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ORD 75-04 TAXING CERTAIN ACTIVITIES RELATING TO GAMBLINGPOULSBO ORDINANCE NO. 7b- 3 WINSLOW ORDINANCE NO. 75- 4 AN ORDINANCE OF THE CITY OF POULSBO AND THE CITY OF WINSLOW RELATING TO GAMBLING, PROVIDING FOR, AND LEVYING, A TAX UPON THE INCOME DERIVED FROM THE CONDUCT OF CERTAIN ACTIVITIES; PROVIDING FOR NECESSARY ADMINISTRATIVE PROCEDURES FOR THE COL- LECTION AND ENFORCEMENT OF SUCH A TAX; PROVIDING PENALTIES FOR FAILURE TO TIMELY PAY THE TAX; AND PROVIDING FOR THE EFFECTIVE DATE OF THIS ORDINANCE. WHEREAS, Chapter 218, Laws of 1973, 1st Ex. Sess. and ch~,[~ter 9.46 RCW, each as amended, allows qualified persons licensed by the Washington State Gambling Commission to conduct certain gambling activities within this jurisdiction subject to compliance with state law and the rules of the Washington State Gambling Commission, unless the particular gambling activity has been specifically prohibited by action of the appropriate local agency pursuant to RCW 9.46.295; and WHEREAS, RCW 9.46.210 makes it the duty of the law enforcement officials of this jurisdiction, among others, to enforce the pro- visions of chapter 9.46 RCW imposing a financial burden upon the City of Poulsbo and the City of Winslow; and WHEREAS, RCW 9.46.110 empowers each city to, by ordinance, provide for the taxing of any gambling activity authorized by RCW 9.46.030 which is conducted within its jurisdiction subject to certain maximum tax rates; NOW, THEREFORE, THE CITY COUNCILS OF THE CITY OF POULSBO AND THE CITY OF WINSLOW DO ORDAIN AS FOLLOWS: Section 1. Name. This ordinance shall be known as the City of Poulsbo and City of Winslow Gambling Ordinance. Section 2. Definitions. For the purposes of this ordinance the words and terms used shall have the same meaning as each has under Chapter 218, Laws of 1973, 1st Ex. Sess. and chapter 9.46 RCW, each amended, and under the rules of the Washington State Gambling Commission, chapter 230 WAC, unless otherwise specifically provided or the context in which they are used herein clearly indicates that they be given some other meaning. Section 3. Persons Subject to Tax - Tax Rates. There is hereby levied upon all persons, associations and organizations con- ducting or operating within the jurisdiction of either the City of Poulsbo or the City of Winslow any of the activities listed below a tax in the following amounts to be paid to the City of Poulsbo or City of Winslow: (a) BinSo, in the amount of gross receipts therefrom, less ~he amount of money paid in cash or for merchandise actually awarded as prizes during the taxable period, multiplied by the rate of five percent (5%) of the first Ten Thousand Dollars ($!0,00.00) of such receipts and by the rate of ten percent (10%) of any such receipts over Ten Thousand Dollars ($10,000.00). (b) Raffles,in the amount of the gross receipts therefrom, less the amount of money paid in cash, and paid for merchandise, actually awarded as prizes during the taxable period, multiplied by the rate of ten percent (10%). (c) Amusement games, in the amount of the gross receipts hherefrom, less the amount of money paid in cash, and paid for merchandise, actually awarded as prizes during the taxable period, multiplied by the rate of ten percent (10%). (d) Any punchboards or pull tabs, in the amount of three percent (3%) of the gross receipts directly from the operation of the punchboards or pull tabs themselves. (e) Card playing, in the amount of ten percent (10%) of the gross receipts received as fees charged persons for the privilege of playing in card games. ~=~ Section 4. Tax to be Computed and Paid Quarterly - Excep- ~. tions. Each of the various taxes imposed by this ordinance shall Be computed on the basis of activity during each calendar quarter year, shall be due and payable in quarterly installments, and remittance therefor, together with return forms, shall be made to the City of Poulsbo or the City of Winslow, Washington, on or before the last day of the month next succeeding the quarterly -2- period in which the tax accrued, that is, on January 31, April 30, July 31, and October 31 of each year: PROVIDED, that the following exceptions to this payment schedule shall be allowed, or required: (a) Except as provided in (b) below, whenever any person, association or organization taxable hereunder conducting or operating a taxable activity on a regular basis discontinues operation of that taxable activity for a period of more than four (4) consecutive weeks, or quits business, sells out, or other- wise disposes of its business, or terminates the business, any tax due hereunder shall become due and payable, and such taxpayer shall, within ten (10) days thereafter, make a return and pay the tax due. (b) It is recognized that some bona fide charitable or bona fide nonprofit organization taxpayers will be conducting or operating taxable activities only upon an occasional and random basis. Except as provided in (c) below, when such a taxpayer conducts only one taxable activity during any calendar quarter, the duration of each such activity does not exceed fifteen (15) consecutive calendar days, and the gross receipts therefrom do not exceed Fifteen Hundred Dollars ($1500.00) per quarter, that taxpayer need not remit the tax due with a return therefor until on or before January 31 of the year following that year in which the activity took place. Such returns shall be made upon a specia!~ form to be supplied by the City Clerk/Treasurer. (c) Whenever it appears to the City Clerk/Treasurer that the collection of taxes from any person, association or organization may be in jeopardy, that officer, after not less than five (5) days notice to the taxpayer, is authorized to require that taxpayer to remit taxes and returns at such shorter intervals than quarterly or annuallly, as that officer shall deem appropriate under the cir- cumstances. Section 5. Administration and Collection of Tax. Administration and collection of the various taxes imposed by this ordinance shall be the responsibility of the City Clerk/Treasurer. Remittance of the amount due shall be accompanied by a completed return form prescribed and provided by that officer. The taxpayer shall be required to swear and affirm that the information given in the return is true, accurate and complete. The City Clerk/Treasurer is authorized, but not required, to mail to taxpayers forms for returns. Failure of the taxpayer to receive such a form shall not excuse a taxpayer from making the return and timely paying all taxes due. The City Clerk/Treasurer shall make forms available to the public in reasonable numbers in the City Hall during regular business hours. In addition to the return form, a copy of the taxpayer's quarterly report to the Washington State Gambling Commission required by WAC 230-08 for the period in which the tax accrued, shall accompany remittance of the tax amount due. Section 6. Method of Payment. Taxes payable hereunder shall be remitted to the City Clerk/Treasurer on or before the time required by bank draft, certified check, cashier's check, personal check, money order, or in cash. If payment is made by draft or check, the tax shall not be deemed paid until the draft or check is honored in the usual course of business, nor shall the acceptance of any sum by the City Clerk/Treasurer be an acquittance or discharge of the tax unless the amount paid is the full amount due. The return, and copy of quarterly report to the Washington State Gambling Commission, shall be filed in the office of the City Clerk/Treasurer after notation by that office upon the return of the amount actually received from the taxpayer. Section 7. Failure to Make Timely Payment of Tax or Fee. If full payment of any tax or fee due under this ordinance is not received by the City Clerk/Treasurer on or before the date due, there shall be added to the amount due a penalty fee as follows: (a) 1-10 days late - Five per cent (5%) of tax due (b) 11-20 days late - Seven and one-half per cent (7-1/2%) of tax due (c) 21-31 days late - ten per cent (10%) of tax due (d) 32-60 days late - fifteen per cent (15%) of tax due but in no event shall the penalty amount be less than Ten Dollars ($10.00). In addition to this penalty, the City Clerk/Treasurer may charge the taxpayer interest of eight per cent (8%) per annum of all taxes and fees due for each thirty (30) day period, or portion thereof, that said amounts are past due. Failure to make payment in full of all tax amounts, and penalties, within sixty (60) days following the day the tax amount initially became due shall be both a civil and a criminal violation of this section. Section 8. Notice of Intention to Engage in Activity to be filed. In order that the City of Poulsbo or City of Winslow may identify those persons who are subject to taxation under this ordinance, each person, association or organization shall file with the City Clerk/Treasurer a sworn Declaration of Intent to conduct an activity taxable under this ordinance upon a form to be pre- scribed by that officer, together with a copy of the license issued therefor by the Washington State Gambling Commission. The filing shall be made not later than ten (10) days prior to conducting or operating the taxable activity. No fee shall be charged for such filing, which is not for the purpose of regulation of this activity but for the purposes of administration of this taxing ordinance only. Failure to timely file shall not excuse any person, association or organization from any tax liability. Section 9. Records Required. Each person, association, or organization engaging in an activity taxable under this ordinance shall maintain records respecting that activity which truly, com- pletely and accurately disclose all information necessary to determine the taxpayer's tax liability hereunder during each base tax period. Such records sha'll be kept and maintained for a period of not less than three (3) years. In addition, all information and items required by the Washington State Gambling Commission under WAC 230-08, and the United States Internal Revenue Service res- pecting taxation, shall be kept and maintained for the periods required by those agencies. All books, records, and other items required to be kept and maintained under this section shall be subject to, and immediately made available for, inspection and audit at any time, with or without notice, at the place where such records are kept; upon demand by the City Clerk/Treasurer or his designees, for the pur- pose of enforcing the provisions of this taxing ordinance. Where a taxpayer does not keep all of the books, records or items required to be kept or maintained under this section in this jurisdiction so that the City Clerk/Treasurer may examine them conveniently, the taxpayer shall either: (a) Produce all of the required books, records or items within this jurisdiction for such inspection within fifteen (15) days following a request of the local official that he do so; or (b) Bear the actual cost of inspection by the City Clerk/ Treasurer or his designee, at the location at which such books, records or items are located, provided that a taxpayer choosing to bear these costs shall pay in advance to the City Clerk/Treasurer the estimated cost thereof, including but not limited to, round trip fare by the most rapid means, lodging, meals, and incidental expenses. The actual amount due, or to be refunded, for expenses shall be determined following said examination of the records. A taxpayer who fails, neglects or refuses to produce such books and records either within or without this jurisdiction, in addition to being subject to other civil and criminal penalties provided by this ordinance, shall be subject to a jeopardy fee or tax assessment by the City Clerk/Treasurer. This penalty fee or jeopardy assessment shall be deemed prima facie correct and shall be the amount of fee or tax owing the City Clerk/Treasurer by the taxpayer unless he can prove otherwise by competent evidence. The taxpayer shall be notified by mail by the City Clerk/Treasurer of the amount of tax so determined by jeopardy assessment, together with any penalty and/or interest, and the total of such amounts shall thereupon become immediately due and payable. Section 10. Overpayment or Underpayment of Tax. If, upon application by a taxpayer for a refund or for an audit of his records, or upon any examination of the returns or records of any taxpayer, it is determined by the City Clerk/Treasurer that within three (3) years immediately preceding receipt by the City Clerk/ Treasurer of the application by the taxpayer for a refund, or an audit, or, in the absence of such an application, within the three (3) years immediately preceding the commencement by the City Clerk/ Treasurer of such examination: (a) A tax or other fee has been paid in excess of that pro- perly due, the total excess paid over all amounts due to the City of Poulsbo or the City of Winslow within such period of three (3) years shall be credited to the taxpayer's account or shall be credited to the taxpayer at the taxpayer's option. No refund or credit shall be allowed with respect to the City Clerk/Treasurer more than three years before the date of such application or examination. (b) A tax or other fee has been paid which is less than that properly due, or no tax or other fee has been paid, the City Clerk/ Treasurer shall mail a statement to the taxpayer showing the balance due, including the tax amount or penalty assessments and fees, and it shall be a separate, additional violation of this ordinance, both civil and criminal, if the taxpayer fails to make payment in full within ten (10) calendar days of such mailing. Section 11. Failure to Make Return. If any taxpayer fails, neglects or refuses to make and file his return as and when required under this ordinance, the City Clerk/Treasurer is authorized to determine the amount of tax payable, together with any penalty and/or interest assessed under the provisions of this ordinance, and by mail to notify such taxpayer of the amount so determined, which amount shall thereupon become the tax and penalty and/or interest and shall become immediately due and payable. Section 12. Tax Additional to Others. The tax herein levied shall be additional to any license fee or tax imposed or levied under any law or any other ordinance of the City of Poulsbo or the City of Winslow, Washington, except as herein otherwise expressly provided. Section 13. City Clerk/Treasurer to Make Rules. The City Clerk/Treasurer shall have the power, and it shall be his duty, from time to time, to adopt, publish and enforce rules and regulations not inconsistent with this ordinance or with superior law, for the purpose of carrying out the provisions hereof, and it shall be unlawful to violate or fail to comply with any such rule or regulation. Section 14. Taxes, Penalties and Fees Constitute Debt to Municipality. Any tax due and unpaid under this ordinance and all penalties or fees shall constitute a debt to the City of Poulsbo or City of Winslow, a municipal corporation, and may be collected by court proceedings the same as any other debt in like amount which shall be in addition to all other existing remedies. Section 15. Limitation on Right to Recovery. The right of recovery by the City of Poulsbo or the City of Winslow f~om the taxpayer for any tax provided hereunder shall be outlawed after the expiration of three (3) calendar years from the date said tax became due. The right of recovery against the City of Poulsbo or the City of Winslow because of overpayment of tax by any taxpayer shall be outlawed after the expiration of three (3) calendar years from the date such payment was made. Section 16. Violation - Penalties. Any person violating or failing to comply with any of the provisions of this ordinance or any lawful rule or regulation adopted by the City Clerk/ Treasurer pursuant thereto, upon conviction thereof, shall be punished by a fine in any sum not to exceed Three Hundred Dollars ($300.00), or by imprisonment in the City Jail for a term not exceeding six (6) months, or by both such fine and imprisonment. Any taxpayer who engages in, or carries on, any gambling activity subject to a tax hereunder without having complied with the provisions of this ordinance shall be guilty of a violation of this ordinance for each day during which the gambling activity is carried on. Section 17- Appeal. In the event any person feels aggrieved by any decision or determination of the City Clerk/Treasurer, said person shall have the right to appeal such determination to the City Council by filing a Notice of Appeal within ten (10) days after such determination is made and the City Council shall have the power to affirm, disaffirm or modify such administrative determination and any person feeling aggrieved by any determination of the City Council shall have the right of appeal to the Superior Court of Kitsap County in accordance with the procedures established for extraordinary remedies. Section 18. Repeal. Any and all ordinances, or parts of ordinances in conflict herein are repealed. Section 19. Severability. If any provision or section of this ordinance shall be held void or unconstitutional, all other parts, provisions and sections of this ordinance not expressly so held to be void or unconstitutional shall continue in full force and effect. Section 20. Effective Date. This ordinance shall take effect and be in force five (5) days from and after its passage and publication in the manner provided by law. PASSED BY the City Council of the City of Poulsbo this 29th day of January, 1975. 9 PASSED BY the City Council of the City of Winslow this day of February, '1975. 3rd CITY OF POULSBO By Maurice Lindvig, Mayor ATTEST: City Clerk/Treasurer ATTEST: City Clerk CITY OF WINSLOW By "~'~"~'C Vibrans, 'Jr. , Mayo APPROVED AS TO FORM: Robert W. McKisson of Beresford, Booth, Lehne & McKisson City Attorneys 10