local "911" emergency telephone systems imposed by a
local jurisdiction, as described in section 42102.5.
E. "Local Jurisdiction" or "local agency" means a city, county, or city and
county, which includes a charter city, county, or city and county of this State, which has
adopted an ordinance imposing a local charge of the kind described in Part 21.1 of
Division 2 of the Revenue and Taxation Code and has entered into a contract with the
Board to perform all functions incident to the collection of the local charges.
F. "Ordinance" means an ordinance of a local jurisdiction imposing a local
charge, including any local enactment relating to the filing of a refund or a claim arising
under the ordinance, attached hereto, as amended from time to time.
EXHIBIT 2
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G. "Quarterly local charges" means the total amount of local charges
transmitted by the Board to a local jurisdiction for a calendar quarter, as set forth in
section 42106(a)(1).
H. "Refund" means the amount of local charges deducted by the Board from a
local jurisdiction's quarterly local charges in order to pay that jurisdiction's share of a
local charge refund due to one taxpayer.
I. "Section"— all section references are to the Revenue and Taxation Code.
J. "Seller" means a person that sells prepaid mobile telephony service to a
person in a retail transaction.
ARTICLE II
BOARD ADMINISTRATION AND COLLECTION OF LOCAL CHARGES
A. Administration. The Board and the local jurisdiction agree that the Board
shall perform functions incident to the collection of the local charges from sellers that are
not direct sellers.
B. Collection. The Board shall collect the local charges in the same manner as it
collects the prepaid NITS Surcharge in the Prepaid Mobile Telephony Services Surcharge
Collection Act, subject to specified limitations in the Local Charge Act for which the
local jurisdiction is responsible, as set forth in Article III of this Agreement.
C. Audits. The Board's audit duties shall be limited to verification that the seller
that is not a direct seller complied with the Local Charge Act.
D. Other applicable laws. The Board and the local jurisdiction agree that all
provisions of law applicable to the administration and operation of the Local Charge Act,
Prepaid Mobile Telephony Services Surcharge Collection Act, and the Fee Collection
Procedures Law (FCPL) shall be applicable to the collection of local charges. References
in the FCPL to feepayer include a person required to pay the local charge, including the
seller. All future amendments to applicable laws are automatically incorporated into this
Agreement.
E. Deposit of Local Charges. All local charges collected by the Board shall be
deposited in the Local Charges for Prepaid Mobile Telephony Services Fund in the State
Treasury to be held in trust for the local taxing jurisdiction. Local charges shall consist
of all taxes, charges, interest, penalties, and other amounts collected and paid to the
Board, less payments for refunds and reimbursement to the Board for expenses incurred
in the administration and collection of the local charges, including preparation and wind -
down costs.
F. Allocation of Expenses. The Board shall allocate the total combined annual
expenses incurred for administration and collection pursuant to the Prepaid Mobile
Telephony Services Surcharge Collection Act and the Local Charge Act on a pro rata
basis according to revenues collected for: (1) the emergency telephone users surcharge
portion of the prepaid NITS surcharge, (2) the Public Utilities Commission surcharges
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portion of the prepaid NITS surcharge, and (3) local charges. The Board shall charge a
local jurisdiction its pro rata share of the Board's cost of collection and administration.
G. Transmittal of money. All local charges collected by the Board shall be
transmitted to the local jurisdiction once in each calendar quarter. Transmittals may be
made by mail or by deposit to the account of the local jurisdiction in a bank designated
by that jurisdiction. The Board shall furnish a statement quarterly indicating the amounts
paid and withheld for expenses of the Board.
H. Rules. The Board shall prescribe and adopt such rules and regulations as in its
judgment are necessary or desirable for the administration and collection of local charges
and the distribution of the local charges collected.
I. Security. The Board agrees that any security which it hereafter requires to be
furnished under the FCPL section 55022 will be upon such terms that it also will be
available for the payment of the claims of the local jurisdiction for local taxes owing to it
as its interest appears. The Board shall not be required to change the terms of any security
now held by it, and the local jurisdiction shall not participate in any security now held by
the Board.
J. Records of the Board.
1. Information obtained by the local jurisdiction from the examination of the
Board's records shall be used by the local jurisdiction only for purposes related to the
collection of the prepaid mobile telephony services surcharge and local charges by the
Board pursuant to this Agreement.
2. When requested by resolution of the legislative body of a local jurisdiction, the
Board shall permit any duly authorized officer or employee or other person designated by
that resolution to examine any information for its own jurisdiction that is reasonably
available to the Board regarding the proper collection and remittance of a local charge of
the local jurisdiction by a seller, including a direct seller, subject to the confidentiality
requirements of sections 7284.6, 7284.7 and 19542. (sections 42110(b), 42103(e).).
3. The resolution of the local jurisdiction shall certify that any person designated
by the resolution, other than an officer and an employee, meets all of the following
conditions:
a. Has an existing contract with the local jurisdiction that authorizes the person
to examine the prepaid NITS surcharge and local charge records.
b. Is required by that contract with the local jurisdiction to disclose information
contained in or derived from, those records only to an officer or employee of
the local jurisdiction authorized by the resolution to examine the information.
c. Is prohibited by that contract from perforn- ing consulting services for a seller
during the term of that contract.
d. Is prohibited by that contract from retaining information contained in, or
derived from, those prepaid NITS surcharge and local charge records, after
that contract has expired.
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4. Any third party contract between the local jurisdiction and an entity or person
authorized by the local jurisdiction to request information from the Board shall be subject
to the following limitations:
a. Any third party shall, to the same extent as the Board, be subject to Section
55381, relating to unlawful disclosures.
b. A third party contract shall not provide, in whole or in part, in any manner a
contingent fee arrangement as payment for services rendered.
5. Information obtained by examination of Board records shall be used only for
purposes related to the collection of the prepaid NITS surcharge and local charges by the
board pursuant to the contract, or for purposes related to other governmental functions of
the local jurisdiction set forth in the resolution.
6. If the Board believes that any information obtained from the Board's records
related to the collection of the prepaid NITS surcharge and local charges has been
disclosed to any person not authorized or designated by the resolution of the local
jurisdiction, or has been used for purposes not permitted by section 42110(b), the board
may impose conditions on access to its local charge records that the board considers
reasonable, in order to protect the confidentiality of those records. (section 42110 (c).)
7. The costs incurred by the Board in complying with a request for information
shall be deducted by the Board from those revenues collected by the Board on behalf of
the local jurisdiction making the request, as authorized by section 42110(b)(1).
ARTICLE III
LOCAL JURISDICTION
ADMINISTRATION AND RESPONSIBILITIES
A. The local jurisdictions shall be solely responsible for all of the following:
1. Defending any claim regarding the validity of the ordinance in its application
to prepaid mobile telephony service. The claim shall be processed in accordance with the
provisions of the local ordinance that allows the claim to be filed.
2. Interpreting any provision of the ordinance, except to the extent specifically
superseded by section 42105 of the Local Charge Act. The claim shall be processed in
accordance with the provisions of the local enactment that allows the claim to be filed.
3. Responding to specified consumer claims for refund involving: (1) rebutting
the presumed location of the retail transaction; (2) a consumer claim of exemption from
the local charge under the ordinance; or (3) any action or claim challenging the validity
of a local tax ordinance, in whole or part. The claim shall be processed in accordance
with the provisions of the local enactment that allows the claim to be filed.
4. Refunding the taxes in the event a local jurisdiction or local government is
ordered to refund the tax under the local ordinance.
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5. Reallocating local charges as a result of correcting errors relating to the
location of the point of sale of a seller or the known address of a consumer, for up to two
past quarters from the date of knowledge.
6. Collecting local charges on prepaid mobile telephony service and access to
communication services or access to local 911 emergency telephone systems imposed on
direct sellers.
7. Enforcement, including audits, of the collection and remittance of local
charges by direct sellers pursuant to the ordinance.
8. The local jurisdiction shall be the sole necessary party defendant on whose
behalf the local charge is collected in any action seeking to enjoin collection of a local
charge by a seller, in any action seeking declaratory relief concerning a local charge, in
any action seeking a refund of a local charge, or in any action seeking to otherwise
invalidate a local charge. There shall be no recovery from the State for the imposition of
any unconstitutional or otherwise invalid local charge that is collected under the Local
Act.
9. Entering into an agreement with the Board to perform the functions incident to
the collection of the local charges imposed on sellers that are not direct sellers.
10. Submitting an executed Certification to the Board, certifying that:
(a) the local jurisdiction's ordinance applies the local charge to prepaid mobile
telephony services;
(b) the amount of the rate charged for access to local 911 emergency telephone
systems or access to communications services complies with the requirements of section
42102.5; and/or applies the tiered rate for the utility user tax, as identified in section
42102.
(c) The local jurisdiction shall further certify that it agrees to indemnify and to
hold harmless the Board, its officers, agents, and employees for any and all liability for
damages that may result from the Board's collection pursuant to this Agreement.
11. Submitting signed documents to the Board to include agreement(s),
certification, copy of ordinance(s), and resolution(s).
12. Providing payment to the Board of the local jurisdiction's pro rata share of the
Board's cost of collection and administration as established pursuant to subdivision (e) of
section 42020.
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ARTICLE IV
LOCAL CHARGES
A. Local Charges — Timeliness — This part shall remain in effect until
proposed California Code of Regulations, title 18, section 2460 is adopted by the
Board and approved by the Office of Administrative Law.
1. Ordinances in effect as of September 1, 2015.
On or after January 1, 2016, a local charge imposed by a local jurisdiction on prepaid
mobile telephony services shall be collected from the prepaid consumer by a seller at the
same time and in the same manner as the prepaid MTS surcharge is collected under Part
21 (commencing with section 42001) provided that, on or before September 1, 2015, the
local jurisdiction enters into a contract with the Board pursuant to section 42101.5.
Thereafter, all subsequently enacted local charges, increases to local charges, or other
changes thereto, shall become operative pursuant to paragraphs (2), (3), and (4).
2. New charges. When a local jurisdiction adopts a new local charge after
September 1, 2015, the local jurisdiction shall enter into a contract with the Board,
pursuant to section 42101.5, on or before December I", with collection of the local
charge to commence April 1st of the next calendar year.
3. Increases in local charges. When a local jurisdiction increases an existing
local charge after September 1, 2015, the local jurisdiction shall provide the Board
written notice of the increase, on or before December 1st, with collection of the local
charge to commence April 1't of the next calendar year.
4. Inaccurate rate posted on the Board's website. When a local jurisdiction
notifies the Board in writing that the rate posted on the Board's Internet Web site (posted
rate) for a local charge imposed by that local jurisdiction is inaccurate, including
scenarios where the local charge was reduced or eliminated, the recalculated rate
applicable to the local jurisdiction shall become operative on the first day of the calendar
quarter commencing more than 60 days from the date the Board receives the local
jurisdiction's written notification that the posted rate is inaccurate.
A. Local Charges — Timeliness — This part shall take effect and supersede
the above "Local Charges — Timeliness section when California Code of
Regulations, title 18, section 2460 is adopted by the Board and approved by the
Office of Administrative Law.
1. Ordinances in effect as of September 1, 2015. On or after January 1, 2016,
a local charge imposed by a local jurisdiction on prepaid mobile telephony services shall
be collected from the prepaid consumer by a seller at the same time and in the same
manner as the prepaid MTS surcharge is collected under Part 21 (commencing with
section 42001) provided that, on or before September 1, 2015, the local jurisdiction enters
into a contract with the Board pursuant to section 42101.5.
In the event a local jurisdiction does not enter into a contract with the Board by
September 1, 2015, the local jurisdiction may enter into a contract with the Board,
pursuant to section 42101.5, on or before December fat, with collection of the local
charge to commence April 1" of the next calendar year. Thereafter, all subsequently
6
55B -12
enacted local charges, increases to local charges, or other changes thereto, shall become
operative pursuant to paragraphs (2), (3), (4) and (5) of this subdivision.
2. New charges. When a local jurisdiction adopts a new local charge after
September 1, 2015, the local jurisdiction shall enter into a contract with the Board,
pursuant to section 42101.5, on or before December I't, with collection of the local
charge to commence April 1st of the next calendar year.
3. Increases in local charges. When a local jurisdiction increases an existing
local charge after September 1, 2015, the local jurisdiction shall provide the Board
written notice of the increase, on or before December I", with collection of the local
charge to commence April 1st of the next calendar year.
4. Advance written notification. When a local charge is about to expire or
decrease in rate, the local jurisdiction imposing the local charge shall notify the Board in
writing of the upcoming change, not less than 110 days prior to the date the local charge
is scheduled to expire or decrease. The change shall become operative on the first day of
the calendar quarter commencing after the specified date of expiration or decrease in rate.
If advance written notice is provided less than 110 days prior to the specified date
of expiration or decrease in rate, the change shall become operative on the first day of the
calendar quarter commencing more than 60 days after the specified date of expiration or
decrease.
5. Inaccurate Rate Posted on the Board's Web site. When a local jurisdiction
notifies the Board in writing that the rate posted on the Board's Internet Web site (posted
rate) for a local charge imposed by that local jurisdiction is inaccurate, including
scenarios where the local charge was reduced or eliminated and the local jurisdiction
failed to provide advance written notice pursuant to paragraph 4 of this subdivision, the
recalculated rate applicable to the local jurisdiction shall become operative on the first
day of the calendar quarter commencing more than 60 days from the date the Board
receives the local jurisdiction's written notification that the posted rate is inaccurate. The
local jurisdiction shall promptly notify the Board in writing of any such discrepancies
with the posted rate that are lmown or discovered by the local jurisdiction.
ARTICLE V
COMPENSATION
The local jurisdiction agrees to pay the Board its pro rata share of the Board's cost of
collection and administration of the local charges, as established pursuant to section
42020, subdivision (e). Such amounts shall be deducted from the local charges collected
by the Board for the local jurisdiction.
ARTICLE VI
MISCELLANEOUS PROVISIONS
A. Communications. Communications and notices may be sent by first -class
United States Mail. A notification is complete when deposited in the mail.
Communications and notices to be sent to the Board shall be addressed to:
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State Board of Equalization
P.O. Box 942879 MIC: 27
Sacramento, California 94279 -0001
Attention: Supervisor,
Local Revenue Allocation Unit
Communications and notices to be sent to the local jurisdiction shall be addressed to:
Francisco Gutierrez, Executive Director
Finance and Management Services Agency
City of Santa Ana
20 Civic Center Plaza (M17)
P.O. Box 1968
Santa Ana, CA 92702 -1968
Fax 714 - 647 -5414
B. Term. The date of this Agreement is the date on which it is approved by the
Department of General Services. The Agreement shall take effect on the first day of the
calendar quarter next succeeding the date of such approval, but in no case before the
operative date of the local jurisdiction's ordinance, not on a day other than the first day of
a calendar quarter. This Agreement shall be renewed automatically from year to year
until January 1, 2020, when the Local Charge Act is repealed, unless a statute enacted
prior to that date extends that date. In such event, this Agreement will continue to renew
automatically from year to year to the date authorized by statute.
ATTEST:
MARIA D. HUIZAR
Clerk of the Council
APPROVED AS TO FORM:
SONIA R. CARVALHO
City Attorney
By:
Lisa Storck
Assistant City Attorney
STATE BOARD OF EQUALIZATION
By
Administrator,
Return Analysis and Allocation Section
LOCAL
JURISDICTION City of Santa Ana
By
(Signature on this line)
David Cavazos
(Type name here)
Citv ManaEer
55B -14
(Type title here)
CERTIFICATION
I, Sonia R. Carvalho am authorized to sign this certification on behalf of City of Santa Ana
(Inrart Om of wowf.[49dw[�.n)
I certify to the following:
Please check all the following that apply to your jurisdiction:
1. 911 Charges /Access to Communication Services - Ordinance No. — of the
imposes the local charge set forth in the ordinance to prepaid mobile
J..' d'.. d l...Iju.lediwlanl
telephony services for access to communication services or to local 911 emergency
telephone systems. As required by section 42102.5, the percentage reflecting the rate for
access to the local 911 emergency telephone systems or access to communications services
is
2. X Utility User Tax - Ordinance No. NS -2860 of the City of Santa Ana imposes the local
Q.r n .of l.c.ljwvJwti.nJ
charge set forth in the ordinance to the consumption of prepaid mobile telephony services.
The tiered rate for the utility user tax, as identified in section 42102 is 5.5%
3. The City of Santa Ana agrees to indemnify and to hold harmless the Board of
(mo . �,m..[wmNd=wmloo)
Equalization (Board), its officers, agents, and employees for any and all liability for
damages that may result from the Board's collection pursuant to this agreement.
Executed in the
ATTEST:
MARIA D. HUIZAR
Clerk of the Council
ity of Santa Ana on August 18, 2015
(Ins.rt — ofl— Ijukd,aN -) (Add dare)
APPROVED AS TO FORM:
SONIA R. CARVALHO
City Attorney
By:
Lisa Storck
Assistant City Attorney
CITY OF SANTA ANA
Printed name SONIA R. CARVALHO
Title of person City Attorney
EXHIBIT 3
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Local Jurisdictions MUST Contract with 130E for
Collection of Local Charges on Prepaid Mobile
Telephony Services
Beginning January 1, 2016, a new law AB 717 requires local jurisdictions to contract with the
California State Board of Equalization (BOE) in order to receive revenue from local utility user
taxes (UUT), local 911 charges, and any other local charges imposed on consumers of prepaid
mobile services.
To ensure the uninterrupted collection of these local revenues, local jurisdictions must contract
with the BOE by September 1, 2015. If a local jurisdiction does not contract with the BOE, any
local charges imposed upon prepaid mobile telephony services (MTS) will not be collected by the
sellers and the local jurisdiction will not receive local charge revenue from prepaid MTS once the
new law is effective on January 1, 2016.
If the local jurisdiction does not contract with BOE by September 1, 2015, the next deadline is
December 1, 2015, for collection beginning April 1, 2016. In order to contract with the BOE, local
jurisdictions must have an ordinance that applies its local charge to prepaid MTS.
Current law imposes a variety of surcharges on phone services, including prepaid mobile phone
services. Currently, phone carriers are generally responsible for collecting and paying these
surcharges (for example, the 911 emergency surcharge and California Public Utilities
Commission surcharges) to the state. The new law replaces all current charges imposed upon
prepaid mobile phone services with a new prepaid MTS surcharge. The prepaid MTS surcharge
will be paid by purchasers of prepaid wireless services in California and be collected at the time
of purchase.
Under the new law, the MTS surcharge will be the only method for local jurisdictions to collect
taxes and surcharges imposed upon prepaid mobile telephone services sold in their jurisdiction.
For more information about contracting with BOE for the collection of UUT and /or local 911
charges, please contact the BOE's Local Revenue Allocation Unit at 1- 916- 324 -3000 or by email
at readiudaaboe ca.goy.
For general information about the new Prepaid MTS surcharge, please see our Prepaid Mobile
Telephony Services Surcharge guide, or visit our website at www.boe.ca.gov.
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