HomeMy WebLinkAboutORD 5925 CITY OF RENTON, WASHINGTON
ORDINANCE NO. 5925
AN ORDINANCE OF THE CITY OF RENTON, WASHINGTON IMPOSING THE LOCAL
OPTION SALES AND USE TAX TO BE CREDITED AGAINST THE STATE SALES AND
USE TAX FOR LOCAL REVITALIZATION FINANCING PURSUANT TO RCW 82.14.510.
WHEREAS, pursuant to RCW Chapter 39.104, the City is authorized to undertake a "local
revitalization financing" within the meaning of RCW Chapter 39.104 by using revenues received
from a "local option sales and use tax" imposed pursuant to RCW 82.14.510 to pay the principal
of and interest on bonds issued to finance "public improvements" within the meaning of RCW
Chapter 39.104 within a local revitalization area; and
WHEREAS, pursuant to Ordinance No. 5481, passed by the City Council (the "Council") of
the City of Renton, Washington (the "City"), on August 17, 2009, the City designated certain
property, located within the City and identified as a "local revitalization area"within the meaning
of RCW Chapter 39.104, as the South Lake Washington Revitalization Area (the "Revitalization
Area") and specified certain proposed public improvements meeting the requirements of RCW
39.104.020 to be made therein (the "Improvements"); and
WHEREAS, on November 29, 2010,the State Department of Revenue (the "Department")
awarded the City the maximum Local Revitalization Financing project award of $500,000 per
year; and
WHEREAS, under Ordinance No. 5481, the City estimated the cost of these LRF
improvements at $52,500,000 with approximately twenty-five percent (25%) of the public
improvements to be financed by the LRF program; and
1
ORDINANCE NO. 5925
WHEREAS, the City intends to incur indebtedness to finance the LRF Improvements, in a
maximum principal amount of$8.5 million; and
WHEREAS, on or before July 1, 2019, the City intends to issue Limited Tax General
Obligation Bonds, 2019 (the "Bonds")for purposes of providing up to$8.5 million of financing for
the LRF improvements; and
WHEREAS, pursuant to Ordinance No. 5921 the Council authorized the Bonds and
pledged all Local Option Sales and Use Tax Revenues levied to the portion of the debt service on
the portion of the Bonds allocable to the LRF Improvements; and
WHEREAS, the local option sales and use tax is to be imposed by the City on all covered
taxable sales of goods and services within its jurisdiction, and the amount of revenues generated
by the local option sales and use tax up to aggregate amount of$500,000 with respect to each
one year period commencing on July 1 and ending the following June 30 are to be credited against
the sales and use taxes by the State of Washington (the "State") pursuant to RCW 82.08.020(1)
and 82.12.020; and
WHEREAS, the State sales and use tax increment and State property tax increment (as
described in RCW Chapter 39.104)for the preceding calendar year equal to or exceed the amount
of the project award ($500,000) approved by the Department under RCW 39.104.100, satisfying
a precondition to imposition of the local option sales and use tax; and
WHEREAS, under Ordinance 5481,the City estimated a local option sales and use tax rate
of 0.03%to implement the Local Revitalization Financing, subject to approval by the Department;
and
2
ORDINANCE NO. 5925
WHEREAS, the sales and use tax rate needed to collect the maximum allowable
incremental funding of $500,000 per year is 0.03%, and pursuant to RCW 39.104.100 the
Department has approved a local option sales and use tax of up to 0.03%;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RENTON, WASHINGTON, DO
ORDAIN AS FOLLOWS:
SECTION I. As authorized by and in accordance with RCW 82.14.510,there is imposed
a local option sales and use tax for the full duration authorized by law, such tax to be credited
against the amount of the tax otherwise required to be collected and paid over to the
Department under RCW 82.08.020(1), retail sales tax, or RCW 82.12.020, use tax. Except as
provided in RCW 82.14.510(1), this is in addition to other taxes authorized by law and shall be
collected from those persons who are taxable by the State under RCW Chapter 82.08, retail sales
tax, and RCW Chapter 82.12, use tax, upon the occurrence of any taxable event within the City
limits. The rate of tax imposed hereby shall be 0.03 percent of the selling price, in the case of a
sales tax, and 0.03 percent of the value of the article used, in the case of a use tax.
SECTION II. The City Council hereby finds and determines that the tax rate imposed
hereby does not exceed the lesser of:
(a) the rate provided in RCW 82.08.020(1), less:
(1) the aggregate rates of all other local sales and use taxes imposed by any
taxing authority on the same taxable events;
(2) the aggregate rates of all taxes under RCW 82.14.465 and 82.14.475 and
82.14.510 that are authorized but have not yet been imposed on the same taxable events
by a city or county that has been approved to receive a State contribution by the
3
ORDINANCE NO. 5925
Department or the State Community Economic Revitalization Board under RCW Chapters
39.104, 39.100, or 39.102; and
(3) the percentage amount of distributions required under RCW
82.08.020(5) multiplied by the rate of state taxes imposed under RCW 82.08.020(1); and
(b) the rate, as determined by the City in consultation with the Department,
reasonably necessary to receive the project award under RCW 39.104.100 over ten months.
SECTION III.
(a) The tax will first be imposed on the first day of the State's fiscal year beginning
July 1, 2019.
(b) The cumulative amount of tax received by the City in any fiscal year may not
exceed $500,000,which is the amount approved by the Department pursuant to RCW 82.14.510.
(c) The Department must cease distributing the tax for the remainder of any fiscal
year in which either:
(1) The amount of tax received by the City equals the amount of distributions
approved by the Department for the fiscal year pursuant to RCW 82.14.510; or
(2) The amount of revenue distributed to all sponsoring and cosponsoring
local governments from taxes imposed under RCW 82.14.510 equals the annual state
contribution limit;
(d) The tax will be distributed again, should it cease to be distributed for any of the
reasons provided in (c) above, at the beginning of the next fiscal year, subject to the restrictions
in RCW 82.14.510.
4
ORDINANCE NO. 5925
(e) The State is entitled to any revenue generated by the tax in excess of the
amounts specified in (c) above.
SECTION IV. The amounts generated by the local option sales and use tax up to an
aggregate amount of$500,000 with respect to each one year period commencing on July 1 and
ending on the following June 30 are to be applied solely to finance the LRF improvements. Any
additional amounts are to be retained by the Department.
SECTION V. The administration and collection of the tax imposed by this Ordinance
shall be in accordance with the provisions of RCW 82.14.050, as the same now exists or may
hereafter be amended.
SECTION VI. The Mayor or his designee is authorized to enter into an agreement with
the Department for the administration of the local option sales and use tax.
SECTION VII. The Mayor, the Chief Administrative Officer, the Administrative Services
Administrator, the City Clerk, the City Attorney and other appropriate officers and employees of
the City shall be and each of them is hereby authorized, empowered and directed to execute and
deliver such other documents and agreements in addition to those enumerated herein, and to
take such other actions as they deem necessary or advisable in order to carry out, give effect to
and comply with the terms and intent of this Ordinance and any other documents executed and
delivered pursuant to the authority granted in this Resolution. All actions taken by the Mayor,
the Chief Administrative Officer, the Administrative Services Administrator, the City Clerk, the
City Attorney and other appropriate officers, agents and employees of the City pursuant to or
anticipation of the adoption of this Ordinance but prior to its effective date are hereby ratified,
confirmed and approved.
5
ORDINANCE NO. 5925
SECTION VIII. This Ordinance shall be in full force and effect thirty (30) days after
publication of a summary of this Ordinance in the City's official newspaper. The summary shall
consist of this Ordinance's title.
PASSED BY THE CITY COUNCIL this 22"d day of April, 2019.
r
Jason . Set , Cit Clerk
APPROVED BY THE MAYOR this 22"d day of April, 2019.
W;i111/7
Denis Law, Mayor
Approved as to form:
I a F R EN�,,"A
Paci ca Law GroupLLP -
Bond Counsel o 'or ' SEAL
. '% R
Date of Publication: 4/26/2019 (summary) '',,,, 'I'i—RAT"D\SEQ�e•\\\�\
iiiiitlikt
6