Ordinance 30060006.030.007
CAM/PAO /Ifs
12/30/94
Rev: 01/12/95
ORDINANCE NO. 3006
AN ORDINANCE OF THE CITY OF EDMONDS,
WASHINGTON, RELATING TO BUSINESS AND
OCCUPATION TAXES FOR CELLULAR TELEPHONE
SERVICE, ADDING A NEW DEFINITION FOR CELLULAR
TELEPHONE SERVICE, CHANGING THE EXCEPTIONS AND
DEDUCTIONS FROM GROSS INCOME FOR PURPOSES OF
COMPUTING THE TAX, DESCRIBING A PROCESS FOR
ALLOCATION OF INCOME FROM CELLULAR TELEPHONE
SERVICE, AND STATING THE TIME WHEN TAX RATE
CHANGES ARE EFFECTIVE; AMENDING SECTIONS
3.20.020 AND 3.20.060, ADDING NEW SECTIONS 3.20.155
AND 3.20.156 TO THE EDMONDS CITY CODE; AND FIXING
A TIME WHEN THE SAME SHALL BECOME EFFECTIVE.
WHEREAS, The Department of Revenue was directed by the Washington State
Legislature to form a Cellular Communications Committee, so that the Committee would study
the industry and make a report about how cellular communications should be taxed; and
WHEREAS, the Committee found that there was lack of uniformity in utility tax
ordinances in cities throughout the state, that certain cities were not receiving the tax revenue
to which they were entitled because the customer's filing address was not the same as the
cellular user's normal location, and that necessary adjustments were not made in the definition
of gross income for purposes of computing the cellular company's tax to the cities; and
WHEREAS, the Association of Washington Cities has asked all cities in
Washington to review and amend their ordinances consistent with the findings of the Committee;
NOW, THEREFORE,
90166.10 - 1 -
THE CITY COUNCIL OF THE CITY OF EDMONDS, WASHINGTON, DO
ORDAIN AS FOLLOWS:
as follows:
Section 1. Section 3.20.020 of the Edmonds City Code is hereby amended to read
3.20.020 DEFINITIONS.
In construing the provisions of this chapter, save when otherwise
plainly declared or clearly apparent from context, the following
definitions shall be applied:
A. Cellular Telephone Service is a two -way voice and data
telephone /telecommunications systems based in whole or
substantially in part on wireless radio communications and
which are not subject to regulation by the Washington
Utilities and Transportation Commission (WUTC). This
includes cellular mobile service. The definition of cellular
mobile service includes other wireless radio
communications services such as specialized mobile radio
(SMR), personal communications services (PCS) and any
other evolving wireless radio communications technology
which accomplishes a purpose similar to cellular mobile
service.
C. Gross Income means the value proceeding or accruing by
reason of the transaction of business engaged in and
includes gross proceeds of sales, compensation for the
rendition of services, gains realized from trading in stocks,
bonds, or other evidences of indebtedness, interest,
discount, rents, royalties, fees, commissions, dividends,
and other emoluments, however designated, all without any
deduction on account of the costs of tangible personal
property sold, the cost of materials used, labor costs,
interest, discount, delivery costs, taxes, or any other
expense whatsoever paid or accrued and without any
deduction on account of losses.
90166.10 .-2-
G. - Telephone business means the business of providing access
to a local telephone network, local network telephone
switching service, toll service, coin telephone services, or
the providing of telephonic video, data, or similar
communication or transmission for hire, via a local
telephone network, toll line or channel, cable, microwave,
or similar communication or transmission system. It
further includes cooperative or farmer line telephone
companies or associations operating an exchange.
"Telephone business" does not include the providing of
competitive telephone service, the providing of cable
television service, nor the providing of broadcast services
by radio or television stations.
Section 2. A new subsection (F) is added to Section 3.20.060 of the Edmonds
City Code, to read as follows:
3.20.060 EXCLUSIONS AND DEDUCTIONS
F. There shall be excluded and deducted from the total gross
income upon which the license fee or tax for telephone
businesses and telecommunications companies is computed,
the following:
(1) That portion of the gross income derived from
charges to another telecommunications company, as
defined in RCW 80.04.010, for connecting fees,
switching charges, or carrier access charges relating
to intrastate toll telephone services, or for access to,
or charges for, interstate services.
(2) Charges by a taxpayer engaging in a telephone .
business or to a telecommunications company, as
defined in RCW 80.040.010, for telephone service.
that the purchaser buys for the purpose of resale.
(3) Adjustments made to a billing or to a customer
account or to a telecommunications company
accrual account in order to reverse a billing or
charge that had been made as a result of third -party
90166.10 -3 -
fraud or other crime and was not properly a debt of
a customer.
(4) Charges to cellular telephone service subscribers
passed on to compensate for the cost to the
company of the tax imposed by this chapter.
(5) There shall be allowed as a deduction as to cellular
telephone companies which keep their regular books
of. account on an accrual basis, for credit losses
actually sustained by the taxpayer as a result of the
cellular telephone business.
Section 3. A new section 3.20.155 is hereby added to the Edmonds City Code
to read as follows:
3.20.155 ALLOCATION OF INCOME -- CELLULAR
TELEPHONE SERVICE.
A. Service address. Payments by a customer for the telephone
service from telephones without a fixed location shall be
allocated among taxing jurisdictions to the location of the
customer's principal service address during the period for
which the tax applies.
B. Presumption. There is a presumption that the service
address a customer supplies to the taxpayer (cellular
telephone company) is current and accurate, unless the
taxpayer has actual knowledge to the contrary.
C. Roaming phones. When the service is provided while a
subscriber is roaming outside the subscriber's normal
cellular network area, the gross income shall be assigned
consistent with the taxpayer's accounting system to the
location of the originating cell site of the call, or to the
location of the main cellular switching office that switched
the call.
D. Dispute Resolution. If there is a dispute among one or
more other cities, and /or the taxpayer, as to the service
address of a customer who is receiving cellular telephone
services and the dispute is not resolved by negotiation
among the parties, then the dispute shall be resolved by the
90166.10 - 4 -
City and the other city or cities by submitting the issue for
settlement to the Association of Washington Cities (AWC).
The taxpayer shall have no further liability with respect to
additional taxes on the disputed revenues, but will change
his or her billing records for future revenues to comport
with the settlement facilitated by AWC.
Section 4. A new Section 3.20.156 is hereby added to the Edmonds City Code,
to read as follows:
3.20.156 Rate Change. No change in the rate of tax upon persons
engaging in providing cellular telephone service shall apply -to
business activities occurring before the effective date of the change
and, except for a change in the tax rate authorized by RCW
35.21.870, no change in the rate of the tax may take effect sooner
than sixty (60) days following the enactment of the ordinance.
establishing the change. The City shall send to each cellular
telephone service company at the address on its license, a copy of
any ordinance changing the rate of tax upon cellular telephone
service promptly upon its enactment.
Section 5. Severability. If any section, sentence, clause or phrase of this
ordinance should be held to be invalid or unconstitutional by a court of competent jurisdiction,
such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other
section, sentence, clause or phrase of this ordinance.
Section 6. Effective Date. This ordinance, being an exercise of a power'
specifically delegated to the City legislative body, is not subject to referendum, and shall take
effect five (5) days after passage and publication of an approved summary thereof consisting of
the title.
90166.10 - 5 -
ATTEST /AUTHENTICATED:
Ma
APPROVED AS TO FORM:
OFFICE OF
BY
ATTORNEY:
FILED WITH THE CITY CLERK: 1/16/95
PASSED BY THE CITY COUNCIL: 1/24/95
PUBLISHED: 1/29/95
EFFECTIVE DATE: 2/3/95
ORDINANCE NO. 3006
90166.10 - 6 -
-SUMMARY OF ORDINANCE NO. 3006
of the City of Edmonds, Washington
On the 24th day of January , 1995, the City Council of the City of Edmonds,
passed Ordinance No. 3006 A summary of the content of said ordinance, consisting
of the title, provides as follows:
AN ORDINANCE OF THE CITY OF EDMONDS, WASHINGTON, RELATING TO
BUSINESS AND OCCUPATION TAXES FOR CELLULAR TELEPHONE SERVICE,
ADDING A NEW DEFINITION FOR CELLULAR TELEPHONE SERVICE, CHANGING
THE EXCEPTIONS AND DEDUCTIONS FROM GROSS INCOME FOR PURPOSES OF
COMPUTING THE TAX, DESCRIBING A PROCESS FOR ALLOCATION OF INCOME
FROM CELLULAR TELEPHONE SERVICE, AND STATING THE TIME WHEN TAX
RATE CHANGES ARE EFFECTIVE; AMENDING SECTIONS 3.20.020 AND 3.20.060,
ADDING NEW SECTIONS 3.20.155 AND 3.20.156 TO THE EDMONDS CITY CODE; AND
FIXING A TIME WHEN THE SAME SHALL BECOME EFFECTIVE.
The full text of this Ordinance will be mailed upon request.
DATED this 24th day of January , 1995.
_'VA
y WKS] I a "'150 .� to Il
.__ January__. 2.9.,. ... 1995 .
TIME WHEN THE SAME
.....................................................................................................................................
SHALL BECOME EFFECTIVE.
The fun text of this and that�siid ne paper was regularly distributed to subscribers
Ordinance will be of upon
request.
DATEyyD this 24th day of d 1 of sal period.
Jan RH6NDA J. MARCH •^ -
' J
City Clerk
Published: January 29;.1995. ;/ ` , � /V
:............................................ ...............................
jf Principal Clerk
Subscribed and sworn to before me this .............30th
day of --------------------•- --- Jan.:.. ry ... : ......... 19 95...
...............{ ....:.� ..... .... ...... .. ............ •• - - --
Notary Public In and for th Mate of Washington,
residing at Everett, Snoho 'sh ounty.
01 �Ze E J
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CAVED
Affidavit of Publication FEB 0 7 1995
EDMONDS CITY CLERK
STATE OF WASHINGTON,
COUNTY OF SNOHOIKISH,
ss
The undersigned, being first duly sworn on oath deposes and says
that she is Principal Clerk of THE HERALD, a daily newspaper
printed and published in the City of Everett, County of Snohomish,
and State of Washington; that said newspaper is a newspaper of
general circulation in said County and State; that said newspaper
has been approved as a legal newspaper by order of the Superior
SUMMARY.OF � -.
ORDINANCE O. 3008
Court of Snohomish County and that the notice
he Cit y of
.. of .the City
Edmonds, Washington'
......... ...............................
On the 24th:day of January,
1995, the City Council of the
City of Edmonds, passed
3006.. A
S.u.m.lary of Ordinance No. 3006
................................. ....................
OrdinanceNo.
summary of.the content of said
.... .......: ...............................
ordinance, consisting of the
title; provides as follows:.
AN ORDINANCE OF THE
...... lty,...Qf...E.C1ippa IS
CITY OF EDMONDS. WASH
INGTON RELATING TO
.................................. ...............................
BUSINESS AND OCCUPA.
TION TAXES FOR CELLULAR
TELEPHONE SERVICE,
ADDING A NEW DEFINITION
FOR CELLULAR TELEPHONE
""""'°°""• .............................."
SERVICE, CHANGING THE
a printed copy of which is hereunto attached, was published in said
EXCEPTIONS AND DEDUC-
TIONS FROM GROSS IN.
COME OF,
neWS a p pp g
paper proper and not in supplement form, in the regular and
COMPUTING. THE TAX.
SCRIBING A PROCESS FOR
AI LOCATION OF. INCOME
entire edition of said paper on the following days and times namely:
p p g Y y:
.__ January__. 2.9.,. ... 1995 .
TIME WHEN THE SAME
.....................................................................................................................................
SHALL BECOME EFFECTIVE.
The fun text of this and that�siid ne paper was regularly distributed to subscribers
Ordinance will be of upon
request.
DATEyyD this 24th day of d 1 of sal period.
Jan RH6NDA J. MARCH •^ -
' J
City Clerk
Published: January 29;.1995. ;/ ` , � /V
:............................................ ...............................
jf Principal Clerk
Subscribed and sworn to before me this .............30th
day of --------------------•- --- Jan.:.. ry ... : ......... 19 95...
...............{ ....:.� ..... .... ...... .. ............ •• - - --
Notary Public In and for th Mate of Washington,
residing at Everett, Snoho 'sh ounty.
01 �Ze E J
N0rAR�
O`er
�.AF ,�
G
OP WA SNkN'r
B -2 -1