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HomeMy WebLinkAboutOrdinance No. 0985 Ordinance No. 985 Page 1 of 3 Ordinance No. 985 MEDINA CITY COUNCIL AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MEDINA, WASHINGTON, ADOPTING LEGISLATION TO AUTHORIZE A SALES AND USE TAX FOR AFFORDABLE HOUSING IN ACCORDANCE WITH SUBSTITUTE HOUSE BILL 1406 (CHAPTER 338, LAWS OF 2019), AND OTHER MATTERS RELATED THERETO; ADDING A NEW CHAPTER 3.57 TO TITLE 3 OF THE MEDINA MUNICIPAL CODE; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, in the 2019 Regular Session, the Washington State Legislature approved Substitute House Bill 1406 (Chapter 338, Laws of 2019) (“SHB1406”) and codified as RCW 82.14.540; and WHEREAS, SHB 1406 authorizes the governing body of a city or county to impose a local sales and use tax for the acquisition, construction or rehabilitation of affordable housing or facilities providing supportive housing; and WHEREAS, the tax will be credited against sales and use taxes collected within the City of Medina (the “City”) by the State of Washington and, therefore, will not result in higher sales and use taxes within the City and will represent an additional source of funding to address housing needs in the City; and WHEREAS, revenue received from the sales and use tax must be used to assist persons whose income is at or below 60% of King County’s median income; and WHEREAS, the City has determined that there is a demand and need for affordable housing and that imposing the sales and use tax to address this need will benefit its citizens; and WHEREAS, in order for a city or county to impose the sales and use tax permitted by SHB 1406, within six months of the effective date of SHB 1406, or by January 28, 2020, the governing body must have adopted a resolution of intent to authorize the maximum capacity of the tax, and within twelve months of the effective date of SHB 1406, or by July 29, 2020, must adopt legislation authorizing the maximum capacity of the tax; and WHEREAS, on September 9, 2019, the City Council adopted Resolution No. 404 declaring its intent to adopt legislation to authorize 0.0073% of the sales and use tax as authorized by SHB 1406; and WHEREAS, SHB 1406 allows cities and counties to enter into interlocal agreements with other counties, cities or public housing authorities to pool the sales and use tax receipts and allocate the proceeds of the taxes levied under SHB 1406; and WHEREAS, the City is a member city of and a party to the interlocal agreement establishing A Regional Coalition of Housing (“ARCH”), a joint board established for the purpose of pooling revenue for investment in housing; and WHEREAS, the interlocal agreement establishing ARCH authorizes the City of Bellevue (as the administering agency for ARCH) to establish and maintain a centralized Housing Trust Ordinance No. 985 Page 2 of 3 Fund Account for the purpose of administering the contributions of ARCH members for affordable housing projects and programs; and WHEREAS, the City Council desires to allocate the sales and use tax receipts authorized by SHB 1406 to ARCH, to be pooled with other sources of revenue in accordance with terms of the exiting interlocal agreement, for administration through the ARCH Housing Trust Fund Account, with contributions to be released only when directed by the City; and WHEREAS, this ordinance constitutes the legislation required to authorize a sales and use tax in the amount of 0.0073% in accordance with SHB 1406; and WHEREAS, the City Council now desires to impose a local sales and use tax as authorized by SHB 1406, as set forth herein, and adopt a new Chapter 3.57 to Title 3 of the Medina Municipal Code to adopt and impose said sales and use tax; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MEDINA, WASHINGTON, DOES ORDAIN AS FOLLOWS: Section 1. Findings. The City Council hereby adopts the forgoing recitals as findings in support of this Ordinance. Section 2. Adoption. The City Council hereby adopts a new Chapter 3.57 to Title 3 of the Medina Municipal Code, entitled “Sales and Use Tax for Affordable Housing” to read as follows: Chapter 3.57 Sales and Use Tax for Affordable Housing Purpose 3.57.010 The purpose of this chapter is to impose a local sales and use tax for the acquisition, construction or rehabilitation of affordable housing or facilities providing supportive housing as authorized by RCW 82.14.540. 3.57.020 Imposition of Sales and Use Tax. A. Imposition. In addition to other taxes which may be imposed by the City, there is hereby authorized, fixed and imposed a separate sales and use tax in accordance with RCW 82.14.540. Such tax shall be assessed on the selling price in the case of a sales tax, or value of the article used in the case of a use tax, upon every taxable event that occurs within the City limits of Medina. B. Tax Rate; Term. The rate of the sales and use tax authorized by this Chapter shall be 0.0073% of the selling price or value of the article used or such rate as authorized by RCW 82.14.540 as amended from time to time. The tax imposed by the City under this Chapter shall expire twenty years after the date on which the tax is first imposed. C. Tax Receipts; Administration. The maximum amount to be received by the City from the tax in each year shall be equal to the taxable retail sales within the City limits of Medina in each fiscal year multiplied by the tax rate. The tax imposed by this chapter shall be deducted from the amount of tax otherwise required to be collected or paid to the Washington State Department of Revenue (“DOR”) under chapter 82.08 or 82.12 RCW, as the same now exists or may hereafter be amended. DOR shall collect and administer the tax on behalf of the City at no cost to the City. In the event that the amount of tax exceeds the maximum amount allowed to the City Ordinance No. 985 Page 3 of 3 under RCW 82.14.540, any excess shall be remitted to the State Treasurer in accordance with RCW 82.14.540(5). The City Manager is authorized to enter in an agreement with DOR for the administration of the tax. 3.57.030 Penalty. Any person violating any provision of this Chapter shall be guilty of a misdemeanor and upon conviction thereof punished pursuant to State law or City ordinance. Section 3. Use of Tax Receipts; Pooling Sales and Use Tax Receipts. Revenue received by the City from the sales and use tax authorized in Section 1 of this ordinance shall be used for the purposes authorized in RCW 82.14.540(6), including acquiring, rehabilitating and/or constructing affordable housing, providing supportive housing services, and funding the operations and maintenance costs of new units of affordable or supportive housing. Sales and use tax receipts received by the City as authorized by RCW 82.14.540 are hereby authorized to be remitted to ARCH in accordance with terms of the existing interlocal agreement between ARCH and the City, for administration through the ARCH Housing Trust Fund Account, with contributions to be released only when directed by the City Manager, who is authorized to execute such documents as necessary to carry out the terms of this Section. Section 4. Corrections. The City Clerk and codifiers of the ordinance are authorized to make necessary corrections to this ordinance including, but not limited to, the correction of scrivener/clerical errors, references, ordinance numbering, section/subsection numbers and any references thereto. Section 5. Severability. If any section, subsection, paragraph, sentence, clause or phrase of this ordinance is declared unconstitutional or invalid for any reason, such invalidity shall not affect the validity or effectiveness of the remaining portions of this ordinance. Section 6. Publication and Effective Date. This Ordinance, or a summary thereof consistent of the title, shall be published in the official newspaper of the City and shall take effect and be in full force five (5) days after its adoption and publication as required by law. PASSED BY THE CITY COUNCIL OF THE CITY OF MEDINA ON THE 8TH DAY OF JUNE 2020 BY A VOTE OF 7 FOR, 0 AGAINST, AND 0 ABSTAINING, AND IS SIGNED IN AUTHENTICATION OF ITS PASSAGE THE 8TH DAY OF JUNE 2020. PUBLISHED: EFFECTIVE DATE: ORDINANCE NO.: / AB