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HomeMy WebLinkAbout122 - 09/02/1986 - REPEALING AND RE-ENACTING THE CITY CODE RELATING TO SALES AND USE TAXES ORDINANCE NO. 122, 1986 OF THE COUNCIL OF THE CITY OF FORT COLLINS REPEALING AND RE-ENACTING CHAPTER 104 OF THE CODE OF THE CITY OF FORT COLLINS RELATING TO SALES AND USE TAXES BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS: Section 1. Chapter 104 of the Code of the City of Fort Collins, "Taxation: Retail Sales and Use," is hereby repealed in its entirety and re-enacted as follows: Chapter 104 TAXATION: RETAIL SALES AND USE ARTICLE I General Provisions; Taxes Imposed §104-1. Definitions. §104-2. Legislative intent. §104-3. Imposition of the sales tax. §104-4. Imposition of the use tax. §104-5. Rate of tax. ARTICLE II Licensing §104-6. Retail sales tax license required. §104-7. Separate license required for each place of business. §104-8. Form of license; nontransferable. §104-9 Exempt organization license. - §104-10. Revocation of license. §104-11. Appeal of revocation. ARTICLE III Collection and Remittance §104-12. Collection of tax. §104-13. Tax money in possession of vendor held in trust. §104-14. Tax on credit or secured sales; bad debts. §104-15. Tax on building materials and supplies. §104-16. Proration of use tax on certain construction equipment. §104-17. Location guide available. §104-18. Tax on automotive vehicles purchased outside City. §104-19. Remittance of sales tax collected by vendor. §104-20. Remittance of use tax. §104-21. Remittance of use tax by property owners and lessees. §104-22. Remittance of tax on other than monthly basis. §104-23. Form of tax returns; signature required. §104-24. Consolidation of returns. ARTICLE IV Refunds §104-25. Tax disputes. §104-26. Procedure for refund of disputed tax. §104-27. Right of refund not assignable. §104-28. Action for recovery of refund. ARTICLE V Administration §104-29. Preservation of returns and other records; confidentiality. §104-30. Records and accounts to be kept. §104-31. Examination of returns; recomputation, credits, deficiencies. §104-32. Investigation of tax records of vendor. §104-33. Subpoenas and witness fees. §104-34. Attendance of witnesses and production of evidence to be compelled by district judge. §104-35. Depositions. ARTICLE VI Enforcement §104-36. Failure to make return; improper registration; estimate of taxes, notice; appeal ; audit. §104-37. Assessment and recurring assessment penalty. §104-38. Rate of interest; method of calculation. §104-39. Tax constitutes lien. §104-40. Lien on construction improvements. §104-41. Sale of business subject to lien. §104-42. Certificate of discharge of lien. §104-43. Jeopardy assessment. §104-44. Enforcing the collection of taxes due. §104-45. Recovery of unpaid tax by action at law. §104-46. City may be party in title actions. §104-47. Injunctive relief. §104-48. Waiver of penalties by Director of Finance. §104-49. Obligations of fiduciaries and others. ARTICLE VII Miscellaneous §104-50. Review of decisions of Director of Finance. §104-51. Review bond required. -2- §104-52. Notices. §104-53. License and tax in addition to all other licenses and taxes. §104-54. Hearings to be held in City. §104-55. Administration by Director of Finance; rules and regulations. §104-56. Violations. §104-57. Penalty. §104-58. Purpose of tax; distribution of proceeds. §104-59. Limitations. ARTICLE I General Provisions; Taxes Imposed §104-1. Definitions. The following words and phrases, as used in this chapter, shall have the following meanings: ACCESS SERVICES -- Any charge by local telephone exchange companies to providers of telecommunication services or their customers for use in providing the telecommunication services of such providers. AUCTION OR ESTATE LIQUIDATION SALE -- Any sale conducted or transacted at a permanent place of business operated by an auctioneer or estate liquidator or a sale conducted or transacted at any location where tangible personal property is sold by an auctioneer or estate liquidator when such individual is acting either as agent for the owner of such tangible personal property or is in fact the owner thereof. For the purpose of this chapter, the auctioneer or estate liquidator at any sale as defined herein, except when acting as an agent for a duly licensed vendor or when selling only tangible personal property which is exempt from retail sales or use tax as provided in this chapter, is a vendor as defined in this section, and the sale made by him is a retail sale as defined in this section, and the business conducted by him in accomplishing such sale is the transaction of a business as defined in this section. AUTOMOTIVE VEHICLE -- Any vehicle, including every device in, upon or by which any person or property is or may be transported or drawn upon a public highway or any device used or designed for aviation or for flight in the air, upon which a specific ownership tax is imposed by the State of Colorado, and any watercraft, propelled by machinery, whether or not such machinery is the principal source of propulsion, used or capable of being used as a means of transportation of persons and property on the water, including but not limited to motor vehicles, trailers or semitrailers, aircraft and motorboats, but excepting devices moved by human power or used exclusively upon stationary rails or tracks and excepting any such vehicles, as herein defined, used or engaged in interstate commerce. -3- BUSINESS -- All activities or undertakings of any nature engaged in or caused to be engaged in by any person with the object of gain, benefit or advantage, direct or indirect. CHARITABLE ORGANIZATION -- An organization which, in a manner consistent with existing laws and for the benefit of an indefinite number of persons, exclusively, freely and voluntarily ministers to their physical , mental , or spiritual needs and which thereby lessens the burdens of government. CITY -- The City of Fort Collins, Colorado. CITY MANAGER -- The City Manager of the City of Fort Collins, Colorado. CODE -- The Code of the City of Fort Collins, Colorado. CONSTRUCTION EQUIPMENT -- All pieces of portable machinery, vehicles and other types of equipment used to build, erect or otherwise construct buildings, roads, bridges or any construction project. DIRECTOR OF FINANCE -- The Director of Finance of the City of Fort Collins, Colorado. ENGAGED IN BUSINESS IN THE CITY -- The selling, leasing or delivering in the City, or any activity in the City in connection with the selling, leasing or delivering in the City, of tangible personal property by a retail sale as defined in this section, for use, storage, distribution or consumption within the City. This term shall include, but shall not be limited to, the following acts or methods of transacting business: A. The maintaining within the City, directly or indirectly or by a subsidiary, of an office, distributing house, salesroom or house, warehouse or other place of business; or B. The soliciting, either by direct representatives, indirect representatives or manufacturers' agents, by distribution of catalogs or other advertising, by use of any communication media, by any other advertising media, or by any other means whatsoever, of business from persons residing in the City, and by reason thereof receiving orders from, or selling or renting tangible personal property to, such persons residing in the City for use, consumption, distribution, or storage in the City. FARM CLOSE-OUT SALE -- A sale of all tangible personal property of a farmer or rancher previously used by him in carrying on his farming or ranching operations. Unless said farmer or rancher is making or attempting to make full and final disposition of all property used in his farming or ranching operations and is abandoning said operations on the premises where they were previously conducted, such sale shall not be deemed a "farm close-out sale" within the meaning of this chapter. -4- FOOD -- Food which is advertised or marked for human consumption and is sold in the same form, condition, quantities and packaging as is commonly sold by grocers. The term includes cereals and cereal products; milk and milk products; meat and meat products; fish and fish products; eggs and egg products; vegetables and vegetable products; fruits and fruit products; sugars and sugar products and sugar substitutes; coffees and coffee substitutes; teas, cocoa and cocoa products; and spices, condiments, salt and oleomargarine. The term does not include food or drink served or furnished in or by restaurants, cafes, lunch counters, cafeterias, hotels, drugstores, social clubs, nightclubs, cabarets, resorts, snack bars, caterers, carryout shops and other like places of business at which prepared food or drink is regularly sold, including sales from pushcarts, motor vehicles and other mobile facilities; chewing gum; candy; carbonated beverages; spirituous, malt or vinous liquor; cocktail mixes; proprietary medicines; nostrums; lozenges; tonics; vitamins and other dietary supplements; water, mineral water and carbonated water marketed in containers; ice; pet foods; food or drink furnished, prepared or served for consumption at tables, chairs or counters or from trays, glasses, dishes or other tableware provided by the vendor; prepared food or drink sold by vendors who regularly sell for consumption on or near the premises of the vendor, even though such food or drink is sold on a take-out or to-go order and is bagged, packaged or wrapped and taken from the premises of the vendor; and food or drink vended by or through machines on behalf of a vendor. GROSS SALES AND SERVICES -- The total amount received in money, credit, property or other consideration from leases and sales at retail . LOCAL TELEPHONE EXCHANGE COMPANY -- Any person which provides public telephone or telecommunication exchange access lines, mobile telecommunication or channels necessary to effect the transfer of two-way voice or data grade information between the final user and the local telecommunication network. PERSON - - An individual , firm, partnership , joint venture , association, corporation, estate, trust, receiver, trustee, assignee, lessee or any person acting in a fiduciary or representative capacity, whether appointed by a court or otherwise, or any group or combination acting as a unit, and includes the plural as well as the singular number. PRESCRIPTION DRUG -- A medical substance for human consumption used in the treatment or prevention of disease or other illness, the sale of which is delivered on a written order of a member of the healing arts whether on a regular prescription form or on orders of drugs for dispensing in the practitioner's office. -5- PROSTHETIC DEVICE -- An artificial part which aids or replaces a human bodily function and which is designed and produced or adjusted to fit a particular individual by or with the written recommendation of a member of the healing arts, including prescription eyeglasses and contact lenses. PURCHASE or SALE -- The acquisition for a price by any person of taxable services or tangible personal property which is used, stored, distributed or consumed within the City. A transaction shall be deemed to be a "purchase" or "sale" if the acquisition of tangible personal property was effected by either: A. The transfer, either conditionally or absolutely, of title or possession, or both, of the tangible personal property. B. A lease, rental or grant of a license to use (including royalty agreements), store, distribute or consume the tangible personal property. PURCHASE PRICE -- The aggregate value in money of any thing or things paid or delivered by a lessee or purchaser to a vendor in the consummation of a lease or of a retail sale as defined in this section, without any deduction therefrom on account of the cost of the property sold, cost of material used, labor or service cost or any other expense whatsoever, and provided that when articles of tangible personal property are sold after manufacture or after having been made to order, the gross value of all materials, labor service and profit thereon shall be included in the said "purchase price." However, the "purchase price" shall not include any direct tax imposed by the federal government, the State of Colorado or this chapter. PURCHASER -- Any person to whom a taxable service has been rendered or who has leased or purchased at retail tangible personal property which is used, stored, distributed or consumed in the City upon which a tax is imposed by this chapter. RETAIL SALE or PURCHASED AT RETAIL -- Any sale, purchase, lease, rental or grant of license to use tangible personal property, except a wholesale sale or purchase. SALE or SALE AND PURCHASE -- Installment and credit sales and the exchange of property as well as the sale thereof for money; every such transaction, conditional or otherwise, for a consideration, constituting a sale; and the sale or furnishing of steam or other heat, electrical energy, gas, or telecommunication services; and the transaction of furnishing rooms or accommodations to any person who, for a consideration, uses, possesses, or has the right to use or possess, any room or rooms in any hotel , motel , apartment house, mobile home, trailer court or park or similar place under any lease, permit, right of access, license to use or other agreement. STORAGE -- Any keeping or retention of, or exercise of dominion or control over, tangible personal property within the City. -6- TANGIBLE PERSONAL PROPERTY -- Corporeal personal property, including automotive vehicles, which may be seen, weighed, measured, felt or touched or is in any manner perceptible to the senses. The term shall not include "newspapers" as described in Section 24-70-102, C.R.S. TAX -- Either the tax payable by the purchaser of tangible personal property or services subject to the tax or the aggregate amount of taxes due from the vendor of such tangible personal property or services during the period for which he is required to report his collections, as the context may require. TAXPAYER -- Any person obligated to account to the Director of Finance for taxes collected or to be collected or from whom a tax is due under the terms of this chapter. TELECOMMUNICATION SERVICES -- The transport of signs, signals, writings, images, sounds, messages, data, or other information of any nature by wire, radio, light waves, electromagnetic, digital or electronic means, including pay, cable or subscription television. USE -- The exercise, for any length of time, by any person within the City, of any right, power or dominion over tangible personal property under a lease or when purchased at retail , either within or without the City, from a vendor or any other person. VENDOR -- A person making sales to purchasers of, or leasing to persons, at retail and not for resale, tangible personal property or services subject to the tax imposed by this chapter. To prevent evasion and to provide for more efficient administration, the term "vendor" shall be extended to include any salesman, representative, peddler or canvasser, who, as agent, directly or indirectly, of the dealer, distributor, supervisor or employer under whom he operates or from whom he obtains the tangible personal property or services sold by him, makes sales of tangible personal property or services subject to the tax imposed by this chapter. WHOLESALER -- A person doing a regularly organized wholesale or jobbing business, and known to the trade as such and selling to retail merchants, jobbers, dealers or other wholesalers for the purpose of resale. WHOLESALE SALE -- A sale by wholesalers to retail merchants, jobbers, dealers, vendors or other wholesalers for resale; a sale of tangible personal property to a person engaged in the business of manufacturing or compounding for sale, profit or use any product, which tangible personal property becomes an ingredient or component part of the product which is manufactured or compounded and the container, label or furnished shipping case thereof; a sale of electricity, gas, coal , wood, nuclear fuel , fuel oil or coke for use in processing, manufacturing, mining, refining, irrigation, telecommunication services, street and railroad transportation services and all industrial uses; a sale of newspapers and newsprint and printers' ink -7- 'r used to produce newspapers. The term does not include the sale by wholesalers to users or purchasers not for resale, which sales shall be deemed retail sales. §104-2. Legislative intent. A. It is the intent of the City Council , in exercising the home rule powers provided by the Constitution of the State of Colorado, that through this legislation and in the manner described herein, every person in the City who purchases at retail , leases, consumes, stores, or puts to any use any tangible personal property or taxable services is exercising a taxable privilege. All sales, leases, and purchases of tangible personal property and taxable services defined in this chapter are taxable unless specifically exempted in this chapter. The sales tax imposed upon tangible personal property by this chapter applies to each transfer of ownership, possession, and control of such property and may occur more than once during the life of the property. B. The sales tax is a transaction tax levied upon all sales, purchases, and leases of tangible personal property and taxable services sold or leased by persons engaged in business in the City and is collected by the vendor or lessor and remitted to the City. The use tax is levied upon the privilege of persons in the City to store, use, distribute or consume tangible personal property located in the City and taxable services purchased or leased at retail and furnished within the City, whether purchased or leased inside or outside the City, and not subject to the sales tax imposed by this chapter. The use tax is remitted to the City by the person storing, using, distributing or consuming the tangible personal property or taxable services. The use tax is a complement to the sales tax, and its purposes are to equalize competition between in-City and out-of-City vendors and lessors of tangible personal property and services and to eliminate incentives for City residents to leave the City to purchase or lease tangible personal property and taxable services. §104-3. Imposition of the sales tax. A. There is hereby levied and there shall be collected and paid a sales tax on the full purchase price paid or charged for tangible personal property and taxable services sold at retail or leased by every person exercising a taxable privilege in the City by the sale or lease of such property and services. The sales tax is levied on all sales and leases of tangible personal property or taxable services, except those specifically exempted and is collected by the vendor or lessor and remitted to the City. B. Taxable transactions and items. The sales tax shall apply as follows: -8- 1. On the purchase price paid or charged for all sales and purchases of tangible personal property at retail . 2. On the total amount due under a lease or contract when the right to possession or use of tangible personal property is granted therein and such transfer of possession would be taxable under this chapter if an outright sale were made. 3. In the case of retail sales involving the exchange of property, on the purchase price paid or charged, including the fair market value of the property exchanged at the time and place of the exchange , excluding , however, from the consideration or purchase price, the fair market value of the exchanged property, provided such exchanged property is to be sold thereafter in the usual course of the vendor's business. 4. (a) Upon telecommunication services, including access services, whether furnished by public or private corporations or enterprises , for all intrastate telecommunication services originating from or received on telecommunication equipment in the City if the charge for the service is billed to a person in the City or billed to an affiliate or division of such person in the City on behalf of a person in the City. (b) Upon access services, whether furnished by public or private corporations or enterprises, for all interstate telecommunication services originating from or received on telecommunication equipment in the City if the charge for the service is billed to a person in the City or billed to an affiliate or division of such person in the City on behalf of a person in the City. 5. Upon gas and electric service, whether furnished by municipal , public or private corporations or enterprises, for gas and electricity furnished and sold for domestic and commercial consumption and not for resale and upon steam when consumed or used by the purchaser and not resold in original form, whether furnished or sold by public or private corporations or enterprises. 6. Upon the entire amount charged to any person or persons for rooms or accommodations. 7. Upon the amount paid for all meals and cover charges, if any, furnished in any restaurant, hotel , club, hospital , nursing home or other place at which meals or food are regularly sold. 8. Upon the purchase price paid for any automotive vehicle, whether new or used, purchased inside or outside the City by a resident of the City or for a business located in the City for use or storage in the City. Said tax shall be paid prior to or at the time the title and registration for said vehicle are -9- issued by the County Clerk of Larimer County, whichever occurs first. 9. Upon the purchase price of tangible personal property acquired with the purchase of a business for use in the operation of such business as such purchase price is documented in the bill or contract of sale, but in no event shall the tax be based upon a valuation of property less than its fair market value. If the purchase price of the property is not itemized in the bill or contract of sale, the tax shall be based upon the book value that the purchaser uses for income tax depreciation or upon the fair market value of the property if no book value has been established. Regardless of the method used to value the property, no deduction shall be made on account of any outstanding liabilities acquired by the purchaser of the business and property. C. Transactions and items exempt from the sales tax. 1. The following shall be exempt from the sales tax: (a) All sales of automotive vehicles properly titled and registered to an address outside the City. (b) All sales of tangible personal property if all of the following conditions exist: (1) The sales are to those who reside or do business outside the City. (2) The articles purchased are to be delivered to the purchaser outside the City by common carrier or by the conveyance of the vendor or by mail . (3) The articles so purchased and so delivered are used outside the City. (c) All sales of gasoline or motor fuel which are taxed under the provisions of Article 27, Title 39, C.R.S. (d) All sales of goods manufactured in the City and sold by the manufacturer thereof directly to the ultimate consumer, when delivery of such goods is made by common, contract or commercial carrier or by conveyance of the vendor or the purchaser to a point outside the City for use outside the City. (e) All sales to the United States or the State of Colorado or departments, institutions, or political subdivisions thereof and all sales to the City and any department thereof when made in the exercise of their governmental functions, provided that such purchases are supported by official government purchase orders or charged to the -10- governmental entity's credit card account and are paid for by draft or warrant drawn on the governmental entity's bank account. (f) All sales to charitable organizations of tangible personal property or services to be used in the conduct of the organization's regular activities to foster its religious or other expressed charitable purpose, provided that the organization obtains from the City an exempt organization license pursuant to Section 104-9 and presents the license to the vendor at the time of the sale. (g) All sales which the City is prohibited from taxing under the Constitution or laws of the United States or the State of Colorado. (h) All sales and purchases of neat cattle, sheep, lambs, swine and goats; all sales and purchases of mares and stallions for breeding purposes; and, all farm close-out sales. (i) All sales of prescription drugs and all sales of prosthetic devices. (j) All sales of cigarettes. (k) All charges for the furnishing of rooms or accommodations to any person who is a resident of any hotel , motel , apartment house, mobile home, trailer court or park or similar place pursuant to a written lease for a period of at least thirty (30) consecutive days. (1) All sales of tangible personal property to a public utility doing business both within and without the City, for use in said business operations outside the City, even though delivery thereof is made in the City. (m) All sales of tangible personal property through coin-operated vending machines; provided, however, that the owner of said vending machines shall pay a tax in the amount stated in Section 104-5 on the value of the tangible personal property sold in excess of ten cents ($.10) per item so vended in the coin-operated machines, unless the sale shall be otherwise exempt as provided in this chapter. (n) All sales of farm machinery for use on property outside the City and all sales of farm machinery parts for use on property outside the City; provided, however, that this exemption as to farm machinery parts shall not apply in the case of repairs performed or parts installed on equipment in the City and provided further that trucks -11- having a manufacturer's rated capacity of one (1) ton or less shall not be considered farm machinery for the purposes of this section. Nothing herein contained shall be construed to limit any other exemption contained in this chapter. (o) All sales of feed and feed supplements and drugs for livestock or poultry, and all sales and purchases of seeds, plants and fertilizers when such sales are made for commercial farming or ranching purposes. (p) For transactions consummated on or after January 1, 1986, all sales of construction and building materials, as the term is used in Section 29-2-109, C.R.S. , if such materials are picked up by the purchaser and if the purchaser of such materials presents to the vendor a building permit or other documentation acceptable to the City evidencing that a local sales or use tax has been paid or is required to be paid. (q) For transactions consummated on or after January 1, 1986, all sales of tangible personal property or taxable services which transaction was previously subjected to a sales or use tax lawfully imposed on the purchaser or user by another statutory or home rule municipality in Colorado at a rate equal to or greater than the rate stated in Section 104-5 and such tax was collected. If the rate of the sales or use tax paid to such municipality is less than the rate stated in Section 104-5, the difference between the tax due under this chapter and the tax paid previously shall be remitted to the Director of Finance. 2. The sale of food, as defined in this chapter, is exempt from taxation under this chapter in any amount in excess of two and twenty-five hundredths percent (2.25%) of the amount of the purchase price of such food. §104-4. Imposition of the use tax. A. There is hereby levied and there shall be paid a use tax on the full purchase price paid for or acquisition cost of tangible personal property and taxable services brought into the City for the purpose of using, storing, distributing, or consuming such property and services. The use tax is levied upon the privilege of storing, distributing, consuming or using in the City, personally or as part of rendering a service, tangible personal property or taxable services and is paid by either the vendor or the consumer. -12- B. Transactions and items exempt from the use tax. The use, storage, distribution or consumption in the City of the following is hereby exempted from the use tax: 1. Tangible personal property, the sale or use of which was previously subjected to a sales or use tax lawfully imposed on the purchaser or user by another statutory or home rule municipality in Colorado at a rate equal to or greater than the rate stated in Section 104-5 and such tax was collected. If the rate of the sales or use tax paid to such municipality is less than the rate stated in Section 104-5, the difference between the tax due under this chapter and the tax paid previously shall be remitted to the Director of Finance. 2. Tangible personal property purchased in order to be sold at retail in the City either in its original form or as an ingredient of a manufactured or compounded product, in the regular course of business. 3. Gasoline or motor fuel upon which has accrued or has been paid the tax prescribed by Article 27, Title 39, C.R.S. 4. Tangible personal property brought into the City by a nonresident thereof for his own use, storage, distribution or consumption while temporarily in the City, and the tangible personal property of a resident if such property was purchased prior to becoming a resident of the City. 5. Tangible personal property used, stored, distributed or consumed by the United States or the State of Colorado or departments, institutions or political subdivisions thereof and the City and any department thereof, in their governmental capacities only. 6. Tangible personal property purchased from a nonresident vendor by a resident common carrier, resident public utility or resident construction company, which tangible personal property is stored in the City but not used or consumed in the Y• 7. Tangible personal property of a person engaged in the business of manufacturing or compounding for sale, profit or use any product, which tangible personal property becomes an ingredient or component part of the product which is manufactured or compounded and the container, label or furnished shipping case thereof. 8. Electricity, gas, coal , wood, nuclear fuel , fuel oil , or coke for use in processing, manufacturing, mining, refining, irrigation, telecommunication services, street and railroad transportation services and all industrial uses; and newsprint and printers' ink used to produce newspapers. -13- 9. Tangible personal property used, stored, distributed or consumed by charitable organizations in the conduct of the organization's regular activities to foster its religious or other express charitable purpose, provided that the organization obtains from the City an exempt organization license pursuant to Section 104-9 and presents the license as required. 10. Neat cattle, sheep, lambs, swine and goats; and mares and stallions used for breeding purposes. 11. Automotive vehicles and parts and accessories therefor when used or engaged in interstate commerce. 12. Tangible personal property or services which the City is prohibited from taxing under the Constitution or laws of the United States or the State of Colorado. 13. Prescription drugs and prosthetic devices. 14. For transactions consummated on or after January 1, 1986, the storage of construction and building materials. §104-5. Rate of tax. A. The amount of tax hereby levied is two and seventy-five hundredths percent (2.75%) of the purchase price of tangible personal property or taxable services. Of said amount, twenty-five hundredths percent (0.25%) is a tax which shall expire at midnight on December 31, 1989 and the proceeds of which shall be placed in the Capital Projects Fund of the City for the Pool and Ice Rink facility and an additional twenty-five hundredths percent (0.25%) is a tax which shall expire at midnight on June 30, 1989 and the proceeds of which shall be placed in the Capital Projects Fund of the City for the Necessary Capital Projects as determined by the RECAP Committee. B. Notwithstanding the above, in order to avoid fractions of pennies, the tax payable by the purchaser or consumer to the vendor shall be computed in accordance with schedules or systems approved by the Director of Finance. Said schedules or systems shall be designed so that no tax levied by this chapter is charged on any purchase of seventeen cents ($0.17) or less. However, the use of the schedules in collecting taxes from purchasers shall not relieve the vendor from liability for payment of the full amount of the tax levied in subsection A, above, on all of his taxable sales or services. -14- ARTICLE II Licensing §104-6. Retail sales tax license required. A. No person shall engage in the business of selling at retail tangible personal property and services subject to the tax imposed by this chapter without first having obtained a license therefor, which license shall be granted and issued by the Director of Finance and shall be in force and effect until revoked. B. Such license shall be granted only upon application stating the name and address of the person desiring such license, the name of such business and the character thereof, the location, including the street number, of such business and such other facts as may be reasonably required by the Director of Finance. C. If an application for a license is submitted by an individual or business which previously held a license, the Director of Finance may require that any taxes, penalties and interest due under the previous license be paid and a bond posted in an amount set by the Director to ensure payment of taxes under the new license prior to the issuance of such new license. §104-7. Separate license required for each place of business. In case business is transacted at two (2) or more separate places by one (1) person, a separate license for each place of business shall be required. §104-8. Form of license; not transferable. Each license shall be numbered and shall show the name, mailing address and place of the business of the licensee and shall be posted in a conspicuous place in the place of business for which it is issued. No license shall be transferable. §104-9. Exempt organization license. A. No charitable organization shall purchase tax free in the City or use in the City tangible personal property or taxable services without payment of the tax imposed by this chapter unless the organization first obtains an exempt organization license from the Director of Finance and presents its license to the vendor before making a purchase, lease, or use of the property or services. B. The application for an exempt organization license shall include the organization's certificate of incorporation and a copy of the -15- • institution's federal tax exemption letter, by-laws, and financial statements showing source of funds and expenditures. C. By obtaining an exempt organization license, the institution agrees to make regular and complete reports of all purchases, both those that are not taxable and those that are taxable, including, without limitation, purchases of property and services resold to members and others and those used for other than the exempt purpose of the institution. D. An exempt organization license shall expire on the expiration date stated on such license or at such earlier time as the nature of the organization or its activities change so that it no longer qualifies as a charitable organization. The Director of Finance shall be entitled to review the status of any such organization at any time. If the Director determines that the exempt status is no longer appropriate, he shall notify the organization of the same and the organization shall promptly return the exempt organization license to the Director. §104-10. Revocation of license. The Director of Finance may, after giving reasonable notice and after a full hearing, revoke any license issued under this chapter of any person found by the Director of Finance to have violated any provision of this chapter. §104-11. Appeal of revocation. Any finding and order of the Director of Finance revoking the license of any person shall be subject to review by the Larimer County District Court. The procedure for the review shall be in accordance with Rule 106 of the Colorado Rules of Civil Procedure. ARTICLE III Collection and Remittance §104-12. Collection of tax. A. Except as provided in subsection B, below, the tax to be collected as required by this chapter shall be stated and charged separately from the purchase price and shown separately from the purchase price on any record thereof at the time the sale is made or at the time when evidence of the sale is issued or employed by the vendor, provided that when added, such tax shall constitute a part of such price or charge and shall be a debt from the purchaser to the vendor until paid and shall be recoverable at law in the same manner as other debts. The tax shall be paid by the purchaser to the vendor, as trustee for and on account of the City, and the -16- vendor shall be liable for the collection thereof for and on account of the City. B. Nothing herein contained shall be deemed to prohibit any vendor selling malt, vinous or spirituous liquors by the drink from including in the purchase price for such drinks any tax levied under this chapter. The brackets and tax amounts designated in Section 104-5 shall be used by such vendors in determining amounts to be included in such prices as provided herein. No such vendor shall advertise or hold out to the public in any manner, directly or indirectly, that the tax levied by this chapter is not considered as an element in the purchase price of such drinks to the consumer. §104-13. Tax money in possession of vendor held in trust. All sums of money paid by a purchaser to a vendor as taxes imposed by this chapter shall be and remain public monies that are the property of the City. The vendor, as trustee, shall hold such monies in trust for the sole use and benefit of the City until paid to the Director of Finance as herein provided. §104-14. Tax on credit or secured sales; bad debts. A. Whenever tangible personal property is sold under a conditional sales contract or lease-purchase agreement whereby the vendor retains title as security for all or part of the purchase price, or whenever the vendor takes a purchase money security interest on such tangible personal property to secure all or part of the purchase price, the total tax based on the total purchase price shall become immediately due and payable. This tax shall be charged and collected by the vendor. No refund or credit shall be allowed to either party to the transaction in case of repossession. B. Taxes paid on sales which are represented by accounts not secured by conditional sales contracts, lease-purchase agreements or purchase money security interests and which are found to be worthless and are actually and properly charged off as bad debts for the purpose of the income tax imposed by the laws of the State of Colorado may be credited upon a subsequent payment of the tax herein provided in this chapter; but, if any such accounts are thereafter collected by the vendor, a tax shall be paid upon the amounts so collected. §104-15. Tax on building materials and supplies. A. Any person who shall build, construct, reconstruct, alter, expand, modify or improve any building, dwelling or other structure or improvement to real property in the City and who shall purchase or -17- • acquire lumber, fixtures, minerals or any other building materials and supplies used therefor, or any tangible personal property used therein, from sources within or without the City and the owner of said real property shall be jointly and severally responsible for paying the tax set out in this chapter. Prior to the issuance of a building permit, an amount of tax to be held on deposit shall be estimated by determining the building value for permit purposes and multiplying that value by a percentage prescribed by the Director of Finance, which amount shall be collected by the City through the owner or contractor. Upon payment of such sales or use tax deposit, the City shall issue a sales or use tax deposit receipt identifying the address for which the purchase is being made and the City building permit number. It shall be the duty of the owner and/or contractor and subcontractors who are hired to do the above-stated work or any portion thereof to submit a Job Cost Report, on forms authorized by the Director of Finance, to the Director of Finance stating the actual amounts of any purchases of lumber, fixtures, minerals or any other building materials and supplies or tangible personal property for such work and to remit any tax due in excess of the sales or use tax deposit. In any case, the general contractor and/or owner will be held responsible and liable for the payment of all taxes for such materials. The City Building Inspector will not perform a final inspection of the building or issue a final Certificate of Occupancy until the Job Cost Report has been submitted and all taxes due have been paid. B. The owner and/or contractor shall keep and preserve all invoices, receipts and statements showing such purchases of building materials and supplies and tangible personal property for a period of three (3) years after completion of construction. The City may, within the three (3) year period, conduct an audit of such records of the owner and/or contractor and any other relevant information to verify the actual cost of the building materials and supplies and tangible personal property used therein to determine the actual tax due. If the actual tax due is more than that paid by the taxpayer, the Director of Finance shall serve a Notice of Determination, Assessment and Demand for Payment on the taxpayer notifying him of the deficiency, including penalty and interest. Service of such notice and payment of the assessed amount shall be made in accordance with Section 104-36. §104-16. Proration of use tax on certain construction equipment. A. Construction equipment which is located within the boundaries of the City for a period of more than thirty (30) consecutive days shall be subjected to the full use tax of the City. B. With respect to transactions consummated on or after January 1, 1986, construction equipment which is located in the City for a period of thirty (30) consecutive days or less shall be subjected to the City's use tax in an amount calculated as follows: the purchase price of the equipment shall be multiplied by a fraction, -18- the numerator of which is one and the denominator of which is twelve, and the result shall be multiplied by the rate stated in Section 104-5. C. In order to avail himself of the provisions of subsection B of this section, the taxpayer shall substantially comply with the following procedure: (1) At the time that the taxpayer files an application for a building permit, he shall file with the Director of Finance an equipment declaration on a form provided by the City. Such declaration shall state the dates on which the taxpayer anticipates the equipment will be located within and removed from the City, shall include a description of each such piece of equipment, shall state the actual or anticipated purchase price of each such piece of equipment, and shall include such other information as reasonably deemed necessary by the City. (2) The taxpayer shall file with the City an amended equipment declaration reflecting any changes in the information contained in any previous equipment declaration no less than once every ninety (90) days after the equipment is brought into the City or, for equipment which is brought into the City for a project of less than ninety (90) days duration, no later than ten (10) days after substantial completion of the project. (3) The taxpayer need not report on any equipment declaration any equipment for which the purchase price was under $2,500. D. If the equipment declaration is given as provided in subsection C of this section, then as to any item of construction equipment for which the purchase price was under $2,500 which was brought into the City temporarily for use on a construction project, it shall be presumed that the item was purchased in a jurisdiction having a local sales or use tax as high as the rate stated in Section 104-5 and that such local sales or use tax was previously paid. In such case, the burden of proof in any proceeding before the City, the Director of Finance or the district court shall be on the City to prove such local sales or use tax was not paid. §104-17. Location guide available. The Director of Finance shall make available to any requesting vendor a location guide showing the boundaries of the City. For transactions consummated on or after January 1, 1986, the requesting vendor may rely on such location guide and any update thereof available to such vendor in determining whether to collect a sales or use tax. No penalty shall be imposed or action for deficiency maintained against such a vendor who in good faith complies with the most recent location guide available. -19- §104-18. Tax on automotive vehicles purchased outside City. No automotive vehicle purchased or acquired at retail outside the City by a resident of the City for use in the City shall be registered in Larimer County, nor shall title thereto be transferred within Larimer County, nor shall a license or registration for the use thereof in the State of Colorado be issued by the County Clerk of Larimer County, if the tax imposed by this chapter has not been paid to the Director of Finance. §104-19. Remittance of sales tax collected by vendor. A. Vendors shall remit to the City taxes collected pursuant to this chapter. B. The Director of Finance may authorize a vendor to remit the sales tax on a basis other than an accrual basis pursuant to the written request of the vendor. C. Every vendor shall file a tax return each month with the Director of Finance on or before the 20th day of each month for the preceding month and remit the tax due to the Director of Finance simultaneously therewith. Every vendor may deduct three percent (3%) of the amount of the tax to be remitted by him under this chapter to cover his expenses of collection and remittance of the tax. However, if the remission of the tax by the vendor is delinquent, the vendor may not retain any amounts to cover the expense of collecting and remitting the tax unless the vendor demonstrates reasonable grounds for the delinquency acceptable to the Director of Finance. D. If any vendor shall , during any reporting period, collect as a tax an amount in excess of the rate stated in Section 104-5, he shall remit to the Director of Finance the full amount of the tax herein imposed and also such excess. §104-20. Remittance of use tax. A. Every person who operates or maintains a business in the City, and who purchases or leases tangible personal property for use, storage, distribution or consumption in the City in connection with said business and taxable hereunder, and who has not paid the tax imposed thereon by this chapter to a vendor required or authorized to collect the same, shall monthly make a return and pay the tax due to the Director of Finance, on or before the 20th day of each calendar month following the month in which such purchase or lease was consummated or such later date as is approved by the Director of Finance. B. Every resident of the City who purchases or leases tangible personal property for use, storage, distribution or consumption in the City and taxable hereunder, and who has not paid the tax -20- imposed thereon by this chapter to a vendor required or authorized to collect the same, shall make a return and pay the tax due to the Director of Finance within thirty (30) days from the purchase or lease of such tangible personal property, unless a reporting period greater than thirty (30) days is approved by the Director of Finance. §104-21. Remittance of use tax by property owners and lessees. Every owner or lessee of real property in the City and of improvements and structures located upon real property in the City upon which tangible personal property acquired from sources outside the City is attached or affixed who has not paid the tax imposed by this chapter thereon to a vendor required or authorized to collect the same, shall make a return and pay the tax due to the Director of Finance within thirty (30) days from the purchase or lease of such tangible personal property. §104-22. Remittance of tax on other than monthly basis. If the accounting method regularly employed by the vendor in the transaction of his business or other conditions are such that reports of sales made on a calendar-month basis will impose unnecessary hardship on the vendor, the Director of Finance may, upon written request of the vendor, accept returns at such intervals as will , in the Director's opinion, better suit the convenience of the vendor and will not jeopardize the collection of the tax; provided however, that the Director of Finance may, by rule, permit a vendor whose monthly tax collected is less than fifty dollars ($50) to make returns and pay taxes at intervals greater than one (1) month. The Director of Finance may require a bond or other financial guarantee to secure payment of the tax on such less frequent basis and may revoke permission to pay the tax on such basis if payment of the tax due becomes delinquent. §104-23. Form of tax returns; signature required. A. The returns to be filed by the taxpayer shall contain such information and be made in such manner and upon such forms as the Director of Finance may prescribe. B. Each return shall be signed by one of the following, depending upon the nature of the taxpayer: sole proprietorship - owner or authorized agent partnership - general partner or authorized agent corporation - president or authorized agent estate - personal representative trust - trustee other - authorized representative -21- A penalty of ten dollars ($10) shall be charged to and due from the taxpayer for each return filed with the Director of Finance without the appropriate signature. §104-24. Consolidation of returns. A vendor doing business in two (2) or more places or locations, whether within or without the City, and collecting taxes hereunder may file one (1) return covering all such places or locations when accompanied by a supplemental report showing the gross and net taxable sales and the taxes collected thereon for each such place or location. ARTICLE IV Refunds §104-25. Tax disputes. Vendors engaged in business in the City shall collect and purchasers and users shall pay the taxes levied by this chapter, notwithstanding the fact that either vendor, purchaser or user disputes the tax liability or claims an exemption. If the application of the tax to any transaction is disputed, the vendor shall collect and the purchaser or user shall pay the tax, and the taxpayer may thereafter apply to the Director of Finance for a refund of such taxes paid, as provided in this chapter. §104-26. Procedure for refund of disputed tax. A refund shall be made or credit allowed for the tax paid under dispute by any person who claims that the transaction or item was not taxable or claims an exemption as provided in this chapter. Such refund shall be made by the Director of Finance after compliance with the following: A. Application. An application for a refund of sales or use tax paid under dispute by a purchaser or user who claims an exemption under Section 104-3C or Section 104-4B shall be made within sixty (60) days after the date of purchase, storage, use or consumption of the goods or services whereon an exemption is claimed. An application for refund of taxes paid in error or by mistake shall be made within three (3) years after the date of purchase, storage, use or consumption of the goods for which the refund is claimed. Such applications must be accompanied by the original paid invoice or sales receipt and must be made upon such forms as shall be prescribed and furnished by the Director of Finance. B. Burden of proof. The burden of proving that any transaction or item is not taxable or is exempt from the tax shall be upon the -22- person asserting such claim under such reasonable requirements of proof as the Director of Finance may prescribe. C. Decisions. Upon receipt of an application, the Director of Finance shall examine the same with all due speed and shall give written notice to the applicant of his decision thereon. D. Hearing. An applicant whose application for a refund has been denied may, within ten (10) days after such decision is mailed to him, petition the Director of Finance for a hearing on the claim. The Director of Finance shall notify the applicant in writing of the time and place of the hearing. After such hearing, the Director of Finance shall make such order in the matter as he deems just and proper and shall furnish a copy of such final order to the applicant. §104-27. Right of refund not assignable. The right of any person to a refund under this chapter is not assignable. An application for a refund must be made by the individual who paid the tax, as shown on the sales receipt or invoice of the sale. §104-28. Action for recovery of refund. If any such person obtains any refund unlawfully, the Director of Finance is hereby empowered and directed to bring appropriate action for recovery of such refund. A conviction of a violation of Section 104-56E shall constitute prima facie evidence that all refunds received by such person pursuant to the application which contained the false statement were obtained unlawfully. ARTICLE V Administration §104-29. Preservation of returns and other records; confidentiality. A. Returns shall be preserved for a period of three (3) years from the date of filing with the Director of Finance, after which time the Director of Finance may order them destroyed. B. Except in accordance with a court order or as otherwise provided by law, the City and its agents and employees shall not divulge or make known in any way any information obtained from any investigation conducted by the Finance Department or its agents or disclosed in any application, report, return or any other document kept, filed or maintained under the provisions of this chapter except such information as is displayed on the tax license. The persons charged with the custody of such applications, reports, returns or other documents shall not be required to produce any of -23- them or evidence of anything contained therein in any action or proceeding in any court, except on behalf of the Director of Finance in an action or proceeding under the provisions of this chapter to which he or the City is a party, or on behalf of any party to any action or proceeding under the provisions of this chapter when the report of facts shown thereby is directly involved in such action or proceeding, in either of which events the court may require the production of, and may admit in evidence, so much of said reports or of the facts shown thereby as are pertinent to the action or proceeding and no more. C. Nothing in this section shall be construed to prohibit the delivery to a person or a duly authorized representative thereof of a copy of any application, report, return or any other document kept, filed or maintained in connection with such person's tax liability. Copies of such documents may be certified by the Director of Finance and when so certified shall be evidence equally with the originals and may be received as evidence of their contents. D. Nothing in this section shall be construed to prohibit the publication of statistics so classified as to prevent the identification of particular reports or returns and the contents thereof, or the inspection of any documents by the City Attorney or other legal representatives of the City. E. Notwithstanding the provisions of this section, the Director of Finance may furnish to the taxing officials of the State of Colorado or its political subdivisions, any other state or its political subdivisions, or the United States any information contained in any application, report, return or any other document if the recipient jurisdiction agrees with the Director of Finance to grant similar privileges to the City and if such information is to be used by the jurisdiction only for tax-related purposes. §104-30. Records and accounts to be kept. It is the duty of every person engaged in business in the City for the transaction of which a license is required by this chapter to keep and preserve suitable records of all sales, purchases and leases made by him, and such other books or accounts as may be necessary to determine the amount of tax for the collection or payment of which he is liable hereunder. It is the duty of every such person to keep and preserve all such books, invoices and other records for a period of three (3) years and such items shall be open for examination in the City at any time by the Director of Finance. §104-31. Examination of returns; recomputation, credits, deficiencies. As soon as practicable after a return is filed, the Director of Finance shall examine it. If it appears that the correct amount of tax to be remitted may be greater or less than that shown in the return, the tax -24- shall be recomputed by the Director of Finance. If the amount paid exceeds that which is due, the excess shall be refunded or credited against any subsequent remittance from the taxpayer. If the amount paid is less than the amount due and any part of the deficiency is due to negligence or intentional disregard of the provisions of this chapter or of authorized rules and regulations of the City with knowledge thereof but without intent to defraud, the amount of the deficiency together with a penalty of ten percent (10%) of the amount of the deficiency plus interest on both the deficiency and the penalty at the rate imposed under Section 104-38 from the date the return and tax was due shall be due and payable by the taxpayer within ten (10) days after written notice and demand is sent to him by the Director of Finance. If any part of the deficiency is due to fraud with the intent to evade the tax, then there shall be added a penalty of one hundred percent (100%) of the deficiency and in such case, the amount of the deficiency, the penalty and interest calculated as stated above shall be due and payable by the taxpayer within ten (10) days after written notice and demand is sent to him by the Director of Finance and an additional three percent (3%) per month on said amount shall be added from the date the return and tax was due until paid. §104-32. Investigation of tax records of vendor. For the purpose of ascertaining the correctness of a return, or for the purpose of determining the amount of tax due from any person, whether licensed under this chapter or not, the Director of Finance may hold investigations, including audits, and hearings concerning any matters covered by this chapter, and may examine any relevant books, papers, records or memoranda of any such person and may require the attendance of such person, or any officer or employee of such person, or of any person having knowledge of transactions involved, and may take testimony and proof for his information. The Director of Finance shall have the power to administer oaths to such persons. §104-33. Subpoenas and witness fees. All subpoenas issued under the terms of this chapter may be served by any person over the age of eighteen (18) years. The fee of witnesses for attendance in response to a subpoena shall be the same as the fees of witnesses before the District Court, such fees to be paid when the witness is excused from further attendance. When the witness is subpoenaed at the instance of the Director of Finance, such fees shall be paid by the City but when a witness is subpoenaed at the instance of any other party to such proceeding, the Director of Finance may require that the cost of service of the subpoena and the fee of the witness be borne by the party at whose instance the witness is summoned. In such case, the Director of Finance, in his discretion, may require a deposit to cover the cost of such service and witness fees prior to issuing such subpoenas. A subpoena issued as aforesaid shall be served in the same manner as a subpoena issued out of a court of record. -25- §104-34. Attendance of witnesses and production of evidence to be be compelled by district judge. Any district judge of the District Court, upon the application of the Director of Finance, may compel the attendance of witnesses, the production of books, papers, records or memoranda and the giving of testimony before the Director of Finance or his agent, by an action for contempt, or otherwise, in the same manner as the production of evidence may be compelled before said Court. §104-35. Depositions. The Director of Finance, or any party to an investigation or hearing before the Director of Finance, may cause the deposition of witnesses residing within or without the state to be taken in the manner prescribed by law for depositions in civil actions in courts of this state and to that end compel the attendance of witnesses and the production of books, papers, records or memoranda. ARTICLE VI Enforcement §104-36. Failure to make return; improper registration; estimate of taxes, notice; appeal ; audit. A. If any person fails, neglects or refuses to collect the tax or to file a return and pay the tax as required by this chapter, the Director of Finance shall make an estimate of the tax due based on available information and shall add thereto a penalty equal to the sum of fifteen dollars ($15) or ten percent (10%) thereof, whichever is greater, and interest on such delinquent taxes at the rate imposed by Section 104-38 plus one-half percent (112%) per month from the date the return and tax was due, not exceeding eighteen percent (18%) in the aggregate. B. In addition to the penalties contained in Section 104-57 for violation of the provisions of this chapter and in addition to the penalties and interest which may be payable under the provisions of Subsection (A) above, any person who registers a motor vehicle in violation of the following provisions of this Subsection shall be subject to a civil penalty of five hundred dollars (E500) . Such violation shall be determined by the Director of Finance or his designated representative, and shall be assessed by and paid to said Director of Finance according to the provisions of this section if such motor vehicle should properly have been registered at an address within the City. 1 . For purposes of this subsection, a person's residence shall be his principal or primary home or place of abode, to be determined in the same manner as residency for voter registration purposes as provided in Sections 1-2-103 and -26- 31-10-201, C.R.S. ; except that "voter registration" shall be substituted for "motor vehicle registration" as a circumstance to be taken into account in determining such principal or primary home or place of abode. 2. Except as may be otherwise provided for by rule or regulation of the Executive Director of the Department of Revenue for the State of Colorado, it is unlawful for any person who is a resident of the city to register any motor vehicle owned by him or to obtain a license therefor or to procure a certificate of title thereto at any address other than: a. For a motor vehicle which is owned by a business and operated primarily for business purposes, the address from which such vehicle is principally operated and maintained; or b. For any motor vehicle for which the provisions of Subparagraph (a) of this subsection do not apply, the address of the owner's residence; except that, if a motor vehicle is permanently operated and maintained at an address other than the address of the owner's residence, such motor vehicle shall be registered at the address from which such motor vehicle is permanently operated and maintained. C. The Director of Finance shall serve upon the delinquent taxpayer personally or by first class mail directed to the last address of the taxpayer on file with the City written notice of such estimated taxes, penalty and interest. D. Such notice shall constitute a Notice of Determination, Assessment and Demand for Payment and such assessment shall be due and payable from the taxpayer to the Director of Finance within ten (10) days from the date of service of the notice or the date of mailing; provided, however, that within said ten (10) day period, such delinquent taxpayer may petition the Director of Finance for a revision of such assessment, which petition must include the facts and figures supporting the revised amount of such taxes. E. Such petition shall be in writing and shall be given under oath of said taxpayer. Such petition may include a request for a hearing. F. In response to the petition, if a hearing was requested, the Director of Finance shall notify the petitioner in writing of the time and place of the hearing. After such hearing, or after a consideration of the facts and figures contained in the petition if no hearing is requested, the Director of Finance shall make such order in the matter as he deems just and proper and shall furnish a copy of such order to the petitioner. G. The Director of Finance may, at any time within three (3) years of the date the tax was due, conduct an audit of the books and -27- records of the taxpayer to determine the exact amount of tax due and charge the taxpayer for any amount found to be due in excess of the amount previously paid, whether such amount was paid pursuant to a return filed by the taxpayer or a Notice of Determination, Assessment and Demand for Payment. §104-37. Assessment and recurring assessment penalty. If any taxpayer has failed, neglected or refused to pay the tax imposed by this chapter within the time specified for payment, the Director of Finance may assess the following penalties, in addition to the taxes, penalties and interest provided for elsewhere in this chapter, said additional amount being imposed to compensate the City for administrative and collection costs incurred in collecting such delinquent taxes: A. Upon the first or second issuance of a Notice of Determination, Assessment and Demand for Payment within twelve (12) months, fifteen dollars ($15.00) per notice. B. Upon the third , fourth or fifth issuance of a Notice of Determination, Assessment and Demand for Payment within twelve (12) months, twenty-five dollars ($25.00) or fifteen percent (15%) of the delinquent taxes, penalties and interest, whichever is greater, per notice. C. Upon the sixth or more issuance of a Notice of Determination, Assessment and Demand for Payment within twelve (12) months, fifty dollars ($50.00) or thirty percent (30%) of the delinquent taxes, penalties and interest, whichever is greater, per notice. §104-38. Rate of interest; method of calculation. When interest is required or permitted to be charged under any provision of this chapter, the annual rate of interest shall be that established by the State Commissioner of Banking pursuant to Section 39-21-110.5, C.R.S. For the purpose of calculating the amount of interest due, the date the return and tax was due shall be determined without regard to any extension of time for payment and shall be determined without regard to any Notice of Determination, Assessment and Demand for Payment issued, by reason of jeopardy, prior to the last date otherwise prescribed for such payment. §104-39. Tax constitutes lien. A. The sales and use tax imposed by this chapter, together with all penalties and interest pertaining thereto, is a first and prior lien upon the goods, stock in trade, and business fixtures in which the vendor has an ownership interest except for goods that have been purchased in the ordinary course of business by retail purchasers and such lien takes priority over other liens or claims of whatsoever kind or nature on such property. -28- B. The sales and use tax imposed by this chapter, together with all penalties and interest pertaining thereto, is a first and prior lien on the real and personal property of the taxpayer other than the goods, stock in trade, and business fixtures in which the taxpayer has an ownership interest, except as to pre-existing liens or claims of a bona fide mortgagee, pledgee, judgment creditor, or purchaser whose rights have attached prior to the filing of the notice of lien provided for in subsection D of this section on the property of the taxpayer. C. Whenever the business or property of any taxpayer is placed in receivership, bankruptcy, seized under distraint for nonpayment of property taxes, or an assignment is made for the benefit of creditors, all taxes, penalties, and interest imposed by this chapter and for which the taxpayer is in any way liable under this chapter are a prior and preferred claim against all the property of the taxpayer, except as to pre-existing claims or liens of a bona fide mortgagee, pledgee, judgment creditor, or purchaser whose rights have attached prior to the filing of the notice of lien provided for in subsection C of this section on the property of the taxpayer, other than the goods, stock in trade, and business fixtures of such taxpayer. No sheriff, receiver, assignee, or other officer shall sell the property of any taxpayer subject to the provisions of this chapter under process or order of any court without first ascertaining from the Director of Finance the amount of any taxes, penalties, or interest due and payable under this chapter and if there are any such taxes, penalties or interest due, owing or unpaid, it is the duty of such officer to first pay the amount of said taxes, penalties, or interest out of the proceeds of such sale before paying any monies to judgment creditors or other claimants, except that the officer may pay costs of the proceedings and other pre-existing liens or claims as provided in this subsection. D. If any tax, penalty, or interest imposed by this chapter and shown due by returns filed by the taxpayer or by assessments made by the City as provided in this chapter is not paid within five (5) days after it is due, the Director of Finance may issue a notice, setting forth the name of the taxpayer, the amount of the tax, penalties, and interest, the date of its accrual , and the fact that the City claims a first and prior lien therefor on the real and personal property of the taxpayer, except as to pre-existing liens or claims of a bona fide mortgagee, pledgee, judgment creditor, or purchaser whose rights have attached prior to the filing of the notice on the property of the taxpayer, other than the goods, stock in trade, and business fixtures in which the taxpayer has an ownership interest. The notice of lien shall be made on forms prescribed by the Director of Finance and verified by the Director of Finance or his agent and may be filed in the office of the clerk and recorder of any county in the state in which the taxpayer owns real or personal property or with any -29- person in possession of any personal property or rights to property belonging to the taxpayer. E. The Director of Finance shall release any lien as shown on the records of the county clerk and recorder as herein provided, upon payment of all taxes, penalties, and interest covered thereby, in the same manner as mortgages and judgments are released. §104-40. Lien on construction improvements. A. The full amount of unpaid taxes arising from and required to be reported pursuant to the provisions of Section 104-15 and Section 104-21 together with interest and penalties as herein provided, are a first and prior lien on the property of the taxpayer and take priority over all other liens of whatsoever kind and nature, except for liens for general taxes created by state law and pre-existing liens or claims of a bona fide mortgagee, pledgee, judgment creditor, or purchaser whose rights have attached prior to the filing of the notice of lien provided for in Section 104-39. B. The City Building Inspector shall not make a final inspection on or issue a certificate of occupancy for any construction project unless a person has paid or arranged with the Director of Finance to pay all taxes due under this chapter on all lumber, fixtures, minerals and any other building materials and supplies or tangible personal property used in or connected with the construction, reconstruction , alteration , expansion , modification , or improvement of any building, dwelling, or other structure or improvement to real property in the City. §104-41. Sate of business subject to lien. A. Any person who sells a business or stock of goods or closes a business shall complete and file the returns required under this chapter and pay the taxes, penalties and interest due within ten (10) days of the date on which such person sold the business or stock of goods or closed the business and indicate that it is a final return, that the business is sold or closed, and the name and address of the purchaser of the business, if any. B. A purchaser of a business who has acquired the furniture, fixtures, and/or equipment of the business shall withhold sufficient funds from the purchase money to cover the amount of taxes, penalties and interest imposed by this chapter due and unpaid until the seller provides a receipt from the Director of Finance showing that such taxes, penalties, and interest have been paid. If taxes, penalties, and interest imposed by this chapter are due and unpaid after the ten (10) day period herein provided, such purchaser of the business is personally liable for the payment of the taxes, penalties and interest imposed by this -30- chapter due and unpaid to the City to the same extent as the seller of the business or stock of goods. C. Any person who obtains by purchase, foreclosure sale, or otherwise, except at a sale conducted pursuant to Section 104-44E, any goods, stock in trade, or business fixtures owned, leased, or used by any person takes them subject to the lien of the City for any delinquent taxes owed by the prior owner of the property and is liable to pay all delinquent taxes of the prior owner, but only up to and including the value of property so acquired. §104-42. Certificate of discharge of lien. A. If any real or personal property is subject to a lien for payment of tax due to the City under this chapter, the Director of Finance may issue a certificate of discharge of any part of the property subject to the lien if the Director finds that the fair market value of that part of such property remaining subject to the lien is at least twice the amount of the unsatisfied tax liability plus the value of any liens on the property that have priority over the City's lien. B. If any real or personal property is subject to a lien for payment of tax due to the City under this chapter, the Director of Finance may issue a certificate of discharge of any part of the property subject to the lien if the Director is paid in partial satisfaction of the tax liability an amount determined by the Director to be not less than the value of the City's interest in the part of the property so discharged. In determining the value of the part of the property to be discharged, the Director shall consider the fair market value of the property and the value of any liens on the property that have priority over the City's lien. C. A certificate of release of lien issued under this section is conclusive evidence that the City's lien upon the property is extinguished, but does not extinguish or release any portion of the lien on property not specified in the release. §104-43. Jeopardy assessment. A. If the Director of Finance finds that collection of the tax will be jeopardized for any reason, the Director may declare the taxable period immediately terminated, determine the tax, and issue a Notice of Determination, Assessment and Demand for Payment thereof. Notwithstanding the provisions of Section 104-36, the tax shall then be due and payable forthwith, and the Director may proceed to collect the tax as provided in Section 104-44. B. If the taxpayer subject to a jeopardy assessment provides security for payment of the tax satisfactory to the Director of Finance, -31- t \ the Director may forego the jeopardy assessment collection proceedings. §104-44. Enforcing the collection of taxes due. A. The Director of Finance may issue a warrant directed to any employee, agent, or representative of the City or any sheriff of any county of the state, commanding such person to distrain, seize, and sell any personal property in which the taxpayer has an ownership interest, except such property as is exempt from the execution and sale by any statute of the state, for the payment of tax due together with interest and penalties thereon and costs of execution in the following circumstances: (1) When any deficiency in tax is not paid within ten (10) days from the date of the Notice of Determination, Assessment and Demand for Payment and no hearing or extension has been requested in a timely manner; (2) When any deficiency in tax is not paid within thirty (30) days from the date of the Notice of Determination, Assessment and Demand for Payment and no appeal from such notice has been docketed in the Larimer County District Court during such time, except that if the Director of Finance finds that collection of the tax will be jeopardized during such period, the Director may immediately issue a distraint warrant; (3) When any deficiency in tax is not paid within the time prescribed in the judgment and order of court on any appeal to the Larimer County District Court; (4) Immediately upon making a jeopardy assessment or issuing a demand for payment upon jeopardy assessment as provided in Section 104-43; or (5) After or concurrently with the filing of a notice of lien as provided in Subsection 104-39D. B. The Director of Finance may apply to the Judge of the Municipal Court for a warrant authorizing the Director of Finance to search for and seize property located within the City limits for the purpose of enforcing the collection of taxes under this chapter. The Municipal Judge shall issue such warrant after the Director demonstrates that: (1) The premises to which entry is sought contain property that is subject to levy and sale for taxes due; and (2) At least one of the preconditions of subsection A of this section have been satisfied, but if a jeopardy assessment has been declared under Section 104-43, the Director of Finance -32- must set forth the reasons that collection of the tax will be jeopardized. C. The procedures to be followed in issuing and executing a warrant pursuant to this subsection shall comply with Rule 241(c) and (d) of the Colorado Municipal Court Rules of Procedure. D. The taxpayer may contest a warrant previously issued under the procedure provided by Rule 241(e) of the Colorado Municipal Court Rules of Procedure, except that no proceeding to contest such warrant may be brought after five (5) days prior to the date fixed for sale of the distrained property. E. The agent charged with the collection shall make or cause to be made an account of the goods or effects distrained, and shall leave a copy of such account, signed by the agent making such distraint, with the owner or possessor of the property, at the owner's or possessor's usual place of abode with some family member over the age of eighteen years, at the owner's or possessor's usual place of business with a stenographer, bookkeeper, or chief clerk, or, if the taxpayer is a corporation, with any officer, manager, general agent, or agent for process, with a statement of the sum demanded and the time and place of sale. The agent charged with collection shall forthwith cause to be published a notice of the time and place of sale and a description of the property to be sold in a newspaper within the county wherein distraint is made, or, in lieu thereof and in the discretion of the Director of Finance, the agent or sheriff shall cause such notice to be publicly posted at the courthouse of the county wherein such distraint is made and copies thereof shall be posted in at least two other public places within said county. The time fixed for the sale shall not be less than ten (10) days nor more than sixty (60) days from the date of such notification to the owner or possessor of the property and the publication or posting of such notices. The sale may be adjourned or postponed from time to time by the agent or sheriff, if the agent or sheriff deems it advisable, to a date certain but not for a time to exceed in all ninety (90) days from the date first fixed for the sale. When any personal property is advertised for sale under distraint, the agent or sheriff making the seizure shall proceed to sell such property at public auction, offering the property at not less than a fair minimum price that includes the expenses of making the seizure and of advertising the sale. If the amount bid for the property at the sale does not equal the fair minimum price so fixed, the agent or sheriff conducting the sale may declare the same to be purchased for the City. The property so purchased may then be sold by the agent or sheriff under such regulations as may be prescribed for disposing of City property. The goods, chattels, or effects so distrained shall be restored to the owner or possessor, if, prior to the sale, the amount due is paid together with the fees and other charges, or they may be redeemed by any person holding a chattel mortgage or other evidence of right of possession. -33- F. In all cases of sale, the agent or sheriff making the sale shall issue a certificate of sale to each purchaser, and such certificate is prima facie evidence of the right of the agent or sheriff to make such sale and conclusive evidence of the regularity of the proceedings in making the sale; it transfers to the purchaser all right, title, and interest of the delinquent taxpayer in and to the property sold. Where such property consists of certificates of securities or other evidence of indebtedness in the possession of the agent or sheriff, the taxpayer shall endorse such certificates to the purchaser thereof and supply the purchaser with proof of the taxpayer's authority to transfer the same or with any other requisite that may be necessary to obtain registration of the transfer of the certificate. Any surplus remaining above first the City's taxes, penalties, interest, costs, and expenses of making the seizure and of advertising the sale and then any amounts distributed pro rata to other jurisdictions under recorded sales and use or personal property ad valorem tax liens shall be returned to the property owner or such person having a legal right to the property and, on demand, the Director of Finance shall render an account in writing of the sale. G. In any case where a taxpayer has refused or neglected to pay any tax due to the City under this chapter and a lien has been filed as provided in Subsection 104-39D, the Director of Finance may, in addition to pursuing other collection remedies, certify the amount of the tax, penalties and interest due, together with ten percent (10%) of the delinquent amount for costs of county collection, to the Larimer County Treasurer to be levied against the person's property for collection by the County in the same manner as delinquent general taxes upon such property are collected. Before certifying such amounts to the County for collection, the Director of Finance shall provide to the property owner an opportunity for a hearing to contest the authority of the City to incur the tax, or the amount thereof. The Director shall mail the notice to the property owner by first class mail addressed to the last known owner of the property on the records of the Larimer County Assessor. If the Director's decision after a hearing affirms the imposition of charges, the decision shall include notice that the charges are due and payable within ten (10) days of the date of the decision and that, if not paid when due, they will be certified to the Larimer County Treasurer for collection, along with ten percent (10%) of the charges for the cost of county collection. Whenever the Director certifies any such amounts to the Larimer County Treasurer for collection, the Director shall record notice of such certification with the Larimer County Clerk and Recorder. -34- §104-45. Recovery of unpaid tax by action at law. A. In addition to other remedies provided in this chapter, the Director of Finance may treat any such taxes, penalties or interest due and unpaid as a debt due to the City from the taxpayer. If a taxpayer fails to pay the tax, or any portion thereof, or any penalty or interest thereon, when due, the Director of Finance may recover at law the amount of such taxes, penalties and interest in any county or district court of the county wherein the taxpayer resides or has a principal place of business that has jurisdiction over the amounts sought to be collected. The return filed by the taxpayer or the Notice of Determination, Assessment and Demand for Payment issued by the Director of Finance is prima facie proof of the amount due. B. The City Attorney is hereby authorized upon request by the Director of Finance to commence any legal action or suit for the recovery of the tax due under this chapter. C. Such actions may be actions in attachment, and writs of attachment may be issued to the sheriff. In any such proceedings no bond shall be required of the City nor shall any sheriff require of the Director of Finance an indemnifying bond for executing the writ of attachment or writ of execution upon any judgment entered in such proceedings. The City may also prosecute appeals or writs of error in such cases without the necessity of providing bond therefor. D. In any case in which a taxpayer has refused or neglected to pay any tax, penalty, or interest due to the City under this chapter and a lien has been filed upon any real or personal property, the Director of Finance may cause a civil action to be filed in the district court of the county in which is situated any such property subject to said lien to enforce the lien and subject any real or personal property or any right, title, or interest in such property to the payment of the amount due. The court shall decree a sale of such real property and distribute the proceeds of such sale, according to the court's findings concerning the interest of the parties and of the City. The proceedings in such action, the manner of sale, the period for and manner of redemption from such sale, and the execution of deed of conveyance shall be in accordance with the law of foreclosures of mortgages upon real property. In any such action, the court may appoint a receiver of the property involved in such action if equity so requires. -35- §104-46. City may be party in title actions. In any action affecting the title to real property or the ownership or right to possession of personal property, the City may be made a party defendant for the purpose of obtaining an adjudication or determination of its lien upon the property involved therein. §104-47. Injunctive relief. The Director of Finance may seek injunctive or other equitable relief in any court of competent jurisdiction to enforce provisions of this chapter. §104-48. Waiver of penalties by Director of Finance. The Director of Finance is hereby authorized to waive, for good cause shown, any penalty or fee imposed under this chapter. §104-49. Obligations of fiduciaries and others. A. For the purpose of facilitating settlement and distribution of estates, trusts, receiverships, other fiduciary relationships and the assets of corporations in the process of dissolution or that have been dissolved, the Director of Finance may agree with the fiduciary or surviving corporate directors upon an amount of taxes due from the decedent or from the decedent's estate, the trust, receivership or other fiduciary relationship, or corporation for any of the periods of tax liability under this chapter. Payment in accordance with such agreement fully satisfies the tax liability for the periods that the agreement covers, unless the taxpayer has committed fraud or malfeasance or misrepresented a material fact regarding the tax or liability therefor. B. Except as provided in subsection D of this section, any personal representative of a decedent or the estate of a decedent, any trustee, receiver, or other person acting in a fiduciary capacity, or any director of a corporation in the process of dissolution or that has been dissolved who distributes the estate or fund under such person's control without having first paid any taxes covered by this chapter due from such decedent, decedent's estate, trust estate, receivership, or corporation and that may be assessed within the periods authorized by this chapter is personally liable to the extent of the property distributed by such person for any unpaid taxes of the decedent, decedent's estate, trust estate, receivership, or corporation imposed by or due under this chapter and assessed within the periods authorized by this chapter. C. The distributee of a decedent's estate, a trust estate, or fund and the stockholder of any dissolved corporation who receives any of the property of such decedent's estate, trust estate, fund, or corporation is liable under this chapter to the same extent that -36- the decedent, trust estate, fund or corporation is liable under this chapter. D. If a tax under this chapter is due from a decedent or the decedent's estate, personal liability of the persons set forth in this section remains in effect only if a determination of the tax due is made and notice and demand therefor issues within eighteen (18) months after the decedent's personal representative files with the Director of Finance a written request for such determination, filed after it has filed the decedent's final return or the decedent's estate's return to which the request applies. A request for determination under this subsection does not extend the otherwise applicable period of limitation. E. If a tax under this chapter is due from a corporation that is in the process of dissolution or has been dissolved, personal liability of directors or stockholders as provided in this section remains in effect only if a determination of the tax due is made and notice and demand therefor issued within eighteen (18) months after the corporation files with the Director of Finance a written request for such determination, filed after it has filed the corporation's return, but only if the request states that the dissolution was begun in good faith before the expiration of the eighteen (18) month period and the dissolution is completed. A request for determination under this subsection does not extend the otherwise applicable period of limitation. ARTICLE VII Miscellaneous §104-50. Review of decisions of Director of Finance. The taxpayer may apply for a review of the decision of the Director of Finance in the Larimer County District Court in accordance with Rule 106 of the Colorado Rules of Civil Procedure. Such review must be sought not later than twenty (20) days after the date of the decision of the Director. §104-51. Review bond required. For transactions consummated on or after January 1, 1986, within fifteen (15) days after making application to the district court for review of the decision of the Director of Finance, the party making such application shall file with the district court a surety bond in twice the amount of the taxes, penalties, interest, and other charges stated in the final decision by the Director of Finance which are contested on appeal . The taxpayer may, at his option, satisfy the surety bond requirement by a savings account or deposit in or a certificate of deposit issued by a state or national bank or by a state or federal savings and loan association, in accordance with the provisions of Section 11-35-101(1) , C.R.S. , equal to twice the amount of the taxes, penalties, interest, and other charges stated in the final decision by the Director of Finance. The taxpayer may, -37- at his option, deposit the disputed amount with the Director of Finance in lieu of posting a surety bond. If such amount is so deposited, no further interest shall accrue on the contested amount during the pendency of the action. At the conclusion of the action, after appeal or after the time for such appeal has expired, the funds deposited shall be, at the direction of the court, either retained by the Director of Finance and applied against the amount due or returned in whole or in part to the taxpayer with interest at the rate imposed by Section 104-38 from the date it was paid to the Director of Finance. No claim for refund of amounts deposited with the Director of Finance need be made by the taxpayer in order for such amounts to be repaid in accordance with the direction of the court. §104-52. Notices. All written notices required to be given to any taxpayer under the provisions of this chapter shall be hand delivered or mailed, postage prepaid, addressed to said taxpayer at the last known address of the taxpayer on file with the City. §104-53. License and tax in addition to all other licenses and taxes. The license and tax imposed by this chapter shall be in addition to all other licenses and taxes imposed by law, except as herein otherwise provided. §104-54. Hearings to be held in City. Every hearing before the Director of Finance shall be held in the City of Fort Collins. §104-55. Administration by Director of Finance; rules and regulations. The administration of all provisions of this chapter is hereby vested in and shall be exercised by the Director of Finance or his agents, who shall prescribe forms and formulate and promulgate reasonable rules and regulations in conformity with this chapter for the making of returns, for the ascertainment, assessment and collection of taxes imposed and for the proper administration and enforcement thereof. §104-56. Violations. A. It shall be unlawful for any vendor to fail to collect or for any purchaser or user to fail to pay any tax levied by this chapter regardless of whether the tax liability is disputed or an exemption is claimed. B. It shall be unlawful for any vendor to retain any tax collected in excess of the rate stated in Section 104-5 or to fail to remit punctually to the Director of Finance the full amount required by -38- the provisions of this chapter, including taxes, penalties and interest. C. It shall be unlawful for any person to fail or refuse to make or file any return required to be made or filed by this chapter or to make any false or fraudulent return or any false or fraudulent statement in any return. D. It shall be unlawful for any person to do business without the license required by this chapter or to continue to do business after such license is revoked. E. It shall be unlawful for any applicant for a tax refund to make a false statement in connection with such application. F. It shall be unlawful for any resident of the City or representative of a business located in the City to register an automotive vehicle purchased for use or storage in the City at any address other than such resident's principal residence or place of business within the City or such business' address within the City for the purpose of evading the sales or use tax imposed by this chapter. In the event of such registration, it shall be presumed that the resident or representative of the business made such registration for the purpose of evading the tax. G. It shall be unlawful for any vendor to advertise or hold out or state to the public or to any customer, directly or indirectly, that the tax or any part thereof imposed by this chapter will be assumed or absorbed by the vendor or that it will not be added to the purchase price of the property sold, or, if added, that it or any part thereof will be refunded. H. It shall be unlawful for any person other than the City to enrich himself or gain any benefit from the collection or payment of the taxes levied by this chapter. I. It shall be unlawful for any officer, agent or employee of the City to divulge or make known in any way any information classified herein as confidential , except in accordance with a court order or as otherwise provided by law. J. It shall be unlawful for any person to aid or abet another in any attempt to evade the payment of the tax imposed by this chapter. K. It shall be unlawful for any person to violate any other provisions of this chapter. §104-57. Penalty. The penalty for violating any provision of this chapter shall be a fine or imprisonment or both in the amounts stated in Section 1-23 of this Code. -39- §104-58. Purpose of tax; distribution of proceeds. The City Council hereby declares that the purpose of the levy of the tax imposed by this chapter is for the raising of funds for the payment of the expenses of operating the City and for capital improvements; and in accordance with these purposes, all of the proceeds of said tax shall be placed in and become a part of the general funds of the City except as otherwise indicated in Section 104-5. §104-59. Limitations. A. Except as otherwise provided in this section, the taxes for any period, together with interest thereon and penalties with respect thereto, imposed by this chapter shall not be assessed, nor shall any notice of lien be filed, distraint warrant be issued, bond be collected upon, suit for collection be instituted, or any other action to collect the same be commenced, more than three (3) years after the date on which the tax was or is payable. In addition, no lien shall continue after such period, except for taxes assessed before the expiration of such period, when a notice of lien regarding such taxes was filed prior to the expiration of such period, in which case the lien shall continue for only one (1) year after the filing of notice thereof. B. For transactions consummated on or after January 1, 1986, the use tax shall not be imposed with respect to the use or consumption of tangible personal property in the City which occurs more than three (3) years after the most recent sale of the property if, within the three (3) years following such sale, the property has been significantly used in Colorado for the principal purpose for which it was purchased. C. In the case of a false or fraudulent return filed with intent to evade the tax and in the case of failure to file a return, the tax, together with interest and penalties thereon, may be assessed or proceedings for the collection of such taxes may be begun at any time. D. Before the expiration of such period of limitation, the taxpayer and the Director of Finance may agree in writing to an extension thereof, and the period so agreed on may be extended by subsequent agreements in writing made before the expiration of the previously agreed upon time. E. Nothing in this section shall be construed to limit any right accrued or to revive any liability barred by any statute in effect on the effective date of this chapter. -40- Section 2. Severability. The City Council hereby declares that should any section, paragraph, sentence, word or other portion of this ordinance be declared invalid for any reason, such invalidity shall not effect any other portion or its provisions, and the City Council hereby declares that it would have passed all other portions of this ordinance and adopted all such other provisions, independent of the elimination herefrom of any such portion which may be declared invalid. Introduced, considered favorably on first reading, and ordered published in summary form this 19th day of August, A.D. 1986, and to be presented for final passage on the 2nd day of September, A.D. 1986. Mayor TTEST: City Clerk 1986.Passed and adopted on final reading this 2nd day of September, A.D. Mayor AT EST: City Clerk -41-