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Home My WebLink About10445ORDINANCE NO. 10445 AN ORDINANCE AMENDING SECTION 14-4-77 OF THE PUEBLO MUNICIPAL CODE RELATING TO ITEMS EXEMPT FROM USE TAX AND CLARIFYING THAT THE USE TAX EXEMPTION WITH RESPECT TO NONRESIDENTS AND PROPERTY PURCHASED PRIOR TO RESIDENCY APPLIES ONLY TO INDIVIDUALS AND PERSONAL USE OF SUCH PROPERTY BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. Section 14-4-77 of the Pueblo Municipal Code, is amended to read as follows: Sec. 14-4-77. Items exempt from use tax. This tax or excise of the storage, consumption and use of tangible personal property is hereby declared to be supplementary to the City tax on retail sales as provided in this Chapter and shall not apply: (1) To the storage, use or consumption of any tangible personal property the sale of which is subject to the City retail sales tax as provided herein. (2) To the storage, use or consumption of any tangible personal property purchased for resale in this City, either in its original form or compounded product, in the regular course of a business. (3) To the storage, use or consumption of motor fuel upon which there has accrued or has been paid the motor fuel tax prescribed by the Colorado Motor Fuel Tax Law of 1933, C.R.S. 138, Article 2. (4) To the storage, use or consumption of tangible personal property brought into this City by a nonresident thereof for his or her own storage, use or consumption while temporarily within this City, or to the personal property of a resident if such personal property was purchased prior to becoming a resident of this City. The exemption provided herein shall apply only to an individual and only to such individual’s personal use of the tangible personal property brought into the City. (5) To the storage, use or consumption of tangible personal property of the United States government, or of the State or its institutions or political subdivisions in their governmental capacities only; or by charitable organizations as defined in Section 14-4-21 above in the conduct of their regular religious or charitable functions. (6) To the storage, use or consumption of tangible personal property by a person engaged in the business of manufacturing or compounding for sale, profit or use any article, substance or commodity, which tangible personal property enters into the processing of or becomes an ingredient or component part of the product or service which is manufactured, compounded or furnished and the container, label or the furnished shipping case thereof. (7) To the storage, use or consumption of electricity, coal, coke, fuel oil, steam, water or gas for use in processing, manufacturing, mining, refining, irrigation, telegraph, telephone and radio communication, street and railroad transportation services, electric power generation and all industrial uses; except that electricity, gas, coal, fuel oil, steam, water or coke used for lighting or space heating in these operations shall not be exempt. (8) To the storage and use of neat cattle, sheep, lambs, swine and goats within this City; or to the storage and use within this City of mares and stallions kept, held and used for breeding purposes only. (9) To the storage, use or consumption of printers ink and newsprint. (10) A credit shall be granted against the use tax imposed by Section 14-4-63 of this Chapter on any article of tangible personal property the sale of which has already been subjected to a retail sales tax. The amount of the credit shall be equal to: (a) if purchased within the State, the retail sales tax imposed, collected and remitted to a Colorado municipality, city or county, or (b) if purchased outside the State, the amount by which the retail sales tax imposed, collected and remitted to another state or political subdivision thereof, or both, exceeds the sales tax imposed by Section 39-26-106(1), C.R.S. The amount of the credit shall not exceed the use tax imposed by Section 14-4-63 of this Chapter. The credit will be denied if such retail sales tax was not legally due under the laws of such other taxing authority, or such laws are not compatible with those of the City as to specific taxation or exemption of the transaction in question. The credit shall not be granted for subsequent transactions within the City relating to such article of tangible personal property, including but not limited to rentals or leases thereof. (11) To the storage or use of an automobile or other vehicle required to be registered under the Colorado Uniform Motor Vehicle Law by a purchaser who was not a resident of the City at the time of purchase and who purchased such vehicle outside of the City for use outside of the City and actually so used such vehicle for a substantial and primary purpose for which it was acquired, and who lawfully registered, titled and licensed such vehicle outside the City. (12) To the storage, use or consumption of aircraft used or purchased for use in interstate commerce by a commercial airline. a. Commercial airline means an airline carrying freight or passengers on regularly scheduled flights for a fee, but does not include a charter air carrier providing charter air transportation. (13) To the storage, use or consumption of tangible personal property used in the initial construction and equipping of a new six-hundred-or-more-megawatt electric power generation facility constructed on or after January 1, 2005 ("electric power generation facility"). This exemption shall also apply for a period of ten (10) years after such an electric power generation facility becomes operational to tangible personal property stored, used or consumed in the maintenance, repair, refurbishing, remodeling, substitution, relocation or replacement of such an electric power generation facility, or any part thereof. a. Operational means the date the electric power generation facility is deemed by its owner or any regulatory agency with appropriate jurisdiction to be placed into commercial operation pursuant to standards published by the Federal Energy Regulatory Commission and Financial Accounting Standards Board applicable to electric power generation facilities. (14) To the storage, use or consumption of dyed diesel fuel, as that term is defined in Section 39-27-101(8), C.R.S., for use in the construction, rehabilitation, alteration, conversion, extension, demolition or repair of buildings, dwellings, structures, roads, highways or other changes or improvements to real property. (15) To the storage, use or consumption of tangible personal property used in the initial construction and equipping of a new 200 or more megawatt electric power generation facility located within an enterprise zone and constructed on or after June 1, 2010 and prior to January 1, 2012 ("electric power generation facility"). (16) To the storage, use or consumption of tangible personal property by schools in the conduct of their educational functions and activities. SECTION 2. The officers of the City are authorized and directed to perform any and all acts consistent with the intent of this Ordinance to implement the policies and SECTION 3. This Ordinance shall become effective thirty days after the date of final action by the Mayor and City Council. Action by City Council: Introduced and initial adoption of Ordinance by City Council on April 10, 2023. Final adoption of Ordinance by City Council on April 24, 2023 . President of City Council Action by the Mayor: ☒ Approved on April 25, 2023 . □ Disapproved on based on the following objections: Mayor Action by City Council After Disapproval by the Mayor: □ Council did not act to override the Mayor's veto. □ Ordinance re-adopted on a vote of , on □ Council action on _______ failed to override the Mayor’s veto. President of City Council ATTEST City Clerk City Clerk's Office Item # R10 Background Paper for Proposed Ordinance COUNCIL MEETING DATE: April 24, 2023 TO: President Heather Graham and Members of City Council CC: Mayor Nicholas A. Gradisar VIA: Marisa Stoller, City Clerk FROM: Robert Jagger, Deputy City Attorney Alexandria Romero, Director of Finance SUBJECT: AN ORDINANCE AMENDING SECTION 14-4-77 OF THE PUEBLO MUNICIPAL CODE RELATING TO ITEMS EXEMPT FROM USE TAX AND CLARIFYING THAT THE USE TAX EXEMPTION WITH RESPECT TO NONRESIDENTS AND PROPERTY PURCHASED PRIOR TO RESIDENCY APPLIES ONLY TO INDIVIDUALS AND PERSONAL USE OF SUCH PROPERTY SUMMARY: The proposed Ordinance clarifies that the nonresident use tax exemption applies only to an individual and only to such individual’s personal use of the tangible personal property brought into the City. PREVIOUS COUNCIL ACTION: Not applicable to this Ordinance. BACKGROUND: This exemption has remained unchanged since its original enactment in 1955. Consistent with such enactment at the time and subsequent caselaw including Rocky Mountain Prestress, Inc. v. Johnson, 574 P.2d 88, 89 (Colo. 1978), this exemption has been construed and applied only to an individual and only to such individual’s personal use of the tangible personal property brought into the City. Recently, confusion has been expressed by taxpayers as to the scope of this exemption. The proposed Ordinance will clarify the exemption so that such confusion will not exist. FINANCIAL IMPLICATIONS: None. This Ordinance only provides clarifying language consistent with its past application. BOARD/COMMISSION RECOMMENDATION: Not applicable to this Ordinance. STAKEHOLDER PROCESS: Not applicable to this Ordinance. ALTERNATIVES: City Council could choose not to enact the Ordinance, in which case, the Ordinance will continue to be a potential source of confusion to taxpayers. RECOMMENDATION: Administration recommends passage and approval of the Ordinance. ATTACHMENTS: None