HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 10/20/2015 - FIRST READING OF ORDINANCE NO. 132, 2015, AMENDINGAgenda Item 11
Item # 11 Page 1
AGENDA ITEM SUMMARY October 20, 2015
City Council
STAFF
Peggy Streeter, Senior Sales Tax Auditor
SUBJECT
First Reading of Ordinance No. 132, 2015, Amending Section 25-65 of the Code of the City of Fort Collins to
Change the Application Filing Deadline for the City's Manufacturing Equipment Use Tax Rebate Program.
EXECUTIVE SUMMARY
The purpose of this item is to amend City Code Section 25-65 to change the deadline for filing with the City an
application for the manufacturing equipment use tax rebate (MUTR) from December 31st to June 30th.
STAFF RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
BACKGROUND / DISCUSSION
In March 2007, the City of Fort Collins adopted a Manufacturing Equipment Use Tax Rebate (MUTR) program
allowing manufacturers to apply for a rebate of use tax paid on qualifying equipment. Manufacturers apply for
this rebate the year subsequent to when the use tax was paid. Per City Code, the deadline for filing for the
rebate is currently December 31st. This due date results in rebates being processed up to 2 years after the
use tax was paid by the manufacturer. It also results in a lag between posting the use tax received by the City
and the payment of the rebate out of the General Fund.
An earlier filing deadline is advantageous to the manufacturers because they receive their rebate in a timelier
manner. Manufacturers have commented they would like to get the rebate sooner. The data is already
compiled each month when the return is filed so they can easily compile the data and file the application by
June 30th.
Current process:
Manufacturer pays use tax in 2015
Manufacturer applies for the rebate between August 1 and December 31
Manufacturer receives rebate payment in 2017
Proposed process:
Manufacturer pays use tax in 2015
Manufacturer applies for the rebate by June 30
Manufacturer receives rebate payment in 2016
This change requires an amendment to Section 25-65 of the Fort Collins City Code.
Agenda Item 11
Item # 11 Page 2
BOARD / COMMISSION RECOMMENDATION
This proposal to amend the City Code was presented to the Council Finance Committee (CFC) on September
21, 2015. CFC supported the proposed change.
PUBLIC OUTREACH
An email was sent out to the vendors who currently apply for the rebate to provide notification of the proposed
change in the filing deadline for the MUTR program. No concerns were noted.
ATTACHMENTS
1. Council Finance Committee minutes, September 21, 2015 (PDF)
4
interestinallsixoftheoriginalbusespurchasedforMAX.FTAcouldnotauthorizearevisiontothePCGA
withoutauthorizationfromCongress.FTAstaffdoesnotrecommendaskingCongressforarevisionsuchasthis.
DarinalsospokeaboutFTAandtheirpastperformance;theyhavebeenagreatpartnerandhavegonethrough
somemajorleadershipchangesthroughthecontextofthisproject.Assuch,therewillbedifferent
administratorswithdifferentopinions,etc.
Therefore,staffisrequestinganappropriationoffundstopurchasetheBRTbuses,asthebusesareessentialfor
MAXoperations.
Afterdiscussion,itwasdeterminedthatthebusesdoneedtobepaidforandstaffwasdirectedtobringforward
theappropriation.
SALESTAXCODECHANGES
StaffbroughtforwardtheconsiderationofpotentialcodechangestoChapter25oftheMunicipalCodeto
correcttheexpirationdate(December31,2021toDecember31,2020)ofthe.85%KeepFortCollinsTax(KFCG),
toupdatetheexpirationdateforthestreetmaintenancetax,andtoamendthedue date for the manufacturing
equipmentusetaxrebateapplication.
ThestreetmaintenancetaxwasextendedthroughDecember31,2025,byvoterapproval.
Thecurrentdeadlineforthemanufacturingequipmentusetaxrebate(MUTR)islistedasDecember31.Itis
beingrecommendedthisdatebechangedtoJune30.Thecurrentprocessisthemanufacturerpaysusetaxin
2015,appliesfortherebatebyDecember31,2016,andreceivestherebatein2017.Theproposedprocesswill
bethatthemanufacturerpaysusetaxin2015,appliesfortherebatebyJune30,2016,andreceivestherebate
byDecember31,2016;manufacturer’swouldreceiverebatesinatimeliermanner;timeframebetweenreceipt
oftherevenuebytheCityandthepaymentofrebatewouldbereduced.
CFCrecommendedsendingallthemanufacturerslettersstatingthenewchange.
OTHERBUSINESS
GerrywillbeoutoftownonNovember16,2015.StaffwilllookatanalternativedatefortheNovember
meeting.
Gerryalsorequestedthatstafflookatpropertytax;lookatchangingthemilllevy,andsomeotheralternatives.
Therewasdiscussionaboutresidentialvs.commercialtax.JohnD.statedthattherearesomeuniformity
constitutionalrequirementsinrelationtotaxes.Thiswouldhavetobelookedattomakesurethatwhateveris
beingproposeddoesnotviolatethat.Gerryrequestedthatstafflookintothisanddecideifwecanmove
forward.Wadealsoaskedwhataffectdoesanacquisitionofprivatesectorpropertiestothestatehaveonthe
City?MikestatedthatstaffwillresearchthisitemandreportbacktoCFCatalaterdate.
MeetingAdjournedat11:22a.m.
SALES TAX CODE CHANGES
ATTACHMENT 1
COUNCIL FINANCE COMMITTEE
September 21, 2015
- 1 -
ORDINANCE NO. 132, 2015
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AMENDING SECTION 25-65 OF THE CODE OF THE CITY OF FORT COLLINS
TO CHANGE THE APPLICATION FILING DEADLINE FOR THE CITY’S
MANUFACTURING EQUIPMENT USE TAX REBATE PROGRAM
WHEREAS, in 2007 the City of Fort Collins established in Division 5 of Article II of
Chapter 25 of the Fort Collins Municipal Code a program to rebate the City’s use tax imposed on
manufacturing equipment to qualifying manufacturers (the “Rebate Program”); and
WHEREAS, Code Section 25-65 currently requires that manufactures applying for a use
tax rebate under the Rebate Program must file their application with the City no later than
December 31
st
of each year; and
WHEREAS, this late filing deadline has caused delays in the City paying the requested
rebates to manufacturers and staff is recommending that the filing deadline be changed to June
30
th
of each year to help eliminate these delays; and
WHEREAS, this Ordinance amends Code Section 25-65 to change this deadline from
December 31
st
of each year to June 30
th
of each year.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF
FORT COLLINS that Section 25-65 of the Code of the City of Fort Collins is hereby amended to
read as follows:
Sec. 25-65. Application for rebate.
Application for the manufacturing equipment use tax rebate on qualifying manufacturing
equipment shall be made on forms to be provided by the City. In order to qualify for such
rebate, the application must be filed between August 1 and December 31by June 30th
inclusive, of eachthe year following the year in which the use taxes for which a rebate is
requested were paid. Only one (1) application shall be filed per qualifying manufacturer.
Introduced, considered favorably on first reading, and ordered published this 20th day of
October, A.D. 2015, and to be presented for final passage on the 3rd day of November, A.D.
2015.
__________________________________
Mayor
ATTEST:
_____________________________
City Clerk
- 2 -
Passed and adopted on final reading on this 3rd day of November, A.D. 2015.
__________________________________
Mayor
ATTEST:
_____________________________
City Clerk