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HomeMy WebLinkAbout1982-11-16; City Council; 5779-11; Public Facilities FeesCl1 OF CARLSBAD - AGENDA, BILL AB#z779-Y/ TITLE: READOPTION OF PUBLIC FACILITIES FEE - DEPT.HD. - 11/16/8:! MTG. ADDITIONAL BUSINESS LICENSE TAX ON ClTY Ad%&- DEPT. CPl NEW CONSTRUCTION ClTY MGR.iii!!km RECOMMENDED ACTION: If the City Council concurs your action is to introduce Ordinance NO. 60 b7 . ITEM EXPLANATION The voters of Carlsbad approved the imposition of an additional license tax on all new construction in the City. Because of the attorneys' concerns that Article XIIIA of the Constitution (Proposition 13) required more than a majority vote the Council did not adopt the ordinance as approved by the people. Instead the City has been collecting a public facilities fee pursuant to City Council Policy No. 17 from most but not all the projects that would have been covered by the tax. A citizen's committee appointed by the Council to review the fee recommended that an ordinance be adopted applying the fee to all new construction. Again, because of legal concerns that recommendation was not implemented. Court decisions have now removed those concerns. We think it is now possible for the City Council to carry out the committee's recommendation and adopt the ordinance. Attached is a memorandum from the City Attorney dated October 13, 1982 discussing the matter in detail and recommending the adoption of an ordinance. This is a matter of some significance to the City and the City Council may wish to continue your action to introduce the recommended ordinance to allow an opportunity for community input. The Attorney recommends that the Council act to introduce and adopt the ordinance in December so it can be effective prior to the end of the year. EXHIBITS Memorandum from City Attorney dated October 13, 1982 Ordinance No. /OO&~$ - MEMORANDUM DATE: October 13, 1982 TO: Mayor and City Council FROM: City Attorney SUBJECT: RECOMMENDED CHANGES TO THE PUBLIC FACILITIES FEE The primary concern about the legality of the Public Facilities Fee has been that if challenged, it might be construed as a special tax under Article XIIIA of the Constitution (Proposition 13). As the Council knows, a special tax under Article XIIIA can only be imposed upon an affirmative vote of two-thirds of the citizens. The California Supreme Court, in the case of City of San Francisco v. FarrelL, 184 Cal. Rptr. 713 (1982), has given an extremely narrow construction to the two-thirds vote requirement. The Court in Farrell held that if the proceeds from the tax are placed in the general fund and are available for general municipal purposes, then the tax is not a special tax. The decision gives the City Council the opportunity to recast the Public Facilities Fee in a way that would remove our concerns about its legality. This memorandum is to recommend that the Public Facilities Fee be readopted as originally proposed. That is, as an ordinance imposing an additional business license tax on new construction to be applied, with certain limited exceptions, to all new construction in the City. The ordinance has been prepared and it is our recommendation that the Council adopt it prior to December 31, 1982. A'brief review of the history of the Public Facilities Fee may help the City Council understand this recommendation. In 1978-79 the City Council became convinced, as a result of Proposition 13 and the demise of bond financing, that another method had to be found to fund the capital improvements necessary to accommodate new development. On March 6, 1979, the City Council directed our office to prepare an ordinance imposing an additional business license tax on all new construction in the City. The ordinance would have added Chapter 5.09 "Additional License Tax on New Construction" to the Carlsbad Municipal Code. The tax would have been imposed, pursuant to the City Council's authority under Government Code Section 37101 to impose business license taxes under the general taxing authority of the City. The tax would have applied to all new construction within the City, at the rate of three percent of the building permit valuation. We returned with the documents on March 20, 1979 and the City Council approved the special election to submit It i? roposed ordinance and called a o a vote of the people. , r- 4 Mayor and City Council -2- At a special election held in June, 1979, a majority voted for the ordinance. However, the required two-thirds vote under Article XIIIA was not achieved and Council directed us to return with an alternative. During July and August of 1979, the City Manager, a staff committee and our office developed a program for the implementation of a public facilities fee. The City Council approved Council Policy #17 establishing the Public Facilities Fee on August 29, 1979. The fee was imposed pursuant to the Public Facilities element of the general plan as a condition of approval to any discretionary land use approval. On January 15, 1980, a citizen's committee, appointed by the City Council to review the Public Facilities Fee presented their report. The report was strongly supportive of the Council's efforts to insure that new development would pay its own way and that all necessary public facilities would be available concurrent with need. However, they recommended some changes to Policy 817. Most of the committee's recommendations were adopted including deletion of the requirement for a secured agreement. It was the committee's view that projects not requiring discretionary approvals, such as apartments, created just as much of a demand on municipal services as did projects such as condominiums that did require discretionary approvals. kri the committee's opinion it was unfair to make one pay and not the other. They recommended solving the problem by using an ordinance applying equally to all instead of the policy which only covered discretionary approvals. Ry memorandum dated January 9., 1980, our office expressed some legal concerns with that recommendation. While we recognized and appreciated the committee's position, our opinion at that time was that the only way an ordinance could be adopted applying the fee to all new construction was to again place the issue on the ballot. We thought that a business license tax applying to all construction would be considered to be a s'pecial tax. We advised that "it would be seen prudent that the City avoid the possibility of a Proposition 13 lawsuit; at least until the matter is more adequately determined by the Courts." That advice was reiterated in more detail to the Council in a memorandum dated January 10, 1980, a copy of which is attached (Exhibit A). City Council took our advice and did not adopt an ordinance. The California Supreme Court in Farrell has now "adequately determined the matter." This means that, provided some changes are made in the ordinance previously submitted to the voters, we think it is now possible for the City Council to carry out the committee's recommendation and adopt the ordinance. ‘, Mayor and City Council h -3- October 13, 1982 We join in that recommendation. While we think the Public Faciliites Fee, as it presently exists, is legal, there is no specific case law or statutory authority for it. On the other hand, there is both statutory and case law authority for an additional business license tax on new construction. Adoption of an ordinance as recommended below would eliminate any questions as to the legality of the fee and put the City's capital financing program on a firm legal basis (Government Code Section 37101, Associated Home Builders, Etc. v. City of Newark, 18 Cal. App. 3d 107.) Attached to this memorandum (Exhibit B) is the ordinance which received majority approval from the voters. The ordinance we recommend is substantially the same except as follows: 1. 2. 3. 55.09.030 was approved at three percent on buildings and $1,750 per space for mobile homes. That has been reduced to the fee currently being imposed by Policy #17 which is two percent of the building permit valuation of the building or structure or $1,150 for each mobile home space. S5.09.040 provided a credit against the fee for park-in- lieu fees. That section has been deleted in accordance with the recent City Council decision that there shall be no such credit. S5.09.070 requires that all proceeds from the tax be deposited in a special fund to be used for capital outlay. That section has been changed to specify that the proceeds would be general fund monies available to be budgeted by the City Council as part of the City's consideration of its annual Operating and Capital Improvements Budgets. The ordinance states the City Council's intention to appropriate the money for public facilities. As a technical legal matter, an ordinance provision limiting the use of a particular tax revenue shouldn't affect its qualifications as a general as opposed to a special tax under Farrell. However, an ordinance provision earmarking the proceeds of a tax for public facilities would, at a minimum, invite litigation which this recommendation is intended to avoid. Farrell says that the tax is not a special tax unless its revenues are earmarked for a special purpose. Therefore, to remove the possibility that the tax would be a special tax, it is necessary that the ordinance specify that the funds are general fund monies. Mayor and City Council -4- October 13, 1982 4. 55.09.120 establishing the effective date has been revised. The effective date will be immaterial to most of the projects in the City since they will have already agreed to pay a public facilities fee as part of their discretionary approval. However, those projects that received final discretionary approval prior to August, 1979 or which did not require any discretionary approval would not previously be obligated to pay the fee. The Council might have some concern with the effective date for such projects. It would be consistent with past City Council actions on this type of question to provide that any,projects which were in plan check as of the date of this memorandum and which were not otherwise obligated to pay the fee would be grandfathered. It is legally possible for the City Council to make the tax effective immediately or to adopt some other aiternative as the City Council considers appropriate. 5. A new section 5.09.040 has been added, providing that any project which is already obligated to pay a fee pursuant to the Public Facilities Fee policy, and which actually pays such fee, shall receive a credit against the tax imposed by the ordinance. We recommend that the City continue to administer the Public Facilities Fee pursuant to Council Policy Cl7 for three reasons. First, the law in this area is still subject to change. Concerns have been expressed that cities would use the Farrell decision to adopt new revenue sources thereby defeating the purposes of Proposition 13. Proposals are being circulated to reverse Farrell by so called "Son of Proposition 13" or some other legislative action. As long as that possibility exists, we should continue the present fee with the ordinance as a back up. The credit eliminates any duplication. Second, any taxes paid pursuant to the ordinance would be considered "proceeds of taxes" under Article XIIIB of the Constitution (Gann) and would be subject to the City's appropriation limit. It would be advantageous to the City's position to continue to collect the bulk of the money as fees as we do now under Council Policy #17 which in our opinion are not proceeds of taxes. Third, the fees generated by Council Policy #17 could continue to be placed in the Public Facilities Fund, which would minimize any concerns that might be raised that the money might be used for other municipal purposes. Only the comparatively small amounts paid pursuant to the ordinance would legally have to be general fund monies. Mayor and City Council -5- October 13, 1982 We have prepared the necessary ordinance incorporating the revisions discussed above and it is attached as Exhibit C. We recommend that the City Council introduce and adopt this ordinance so it can be effective prior to December 31, 1982. The Council is probably aware that there has-been some concern in other areas about cities "rushing" to adopt new revenue sources under the Farrell decision. We don't think those concerns should rationally apply to this recommendation for several reasons. First, this is not a new revenue source. In most cases those that would be required to pay under the ordinance are already obligated to pay under the Public Facilities Fee. Second, the proceeds are not for general municipal purposes. Most of the money will continue to be collected as public facilities fees which can only be used for new public facilities to serve new development. Those who have paid the fee will receive a benefit in return. Third, the voters have already approved the measure in an amount greater than that to be imposed by this ordinance. Fourth, although legally a portion of the money must be placed in the general fund, the City Council has clearly expressed its intentions to add that amount to the Public Facilities Fund when they consider the budget each year. However, the concern that cities might act "inappropriately" to take advantage of Farrell may result in some changes to the law which might happen as early as January 1983 so we think the Council should act before then. We think these recommendations are very important. We would appreciate the opportunity to discuss any questions you may have individually as it is our intention to present this to the Council with a recommendation that the ordinance be introduced at your meeting of November 16, 1982. - 4 VINCENT F. BIONDO, JR. rme attachments cc: City Manager Assistant City Manager/Developmental Services Director of Building and Planning Land Use Planning Manager City Engineer Finance Director -.. ‘1 II- !c, EXHIBIT A MEMO DATED 10/13/82 RE: PUBLIC FACILITIES FEE MEMORANDUM DATE: January 10, 1980 . * TO: Mayor and City Council . FROM: ' ; - City Attorney - . SUBJECT: PUBLIC FACILITIES FEE CITIZEN COMMITTEE REPORT -,. Our office commends the efforts of the Public Facilities Citizen Committee for the time and effort that they put into the preparation of their committee report- It is clear from reading the report that the Committee has done an excellent job in reviewing an extremely difficult problem; however, we must take issue with the recommendation that the fee should be applied to all new construction by Council ordinance, without placement o- q the-issue before the voters. Such action would be of questionable validity, Although the Committee is correct in their conclusion that the Council is within its authority to set a fee for all new construction under the City's general taxing power,and pursuant to Government Code Section 37101, constitutional restraints limit the use of the City's power, Section 4 of Article XIIIA, commonly known as Propostion 13, apparently requires that before a city may impose special taxesp a two-thirds vote of the people is required. While the question of what a special tax really is, is still unsettled in the state, the apparent trend of authority as revealed by judicial decisions, legislative action and Attorney General's opinions, indicates that the fee on all new construction in the city would be considered as a special tax requiring a vote. While we recognize that placement of a public facilities fee only on discretionary approvals creates certain inequitable situations, the legal basis for imposition of that fee is sound. ,Because the City has an existing fee structure, resting on what we believe is a sound basis, we recommend against changing that structure and placing a.fee on all new construction without complying with the constitutional provisions. This position is consistent with the position w2 took back in March, 1979 when we initially recmmen-c?E-< the pla,,,,,, -=-ant of the issue on the ballot. While we rccogniza the CitL zen Committee's concern, our opinion is that the most pruse nt c=;urse of action if the Council desires to impose the fee on a11 new construction, would be to again place the matter befr,re the voters. _..s'. e_.----.e. in ‘; L I ~ . .,’ I?.!.;1 Cit:y Zrttornc:/ ., ,,- _. . : ,,: ._ _.... -... -.y.._ ~. . . -XHIBIT B Ii; . -4EMO DATED 10/13/82 RB: PUBLIC FACILITIES FEE .!’ ; .3 2 3 4 5 6 7 8 .9 10 11 '12 13 22 . 23 24 . 25 26 27 28 . OLIDINANCE NO.' 6059 . . . AN ORDINANCE OF THE CITY COUNCIL OF.THE CITY OF CARLSBAD, CALIFORNIA AMENDING : TITLE 5 OF THE CARLSBAD MUNICIPAL CODE . . BY THE ADDITION OF CHAPTER 5.09 TO PROVIDE - FOR THE PAYMENT OF TAXES ON NEW CONSTRUCTION AND FOR THE USE OF SUCH TAXES FOR PUBLIC FACILITIES. THE PEOPLX OF THE'CITY OF CARLSBAD DO ORDAIN AS FOLLOWS: SECTION 1: That Title 5 of the Carlsbad &Junicipal Code is . unended by the addition of Chapter 5;09 to read as follows: . d:'"Chapter 5.09 : . :. ADDITIONAL LICENSE'TAX ON NEW CONSTRUCTION . Zections: . : 5.09.010 Purpose and intent. ' 5.09,020 Definitions. 5.09.030 Imposition of tax--amount, 5.09.040 Credit. 5.09-050 Time and place of 'payment. - _ . 5.09.060 Refunds. ' . 5.09.070 Disposition of proceeds; fund created. 5.89.080 Exceptions. 5.09.09.0 Exemptions. . . . 5.09.100 Construction prohibited, .5,09.110 Tax liability; enforcement. 5.09.120 Effective date. . . . . 5.09.010 Purpose and intent, 'The City Council hereby declares tha-l= the license taxes required to be paid hereby sre assessed pursuant to Section 37101 of the Government Code If the State of.California and.the taxing power of the City and ;olely for the purpose of producing revetiue. This chapter-isnot Idopted for regulatory purposes; The continued development of :he City, with tine consequent increase in population and in the lse of public facilities, has imposed increased requirements for such facilities, including but no t limited to parks, major streets, traffic signals, storm drains, bridges and public buildings (such 1s fire stations, police facilities, maintenance facilities, Libraries and general offices). The necessity for such facilities cesul ts directly from new construction and the need cannot be net from ordinary City revenues. The most practical and equitable nethod of paying for such facilities is to impose a tax upon new :Onstruction in the City. . . .' . 5.03.020 Definitions. For the purposes of this chapter the following words <lnd phrases shall have the meanings respective-* LY ascribccl to them by this section. l . . . .,:;.. -. -- I._ --......~._~ --.-\ , , : ,.. *I I* 1 2 8 4 5 6 7 a 9 10 11 12 15 16 17 1e 19 20 21 22 23 24 25 26 27 26 . . _. @ -- . . . . TV . 0.) "Mobilehome space" means each space, area or building, in a'trailer park or mobilehome park or other place, - designed or intended as a place to accommodate any.mobilehome, trailer, van, bus, or other vehicle or mobile structure, at a,time when the same is being used as living or sleeping quarters for human beings. (2) "Person" includes every individual, firm; partner-- ship, joint venture, association, trust, corporation or any Dther group,engaging in construction activities itself or through the services of any employee, agent or independent contractor. . . 5.09.030 Imposition of tax--amount, (a) In'addition to any other fee, license or tax required by this Code, every person constructing or causing to be constructed or erected any building or structure in the City of Carlsbad for which a building permit is required, shall pay a license tax in the amount of 3% percent of the valuation of the building or structure'established pursuant to this Code for determining the building permit fee. (b) The developer of a mobilehome park shall pay a license tax fee of $1,750.00 for each mobilehome space. The license tax for mobilehome spaces shall be automatically increased or decreased on January 1 of each year by the same percentage as the percentage of increase or decrease in construction costs between December 1 of each of the two i.mediately preceding years, for which purpose construction.czosts and the increase or . decrease therein shall be based on the Engineering News-Record' ' Construction Cost Index. (c) For the alteration of.Residential structures; or mobilehome parks the license tax shall be computed only on the square footage of additional dwelling units or mobilehome spaces, if any, resulting from the alteration, and for the alteration of other buildings or structures, the license tax shall be'computed only upon the additional square footage, if any, resulting from the alteration. . . 5.09..040 Credit. A credit toward the license tax imposed by this chapter shall be given for land which has been dedicated for parlc purposes or for any fees paid in lieu thereof pursuant to Chapter 20.44 of this Code. The credit shall be applied to the fee for a building permit for construction on a lot which was part of a subdivision which was subjected to satisfy the requirements of Chapter 20.44. If land was dedicated, the fees which would have been required in lieu of such land at the time it was dedicated shall be determined. Such amount or the actual amount of fees paid shall ten be apportioned to each of the lots in the subdivision. The part of such amount attributed to the lot in question shall be a credit against the fee imposed by this chapter. . 5.09.050 Time and place of payment.' The license taxes imposed purcuant to Section 5.09.030 shall be due and payable. at the Office of the Building Director, City Siall, Carlsbad, . I// . . I// * . 2. . . *- .: _ - _. ._-. .-..I .- ._.- _._” __,__ ..~ .-_ t.;:.;, .\ -‘: . :.. :._ . . “‘., _ . ;.- ., ..J , ‘. ;.* I__ a.: .- .- ./’ ! *3. 2 3 - 4 5 :‘.+ : . ; 6 .I 16 1'7 X8 19 20 21 22 23 24 25 26 ir 28 California,' upon issuance of the building permit. The tax for-a mobilehome space shall be paid prior to the issuance of the first permit for the construction of such space or if such construction is performed without a permit, at the time when construction is commenced. No permit shall issue until the tax is paid. . 5.09.060 Refunds. If a permit for construction work expires or if such permit is revoked and if during the one hundred-twenty days follow&g the expiration or revocation date of the permit the permittee files written application for a refund in the office of the City Clerk, there shall be a refund of the entire tax paid. There shall be no refund if any construction work has been perform-, ed nor shall there be any partial refund. In the event of a refund, it shall be unlawful for any person to proceed in any way with further construction without first applying for another building permit and paying the tax imposed by this chapter. If no refund is made and a permit expires after work has been performed, a new building permit shall be required and the tax imposed by this chapter shall be paid provided, however, a credit shall be given not to exceed the tax paid in connection with. the expired permit. . . ,, 5.09.070 Disposition of proceeds; fund created. (a) All proceeds from the tax collected pursuant to this chapter shall be paid into a special capital outlay fund of the City entitled "Public Facilities Fund" which fund is hereby created. The fund shall be used only for the purpose of acquiring, building, improving, expanding and equipping public property, and public . improvements and facilities including but not limited to the following types of capital projects: Public buildings (such as fire stations, police facilities, maintenance and yard facilities, libraries and general city offices) parks, major streets, traffic signals, storm drains, bridges and other similar projects as the Council nay deem necessary and appropriate. (b) Designation of expenditures of funds available from the Public Facilities Fund shall be made by the City Council. in . the context of approval of the City's annual operating and capital improvements budget or at such other time as the Council. may' direct. At the discretion.of the City Council, funds may be accumulated in unlimited amounts for expected future capital improvement costs. ,. (c) The Citv Council may loan general funds or other funds to the Public Facilities Fund and use the proceeds from the tax imposed by this chapter to repay such loans. 5.09.080 Exceptions, imposed by this There is excepted from the tax chapteri the following: (1) The construction of a building or structure or mobilehome space which is a replacement for a building or space being removed from the same lot or parcel of land. The exception shall equal but not exceed the tax which would be payable here- under if the building being replaced were being newly constructeda If the tax imposed on the new building' cxcceds the amount of this exception, such excess shall be paid. . . 3. . . . 2 3 4 5 6 . . ,..i’. :!:,y. 7 .1,.,,’ . .: _ . .- I :-. :. .* 8 .,.p’.. 7‘. t ‘.$ ;, .;‘; -9 $y:*, -3 . ,‘-: 10 .r .,s. -;;. : *. ‘4 . , ,/ i 11 .‘I’.. *>: *. _ -. 0 3.2 .$ ::y B E 13 6% a# -* 4 su w- yci~’ 14 qgp .z- -x2 *s--’ 2 -9 ., Q L.>“” Z~Sci uJZ~< 2g-3 Zb’ y >k=- -a 2 ‘& CJ 15 16 17 18 19 20 2x 22 23 211, 25 26 2'7 28 $$J .. , . . . . . . . .(2) Accessory buildings or structures in mobilehome parks, such as a club house, swimming pool, or laundry facilities. (3) Buildings or structures which-are clearly accessory to an existing use such as fences, pools, patios and automobile garages. (4) The City Council may grant .ari exception for a low cost housing project where the City Council finds such project consistetit with the Housing Element of the General Plan and that such exception is necessary. In approving an exception for low cost housing the City Council may attach conditions, including limitations on rent or income levels of tenants. If the City Council finds a project is not being operated as a low cost housing project in accordance. with all applicable.conditionst the tax, which would otherwise be imposed by this chapter, shall immediately become due and payable. : 5.09.090 Exemptions. There is excluded from the tax imposed by this chapter: 1. Any person when imposition of such tax upon that person would be in violation of the Constitution and laws of the United States or the State of California, 2. The construction of any building by a nonprofit corporation exclusively for religious,.educational, hospital or charitable purposes. - . - 3. The construction of any building by the City of Carlsbad, the United States or any department or agency thereof or by the,State of California or an:[ department, agency or political subdivision thereof. *: . . . . . 5.09.100 Construction prohibited. It shall be unlawful for any person to erect, construct, enlarge, alter, rep.air, move, improve, make , put together or convert any building or structure in the City, or attempt to do so, or cause the same to be. done, without first paying the tax imposed by this chapter. : 5.09.110 Tax liability; enforcement. The taxes imposed by this chapter are due from the person by or on behalf of whom a residential, industrial or commercial building or mobilehome sp<ce is constructed, whether such person is the owner or a lessee of the land upon which the construction is to occur. The Building Director shall collect the tax due hereunder. The full amount due under this chap'ter shall constitute a debt to the City of Carlsbnd. An action for the collection thereof may be commenced in the name of the City in any court having jurisdiction of the cause.. . . The City Manager shall be responsible for the administration and enforcement of this chapter. Itis decisions may be . appealed to the City Council whose decision shall be final. I// //I 4. . r) i., if!; :‘:** . Q !.I,, : yc;l;, .; , ‘, i:;L,;.,, $2 . . .t:“i, zw- : ‘,, 3. :;:. 3 j::.: ,G&g. - 18 39 * 20 21 22 23 2i 25 26 27 .2E! 1’ 2 3 4 5 . . . . , ,.. . - 6 . i:. ; _ --. _.,- +;.: ’ z:,: :,,. 7 5;“;. :q , 1: : “?1,,. , g.:‘. : 8 r&&<., _-- g.;:‘.’ 4.., d’c- ,. ‘$jj ,J‘,’ 9 3 :’ : ;y. i. .gL ; ‘_ 10 .:,,>::-, ~$4,,;.’ I - . ;‘-:;; ‘2. ‘/. ,f ‘I, - 11 .,..1‘. * c’r: : G.’ 1,” . I;;-::. ;. f$‘Y 32 Cq 1) . ’ . . . ai> ‘. I ‘k * c .- . -a. . * . 5.0.9.120 Effective date. The.taxes imposed by this ' ' Chapter shall be applicable with respect to building permits .for-construction activities, issued on or after April 1, 1979. Any person constructing one or more dwelling units, or other- wise engaging in construction taxable hereunder, pursuant to a building permit applied for on or after said date, or applied for before said date but not actually issued until on or after said date, shall be liable for payment of said tax irrespective of whether said tax was collected at the time -of . building permit application or issuance. No occupancy permit shall be issued with respect to any completed structure or construction taxable hereunder! unless and until the proper tax due has been paid. . . SECTION 2 : Severability. If any section,.subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional by the decision . of a court of competent jurisdiction, such decision shall 'not affect the validity of the remaining portions of the 1 ordinance. The City Council of the City of Carlsbad hereby declares that it would have passed this ordinance, and each section, .subsection, clause or phrase thereof, irrespective . of the fact that any one or more other sections, subsections, clauses or phrases may be declared invalid or unconstitutional. . - SECTION 3: The City Council mdy amend this ordinance from time to time to add exception& or adjust the rate or application of tax or make such other changes as they determine to be necessary provided, the rate of the tax to be imposed by this ordinance shall not be increased and the purposes for which the funds can be expended shall not be changed. . SECTION 4: This ordinance, being an ordinance relatirig to taxes for usual and current expenses of the City, pursuant to Section 36937(d) of the Government Code shall take effect : immediately upon its passage. Bekore the expiration of * fifteen days after its passage, this ordinance shall be *, .* ;; (:$*y; - . . . ,-’ , . I 4. .a 2 3 * 4 . . . .-. , :; I/ j;'y :*;,q; * : ., & ._ :. -.-by :- f-. . . . :... .%, ::' 1,. i _ I., - . . ,.i 9 - 3 8 22 ii -5u a - g$z 5 iti= -b-$2 mii.,s d . Aa f-s wo 2 "1 8 d W’EQ $3 5 3L 2 1%; ;5 . : ,~. ,;.; I.1' . .A' :: : -x ,:: '>,*,.?. . ~ ." .r. : ..-.- .&,.‘ ;' c : . . . . . :., :;;'. .;'7 , I_, _,,: - y.:, ",.. ,, * y: _ .;.$. :',,I: : ,'+C, '2 ,j' : 1 r -._ *i 1 . -'.l.,. : ' .A- .:.T.Iy,' > j' -T$ ,: : . . *'> k'- .T' . .: 'I :,&:L; I.- ',.~%:. -:.; i. : ,.-WI *;Tlti * 'hf "";'; ,, l> . ? ./' .?,I /. ..1 I '<* 7 ;I: 3 ,v i a:: . -?, .'.;' - 1' ..' ‘5 . 6 7 8 9 JO 31 12 13 14 15 16 17 18 19 20 21 22 23 24 . 25 26 ‘27 28 , , . B ” . .,; . . . . published .once in the Carlsbad Journal, a newspaper of . . general circulation printed and published in-the City of Carlsbad. . . *. PASSED, APPROVED AND ADOPTED at a meeting of the City Council of the City of Carlsbad held on, the day of 1979 by the following vote, to wit: . . . AYES; . . . .., NOES: ._ . . : .,._ .- : ABSENT: .' . :: . . . : . .: '- .r ., I,.' " . .:, .,... i,, ; ;i .' . . . . . . . In . . . I RONALD Ci PACKARD, Mayor : . .ATTEST: . -. ALETI-IA L. RAUTENKIGNZ, City Clerk . * . . . (SEAL) . . .-- APPROVED AS TO FORM: ' " '- - :" . . . . . VINCENT F. BIONDO, JR., City Attorney. ,. . . ‘. . . , . .’ . . : . . 6. . . . . 1 2 6 ? ,E 9 1C 11 22 23 24 25 26 27 . 28 I i : i i I I 1 b 1 , ; I I I I / I , ORDINANCE NO. 6067 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA AMENDING TITLE 5 OF THE CARLSBAD MUNICIPAL CODE BY THE ADDITION OF CHAPTER 5.09 TO PROVIDE FOR THE PAYMENT OF AN ADDITIONAL LICENSE TAX ON NEW CONSTRUCTION. The City Council of the City of Carlsbad does ordain as follows: SECTION 1: That Title 5 of the Carlsbad Municipal Code is amended by the addition of Chapter 5.09 to read as follows: "Chapter 5.09 ADDITIONAL LICENSE TAX ON NEW CONSTRUCTION Sections: 5.09.010 5.09.020 5.09.030 5.09.040 5.09.050 5.09.060 5.09.070 5.09.080 5.09.090 5.09.100 5.09.110 5.09.120 Purpose and intent. Definitions. Imposition of tax - amount. Credit. Time and place of payment. Refunds. Disposition of proceeds; fund created. Exceptions. Exemptions. Construction prohibited. Tax liability; enforcement. Effective date. 5.09.010 Purpose and Intent. The City Council hereby declares that the license taxes required to be paid hereby are assessed pursuant to Section .37101 of the Government Code of the State of California and the taxing power of the City and solely for the purpose of producing revenue'. This chapter is not adopted for regulatory purposes.. The continued development of the City, with the consequent increase in population and in the use of public facilities, has imposed increased requirements for such facilities, including but not limited to parks, major streets, traffic signals, storm drains, bridges and public buildings (such as fire stations, police facilities, maintenance facilities, libraries and general offices). The necessity for such facilities results-from new construction. The need for such facilities cannot be met from existing City revenues. The most practical and equitable method of raising City revenue is to impose a tax upon new construction in the City. 5.09.020 Definitions. For the purposes of this chapter the following words and phrases shall have the meanings respectively ascribed to them by this section. . . 1 2 3 4 5 6 7 8 9 10 11 12 2 ;" 18 6 19 20 21 22 ., 23 24 25 26 27 28 4 (1) "Mobilehome space" means each space,' area or building, in a trailer park or mobilehome park or other place, designed or intended as a place to accommodate any mobilehome, trailer, van, bus or other vehicle or mobile structure, at a time when the same is being used as living or sleeping quarters for human beings. (2) "Personn includes every individual, firm,. partnership, joint venture, association, trust, corporation or any other group engaging in construction activities itself or through the services of any employee, agent or independent contractor. 5.09.030 Imposition of tax - amount. (a) In addition to any other fee, license or tax required by this Code, every'person constructing or causing to be constructed or erected any building or structure in the City of Carlsbad for which a building permit is required, shall pay a license tax in the amount of two percent (2%) of the valuation of the building or structure established pursuant to this Code for determining the building permit fee. (b) The developer of a mobilehome park shall pay a license tax fee of $l,lSO.OO. for each mobilehome space. The license tax for mobilehome spaces shall be automatically increased-or decreased on January 1 of each year by the same percentage as the percentage of increase or decrease in construction costs between December 1 of each of the two immediately preceding years, for which purpose construction costs and the increase or decrease therein shall be based on the Engineering News - Record Construction Cost Index. (c) For the alteration of residential structures, or mobilehome parks the license tax shall be computed only on the square footage of additional dwelling units or mobilehome spaces, if any? resulting from the alteration, and for the alteration of other buildings or structures, the license tax shall be computed only upon the additional square footage, if any, resulting from the alteration. 5.09.040 Credit. A credit toward the license tax imposed by this chapter shall be given if a public facilities fee has been paid pursuant to Council Policy No. 17 in satisfaction of an obligation under a public facilities fee agreement for the building or structure. The amount of the credit shall be the amount of the fee paid. 5.09.050 Time and place of payment. The license taxes imposed pursuant to Section 5.09.030 shall be due and payable at the Office of the Director of Building and Planning, City Hall, Carlsbad, California, upon issuance of the building permit. The tax for a mobilehome space shall be paid prior to the issuance of the first permit for the construction of such space or if such construction is performed without a permit, at the time when construction is commenced. No permit shall be issued until the tax is paid. , t /// . 2. . . 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 2s 27 . 28 .- - 5.09.060 Refunds. If a permit for construction work expires or if such permit is revoked and if within thirty days following the expiration or revocation date of the permit the permittee files written application for a refund in the office of the City Clerk, there shall be a refund of the entire tax paid. There shall be no refund if any construction work has been performed nor shall there be any partial refund. In the event of a refund, it shall be unlawful for any person to proceed in any way with further construction without first applying for another bui!ding permit and paying the tax imposed by this chapter. If no refund is made and a permit expires after work has been performed, a new building permit shall be required and the tax imposed by this chapter shall be paid provided, however, a credit shall be given not to exceed the tax paid in connection with the 'expired permit. 5.09.070 Disposition of proceeds. Funds from this tax shall be placed in the General Fund and shall be available for general governmental purposes. Decisions on the expenditure of such funds shall be made by the City Council in the context of approval of the City's annual operating and capital improvements budget or at such other time as the Council may direct. 5.09.080 Exceptions. There is excepted from the tax imposed by this chapter, the following: (1) The construction of a building or structure or mobilehome space which is a replacement for a building or space being removed from the same lot or parcel of land. The exception shall equal but not exceed the tax which would .be payable hereunder if the building being replaced were being newly constructed. If the tax imposed on the new building exceeds the amount of'this exception, such excess shall be paid. (2) Accessory buildings or structures in mobilehome parks, such as a club house, swimming pool, or laundry facilities. (3) Buildings or structures which are clearly accessory to an existing use such as fences, pools, patios and automobile garages. (4) Additions to existing single-family or two-family residential structures provided the addition does not create a new dwelling unit or economy dwelling unit as defined by the uniform building code. (5) The .City Council may grant an exception for a low cost housing project where the City Council finds such project consistent with the Housing Element of the General Plan and that such exception is necessary. In approving an exception for low cost housing the City Council may attach conditions, /I/ /// //I 1 * //I l 3. L 1 2 3 a 9 10 11 .o 12 19 20 21 22 23 24 25 26 27 28 including limitations on rent or income levels of tenants. If the City Council finds a project is not being operated as a low cost housing project in accordance with all applicable conditions, the tax, which would otherwise be imposed by this chapter, shall immediately become due and payable. 5.09.090 Exemptions. There is excluded from the tax imposed by this chapter: (a) Any person when imposition of such tax upon that person would be in violation of the Constitution and laws of the United States or the State of California. (b) The construction of any building by a nonprofit corporation exclusively-for religious, educational, hospital or charitable purposes. (c) The construction of any building by the City of Carlsbad, the United States or any department or agency thereof or by the State of California or any department, agency or political subdivision thereof. 5.09.100 Construction prohibited. It shall be unlawful for any person to erect, construct, enlarge, alter, repair, move, improve, make , put together or convert any building or structure in the City, or attempt to do so, or cause the same to be done, without first paying the tax imposed by this chapter. 5.09.110 Tax liability; enforcement. The taxes imposed by this chapter are due from the person by or on behalf of whom a residential, industrial or commercial building or mobilehome space is constructed, whether such person is the owner or a lessee of the land upon which the construction is to occur. The Director of Building and Planning shall collect the tax due hereunder. The full amount due under this chapter shall constitute a debt to the City of Carlsbad. An action for the collection thereof may be commenced in the name of the City in any court having jurisdiction of the cause. -The City Manager shall be responsible for the administration and enforcement of this chapter. His decisions may be appealed to the City Council whose decision shall be final. 5.09.120 Effective date. The taxes imposed by this Chapter shall be applicable with respect to building permits for construction activities, issued on or after December 21, 1982 provided any person constructi'ng one or more dwelling units, or otherwise engaging in construction taxable hereunder, pursuant to a building permit applied for before Nlzirch 21 1983 but not actually issued uritil on or after said date, shAl1 not be liable for payment of,said tax provided such person has obtained all other discretionary approvals required for the project, has had the application accepted as complete, paid the plan check fee, and who thereafter, in a timely manner, obtains the permit applied for and diligently pursues the project to completion. /// , 4. . -. b- -' . 0 18 19 20 21 22 23 24 25 26 27 28 - SECTION 2: If any section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional by the decision of a court of competetent jurisdiction, such decision shall not effect the validity of-the remaining portions of the ordinance. The City Council of the City of Carlsbad hereby declares that it would have passed this ordinance, and each section,Vsubsection, clause or phrase thereof,irrespective of the 'fact that any one or more other sections, subsections, clauses or phrases may be declared invalid or unconstitutional. SECTION 3: This ordinance, being an ordinance relating to taxes for usual and current expenses of the City, pursuant to Section 36937(d) of the Government Code shall take effect immediately upon its passage. Before the expiration of fifteen days after its passage, this ordinance shall be published once in the Carlsbad Journal, a newspaper of general circulation printed and published in the City of Carlsbad. INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City Council held on the 3 , day of mr 1982, and thereafter /// /// /// ' //I //I /// /// 1 t /// 5. . . 1s 2( 21 2: 2: 24 25 26 . 27 28 PASSED AND ADOPTED at a regular-meeting of said City Council held on the 21st day of bzerker , 1982 by the following vote, to wit: AYES: 0xrxil~Wtkxxs Casl.er,Lewis,Kulchin,Chick andprescot NOES: Nme ABSENT: Ncme . ATTEST: %J!@& MARY H.&ASLER, Mayor KAREN R. (Seal) . 6. .