HomeMy WebLinkAbout08904ORDINANCE NO. 8904 AN ORDINANCE SUBMITTING TO THE ELIGIBLE ELECTORS OF THE CITY OF PUEBLO, COLORADO AT THE GENERAL MUNICIPAL ELECTION TO BE HELD ON NOVEMBER 3, 2015, A QUESTION RELATING TO THE EXTENSION OF THE ONE- HALF PERCENT SALES AND USE TAX RATE FOR FIVE YEARS FOR PRIMARY JOB CREATING CAPITAL IMPROVEMENT PROJECTS WITHIN THE CITY AND THE PUEBLO MEMORIAL AIRPORT BOUNDARIES AND THE ADOPTION OF ORDINANCE NO. 8902 TO IMPLEMENT THE EXTENSION WHEREAS, the City of Pueblo, Colorado (the "City") presently imposes, pursuant to Chapter 4, Title XIV of the Pueblo Municipal Code (the "Act"), a sales and use tax rate of three and one-half percent; and WHEREAS, revenues from a one-half percent sales and use tax rate (of the three and one-half percent rate) are deposited in a special fund known as the "1992 to 2016 Sales and Use Tax Capital Improvement Projects Fund" (the "Fund"); and WHEREAS, monies in the Fund are used for job creating capital improvement projects within the City and the Pueblo Memorial Airport boundaries; and WHEREAS, the capital improvement projects funded by monies from the Fund have been successful in creating jobs and thereby promoting the public peace, health, safety and welfare of the City and its residents; and WHEREAS, the Act was initially enacted by the voters of the City, who also enacted ordinances creating and extending the one-half percent sales and use tax rate used to fund such job creating capital improvements projects; and WHEREAS, the provisions in the Act implementing the one-half percent sales and use tax rate presently expire on December 31, 2016; and WHEREAS, the City Council of the City has determined and hereby finds and determines that extending the one-half percent sales and use tax rate dedicated to primary job creating capital improvement projects within the City and the Pueblo Memorial Airport boundaries would promote the public peace, health, safety and welfare of the residents of the City; and WHEREAS, Section 18-5 of the Charter of the City requires that ordinances such as the Act, which have been adopted by an affirmative vote of the electorate, be amended only upon a vote of the electorate adopting the amending ordinance; and WHEREAS, the City Council has proposed an ordinance ("Ordinance No. 8902"), which is attached hereto and which if adopted by the voters of the City would extend the one-half percent sales and use tax rate for an additional five years; and WHEREAS, Article X, Section 20 of the Colorado Constitution as interpreted by the Colorado Supreme Court in Bruce v. City of Colorado Springs, 129 P.3d 988 (Colo. 2006) requires voter approval in advance for any extension of an expiring tax; and WHEREAS, the City desires to ask the electors of the City, pursuant to Article X, Section 20 of the Colorado Constitution and Section 18-5 of the Charter, to approve Ordinance No. 8902 and thereby extend the one-half percent sales and use tax rate for another five years for the purposes stated above; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that SECTION 1. The question of adopting Ordinance No. 8902 and thereby extending the one-half percent sales and use tax rate dedicated to primary job creating capital improvement projects shall be submitted to a vote of the eligible electors of the City at the City's general election to be held on November 3, 2015. The ballot question (submission clause and title) therefore shall be as follows: QUESTION NO. 2A - (EXTENSION OF THE ONE-HALF CENT SALES TAX) WITHOUT RAISING ADDITIONAL TAXES, SHALL THE EXISTING ONE-HALF PERCENT CITY SALES AND USE TAX RATE BE EXTENDED FOR A FIVE- YEAR PERIOD FROM ITS CURRENT EXPIRATION OF DECEMBER 31, 2016 THROUGH DECEMBER 31, 2021 BY ADOPTING ORDINANCE NO. 8902, THE REVENUES THEREFROM TO BE SPENT TOGETHER WITH ALL INVESTMENT INCOME THEREON AS A VOTER-APPROVED REVENUE CHANGE AND AN EXCEPTION TO THE LIMITS WHICH WOULD OTHERWISE APPLY PURSUANT TO ARTICLE X, SECTION 20 OF THE COLORADO CONSTITUTION OR ANY OTHER LAW, AND BY CONTINUING TO DEDICATE THE REVENUES FROM THE ONE-HALF PERCENT SALES AND USE TAX RATE FOR PRIMARY JOB CREATING CAPITAL IMPROVEMENT PROJECTS WITHIN THE CITY AND THE PUEBLO MEMORIAL AIRPORT BOUNDARIES, CREATING A SPECIAL FUND FOR THE DEPOSIT OF SUCH REVENUES, AND FINDING AND DETERMINING THAT THE EXPENDITURE OF SUCH REVENUES FOR PRIMARY JOB CREATING CAPITAL IMPROVEMENT PROJECTS ARE PUBLIC PURPOSES AND MUNICIPAL FUNCTIONS? FOR THE ORDINANCE _____ AGAINST THE ORDINANCE _____ The text of Ordinance No. 8902 is as follows: BE IT ORDAINED BY THE PEOPLE OF THE CITY OF PUEBLO, that (brackets indicate matter being deleted; underscoring indicates new matter being added): SECTION 2. Section 14-4-85 of Chapter 4, Title XIV of the Pueblo Municipal Code, as amended, (a portion of Section 13 of Ordinance No. 2189 approved by a vote of the People on November 8, 1955, as amended by Ordinance Nos. 3160, 3474, 4235, 5170, 5314, 5668, 5810, 5978, 6683, 7464 and 8197) is hereby amended by amending subsections (e) and (f) thereof to read as follows: Sec. 14-4-85. Schedule; tax added to price. . . . (e) Notwithstanding the three percent rate provision of paragraph (a) of this \[\] 2021 section 14-4-85, for the period January 1, 1992 through December 31, 2016,, the rate of tax imposed pursuant to section 14-4-85(a) shall be three and one-half percent. (f) The revenues from the additional one-half percent sales and use tax rate imposed by sections 14-4-63(b) and 14-4-85(e) of this Chapter, including interest and penalties with respect thereof, shall upon collection and receipt by the City, be deposited \[\] 2021 and placed in a special fund hereby created to be known as the " 1992 to 2016 Sales and Use Tax Capital Improvement Projects Fund" (the "Fund"). The moneys in the Fund shall be used solely for primary job creating capital improvement projects within the City and the Pueblo Memorial Airport boundaries and, incidentally, not more than two percent of such revenues for primary job training programs of not more than $800.00 for each qualified employee at such times and in such amounts and for such capital improvement projects and incidental job training programs as the City Council shall determine, provided, that monies in the Fund representing revenues from the additional one-half cent sales and use tax rate imposed prior to January 1, 2007 shall not be used for job training programs. The City Council may, in anticipation of the collection of the revenues from the additional one-half percent sales and use tax rate, and subject to the Colorado Constitution, issue revenue bonds payable solely from the moneys in the Fund for the purpose of financing such capital improvement projects. The City Council may transfer the income from the investment of moneys in the Fund to the Capital Improvement Fund created by Section 7-16 of the Charter. The unappropriated \[\] 2025 balance of the Fund on December 31, 2020 shall be transferred to said Capital Improvement Fund. SECTION 3. Section 14-4-63 of Chapter 4, Title XIV of the Pueblo Municipal Code (Section 20 of Ordinance No. 2189 approved by a vote of the People on November 8, 1955, as amended by Ordinance Nos. 3160, 3474, 4734, 5170, 5314, 5668, 5810, 5978, 6683, 7464 and 8197) is hereby amended by amending subsection (2) thereof to read as follows: Sec. 14-4-63. Storage, consumption and use tax schedule. . . . (2) Notwithstanding the three percent rate provision of this Section for the \[\] 2021 period January 1, 1992 through December 31, 2016 , the rate of tax imposed pursuant to this Section shall be three and one-half percent (3.5%). SECTION 4. The people of Pueblo do hereby find, determine and declare that the expenditure of revenues from a one-half percent sales and use tax rate for primary job creating capital improvement projects within the City and the Pueblo Memorial Airport boundaries will (a) create employment opportunities for the citizens of the City of Pueblo thereby reducing unemployment and social evils associated therewith, (b) enhance the economic development of the City and Pueblo Memorial Airport by the establishment of new businesses and commitments from companies to operate new business facilities, and (c) promote the public peace, health, safety and welfare. The people of Pueblo do further find, determine and declare that the expenditure of such revenues for primary job creating capital improvement projects are public purposes and municipal functions notwithstanding that such expenditure may, directly or indirectly, aid, assist or benefit private persons, corporations or other entities. SECTION 5. The City Council is authorized and directed to establish by Ordinance the criteria, standards, rules and regulations for the appropriation and expenditure of such revenues for primary job creating capital improvement projects and incidental primary job training programs within the City and the Pueblo Memorial Airport boundaries and none of the revenues shall be appropriated or expended except in conformity therewith. Until the adoption of any new Ordinance subsequent to the effective date of this Ordinance, the criteria, standards, rules and regulations heretofore adopted by City Council for appropriation and expenditure of such revenues are hereby reaffirmed and ratified. SECTION 6. All ordinances relating to sales and use taxes heretofore adopted, amended or implemented shall remain in full force and effect except as the same have been previously amended or repealed or as the same may be amended by this Ordinance. SECTION 7. All ordinances, or parts thereof, inconsistent herewith are hereby repealed to the extent of such inconsistency. This repealer shall not be construed to revive any ordinance, or part thereof, heretofore repealed. SECTION 8. If any section, subsection, paragraph, clause or other provision of this Ordinance for any reason is invalid or unenforceable, the invalidity or unenforceability of such section, subsection, paragraph, clause or other provision shall not affect any of the remaining provisions of this Ordinance. SECTION 9. This Ordinance shall become effective upon the majority vote in favor thereof by the registered electors of the City voting thereon at the Municipal General Election to be held Tuesday, November 3, 2015. The tax levies of this Ordinance shall take effect beginning January 1, 2017. SECTION 10. The officers and staff of the City are authorized and directed to take all action necessary, appropriate or required to effectuate the provisions of this Ordinance. SECTION 11. Any revenues generated by the one-half percent sales and use tax imposed pursuant to this Ordinance, together with all investment income thereon, may be collected, retained and spent as a voter-approved revenue change and an exception to the limits which would otherwise apply pursuant to Article X, Section 20 of the Colorado constitution or any other law. INTRODUCED: July 27, 2015 BY: Ed Brown PASSED AND APPROVED: August 10, 2015 City Clerk’s Office Item # R-3 Background Paper for Proposed Ordinance COUNCIL MEETING DATE: July 27, 2015 TO: President Stephen G. Nawrocki and Members of City Council CC: Sam Azad, City Manager VIA: Gina Dutcher, City Clerk FROM: Daniel C. Kogovsek, City Attorney SUBJECT: AN ORDINANCE SUBMITTING TO THE ELIGIBLE ELECTORS OF THE CITY OF PUEBLO, COLORADO AT THE GENERAL MUNICIPAL ELECTION TO BE HELD ON NOVEMBER 3, 2015, A QUESTION RELATING TO THE EXTENSION OF THE ONE-HALF PERCENT SALES AND USE TAX RATE FOR FIVE YEARS FOR PRIMARY JOB CREATING CAPITAL IMPROVEMENT PROJECTS WITHIN THE CITY AND THE PUEBLO MEMORIAL AIRPORT BOUNDARIES AND THE ADOPTION OF ORDINANCE NO. 8902 TO IMPLEMENT THE EXTENSION SUMMARY: Attached is a proposed Ordinance referring the extension of the one-half percent sales and use tax ballot question to the voters of the City of Pueblo at the November 3, 2015 municipal general election. PREVIOUS COUNCIL ACTION: City Council has previously referred ballot measures to the electorate for the extension of the one-half percent sales and use tax in 1995 by Ordinance No. 5978; in 2000 by Ordinance No. 6683; in 2006 by Ordinance No. 7464 and in 2010 by Ordinance 8197. BACKGROUND The City’s one-half percent sales and use tax rate for job creating capital improvement projects will expire December 31, 2016. The Ordinance will extend the one-half percent sales and use tax rate for 5 years from January 1, 2017 to December 31, 2021. Due to the requirements of the Taxpayers Bill of Rights ("TABOR"), Article X, §20 of the Colorado Constitution, any extension of an existing tax must be approved by the voters. This measure would refer the extension of the one-half cent sales and use tax question to the voters and, if approved, would also "De-Bruce" the revenue derived from the tax extension (i.e., exempt it from the revenue growth and spending limitations of TABOR). FINANCIAL IMPLICATIONS: It is anticipated that the one-half percent sales and use tax rate will generate approximately $7,000,000 in 2017 and each subsequent year, subject to fluctuation in sales and use tax revenue collected during those years. BOARD/COMMISSION RECOMMENDATION: Not applicable to this Ordinance. STAKEHOLDER PROCESS: Members of the public are the primary stakeholders affected by the proposed Ordinance. The issue of extending the one-half cent sales and use tax for an additional five years has been discussed at various public Council meetings and work sessions during the past year. ALTERNATIVES: If the Ordinance is not approved, the one-half cent sales and use tax will expire on December 31, 2016. RECOMMENDATION: This Ordinance must be adopted in order to refer the ballot measure to the voters. Attachments: Proposed Ordinance