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ORD 99-28 LICENSING OF BUSINESSES AND B & O TAXORDINANCE NO. 99-28 AN ORDINANCE of the City of Bainbridge Island, Washington, relating to the City' s licensing of businesses and its business and occupation tax; mending Chapter 5.04 and adding a new Chapter 5.05 to the Bainbridge Island Municipal Code. Wlll~REAS, RCW 35.21.710 provides that cities are authorized to require the licensing of businesses and to levy and collect a tax not to exceed two-tenths of one percent on their gross income; and WltF~REAS, the City of Bainbridge Island has imposed such licensing and tax requirements continuously since at least 1982; and Wlt!~REAS, the Finance Committee of the Bainbridge Island City Council has conducted extensive public meetings to determine needed improvements, corrections and adjustments to BIMC Chapter 5 04; now, therefore ~ CITY COUNCIL OF ~ CITY OF BAINBRIDGE ISLAND, DOES ORDAIN AS FOLLOWS: Section 1. Chapter 5.04 of the Bainbridge Island Municipal Code is hereby amended as.follows: Chapter 5.04 Business Licenses Sections: 5.04.010 5.04.020 5.04.030 5.04.040 5.04.050 5.04.055 5.04.060 5.04.070 5.04.080 5.04.190 5.04.200 5.04.210 5.04.220 5.04.230 Purpose. Definitions and presumption. License required. License - Application and issuance. License - Nontransferable. Standards of Conduct. License - Suspension, Denial or Revocation. License - Multiple locations. Exempt Activities. License - Fee additional to others. License - Collection. Over or underpayment of License. Appeal procedure. License - Contidentiality of applications. 5.04.240 5.04.250 5.04.260 5.04.270 5.04.280 Duties of the director. Civil penalty. Violation - Penalty. Uxability of Successor Limitations on License 5.04.010 Purpose. The provisions of this chapter are an exercise of the police and taxation powers of the city to license for revenue purposes and to govern the privilege of engaging in business in the city. 5.04.020 Definitions and presumption. A. This chapter incorporates by reference all definitions set forth in Chapter 82.04 RCW, hereafter amended, except where a conflicting definition is stated in this chapter. B. "Director" means the director of finance and administrative services for the city. C. Businesses or persons soliciting business within the city or using either a business telephone number or business address within the city shall be presumed to be engaged in business within the city. 5.04.030 License required. Every person who engages in business activities within the city shall apply for and obtain from the director a license for the privilege of engaging in business within the city for each calendar year or portion thereof The fee for the business license shall be in the amount established by resolution of the city council. No person shall engage in any business for which a business license is required under this chapter without being so licensed, regardless of the amount of income received, except as otherwise provided in this rifle. 5.04.040 License - Application and issuance. A. Business licenses must be obtained and the fee paid before a business commences operation within the city. The license fee shall be considered delinquent if not paid when due. B. The business license required by this chapter shall expire on December 31st of the year for which it is issued. A new license shall be required for each year and the fee paid on or before the last day of February. C. Applications for business licenses shall be made to and issued by the finance director on forms provided by the city, which shall state the residence of the applicant, the nature of each business activity in which the applicant desires to engage, and the place where the applicant proposes to conduct its business. fithe director finds that the application is complete and correct, that all required fees have been paid, and all laws and requirements have been complied with, the business license shall be issued. D. The director shall, when appropriate, refer applications to the Department of planning and Community Development, the Department of Public Safety, the Balnbridge Island Fire Department, and other governmental agencies for their review. E. Multiple business activities under common ownership may be conducted under a single license. F. Neither the filing of an application for a license, or the renewal thereof, nor the payment of any application or renewal fee, shall authorize a person to engage in or conduct a business until such license has been granted or renewed. 5.04.050 License - Nontransferable. The business license issued under this chapter shall be personal and nontransferable, and shall at all times be posted in the place of business for which it is issued. Where a licensee's place of business is changed, the licensee shall return the license to the director and a new license shall be issued for the new place of business without charge. No licensee shall allow another person to operate a business under, or display, the license, nor shall another person operate under or display the license. 5.04,055 S~andards of Conduct Even licensee under this chapter shall: A. Permit reasonable inspections of the business premises by governmental authorities for the purpose of enforcing the provisions of this chapter~ B. Comply with all federal, state and city statutes, laws, ordinances and regulations relating to the business premises and the conduct of the business thereon~ C. Refrain from unfair or deceptive acts or practices, or consumer fraud, in the conduct of the business, and avoid maintaining a public nuisance on the business premises; D. Re~ain from operating the business after expiration of a license or during the period that the license may be suspended or revoked. 5.04.060 License - Suspension, Denial or Revocation. A. A business license may be suspended by the city without notice for any of the following causes: (1). The licensee or any of its officers, directors, agents or employees while acting within the scope of their duties has violated or failed to keep the building structure or equipment of the licensed premises in compliance with applicable health, building, fire, or safety laws, ordinances, or regulations; (2).. Failed to comply with the standards of conduct specified in this chapter; Such suspension shall remain in effect until the conditions causing the suspension are cured and reasonable measures are taken to ensure that those conditions will not recur. B. In addition to the other penalties provided by law, a business license may be denied or revoked by the city for any of the causes in A (1) and (2) above or if the license was issued through mistake or inadvertence; C. Upon suspension, denial or revocation of a license, the director shall, by certified mail, give written notice of such action to the applicant, including a written report summarizing the complaints, objections and information received and considered by the director and further stating the reason for the action. Notice mailed to the mailing address on the application or most recent renewal shall be deemed received three days after mailing. Appeal of the director' s decision shall follow the appeal procedures set forth in this chapter. D. A bus'mess license may be revoked on 20 days' written notice to the licensee where the licensee fails to pay the annual license fee and/or bus'mess and occupation tax, together with any penalties due thereon, within six months after the fee or tax is due and owing. The licensee shall have the fight to full reinstatement of the bus'mess license upon payment of all amounts due within 10 days of the revocation. 5.04.070 License - Multiple locations. If bus.mess is transacted by one person at two or more separate locations within the city, a separate license shall be obtained and displayed in each location at which business is 5.04.080 Exempt Activities. The fullowing activities shall be exempt from the licensing provisions of this chapter: A. Nonprofit activities carried on by religious, charitable, educational, benevolent, fraternal or social organizations which have been determined by the Internal Revenue Service of the United States to be exempt from the payment of income tax; B. The exercise of governmental functions performed by any instrumentality of the United States, the State of Washington, or any political subdivision thereof. C. Faxmers or gardeners selling their own farm products raised and grown exclusively upon lands owned or occupied by them; D. Garage sales conducted on residential premises in compliance with this code; E. The mere delivery of goods or services to the customer or client by bus'messes where the sale occurred on business premises outside of the city, and was the only event occurring within the city except that the performance of contracting or subcontracting services is not an exempt activity; or F. Any bus'mess activity which is owned and operated solely by a person under the age of 18, and which does not generate a gross income of more than $2,500 per year. 5.04.090 Payment of License F~:. A. There shall be a license fee imposed for the privilege of doing bus'mess as set by resolution of the city count'ft. B. Payment of the fee imposed by this chaptershall be due on or before the commencement of business and renewed on or before the last day of]February of each successive year. C. On or before the due date, every person required to pay a license fee or a tax as set forth by this chapter shall fie with the city a written return, upon such foiiii and including such information as the director shah require, together with the payment of the amount of the fee. 5.04.190 License - Fee additional to others. The license imposed and levied by this chapter shall be in addition to any license fee or tax imposed or levied under any law or other ordinance of the city, except as otherwise expressly provided. 5.04.200 License Fee - Collection. The license fee imposed by this chapter, and all penalties thereon, shall constitute a debt to the city, and may be collected by court proceedings in the same manner as any other debt in like amount, which remedy shall be in addition to all other existing remedies. Any judgment entered in favor of the city shall include an award to the city of all court and collection costs including attorneys' fees. Amounts delinquent more than 90 days may be assigned to a third party for coliection, in which case the amount of any collection charges shall be in addition to all other amounts owed. Amounts due shall not be considered paid until the city has received good funds for the full amount due or has discharged the amount due and not paid. 5.04.210 Over or underpayment of fees. In the event that any person makes an overpayment, and within two years of the date of such overpayment makes application for a refund or credit, the person's claim shall be allowed and a refund made by the city upon determination by the director that no other sums are owed by the person to the city. ff a person determines that the fees have been underpaid and without notice by any party pays the amount due to the city, the amount underpaid and corrected by the person shall not be subject to penalty. 5.04.220 Appeal procedure. A person who has had a license suspended, denied or revoked or who has been aggrieved by the amount of the license fee deteua~ined to be due to the city by the director under the provisions of this chapter may appeal to the city council from such determination by filing a written notice of appeal with the city clerk within 20 days from the date on which such person is given notice of the license fee. The city counc'~ or a committee of the city council shall, as soon as practicable, fix a time and place for the hearing for such appeal. Notice of the hearing shah be given to the appellant by certified mail at least five days prior to the date of the hearing. The licensee may appear at the hearing and be heard in opposition to such denial, suspension or revocation or to the fee imposed. The decision of the city council or its committee shall be announced at the conclusion of the hearing and shall be final, subject only to a writ of certiorari being filed with the Kitsap County Superior Court within 14 days following the date of the c:,~' :cur, c:d': decision of the city council or a committee of the city counc'~. 5.04.230 License - Confldentiality of applications. , The applications made to the city pursuant to this chapter shall be made public, and shall be subject to inspection excepfmg only that emergency telephone numbers shall not be made public except where required by law. 5.04.240 Duties of the director. A. The director shall keep full and accurate records of all funds received under the provisions of this chapter. Upon receipt of any license fee or penalties collected under the provisions of this chapter, the director shall deposit the amounts collected into the current expense fund of the city. B. In order to carry out the provisions of this chapter, the director shall have the power to adopt, publish and enforce rules and regulations consistent with this chapter. 5.04.250 Civil penalty. In the event that any person fails to pay the license fee imposed by this chapter within 15 days of the due date, a civil penalty shall be imposed in the amount of 10 percent of the delinquent license fee plus any previously assessed and unpaid penalties under this chapter. For the purposes of calculating the penalty, each month that the mounts owed under this chapter are due and unpaid shall be considered a separate violation subject to penalty. Civil penalties shall be limited to not more than amount of the full license fee for each year for which a license is required and shall not commence until the bus'mess has been notified of the need for a license and failed to get one within thirty days. A fraction of a month shall be deemed a full month. In the event that a penalty has been wrongfully collected, the director shall refund the penalty. $.04.260 Violation - Penalty. A. It shall be a violation of this chapter: 1. For a person required obtaining a business license under this chapter to fail or refuse to secure the business ficense or to fail to pay the fee imposed; 2. For a person to make any false representation in connection with application for a business license under this chapter; 3. For a person to evade payment of the fee or any part thereoi~ 4. For a person to fail to appear and/or refuse to testify in response to a subpoena issued hereto; 5. For a person to test'fly falsely upon any investigation of the correctness of a return, or upon the head'mS of any appeal; or 6. For a person to in any manner hinder or delay the city or any of its officers in carrying out the provisions of this chapter. B. It shall be unlawful for any person to conduct business within the city limits when not in compliance with this chapter. C. A person violating any of the provisions of this chapter, upon conviction thereof, shall be punished by a fine of not more than $500.00 or by imprisonment for not more than six months, or by both such fine and imprisonment. Each such person is gu'dty of a separate offense for each and every day during the portion of which any violation of any provision of this chapter is committed, continued or permitted by any such person and he is punishable accordingly. 5.04.270 Sueee~sor Liability A. Whenever any person required to be licensed by this chapter quits business, or sells out, exchanges or otherwise disposes of his/her business or stock of goods, any license fees or penalty payable to the city shall immediately become due and payable, and such person shall, within thirty days, file the required forms and pay the fees due. Any person who becomes a successor to such person shall become liable for the full amount of the license fees and penalties due and owing and shall withhold from the purchase price a sum sufficient to pay any amount due from the seller until such time as the seller shall produce a receipt from the city clerk showing payment in full of any amount due or a certificate that no license fees are due. The payment of the fees by the successor shall, to the extent thereof, be deemed a payment upon the purchase price, and if such payment is greater than the purchase price, the amount of the difference shall become a debt due such successor from the seller. The successor's liability shall be limited to the purchase price or the fair market value of the business if no cash transaction took place. B. No successor shall be liable for any license fees due from the person from whom he/she has acquired a business or stock of goods if he/she gives written notice to the city clerk or director of such acquisition, and no assessment is issued by the director within six months of receipt of such notice against the former operation of the business and a copy of the assessment mailed to the successor. C. Each person's account will remain on an active status and be subject to all license fees, and penalties until such time as the director is notified in writing that the person has discontinued business activity within the city. 5.04.280 Limitations on License. Notwithstanding any provisions to the contrary, a license issued under this chapter shall not be issued to any person who uses or occupies or proposes to use or occupy and real property or otherwise conducts or proposes to conduct any business in violation of the provisions of an ordinance of the City of Balnbridge Island, specifically including the city' s zoning laws, or of the laws of the State of WashinSton. The granting of a business license shall in no way be construed as permission or acquiescence in a prohibited activity or other violation. Because the issuance of a license under this chapter specifically denies the applicant authority to violate any law or regulation, the city shall not be held liable for the actions of any licensed business by virtue of having issued a license to conduct business. Section 2. A new Chapter 5.05 is hereby added to the Bainbridge Island Municipal Code as follows: Chapter 5.05 Business and Occupation Tax Sections: 5.05.010 5.05.020 5.05.080 5.05.085 5.05.090 5.05.100 5.05.110 5.05.120 5.05.130 5.05.140 5.05.150 5.05.160 5.05.170 5.05.180 5.05.190 5.05.200 5.05.210 5.05.220 5.05.230 5.05.240 5.05.250 5.05.260 5.05,270 Purpose. Definitions and presumption. Persons subject to tax- Amount. Exempt Businesses. Exemptions--- Type of Income. Amount of income taxed. Limits on taxation. Taxes- Apportionment- Statement of principle. Taxes - Apportionment - Persons rendering services inside and outside the city. Tax - Apportionment - Persons engaged in business activity other than rendering services. Taxes - Apportionment- Allocation authority of director. Taxes - Apportionment- Records. Taxes - Apportionment - Effect of apportionment on tax exemption. Payment of tax. Tax Additional to others. Collection. Over or underpayment of tax. Appeal procedure. Confidentiality of Tax returns. Duties of the director. Civil penalty. Violation- Penalty. Liability of Successor 5.05.010 Purpose. The provisions of this chapter are an exercise of the taxation powers of the city. 5.05.020 Definitions and presumption. A. This chapter incorporates by reference all definitions set forth in Chapter 82.04 RCW, hereafter amended, except where a conflicting definition is stated in this chapter. B. "Director" means the director of finance and administrative services for the city. C. Businesses or persons soliciting business within the city or using either a business telephone number or business address within the city shall be presumed to be engaged in business within the city. 5.05.080 Persons subject to tax - Amount. In addition to the business license fee required by Chapter 5.04, there is levied upon and shall be collected from every persen, for the act or privilege of engagin8 in business activities within the city, a business and occupation tax per calendar year, or any portion thereof, except as otherwise provided in this title. The business and occupation tax shall be in the mount of one-tenth of one percent of the mount of gross income subject to tax by the state of Washington pursuant to Chapter 82.04 RCW, as hereafter amended, for business activities occurring within the city. 5.05.085 Exempt Activities. The following activities shall be exempt from the provisions of this chapter: A. Nonprofit activities carried on by religious, charitable, educational, benevolent, fraternal or so~ial organizations which have been deteiH,ined by the Internal Revenues Service of the United States to be exempt from the payment of income tax; B. The exercise of governmental functions performed by any instrumentality of the United States, the State of Washington, or any political subdivision thereof. C. Garage sales conducted on residential premises in compliance with this code; D. The mere delivery of goods or services to the customer or client by businesses where the sale occurred on business premises outside of the city, and was the only event occurring within the city except that the performance of contracting or subcontracting services is not an exempt activity; or E. Any business activity which is owned and operated solely by a person under the age of 18, and which does not generate a gross income of more than $2,500 per year. 5.05.090 Exemptions - Type of income. The following types and sources of income shall not be included in the gross income subject to the tax imposed by this chapter: A. All types and sources of income, revenue, proceeds or receipts which are exempt from the business and occupation tax imposed by the state of Washington pursuant to Chapter 82.04 RCW, as hereafter mended; B. Gross income derived from the operation of a commercial parking lot business and which is subject to the commercial parking lot tax imposed in this title; C. Gross income or proceeds derived fxom liquor, as defined by RCW 66.04.010(15), motor vehicle fuels, and any other business or item which is not subject to taxation by the city pursuant to state law; D. Gross income of any telephone business; E. Gross income of a temporary stationary business as deftned in Chapter 5.40 BIMC; and F. Gross income, revenue, proceeds or receipts which are subject to taxation by any other 5.05.100 Amount of income taxed. A. The business and occupation tax shall only be imposed if the gross income of the person exceeds $250,000 per year. Persons with gross income exceeding $250,000 per year shall be taxed only on the amount of gross income exceeding $250,000. Only one such exemption shall be allowed to any group of bus.messes under common ownership. For the purposes of this chapter, businesses shall be considered to be under common ownership if 10 percent or more of the ownership of the business is held or controlled by the same person or persons. B. If a person operates a business for less than a full year, the amount of gross 'income exempted from the business and occupation tax shall be reduced proportionately. 5.05.110 Limit~ on taxation. Washington law limits the amount of tax that a city may levy on a person. The tax imposed by this chapter is within those limits at the time this chapter is enacted. ffin the future the rates imposed by this chapter exceed statutory limits, the taxes imposed by this chapter shall be automatically reduced to the highest legal rate. 5.05.120 Taxes - Apportionment - Statement of principle. It is the intent of this chapter that a person pay a tax no more than once to local government on manufacturing and selling the same product. No deduction is allowed for the payment of taxes to the state of Washington or for the payment of diss'wnilar fees or taxes. fithe imposition of the city's business and occupation tax would place an undue burden upon interstate commerce or violate constitutional provisions, a person shall be allowed a deduction to the extent necessary to preserve the validity of the city's tax. The taxpayer may deduct from gross income or receipts the value of goods manufactured inside the city and sold outside the city in those cases where the goods are sold outside the State of Washington and are subject to a gross income or receipts tax where the tax is not separately stated from the sales price or where the goods are sold in any foreign country. 5.05.130 Taxes - Apportionment - Persons rendering services inside and outside the city. Persons who render services both inside and outside the city and who maintain an office or place of business within the city and not elsewhere, shall be taxed on the gross income from the business without regard to the place where the business is conducted. Persons who render services both inside and outside of the city and who maintain an office or place of business both inside the city and outside the city, or who have no office or other place of business within the city, shall have the option, for purposes of limiting their tax liability to the city under this chapter, of apportioning to the city that portion of gross income derived from services rendered within the city. If the person cannot readily determine the portion of gross income derived from services rendered within the city, the person shall apportion to the city that portion of total income which the cost of rendering services within the city bears to the total cost of rendering services both inside and outside of the city. 5.05.140 Tax - Apportionment - Persons engaged in business activity other than rendering services. Any person who is subject to tax under this chapter and who has no office, store or other place of business within the city, shall allocate to the city the gross proceeds of all sales in which the person's business activity within the city is either a determining element in the transaction or a predominant factor in making or holding the market in the city. Conversely, a person who engages in business using an office, store or other outlet within the city and maintains no equivaient fac'dity elsewhere in Washington, may deduct the gross proceeds of sales which (1) are used by another Washington city to calculate a license fee or tax measured by gross receipts, and (2) reflect bus'mess activity conducted in the taxing city that is either a determining element in the transaction or a predominant factor in making or holding the taxpayer's market in that city. A person who engages in business us'me stores, offices, or outlets both within the city and outside of the city may allocate the gross proceeds of sales to the store, office or outlet where the predominant selling activity occurs. 5.05.150 Taxes - Apportionment - Allocation authority of director. To prevent or reduce overlapping municipal taxation, the director is authorized to (1) agree with one or more Washington cities for a joint andit of a person, and for the reciprocal application of common principles or policies consistent with the provisions of this chapter relating to the allocation or apportionment of the gross proceeds of sales, gross receipts, or gross income with respect to any person; and (2) as part of an inter-city agreement, or in concert with other Washington cities, include or implement reciprocal policies and procedures, consistent with this chapter, to ensure that this city and the other cities receive the tax payments each city is due when a person in good faith has overpaid municipal taxes measured by the person's ~oss proceeds of sale, gross receipts, or gross income to either city when such overpayments are due both to this city and the other cities. 5.05.160 Taxes - Apportionment - Records. Each person who elects to apportion his gross receipts or gross income shall keep for five years all records reflecting the amount of his value of products, gross proceeds of sale, or gross income or gross receipts of business, as the case may be. Such records shall be open at all reasonable runes to the inspection of the director, or his duly authorized agent, for the verification of the persods tax returns. 5.05.170 Taxes - Apportionment - Effect of apportionment on tax exemption. All persons electing to apportion their income or gross revenue shall also reduce the amount of the income exempt from taxation, as defined under this chapter, by the same proportion as the proportion of income derived from or attributed to sources outside the city. 5.05.180 Payment of tax. A. Payment of the tax imposed by this chapter shall be due on or before the last day of February of the year following the tax year. B. On or before the due date, every person required to pay a tax as set forth by this chapter shall file with the city a written return, upon such form and including such information as the director shall require, together with the payment of the amount of the tax. Payment shall he accompanied by either copies of the pages of the Washington state tax return showing the amounts subject to business and occupation tax by the state of Washington, or an affidavit of either the owner or an authorized officer of the business certifying the amount of income subject to business and occupation tax by the state of Washington. In any instance in which the documents mentioned in this subsection do not allow the ready calculation of the amount of tax due the city, the director may also require the person to file a written return, upon such form and setting forth such information as the finance director may reasonably require in order to determine the amount of tax due to the city. C. The director shall have the right to require proof of gross income or gross receipts. Upon supplying the director with the Washington state tax returns filed with the Department of Revenue for the state of Washington and the city tax returns filed with the responsible city officials for all cities for which apportionment deductions are claimed for the period of time in question, the person shall be deemed to have made a prima facie showing of proof of the person's gross income or gross receipts. fithe information provided by the taxpayer is deemed by the director to be inadequate to substantiate the amount of income claimed or the tax paid, the director may require the taxpayer to produce the records of the business for audit at a location satisfactory to the city. If payment of any tax due is not received by the city by the last day of the month in which the tax becomes due, such payment shall be considered delinquent. D, 5.05.190 Tax - Additional to others. The business and occupation tax imposed and levied by this chapter shall be in addition to any license fee or tax imposed or levied under any law or other ordinance of the city, except as otherwise expressly provided. 5.05.200 Tax - Collection. The tax imposed by this chapter, and all penalties thereon, shah constitute a debt to the city, and may be collected by court proceedings in the same manner as any other debt in like amount, which remedy shall be in addition to all other existing remedies. Any judgment entered in favor of the city shall include an award to the city of all court and collection costs including attorneys' fees. Amounts delinquent more than 90 days may be assigned to a third patty for collection, in which case the amount of any collection charges shall be in addition to all other amounts owed. Amounts due shall not be considered paid until the city has received good funds for the full mount due or has discharged the amount due and not paid. 5.05.210 Over or underpayment of tax. In the event that any person makes an overpayment, and within two years of the date of such overpayment makes application for a refund or credit, the person's claim shall be allowed and a refund made by.the city upon determination by the director that no other sums are owed by the person to the city. If a person determines that the tax has been underpaid and without notice by any party pays the amount due to the city, the amount underpaid and corrected by the person shatl not be subject to penalty. 5.05.220 Appeal procedure. A person who has been aggrieved by the amount of the tax determined to be due to the city by the director under the provisions of this chapter may appeal to the city council from such determination by filing a written noticeof appeal with the city clerk within 20 days from the date on which such person is given notice of the tax. The city council or a committee of the city council shall, as soon as practicable, fix a time and place for the hearing for such appeal. Notice of the hearing shall be given to the appellant by certified mall at least five days prior to the date of the hearing. The licensee may appear at the hearing and be heard in opposition to such denial, suspension or revocation or to the tax imposed. The decision of the city council or its committee shall be announced at the conclusion of the hearing and shall be final, subject only to a writ of certiorari being ~ed with the Kitsap County Superior Court within 14 days following the date of the decision of the city council or a committee of the city council. 5.05.230 Con~dentiality of Tax returns. The tax returns made to the city pursuant to this chapter shall not be made public, nor shall they be subject to the inspection of any person who is not an employee of or under contract to the city and then only when such persons are acting in an o~cial capacity. It shall be unlawful for any person to make public or to infoLm any other person as to the contents of a tax return, to permit inspection of an application except as authorized in this section or as required by law. This section shall not be con~strued to prohibit disclosure of information received under this chapter to the Federal Internal Revenue Service, State Department of Revenue, or to any other city in this state for official purposes only; and this section shall not be construed to prohibit or make unlawful the disclosure of the name and address of any person subject to tax under this chapter, or of any person signing a tax return. 5.05.240 Duties of the director. A.' The director shall keep furl and accurate records of all funds received under the provisions of this chapter. Upon receipt of any tax, or penalties collected under the provisions of this chapter, the director shall deposit the amounts collected into the current expense fund of the city. B. In order to cany out the provisions of this chapter, the director shall have the power to adopt, publish and enforce rules and regulations consistent with this chapter. C. The director for good cause shown may extend the time for making and filing any tax return as required under this chapter', provided, that any extension in excess of 30 days shall be conditioned upon payment of interest of one percent for each 30 days or portion thereof on the mount of tax from the date upon which the tax became due. 5.05.250 Civil penalty. In the event that any person fails to pay the tax imposed by this chapter within 15 days of the due date, a civil penalty shall be imposed in the amount of 10 percent of the delinquent tax plus any previously assessed and unpaid penalties under this chapter. For the purposes of calculating the penalty, each month that the amounts owed under this chapter are due and unpaid shall be considered a separate violation subject to penalty. Penalties on the tax imposed by this chapter shall not be limited. A fraction of a month shall be deemed a full month. In the event that a penalty has been wrongfully collected, the director shall refund the penalty. 5. 6. B. It C.A 5.05.260 Violation - Penalty. A. It shall be a violation of this chapter: 1. For a person required to pay a tax under this chapter to fail or refi~se to pay the fee or tax imposed; 2. For a person to make any false representation in connection with application for a business license under this chapter; 3. For a person to evede payment of the tax, or any part thereof; For a person to fail to appear and/or refuse to testify in response to a subpoena issued hereto; For a person to testify falsely upon any investigation of the correotness of a return, or upon the heading of any appeal; or For a person to in any manner hinder or delay the city or any of its officers in carrying out the provisions of this chapter. shall be unlawful for any person to coonduct business within the city limits when not in compliance with this chapter. person violating any of the provisions of this chapter, upon conviction thereof, shall be punished by a fine of not more than $500.00 or by imprisonment for not more than six months, or by both such fine and imprisonment. Each such person is guilty of a separate offense for each and every day during the portion of which any violation of any provision of this chapter is committed, continued or pcaa,~tted by any such person and he is punishable accordingly. 5.05.270 Successor Liability ~ Whenever any taxpayer quits business, or sells out, exchanges or otherwise disposes of his/her business or stock of goods, any tax, interest or penalty payable to the city shall immediately become due and payable, and such taxpayer shall, within thirty days, make a return and pay the tax due. Any person who becomes a successor to such taxpayer shall become liable for the full amount of the tax, interest and penalties due and owing and shall withhold from the purchase price a sum sufficient to pay any amount due from the taxpayer until such time as the taxpayer shall produce a receipt from the city clerk showing payment in full of any amount due or a certificate that no tax is due. The payment of the tax by the successor shall, to the extent thereof, be deemed a payment upon the purchase price, and if such payment is greater than the purchase price, the amount of the difference shall become a debt due such successor from the taxpayer. The successor's liability shall be limited to the purchase price or the fair market value of the business if no cash transaction took place. B. No successor shall be liable for any tax due from the person from whom he/she has acquired a business or stock of goods if he/she gives written notice to the city clerk or director of such acquisition, and no assessment is issued by the director within six months of receipt of such notice against the former operation of the business and a copy of the assessment mailed to the successor. C. Each taxpayer's account will remain on an active status and be subject to all tees, penalties, and interest until such time as the director is notified in writing that the taxpayer has discontinued business activity within the city. Section. 3. This ordinance shall take effect and be in force on and after August 1, 1999, which date is more than five days from and after its passage, approval, and publication. PASSED by the City Council this 23rd day of June, 1999. APPROVED by the Mayor the 25_ th day of June, 1999. ATTEST/AUTHENTICATE: S~~P. KASP//~R, City Clex'/~~k APPROVED AS TO FORM: ROD P. KASEGUMA, City Attorney FILED WITH THE CITY CLERK PASSED BY THE CITY COUNCIL PUBLISHED: EFFECTIVE DATE: ORDINANCE 99 - 28 February 10, 1999 June 23, 1999 June 30, 1999 August 1, 1999