HomeMy WebLinkAbout11A - ORDINANCE - BUSINESS LICENSE TAX PENALTY ABATEMENTREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
FEBRUARY 4, 2013
TITLE:
ORDINANCE
BUSINESS
ABATEMENT
SECOND
LICENSE TAX
CLERK OF COUNCIL USE ONLY:
APPROVED
? As Recommended
READING: ? As Amended
El Ordinance on 1" Reading
PENALTY
? Ordinance on 2"d Reading
? Implementing Resolution
? Set Public Hearing For
CITY MANAGER
RECOMMENDED ACTION
Place ordinance on second reading and adopt.
DISCUSSION
CONTINUED TO
FILE NUMBER
On January 22, 2013, the City Council introduced first reading and authorized publication of title
for the following Ordinance by a vote of 7-0:
ORDINANCE NO. NS-2841 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA ESTABLISHING A BUSINESS LICENSE TAX PENALTY ABATEMENT
PROCEDURE AND AMENDING SECTIONS 21-3, 21-12, 21-16, 21-25, 21-41, 21-43, 21-44, 21-
60, 21-64, 21-83, 21-85, 21-100, 21-115, 21-122, 21-123, 21-124, 21-125 AND ADDING
SECTIONS 21-80.1 AND 21-83.1 RELATING TO ADMINISTRATIVE PROVISIONS OF
CHAPTER 21, THE BUSINESS LICENSE TAX CODE, AND ADDING SECTION 21-93.1
RELATING TO ENFORCEMENT AND COLLECTION AND SECTION 21-118.1 RELATING TO
DEPOSIT ADJUSTMENT AND SECTIONS 21-119.1, RELATING TO LIMITED LIABILITY OF
HOLDING COMPANIES AND PASS-THROUGH ENTITIES AND SECTIONS 21-119.2 AND 21-
119.3 AND 21-120h ESTABLISHING AN ALTERNATIVE ELECTIVE FLAT RATE BUSINESS
LICENSE TAX ASSESSMENT FOR HOME-BASED BUSINESSES
FISCAL IMPACT
There is no fiscal impact associated with this action.
Maria D. Huizar,
Clerk of the Council
ATTACHMENT: Ordinance No. NS-2841
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ORDINANCE NO. NS-
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA
ANA ESTABLISHING A BUSINESS LICENSE TAX PENALTY
ABATEMENT PROCEDURE AND AMENDING SECTIONS 21-3, 21-12,
21-16, 21-25, 21-41, 21-43, 21-44, 21-60, 21-64, 21-83, 21-85, 21-100,
21-115, 21-122, 21-123, 21-124, 21-125 AND ADDING SECTIONS 21-
80.1 AND 21-83.1 RELATING TO ADMINISTRATIVE PROVISIONS OF
CHAPTER 21, THE BUSINESS LICENSE TAX CODE, AND ADDING
SECTION 21-93.1 RELATING TO ENFORCEMENT AND COLLECTION
AND SECTION 21-118.1 RELATING TO DEPOSIT ADJUSTMENT AND
SECTIONS 21-119.1, RELATING TO LIMITED LIABILITY OF HOLDING
COMPANIES AND PASS-THROUGH ENTITIES AND SECTIONS 21-
119.2 AND 21-119.3 AND 21-120h ESTABLISHING AN ALTERNATIVE
ELECTIVE FLAT RATE BUSINESS LICENSE TAX ASSESSMENT FOR
HOME-BASED BUSINESSES
THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES HEREBY ORDAIN AS
FOLLOWS:
SECTION 1: The City Council hereby finds, determines and declares as follows:
A. Since the time of its incorporation, the City has imposed a general tax on the
privilege of conducting and carrying on all manner of business within the City, in order to
provide a portion of the general fund revenues required to provide police, fire, general
government and a host of other essential services to the community; and,
B. Due to continued financial instability at the Federal and State level, additional
reductions in revenues allocated to the City may occur; and,
C. Due to these reductions in immediate and future City revenues, and in order to
maximize the generation of general fund revenue from sources under the City's own
control, it is appropriate for the City to adopt a Business License Tax Penalty Abatement
Procedure allowing for the abatement of penalties and interest for (1) unlicensed
businesses obtaining their required City business licenses; and (2) licensed businesses
submitting amended returns in connection with underreported or misreported taxes
owing,
D. In order to assure the effective identification of unlicensed businesses and to
enhance the effective collection of the business license taxes, it is appropriate for the
City to amend Chapter 21, "The Business License Tax Code", to modify and to add
appropriate definitional and administrative provisions for the effective identification,
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enforcement, collection and enhanced administration of the City's business license tax;
and,
E. In order to promote immediate and future ease of administration by the City, as
well as encourage participation and compliance by qualifying businesses, it is
appropriate for the City to amend Chapter 21 to add a voluntary elective alternative flat
rate tax assessment for home-based businesses doing business in Santa Ana
equivalent to the average gross receipts tax assessment paid by licensed home-based
businesses for the most recently tax assessment period. For qualifying unlicensed
home-based businesses that are in arrears for prior years' taxes it is appropriate that
this alternative tax assessment be adopted retro-active to January 1, 2010. For all other
qualifying business who are in arrears for prior years' taxes it is appropriate that
penalties and interest be abated to an amount equivalent to the amount of the prior years'
taxes owing, as computed or determined based upon the business license tax rates and
charges in effect for the most current tax year; and,
F. In the course of adopting a Business License Tax Penalty Abatement
Procedure and modifying the City's Business License Tax Code, it is not the intent of
the city council to either increase the scope of the City's business license tax, or impose
a higher business license tax rate, or shift any category of business to a higher tax
assessment classification. Any changes in definitional terms are intended to clarify the
administration of the City's business license tax with regard to changes in state and/or
federal law and modern business practices.
SECTION 2: ESTABLISHMENT OF BUSINESS LICENSE TAX PENALTY
ABATEMENT PROCEDURE. An ordinance is hereby adopted establishing a Business
License Tax Penalty Abatement Procedure.
(a) SHORT TITLE. Section 2 of this ordinance shall be known as the "Business
License Tax Penalty Abatement Ordinance."
(b) DEFINITIONS. Except where the context otherwise requires, the terms used in
this ordinance shall have the meaning given to them in Chapter 21 of the Santa
Ana Municipal Code.
(c) ABATEMENT PROGRAM. A business license tax penalty abatement program
is hereby established for persons required to obtain a business license and pay
a business license tax under Chapter 21 of the Santa Ana Municipal Code.
SECTION 3: That section 21-3 [Definitions-Specific. definition of "Gross Receipts",
definition of "Person", and definition of "Transact and Carry-on'] of Chapter 21 of the
Santa Ana Municipal Code are hereby amended and shall read as follows [new
language in bold, deleted language in °+ru]:
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Gross receipts shall include the total amount of the sale price of all sales and the
total amount charged or received for the performance of any act or service of whatever
nature it may be, for which a charge is made or credit allowed, whether or not such act
or service is done as a part of or in connection with the sale of materials, goods, wares
or merchandise. The following shall be included in "gross receipts": all receipts, rents,
cash, credits and property of any kind or nature, without any deduction therefrom on
account of the cost of property sold, the cost of materials used, labor or service cost,
interest paid or payable, or losses or other expenses whatsoever.
The following shall be excluded from "gross receipts":
(a) Cash discounts allowed and taken on sales;
(b) Credit allowed on property accepted as part of the purchase price and
which property may later be sold;
(c) Any tax required by law to be included in or added to the purchase price
and collected from the consumer or purchaser;
(d) Such part of the sale price of property returned by purchasers upon
rescission of the contract of sale as is refunded either in cash or by credit;
(e) Amounts collected for others where the business is acting as an agent or
trustee to the extent that such amounts are paid to those for whom
collected, provided the agent or trustee has furnished the collector with the
names and addresses of the others and the amounts paid to them, other
than amounts received as commissions or fees earned, or charges of any
character made or compensation of any character received for the
performance of any service as agent or trustee, provided that any agent or
trustee dealing in stocks or other similar written instruments evidencing a
right to participate in the assets of any business, or dealing in bonds or
other evidences of indebtedness, who also deals in such property as a
principal, shall include in the gross receipts by which the tax is measured
the amount of his or her trading profits resulting therefrom. No deduction
from receipts attributable to trading as a principal shall be made unless
such deduction is provided for in this section;
(f) The difference between the balance owed and paid on a defaulted
purchase or finance contract upon repossession by seller and the amount
received from resale of the repossessed article by the repossessing seller;
(g) Receipts of refundable deposits, except that refundable deposits forfeited
and taken into income of the business shall not be excluded;
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(h) As to alcoholic beverages, that portion of the receipts of a manufacturer,
transporter, retailer or wholesale distributor generated or otherwise
collected from the manufacture, transport, retail or wholesale of
intoxicating liquors within the state pursuant to Article XX, Section 22 of
the State Constitution;
(i) As to a retail gasoline dealer, a portion of his or her receipts from the sale
of motor vehicle fuels equal to the motor vehicle fuel license tax imposed
by and previously paid under the provisions of Part 2 of Division 2 of the
State Revenue and Taxation Code, as the same now exists or as
hereafter amended;
(j) As to a retail gasoline dealer, the special motor fuel tax imposed by
Section 4041 of Title 26 of the United States Code, as the same now
exists or as hereafter amended, if paid by the dealer or collected by him or
her from the purchaser;
(k) Cash value of sales, trades, transfers or other transactions as made
between separate departments, divisions or units of any single business
entity;
(1) Sales for convenience where sales of new goods, wares or merchandise
are made by a person engaged in selling such articles to another person
engaged in selling like or similar articles:
(1) Where the primary purpose of the particular transaction of sale is to
accommodate the purchaser rather than to make a sale in the
ordinary course of business and the price paid is essentially the
book value of the article;
(2) Where, in the particular kind of business involved, a similar manner
of dealing is frequent or customary in the circumstances under
which the particular sale is made; and
(3) Where goods, wares or merchandise of like or similar kind and of
substantially equivalent value to that which was sold is received in
consideration.
As to general contractors and other similar businesses, "gross receipts" shall not
include that portion of the receipts of a general contractor which represents payments to
subcontractors, provided that such subcontractors are licensed under this chapter and
provided the general contractor furnishes the collector upon request with the names and
addresses of the subcontractors and the amounts paid to them.
As to bail bond brokerages, commission agent brokerages, mortgage
brokerages, real estate brokerages, securities brokerages, travel agencies, and other
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similar businesses employing agents, brokers and/or commissioned employees, "gross
receipts" shall include the total gross commissions or other receipts attributable to the
local office, agents, brokers and/or employees.
As to accountants, architects, attorneys, chiropractors, doctors, dentists,
optometrists, podiatrists, psychologists, veterinarians and other professionals, either
practicing solely or in partnership or as a professional corporation, "gross receipts" shall
include the total gross fees or other receipts attributable to services performed or
otherwise rendered within the city.
As to other persons having a fixed place of business within the city and providing
a service or plying an occupation or trade or involved in similar businesses, "gross
receipts" shall include the total fees, commissions or other receipts attributable to that
local location and/or employees.
As to a business established outside the city but maintaining a local office or
establishment or facility, within the city through an agent, broker or employee, "gross
receipts" shall include the total sales or receipts attributable to the local office or
establishment or facility, agent, broker or employee.
As to a business established outside the city but transacting and carrying on
business within the city, or otherwise performing or rendering services negotiated or
contracted for within the city, whether or not by a principal or through an agent or
employee, "gross receipts" shall include the total fees, commissions or other receipts
attributable to the business activity conducted.
As to any business, whether established within or established outside the city, in
the event separate sales or receipt records are not maintained for a local office or
establishment or facility, agent, broker or employee, or in the event any retailing,
wholesaling, manufacturing or processing activity conducted thereat does not generate
gross receipts as hereinabove defined, or in the event said local office or establishment
or facility, agent, broker or employee is engaged in providing administrative or
management related services, to include, but not limited to, record keeping, data
processing, research and development, advertising, public relations, personnel
administration or legal services, in connection with sales or services performed or
rendered elsewhere, the business tax shall be based upon an amount which bears the
same proportion to the total gross receipts of the business which cost of maintaining
said local office, facility, local agent, broker or employee bears to the total cost of
maintaining said business. Alternatively, at the election of an applicant or licensee, the
business tax may be based on an amount equivalent to the cost of maintaining said
business without reference to the total gross receipts of the business. As used herein
the phrase "cost of maintaining said business" shall have the same meaning as "cost of
doing business".
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Person shall include, without limitation, all domestic and foreign corporations of any
kind, all firms and companies (holding, joint stock, private, public, parent, pass-through,
professional, operating, operating property, non-profit, subordinate and subsidiary),
partnerships of every kind including but not limited to (general partnerships, limited
partnerships, master limited partnerships, limited liability partnerships, limited liability
limited partnerships, professional partnerships, and publically traded partnerships), private
trusts, Massachusetts business or common law trusts, real estate investment trusts,
royalty trusts, estates, associations, syndicates, clubs, joint ventures, unincorporated
business organizations, limited liability companies of every kind including but not limited to
(sole member limited liability companies, multi member limited liability companies, non-
profit limited liability companies, and series limited liability companies), cooperatives, all
other types of business entities defined or authorized under federal and state laws,
receivers, trustees, guardians or other representatives appointed by order of any court,
and any natural individuals transacting and carrying on any business in the city other than
as an employee.
Transact and carry on means to repeat, or intend to repeat, or to continue and
includes:
(a) The maintaining, operating, managing or being in control of, or right to
make use of directly or remotely, any office, store, warehouse, factory,
establishment, premises, location or place:
(1) Having one or more telephones listed for any business activity in
any classified telephone directory or in the classified section of any
consolidated telephone directory, or in any combined online
directory or internet/web based listing service,
(2) Having computers or other computing devices used to maintain one
or more internet websites or webpages or maintaining internet/web
based advertising,
(3) Having in use in connection with any business one or more
counters, desks, chairs, tables, filing cabinets, typewriters, adding
or calculating machines, computers, servers, printers, scanners, fax
machines or other articles of office equipment,
(4) At, from, or in which any processing, manufacturing, supervising,
administration, management, research, sales or sales promotion,
peddling, solicitation, warehousing, distributing, routing, delivery,
mail or package receipt, recycling, dispatching, billing, collection,
accounting, computing, product development, software
development, testing, storage, record-keeping or other activity is
conducted in connection with any business,
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(5) In or at which one or more persons may, for any valuable
consideration intended to result, or that results, in any livelihood,
financial profit or commercial gain to any person, receive any
instruction, advice, treatment or examination, or any service upon
their person, or any repair, refinishing, renewing, cleaning, or other
improvement to, or of, any personal property,
(6) In which any letter, announcement, advertisement, circular,
handbill, newspaper, agreement, contract, instruction, legal
instrument, government required registration, permit or license, tax
filing statement, financial statement, statement of account, financial
record, or any other instrument or record is written, printed,
reproduced, published, prepared or kept in connection with any
business,
(7) From which any circular, handbill, newspaper, announcement,
statement of account, card or letter is sent or distributed, in writing,
or any contract is made, in person or by telephone, in connection
with any business,
(8) Upon any exterior side, wall, window, door, roof or other portion, or
in the proximity of which, there is maintained any sign, lettering,
announcement or advertisement indicating that such office or place
is one in, at or from which any article exists, or any act is performed
in connection with any business;
(b) The repeated or continuous offering, or contracting, orally or in writing, in
connection with any business:
(1) To sell or rent one or more articles, or one or more rooms,
apartments, portions or parcels of any real or personal property, or
(2) To transport any person or personal property, or
(3) To perform any service;
(c) In connection with any business, the repeated or continuous:
(1) Sale or renting of one or more articles or parcels of real or personal
property, or
(2) The transporting of any person or property, or
(3) The performance of any service;
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(d) The repeated parking, servicing, replenishing or maintaining of any
delivery vehicle, catering truck, junk collection vehicle, pushcart or wagon
within the city, whether or not on the premises of another, when done in
connection with the permanent painting or inscribing or affixing of said
address on the surface of said pushcart, vehicle or wagon;
(e) The performance, in connection with any business, of any single act, with
intent to repeat or continue the performance of such act.
SECTION 4: That section 21-3 [Definitions-Specific. definition of "Service fee'] be
added to Chapter 21 of the Santa Ana Municipal Code to hereby read as follows [new
language in bold]:
Service fee shall mean a fixed fee, specified by resolution of the city council,
which is intended solely to cover the reasonable administrative costs incurred in
redeeming dishonored or stopped payments, in performing audits, collections,
inspections, investigations, and the administrative enforcement of this chapter and
adjudication thereof.
SECTION 5: That sections 21-12, 21-16, 21-25, 21-41, 21-43, 21-44, 21-49, 21-
60, 21-64, 21-83, 21-85, 21-100, 21-115, 21-122, 21-123, 21-124, 21-125 of Chapter 21
of the Santa Ana Municipal Code are hereby amended and shall read as follows [new
language in bold, deleted language in Wit]:
Sec. 21-12. Association with local business or governmental agency; disclosure of
associated businesses and independent contractors.
Any person who shall associate with any local business or governmental agency,
whether or not on a temporary basis, shall not be relieved from the provisions of this
chapter and shall be required to pay the appropriate business license tax as specified in
this chapter. Nothing in this chapter shall be deemed or construed to relieve any such
person from the provisions of this chapter by virtue of any exemption provided to any local
business pursuant to this chapter or any exemption or exclusion applicable to any agency,
instrumentality, or political subdivision of the state or of the United States, or any
exemption or exclusion otherwise arising out of the constitution or applicable statutes of
the United States or the state.
(a) Definitions. As used in this section, the following phrases shall have the
meaning hereinafter set forth:
(1) The phrase "local business" as used in this section shall be defined as
including all persons transacting and carrying on business from any fixed
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place of business within the city other than as an employee. In addition,
the phrase "local business" shall include all leaseholder-lessors and
owner-lessors of commercial or residential real estate within the city.
(2) The phrase "governmental agency" as used in this section shall be
defined as including every agency, instrumentality, or political subdivision
of the state or of the United States.
(3) The phrase "associate with" as used in this section shall be defined to
mean the transacting and carrying on, by any other person, of business
on the premises owned, controlled, or managed by said local business
or governmental agency, whether as a tenant of, in connection with, or
as an affiliate of, or as an adjunct to, or in the name of said local
business or governmental agency, or whether as a building
management agent, or property management agent, or independent
general operating agent or manager for said local business or
governmental agency, or whether as an outside business or an
independent contractor performing services for said local business or
governmental agency.
(b) Application. In the case of a local business which is a partnership or joint
venture, the phrase "associate with" shall not include the business transacted
and carried on by a general partner in connection with the general partnership
or by a joint venturer in connection with the joint venture. In the case of a local
business which is a corporation, the phrase "associate with" shall include any
business transacted and carried on by a subordinate or subsidiary corporation
or holding company, pass-through entity or trust. For all local businesses, the
phrase "associate with" shall include the maintaining on the premises of the
local business of any principle executive or other business office as required
in connection with the registration of any business entity address with the
California Secretary of State for any actively registered corporation, limited
liability company, limited partnership, or limited liability partnership under the
California Corporations Code as the same now exists or as may be hereafter
amended from time-to-time.
In the case of a local business which is a leaseholder-lessor or owner-lessor of
commercial or residential real estate within the city, the phrase "associate with"
shall include any business transacted and carried on by an independent
resident property manager, independent building manager, independent
property agent or independent building agent, whether or not such independent
manager or agent is also a tenant of said property. Such independent
manager or agent shall be required to obtain a separate business license. In
the case of a local business which is a tenant of a commercial premises and a
party to a lease-back agreement or other similar agreement involving said
commercial real estate in which the ownership identities of both parties to the
agreement are identical, but the legal entities are distinct, the phrase "associate
with" shall include any such business transacted by the owner-lessor or
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leaseholder-lessor of said commercial real estate. Such owner-lessor or
leaseholder-lessor shall be required to obtain a separate business license and
shall be subject to all the requirements of this chapter.
(c) Disclosure.
(1) Every local business, and any person acting as their agent, shall upon
request by the collector, provide the names and addresses of all persons
who lease, rent or maintain space, mailboxes, coin-operated machines
or devices, or in any other manner transact and carry-on business, or
occupy or maintain a business presence on the premises owned,
controlled, or managed by said local business. In addition, every local
business, and any person acting as their agent, shall upon request by the
collector, provide the names and addresses of all persons, whether or
not located within the city, who are contracted to perform, or who
regularly do perform services on the premises owned, controlled, or
managed by said local business.
(2) Every person engaged in the rental of residential real estate within the
city, every condominium or homeowner association within the city, and
all property management services acting as their agents, shall upon
request by the collector, provide the names and addresses of all persons
who have been granted permission to engage in business activity on the
premises owned, controlled, or managed by them. In addition thereto, all
condominium or homeowner associations within the city and all property
management services acting as their agents, shall upon request by the
collector, provide the names, property addresses, and mailing addresses
of all owners engaged in the rental of any residential real estate, under
their control or management.
(3) Every person engaged in the rental of commercial real estate within the
city, and all property management services acting as their agents, shall,
at the time the license required by this chapter is applied for and
thereafter annually at the time of the renewal of their license for the
rental of commercial real estate, or at such other time as the collector in
his or discretion may set, provide to the collector a list of (i) the names
and addresses of all tenants (including subtenants) occupying the
commercial real estate property licensed; and (ii) the names and
addresses of all persons, whether or not located within the city, who are
contracted to perform, or who regularly do perform services on the
licensed premises owned, controlled, or managed by said commercial
real estate rental licensee or commercial real estate management agent.
(d) Disclosure requirements - authority to vary. To effectively implement the intent
of the disclosure provisions of this section, the collector may vary the strict
requirements of subsection (c) above to accommodate the regular record
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keeping and business practices of persons subject to the disclosure
requirement and also to facilitate ease of administration by the collector.
(e) Confidentiality. All information received by the collector pursuant to this section
shall remain confidential and shall be used solely for the purposes of
administering the city's business license tax and shall not be maintained by the
city as part of the public record.
Sec. 21-16. Evidence of doing business.
(a) When any person shall by use of signs, circulars, cards, business letterhead,
telephone books, newspapers, billboards, trade publications, electronic telephone or
business directories, internet advertisement, or websites, advertise, holdout, or represent
that such person is in business in the city; or when any person has registered and
published a Fictitious Name Statement registered to an address in the city, or holds or has
been issued an active State Board of Equalization Permit, or holds any other active
licenses, permits, certificates or registrations issued by a governmental agency (including
but not limited to: Federal or State Employer Identification Numbers, or registration with
the California Secretary of State as a corporation, limited partnership, limited liability
partnership, or limited liability company) indicating that such person is in business within
the city, or maintains a post office box under a business name registered to any address
within the city, or when any person files federal income tax or state franchise tax
statements reporting business income within the city or claiming business office
deductions or business expense deductions for a commercially located or home-based
business in the city, or gives other evidence of transacting and carrying on business as
may be defined elsewhere under the terms of this chapter and such person fails to deny in
a sworn statement given to the collector that such person is "engaged in business" within
the city, or fails to assert and document that such person is "exempted" or otherwise
"excluded" from the requirement to pay a business license tax, after being requested to do
so by the collector, then these facts shall be considered prima facie evidence that such
person is conducting a business in the city.
(b) When any municipal utility records indicate that the occupant of any commercial
real estate within the city is a person other than the person indicated by county assessor
or county recorder records to be the owner of such property, or when any utility records
indicate that the occupant of any residential real estate within the city is a person other
than the person indicated by county assessor or county recorder records to be the owner
of such property, or when the county assessor or county recorder records indicate that any
person owning residential real estate within the city does not claim a homeowner's
exemption for said property and receives their property tax notification for said property at
another residence location, and such person fails to deny in a sworn statement given to
the collector that such person is engaged in the "rental of residential real estate" within the
city, or fails to assert and document that such person is "exempted" or otherwise
"excluded" from the requirement to pay a business license tax, after being requested to do
so by the collector, then these facts shall be considered prima facie evidence that such
person is conducting a business in the city.
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Sec. 21-25. Original delinquency penalty; conducting a business without first having
procured a license; effect - Voluntary compliance; effect - Abatement of
penalty; application -Violation; misdemeanor.
(a) Any person who shall commence, engage, transact and carry on any trade,
calling, profession, occupation or business within the city without first having procured
the required business license from the city to do so, shall be assessed a penalty of fifty
(50) per cent of the amount of the license tax owing, which amount shall be separately
calculated for each successive license period beginning with the calendar month in
which the commencement of business activity within the city began, and ending with the
expiration of the current annual licensing period. Provided, however, that the start of
such period shall not exceed three (3) years prior to the date of notification of violation.
Such penalty to be collected, and the amount thereof to be enforced, in the same
manner as all other business license taxes are collected and the payment thereof
enforced.
(b) Where any person is in arrears for business license taxes under subsection (a)
above, owed for the rental of residential or commercial real estate within the city, or
owed for a business which is conducted solely from a home residence within the city,
the penalties imposed under subsection (a) shall be abated in accordance with
subsection (f) below if the tax is paid by the last day of the calendar month following the
month in which such person was given notice of the requirement to obtain a city
business license; otherwise penalties shall accrue as in the case of any other business.
(c) Where any person occupying a commercial premises as a tenant or subtenant
is in arrears for business license taxes under subsection (a) above, and has been
reported to the collector pursuant to section 21-12, the penalties imposed under
subsection (a) shall be abated in accordance with subsection (f) below if the tax is paid
by the last day of the calendar month following the month in which such person was
given notice of the requirement to obtain a city business license; otherwise penalties
shall accrue as in the case of any other business.
(d) Where any person, whether or not located within the city, is contracted to
perform, or regularly does perform services on the premises owned, controlled, or
managed by a local business as defined in section 21-12 and is in arrears for business
license taxes under subsection (a) above, and has been reported to the collector
pursuant to section 21-12, the penalties imposed under subsection (a) shall be abated
in accordance with subsection (f) below if the tax is paid by the last day of the calendar
month following the month in which such person was given notice of the requirement to
obtain a city business license, otherwise penalties shall accrue as in the case of any
other business.
(e) Where any person is otherwise in arrears for business license taxes under
subsection (a) above, the penalties imposed under subsection (a) shall be abated in
accordance with subsection (f) below if such person voluntarily applies for the required
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business license and pays the business license tax owing in arrears; otherwise
penalties shall accrue as in the case of any other business.
(f) In all cases where the provisions of this section provide for the abatement of
penalties imposed under subsection (a), the amount owing in arrears and the amount of
the accrued penalties shall be abated until the combined amount of tax and penalty due
is equalized to an amount equivalent to the amount of current and prior years' taxes
owing as computed or determined based upon the business license tax rates in effect
for the most current tax year.
(g) In determining the amount of penalty due for any person for whom an initial
license period gross receipts in lieu deposit is required in accordance with sections 21-
117, 21-118 or 21-118.1 the collector shall compute and apply the penalty due at the
time that such person's initial period gross receipts report is filed and computed in
accordance with section 21-117(c).
(h) However, no abatement of penalties or interest shall be permitted under this
section in any case where such person concurrently holds or has previously held a city
business license or previously been given notice of said requirement with regard to any
business activity engaged in or conducted within the city.
(i) When any person is determined to be liable for delinquent business license
taxes and such person fails to properly procure the correct business license after being
given notice to do so, the collector shall determine the amount of delinquent business
license taxes owed in accordance with section 21-41. Penalties thereon shall be
accrued as applicable in accordance with this section. In determining the amount of tax
due for any business for whom the gross receipts of such business is made the basis
for fixing the amount of such business license the collector may base such
determination upon an average of the reported gross receipts of like businesses,
similarly classified.
Q) Any person required to obtain a city business license under the terms of this
chapter having been given notice of the requirement to obtain a city business license
under the terms of this section, whether by personal service, or by a notice
conspicuously posted upon the premises of such person's business, or by notice given
through the United States mail, who has not paid said business license tax or otherwise
obtained a valid business license, or applied for exemption therefrom and who has not
applied for, or who is not undergoing the process of a hearing or appeal pursuant to
section 21-41 or Chapter 3 of this Code shall be deemed guilty of a misdemeanor
violation. For the misdemeanor violation provision of this section to apply, notice, when
given by United States mail shall be mailed to the responsible person by certified mail,
postage prepaid with a requested return receipt. Simultaneously, the notice may be
sent by first class mail. If the notice is sent by certified mail and the return receipt is
returned unsigned or refused, then service of notice shall be deemed effective pursuant
to first class mail, provided the notice sent by first class mail is not returned.
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Sec. 21-41. Collector; assessment of tax, penalties, interest, charges (including service
fees), determination of classification; notification of violation; right to hearing;
hearing service fee deposit.
(a) The collector shall determine the amount of license tax due, together with any
penalties, interest, charges (including service fees) that may be due and payable and/or
the proper classification for a business by means of such information as he or she may be
able to obtain in the event:
(1) Any person fails to properly procure the correct business license prior
to doing business in the city; or
(2) Any person engaged in transacting and carrying on business within
the city fails to renew any business license; or
(3) Any person fails to file any required statement within the time
prescribed; or
(4) If, after demand therefor has been made by the collector, any person
fails to file a corrected statement within fifteen (15) days after
notification to do so; or
(5) It appears to the satisfaction of the collector that a statement filed does
not set forth the facts of the business for which a license is required; or
(6) If a licensee or an applicant for a license believes that the business is
not assigned to the proper classification because of circumstances
peculiar to it.
(b) In the case where such determination is made, the collector shall give notice of
the amount so assessed, or classification found to be appropriate in the following manner:
(1) By serving it personally, or causing it to be served personally by a duly
authorized agent; or
(2) By depositing it in the United States Mail, postage prepaid addressed
to the person so assessed at their address of record.
(c) Any person receiving a determination made by the collector pursuant to this
section regarding the amount of tax owed, or classification found to be appropriate, may,
within fifteen (15) days after the serving or mailing of such notice, make application in
writing to the collector for an administrative hearing, hereinafter ("hearing") by completing
and filing a "request for hearing" form with the collector. Request for hearing forms shall
be made available in the office of the Director of Finance and Clerk of the City Council. A
failure to file a timely "request for hearing" form shall be deemed a waiver of the right of
appeal. Provided, further that any person seeking a hearing under this section shall first
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deposit with the collector a hearing service fee to be specified by resolution of the city
council to cover the city's cost in providing an administrative hearing officer, hereinafter
("hearing officer").
(d) All hearings conducted pursuant to this section shall be heard by the same
hearing officer who has been appointed by the Santa Ana City Manager pursuant to
section 1-28.8 of this code.
(e) Hearing procedures for hearings conducted pursuant to this section shall be as
follows:
(1) No hearing to contest a determination of the collector before a hearing
officer shall be held unless and until a timely "request for hearing" form
has been completed and filed with the collector, and
(2) After receipt of the "request for hearing" form and deposit of the
hearing service fee, a hearing before the hearing officer shall be set
for a date that is not less than fifteen (15) and not more than sixty (60)
days from the date that the "request for hearing" is filed in accordance
with the provisions of this section. The person requesting the hearing
shall be notified at least (10) days prior to the date of the hearing. The
failure of any person to appear at the hearing shall constitute a
forfeiture of the administrative hearing service fee deposit and shall be
a bar to judicial review of the hearing officer decision based upon
failure to exhaust administrative remedies.
(3) At such hearing the person may appear and offer evidence why the
collector's specified tax amount should not be fixed as the license tax
amount or why such classification prescribed by the collector as the
applicable tax classification should not be fixed. Formal rules of
evidence shall not apply.
(4) Upon request, the person requesting the hearing shall be provided
with reports and other documents relied upon by the collector in
making his or her determination. In addition, if the collector, duly
authorized revenue officer, or other individual appearing at the hearing
as the agent of the collector submits any additional written reports to
the hearing officer for consideration at the hearing, then a copy of said
documentation shall also be served by mail on the person requesting
the hearing.
(5) The hearing officer may continue the hearing and request additional
information from the collector prior to issuing a written decision.
(6) After such hearing, the hearing officer shall determine the proper tax
to be charged or classification prescribed and shall forthwith give
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written notice to the person requesting the hearing in the manner
prescribed herein of such determination and the amount of such tax.
(f) Hearing officer's decision. After considering all of the testimony and evidence
submitted at the hearing, the hearing officer may immediately issue a verbal decision or
may issue a written decision within fifteen (15) days of the hearing. The decision shall
include the reasons for the decision and such decision shall be final.
(g) If the hearing officer fixes the amount of the tax, penalty, interest, charges,
service fees or the tax classification in accordance with the original written determination of
the collector, then the amount as finally determined shall be immediately due and payable
and/or the classification shall be immediately applicable, and the hearing service fee shall
be forfeit. If the hearing officer determines the amount of the tax, penalty, interest,
charges, service fees or the tax classification to be applicable in accordance with the
original statement of the person requesting the hearing then the amount due and payable
and/or the classification applicable shall be as set forth in such person's original statement
and the collector shall refund the hearing service fee deposit. If the hearing officer fixes
the amount of the tax, penalty, interest, charges, service fees and/or the tax classification
to be applied in some other manner the hearing officer shall also make a written
determination as to fixing the amount of tax, penalty, interest, charges, service fees and/or
the tax classification applicable and shall indicate the disposition of the hearing service fee
deposit.
(h) Any person who is aggrieved by the decision of the hearing officer may obtain
judicial review of such decision in the manner provided under section 1-21.9 of this code.
(i) In the event no application for a hearing is filed within the time prescribed, the
decision of the collector shall become final and conclusive on expiration of the time herein
fixed for hearing and shall render any subsequent appeal null and void and shall further
act as a waiver against future action.
0) Notwithstanding any other provision contained in this chapter or any other
provision contained in this code to the contrary, any person voluntarily tendering payment
of any license tax, interest, or penalties to the city pursuant to any provision of this chapter
shall for all purposes thereafter be precluded and barred from appealing, contesting or
otherwise challenging the validity or amount of any such tax, interest or penalties pursuant
to any otherwise available procedure set forth in this chapter, or otherwise available by
law, unless said payment is made under written protest to the city. Said written protest
shall be deemed made for the purposes of this chapter only by one of the following
methods: (1) a written notation set forth on the check, draft, money order, or other
negotiable instrument by which payment is tendered, indicating that such payment is made
under protest; or (2) a written notice addressed and delivered to the collector at the time of
payment indicating that such payment is made under protest. Provided, however, that this
subsection shall not bar a request for refunds authorized pursuant to section 21-87 of this
chapter.
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Sec. 21-43. Collector; extension of time for filing - compromise of claims; waiver of
claims.
(a) The collector shall have the power to extend the time for filing any required
application, affidavit, statement or report and remitting of any taxes or other monies
owing for a period of up to six (6) months. In connection with that authority the collector
shall also have the power to extend the time for giving notification of tax renewal and to
extend the time that any previously issued license shall remain valid. The collector may
in his or her discretion exercise this authority on a case-by-case basis in connection
with any individual applicant or licensee, or other individual person subject to the
requirements of this chapter. The collector may also exercise this authority on a class-
by-class basis in connection with any category, class or subclass of assessment or any
category, class or subclass of applicants, licensees, or other persons subject to the
requirements of this chapter, or any persons subject to any applicable business license
tax surcharge or surtax or other business license related assessment or fee required or
authorized under the general laws of the state.
(b) The collector shall have the further power, for good cause shown, to
compromise any claim, or class of claims, as to the amount demanded or owing.
(c) The collector, shall have the further authority to settle, discontinue, or waive
the collection of any claim, or class of claims, for good cause shown, or if it appears that
further proceedings would be without merit, or if the administrative or legal cost therefor
would be excessive, or if the amount of the claim in question is de minimus. A claim, or
class of claims, shall be deemed to be de minimus whenever the total amount of the
claim is determined by the collector to be equal to or less than the total anticipated
administrative costs associated with collecting said amount. The collector may in his or
her discretion determine this amount on a case-by-case basis or on a class-by-class
basis. In accordance with section 21-42 the collector may adopt administrative rules,
regulations, and guidelines, relating to the settlement, discontinuance, or waiver of
claims arising pursuant to this chapter.
(d) In connection with the exercise of the power and authority hereinabove
provided to the collector, he or she in their discretion, shall have the right to allow the
payment of any taxes or other monies owed to the city by installment without penalty,
interest or other administrative charge on a case-by-case basis or class-by-class basis.
In accordance with section 21-42 the collector may adopt administrative rules,
regulations, and guidelines, relating to the acceptance of installment payments.
(e) Moreover, to effectively implement the intent of the general provisions of this
chapter the collector in his or her discretion may vary the strict procedural, enforcement,
deposit, or other administrative requirements of this chapter on a case-by-case or class-
by-class basis in any manner.
Sec. 21-44. Collector; additional power.
11X-19
In addition to all other powers conferred upon him or her, the collector shall have
the power, for good cause shown, to waive or reduce any penalty or late interest
imposed, or deposit, or charge, or service fee demanded.
Sec. 21-49. Business licensing - Specified exclusions.
Except as may be otherwise specifically provided in this chapter, the terms
hereof shall not be deemed to apply or construed to require the payment of a license tax
by any of the following persons:
(1) Any public utility making franchise payments to the city, except to the
extent said public utility engages in retail sales or services within the city
not covered or otherwise authorized by such franchise,
(2) Banks, including national banking associations, federal credit unions, and
financial corporations, to the extent that a city may not levy a license tax
upon them under the provisions of Article XIII, Section 27 of the State
Constitution.
(3) Insurance companies or associations engaged in the sale and servicing of
insurance and their direct agents, including bailbond agents and life
agents, but not including brokers or bailbond brokers or life and disability
insurance analysts or insurance solicitors to the extent that a city may not
levy a license tax upon them under the provisions of Article XIII, Section
28 of the State Constitution.
(4) Any governmental agency or subdivision and the employees thereof, to
the extent they are engaged in the business of such governmental
agencies or subdivisions.
(5) Any state alcoholic beverage licensee engaged in the manufacture, sale,
purchase, possession, or transportation of alcoholic beverages within the
state to the extent that a city may not levy a license tax upon them under
provisions of Article XX, Section 22 of the State Constitution.
Sec. 21-60. Application; autoregistration - service fee.
Before any license is issued, the applicant shall make a written application to the
collector, which shall contain the following information:
(1) The exact nature or kind of business, profession, show, exhibition, game,
occupation or enterprise for which the license is requested;
(2) The place where such business, profession, show, exhibition, or
enterprise is to be carried on; and if the same is not to be carried on at any
permanent place of business, the residence address, identified as such, of
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the owners of the same;
(3) The address where the applicant shall consent to receive mail concerning
the license applied for;
(4) Where any person contracts, sells or delivers any goods, wares or
merchandise in the city for which sales or use tax is payable, the
application shall set for the appropriate California State Board of
Equalization permit number;
(5) Where any person employs others in the course of such business the
application shall set forth the appropriate federal and/or state employer
identification number;
(6) Where any person conducting any business is self-employed, or is
conducting business as a spouse or joint-owner or in any other capacity
not requiring a federal and/or state employer identification number the
application shall set forth the social security number of the applicant(s).
Where any such applicant is not in possession of a social security number
the collector in his or her discretion may accept another form of personal
identification sufficient to properly identify such applicant;
(7) In the event that the application is made for the issuance of a license to a
person doing business under a fictitious name, the application shall set
forth the names and places of residence of those owning said business or
enterprise;
(8) In the event that the application is made for the issuance of a license to a
person doing business as a state licensed contractor, the application shall
set forth the applicant's state contractor's license number and specialty
classification,
(9) In all cases where the amount of tax to be paid is based upon the number
of persons employed, or upon the number of vehicles used, or upon the
number of rental units in any building or structure, or upon the seating
capacity of any auditorium, stadium or enclosure, or upon the number of
coin-operated machines or devices, or upon any amount or number which
furnishes the basis for determination of the license tax for the particular
business referred to in the application, such items must be stated on the
application; provided that a newly established business shall make a true
estimate or statement of such information and the business tax shall be
based upon said estimation and shall be paid at the time such license is
issued;
(10) Any further information which the collector may require to enable him or
her to issue the type of license applied for;
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(11) Any further information which the state may require, or any further
information which the collector may deem necessary to properly identify
the applicant.
(12) A signed statement made under penalty of perjury that the statements
therein are true and correct, which statement shall be required to be filed
with the collector upon submission of any original license application,
annual renewal statement, miscellaneous supplementary statement, or
other return or filing. Each such declaration of truth of application or
statement shall have included therein, or attached thereto, a certification
or declaration, which shall be substantially in the following form:
I declare, under penalty of perjury, that this application, return or
statement (including any accompanying schedules, statements, and
supporting data) has been examined by me, and, to the best of my
knowledge, information, and belief, is a full true and correct application,
return, or statement and I accordingly so represent.
(Signature of Owner, or Partner, or (Date)
Officer of Corporation, or Other
Authorized Agent or Representative of
an of the above said same)
(13) In the case of applications submitted via email, the collector in his or her
discretion may accept a facsimile copy of the applicant's signature;
(14) In the case of applications submitted via other electronic means, the collector
in his or her discretion may accept a digital signature or other unique personal
identification number (PIN) verification.
All information specified to be set forth on any application form prescribed by the
collector shall be submitted completely and accurately and the license shall be deemed
based upon the information submitted and represented. The collector shall not be
required to receive or consider, any application, return or statement unless the above
quoted declaration, in substantially the form hereinabove set forth, is contained therein
or attached thereto and properly executed by the applicant or the authorized agent or
representative of the applicant, and it is unlawful and shall be deemed a misdemeanor
in any such application, return or statement for such applicant or authorized agent or
representative of the applicant to make any statement which is false or which is contrary
to the declaration or representation made in the above quoted form.
Any license shall be deemed based upon the application on file, and if the
information is incomplete or inaccurate, the license shall be deemed invalid. If
information submitted in an application subsequently becomes incomplete or inaccurate
by reason of a change in circumstances, the license shall thereafter be deemed invalid.
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Upon the collector's learning of any inaccuracy or incompleteness, notice shall be given
forthwith to the licensee, at the address shown on the license where the licensee
consented to receive information concerning his or her license, that the license is invalid
and requesting the licensee to reapply for a re-validated license within thirty (30) days.
Upon the licensee's successful application for a re-validated license within the
period hereinabove set the collector shall apply pro rata to the re-validated license the
remainder of the sum originally paid by the licensee.
Upon the licensee's failure to make successful application for a re-validated
license within the period hereinabove set the collector shall give notice forthwith
pursuant to section 21-86 that the licensee's license is hereby suspended. Thereafter,
upon denial of licensee's appeal it shall be revoked whereupon the licensee's original
payment shall be forfeit.
Any person refusing or failing to make application or to provide information
required shall be assessed an amount pursuant to section 21-41, and shall be in
violation of this chapter. The collector, upon making an assessment pursuant to section
21-41, may in his or her discretion autoregister a license account in the name of any
such person for purposes of assessing business license taxes, penalties, interest,
charges, and service fees as applicable. Whenever the collector shall cause a license
account to be registered an autoregistration service fee shall be applicable in the
amount as specified by resolution of the city council.
Sec. 21-64. How and when payable; effect of dishonored instrument; return payment
service fee.
All business license taxes or deposits in lieu thereof due hereunder shall be paid
in advance, in lawful money of the United States, or by check, draft or other instrument
in the discretion of the collector, at the office of the collector in the finance department of
the city. No business license shall be issued or renewed until the amount due and
payable has been paid in full. Any license, the fee for which has been paid by an
instrument such as a check, or draft which is dishonored upon presentation for
payment, shall be void and of no effect from its inception. The collector, may, in his or
her discretion, withhold the effect of this provision if the fee is paid within fifteen (15)
days. Payment of license fees following a dishonor of such instrument upon
presentation for payment shall thereafter be made only by cashier's check, money order
or cash, which fee shall include any applicable penalty, as well as a return payment
service fee in the amount as specified by resolution of the city council for such dishonored
instrument. The collector shall be authorized to reject payment other than by cash,
cashier's check or money order from such licensee for a period of two (2) years
following any such dishonor.
Sec. 21-83. Penalties for past due delinquency; application - Minor errors in payments;
acceptance.
21
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11
(a) For failure to fully pay any business license renewal tax amount when due,
the collector shall add the following penalties:
(1) Ten dollars ($10.00) or ten (10) percent of the unpaid balance of said
amount, whichever is greater, on the past due date thereof,
(2) Fifteen dollars ($15.00) or fifteen (15) per cent of the unpaid balance
of said amount, whichever is greater, on the first day of the second
month after the due date thereof;
(3) Twenty-five dollars ($25.00) or twenty-five (25) per cent of the unpaid
balance of said amount, whichever is greater, on the first day of the
third month after the due date thereof; and
(4) Fifty dollars ($50.00) or fifty (50) per cent of the unpaid balance of
said amount, whichever is greater, on the first day of the fourth
month after the due date thereof;
provided that the maximum amount shall not exceed an amount equal to one hundred
(100) per cent of the amount of the business license tax due. Notification of delinquent
business license taxes will be given by first class United States mail no later than the
fifteenth day of each month, until the maximum penalty is imposed; provided that failure to
receive such notification shall not exempt the licensee from all requirements under this
chapter.
(b) In the event a minor discrepancy exists between the amount paid and the amount
due under this chapter, arising from a miscalculation on the part of an applicant or
licensee, and resulting in an underpayment of the business license tax in an amount not to
exceed such amount as is specified by resolution of the city council, the collector may
accept and record the underpayment as payment in full without notification to the taxpayer.
Sec. 21-85. Same - Interest.
In addition to the past due delinquency penalties imposed in section 21-83, any
business that fails to remit the tax due shall pay interest at the rate of one (1) per cent
per month, or portion thereof, exclusive of penalties, on the amount of the unpaid tax,
from the date on which remittance first became delinquent until paid-in-full or otherwise
satisfied. Provided however, that pursuant to section 21-84 penalties upon attaining a
combined amount equal to one hundred (100) per cent of the amount of the business
license tax due are merged with the tax payable hereunder and any additional interest
charged from such date on shall be charged the combined amount delinquent until paid.
Sec. 21-100. Additional required information.
At the time the license required under section 21-98 is applied for, and thereafter
annually at the time of the renewal of such license, or at such other time as the collector
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may set, the applicant or licensee shall provide to the collector a list giving the kind or
character of machine or device, local business name and street address, and number of
machines or devices at each proposed or existing location.
Sec. 21-115. Same - Keeping of records; applicability of audit.
Section 21-80 shall apply to all statements provided to be filed under section 21-
114; provided however, that the inspection of books and records shall be limited
specifically to books and records reflecting the employees and other persons engaged in
the business activity.
Sec. 21-122. Nonpayment of tax; assessment by lien; recording and enforcement of
liens; recording service fee.
(a) Recording of a certificate of lien. If any amount, including penalties, interest,
and administrative charges required to be paid under this chapter is not paid when due,
the collector or any duly authorized revenue officer acting as his or her designated
agent, may record or cause to be recorded, in the office of the county recorder(s) of
such counties as the collector may determine, a certificate which specifies the amount
due, the name and address of the person liable for the same, a statement that the
collector has complied with all provisions of this chapter in the determination of the
amount required to be paid, and a legal description of the real property owned by such
person. From the time of the recording of the certificate, the amount required to be paid
together with penalties, interest, and administrative charges owing constitutes a lien
upon all real property in the county owned by such person or thereafter acquired before
the lien expires. The lien shall have the force, effect and priority of a tax lien and shall
continue for ten (10) years from the filing of a certificate unless sooner released or
otherwise discharged.
(b) Recording service fee. Whenever the collector in his or her discretion
determines that the recording of a certificate of lien is desirable to secure and effectuate
the collection of any amount required to be paid under the terms of this chapter, then a
recording service fee shall be applicable in the amount as specified by resolution of the
city council.
Sec. 21-123. Reserved.
Sec. 21-124. Reserved.
Sec. 21-125. Reserved.
SECTION 6: That sections numbered 21-80.1, 21-83.1, 21-93.1, 21-118.1, 21-
119.1, 21-119.2, 21-119.3, and 21-120h shall hereby be added to Chapter 21 of the
Santa Ana Municipal Code and shall read as follows [new language in bold]:
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11 A-25
Sec. 21-80.1. Same -Audit deficiency; application of penalty and interest;
Voluntary compliance; effect - Abatement of penalty and interest;
application.
In the event that the collector or his or her designated agents, whether through an
audit or otherwise, determine that any person has misstated their gross receipts amount or
other criteria upon which their current or prior years' business license tax has been
calculated resulting in an underpayment of the tax amount owed, the collector shall
separately calculate the deficiency for each distinct license period affected and issue a
statement of tax deficiency and add delinquency penalties as applicable to the amount of
the tax deficiency in accordance with section 21-25, subsection (a) and section 21-83,
subsection (a), together with interest as provided under sections 21-84 and 21-85, as
applicable, until such time as the tax deficiency together with the accrued penalties and
interest, are satisfied.
Provided, however, that where any person voluntarily reports a tax deficiency such
person's penalty and interest assessment on said deficiency shall be abated until the
combined amount of tax, penalty and interest due is equalized to an amount equivalent
to the amount of current and prior years' taxes owing as computed or determined based
upon the business license tax rates and charges in effect for the most current tax year.
In computing the abatement of accrued penalties and interest to arrive at a combined
amount of tax, penalty and interest equivalent to the amount of the current or prior
years' taxes owing as computed or determined based upon the business license tax
rates in effect for the most current tax year the collector in his or her discretion may
retain a sufficient amount of accrued penalty alone, or a sufficient amount of accrued
interest alone, or any sufficient combination of accrued penalty amount and accrued
interest amount necessary.
Whenever the result of any audit performed pursuant to this chapter determines
that any licensee has, exclusive of penalties and interest, underpaid the amount of their
business license tax by ten (10) per cent or more of the total amount due, but not less
than two hundred fifty dollars ($250), then an audit service fee in an amount as
specified by resolution of the city council shall be applied.
Sec. 21-83.1. Partial payment; not construed as meeting requirements of chapter-
Installment payments and/or deferral; permitted - Written agreement to
satisfy indebtedness; effect.
(a) Except as provided in section 21-83, subsection (b), acceptance of any partial
payment of business license tax or penalty or interest owing that is less than the amount
required under the terms of this chapter shall not be construed as meeting the
requirements of this chapter. No license or sticker, decal, tag, plate or symbol shall be
issued, nor shall one which has been suspended or revoked be reinstated or reissued,
to any person who, at the time of applying therefor, is indebted to the city for any
delinquent business tax, unless such person, enters into an acceptable binding written
agreement with the city to satisfy said delinquency within one (1) year. With the consent of
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the collector such agreements may be deferred or extended for a period exceeding one (1)
year.
(b) The execution of any agreement to satisfy delinquent business license taxes by
means of installment payments and/or deferral shall not prevent the accrual of penalties
and interest as applicable on the unpaid balance as provided under the terms of this
chapter. However, such additional penalties as may accrue and the interest on such
penalties shall not be applied after the execution of such agreement and the payment of
the first installment and during such time as such person shall not be in breach of the
agreement. Upon the timely payment of the final installment of the agreement such
additional penalties and the interest thereon as may have accrued shall be waived. In any
agreement so entered into, such person shall acknowledge the obligation owed the city
and agree that, in the event of failure to make timely payment of any installment, the whole
amount unpaid, principal together with accrued penalties and interest thereon, shall
become immediately due and payable. In the event such person fails within a period of
thirty (30) days thereafter to render payment in full, such person's current business license
may be revoked by the collector. In the event legal action is brought by the city to enforce
collection of any amount included in the agreement, such person shall pay all costs of suit
incurred by the city or its assignee, including attorney fees. The execution of such an
agreement shall render any subsequent appeal null and void and shall constitute a waiver
against future action.
Sec. 21-93.1. Enforcement; inspection/collection service fee - application.
(a) Whenever any person charged with the duty of enforcing this chapter shall have
cause to re-examine, re-inspect, re-investigate, or re-visit a place of business for
purposes of enforcing any portion of the business license tax code or to collect any sum
owed pursuant to this chapter, a separate inspection/ collection service fee shall be
applicable in the amount as specified by resolution of the city council.
(b) In the case of a re-examination, re-inspection, re-investigation, or re-visitation of
any local place of business pursuant to a violation of this chapter or noncompliance with
the business license tax code, a reasonable period of time shall be given to the
responsible party to correct the violation or to come into satisfactory compliance with the
requirements of this chapter. If the violation or noncompliance necessitating the re-
examination, re-inspection, re-investigation, or re-visitation of any local place of
business is remedied prior to the expiration of the correction period no
inspection/collection service fee shall be imposed.
(c) Whenever the collection of the unpaid balance of any business license tax or
other amount subject to the enforcement and collection requirements of this chapter is
sought by transfer to a collection agency, or any other method of assignment not
inconsistent with the provisions of this chapter, a transfer service fee in the amount as
specified by resolution of the city council shall also apply.
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(d) The collector and his or her authorized agents charged with the duty of
enforcing this chapter, may waive the application of the inspection/collection service fee
or any other service fee elsewhere established pursuant to the provisions of this
chapter, in connection with any satisfactory agreement entered into in accordance with
section 21-80.1, or any compromise of claim, or any agreement or settlement entered
into pursuant to a court approved stipulation, or for other good cause shown.
Sec. 21-118.1. In lieu deposits - election of alternate in lieu deposit.
Whenever an applicant for a new business license for whom the gross receipts of
such business is made the basis for fixing the amount of such license is required under the
terms of sections 21-117 or 21-118 to post a deposit in lieu of payment in advance of their
business license tax, said applicant may alternatively elect to post an adjusted deposit
amount equal to the amount of their anticipated tax based on an acceptable good-faith
estimation of their expected gross receipts.
Sec. 21-119.1. Holding companies and pass-through entities - basic rate amount
only.
Whenever a business entity or other person functions as a holding company or
pass-through entity and does not directly generate gross receipts within the city, but
otherwise transacts and carries on business within the city, or maintains a business
presence in the city, or is registered as a business entity with the California Secretary of
State pursuant to the California Corporations Code as the same now exists or as may be
hereafter amended from time-to-time with a designated or registered business entity
address located in the city, then the business license tax liability of such business entity or
person under section 21-119 shall be limited to the applicable basic rate amount only.
Sec. 21-119.2. Home-based businesses - alternate tax.
(a) Persons liable under the terms of this chapter for gross receipts business
license taxes for business conducted from a home residence within the city shall have the
right to elect an alternate flat rate business license tax as set forth in section 21-120h of
this chapter for home based businesses and home based occupations, in lieu of the gross
receipts tax which would otherwise be applicable. Such election shall be made in writing
at the time of applicant's original application for a business license or may be made once
annually thereafter at the time of licensee's application for a renewal license.
(b) Home based businesses and home occupations eligible for election of an
alternate flat rate tax assessment shall be deemed to be those businesses or occupations
conducted from a home residence in the city whose business or occupational use of said
residential premises meets the requirements for a Home Occupation Permit as set forth in
sections 41-193.1 through 41-607 of this code as the same now exist or as they may be
hereafter amended from time-to-time.
Sec. 21-119.3. Election of an alternate tax assessment basis - effect.
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In every case where a licensee exercises a right under this chapter to elect an alternate
tax assessment basis the effect of said election shall be as follows:
(a) In the event an existing licensee elects to convert their annual license
assessment to an alternate tax assessment basis with an annual term
beginning one or more calendar quarters before the commencement of their
pre-existing tax assessment basis and ending one or more calendar quarters
after the conclusion of their pre-existing tax assessment basis, then their initial
alternate tax assessment shall be subject to a quarterly proration to account for
the reduced number of calendar quarters remaining in the term of the newly
elected tax assessment.
(b) In the event an existing licensee elects to convert their annual license
assessment to an alternate tax assessment basis with an annual term
beginning one or more calendar quarters after the commencement of their pre-
existing tax assessment basis and ending one or more calendar quarters after
the conclusion of their pre-existing tax assessment basis, then their pre-existing
tax assessment shall be retroactively increased prorata by the number of
quarters necessary to account for the quarterly periods remaining between the
conclusion of their pre-existing licensing term and the commencement of their
alternate tax assessment licensing term.
Sec. 21-120h. Home-based businesses, home occupations.
HOME-BASED BUSINESS/HOME OCCUPATION .......................................... $165.00 A
SECTION 7: The elective alternate flat rate home-based business/home
occupation business license tax fee adopted pursuant to Section (6) of this ordinance
shall be applicable to any person in arrears for business license taxes related to a
home-base business or occupation in the city effective January 1, 2010. The prior
payment of business license taxes due for home-based businesses or occupations, by
any other person not in arrears for said taxes shall not be deemed to constitute grounds
for a request for a refund pursuant section 21-87(c).
SECTION 8: That sections 21-3, 21-12, 21-16, 21-41, 21-43, 21-44, 21-49, 21-60,
21-64, 21-80.1, 21-83.1, 21-93.1, 21-100, 21-115, 21-118.1, 21-119.1, 21-119.2, 21-
119.3, 21-120h, 21-122, shall come into full force and effect on the first day of the
calendar month following the effective date of this ordinance. To efficiently execute the
intent of this ordinance with respect to sections 21-25, 21-83, and 21-85, the collector
shall have the authority, in his or her discretion, to vary the strict time table and/or method
of implementation of these sections beginning between the first day of the calendar
month following the effective date of this ordinance and up to and including June 30,
2013. Notwithstanding this authority, sections 21-25, 21-83, and 21-85, shall come into
full force and effect not later than July 1, 2013.
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SECTION 9: If any section, subsection, sentence, clause, phrase or portion of this
ordinance is for any reason held to be invalid or unconstitutional by the decision of any
court of competent jurisdiction, such decision shall not affect the validity of the
remaining portions of this ordinance. The City Council of the City of Santa Ana hereby
declares that it would have adopted this ordinance and each section, subsection,
sentence, clause, phrase or portion thereof irrespective of the fact that any one or more
sections, subsections, sentences, clauses, phrases, or portions be declared invalid or
unconstitutional.
SECTION 10: Neither the adoption of this ordinance nor the repeal hereby of any
ordinance shall in any manner affect the prosecution for violation of ordinances, which
violations were committed prior to the effective date hereof, nor be construed as
affecting any of the provisions of such ordinance relating to the collection of any tax or
penalty or the penal provision applicable to any violation thereof, nor to affect the
validity of any bond or cash deposit in lieu thereof, required to be posted, filed or
deposited pursuant to any ordinance and all rights and obligations thereunder
appertaining shall continue in full force and effect.
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ADOPTED this day of
APPROVED AS TO FORM:
Sonia R. Carvalho
City Attorney
Jose Sandoval
Chief Assistant City Attorney
AYES:
NOES:
COUNCILMEMBERS:
COUNCILMEMBERS:
2013.
Miguel A. Pulido
Mayor
ABSTAIN: COUNCILMEMBERS:
NOT PRESENT: COUNCILMEMBERS:
CERTIFICATE OF ORIGINALITY & PUBLICATION
I, Maria D. Huizar, Clerk of the Council, do hereby certify the attached Ordinance No.
to be the original ordinance adopted by the City Council of the City of Santa
Ana on ; and that said ordinance was published in accordance with
the Charter of the City of Santa Ana.
Date:
Clerk of the Council
City of Santa Ana
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