Update on Measure M: The Sonoma County Library Improvement Act

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Measure M UPDATE

Preliminary results from the Registrar of Voters show that Measure M received 62.2% of the vote.  Since a 66.7% approval rate was required, the Measure did not pass.  We want to thank all of the voters who did vote “Yes” on M: Thank you! Library staff and the Library Commission will now have to make some difficult decisions in the coming months to ensure that the organization can meet its financial obligations.  In the meantime, the Sonoma County Library will continue to focus on providing the best services possible within our current budget.


Measure M: The Sonoma County Library Improvement Act

At the August 5, 2014 meeting, the Board of Supervisors voted to place a 1/8 of one cent sales tax measure on the November ballot.  The Ordinance will impose a one-eighth cent (.125%) transactions and use tax, for a period not to exceed ten (10) years, and will generate approximately $10 million annually. The sales tax will be used exclusively to supplement existing funding for library operations, programs, acquisitions, construction and modernization throughout the incorporated and unincorporated territory of the County. An Expenditure Plan set out in the Ordinance sets out the particular goals, projects and programs to be supported by the tax.


A two-thirds (2/3) of the electors voting on the measure vote is required to approve the imposition of the tax at an election called for that purpose. Should the measure pass, prior to the operative date the County will contract with the State Board of Equalization to perform functions incident to the collection of the transactions and use tax ordinance, and will contract with the Library to administer the Expenditure Plan.

About the Library

The Sonoma County Library is a special district, apportioned by Proposition 13, supported almost exclusively by property taxes.  The Library has operated under the same revenue stream since 1978: 22.5 cents per thousand of assessed value, one of the lowest per capita library revenues in the state.

Additionally, the Library was dramatically affected by the reduction in property values and tax revenues, a result of the 2009 economic downturn.  Cost-saving measures to balance the budget have included employee furloughs, cuts to materials budgets, a freeze on filling key positions in the organization, and significant reductions in open hours.  Since 2011, all libraries in Sonoma County have been closed on Mondays—representing a 25% reduction in hours open to the public. 

The Ordinance

ORDINANCE NO. 6083

AN ORDINANCE OF THE COUNTY OF SONOMA IMPOSING A TRANSACTIONS AND USE TAX TO BE

ADMINISTERED  BY THE STATE BOARD OF EQUALIZATION TO MAINTAIN AND IMPROVE LIBRARY SERVICES FOR ALL RESIDENTS OF SONOMA COUNTY

Section 1.      TITLE AND SUMMARY.  This ordinance shall be known as the Sonoma County Library Improvement Act.  The County of Sonoma, hereinafter shall be called "County." This ordinance shall be applicable in the incorporated and unincorporated territory of the County. If approved by the voters, this Ordinance will impose a one-eighth of one cent (0.125%) transactions and use tax to be used exclusively to supplement existing funding for library operations, maintaining and enhancing library hours, programs, acquisitions, construction and modernization  throughout the incorporated and unincorporated territory of the County.  Library services are provided by the Sonoma County Library, a joint powers agency ("Library").

Section 2.      OPERATIVE DATE.  "Operative Date" means the first day ofthe first calendar quarter commencing more than 110 days after the latter of (1) the election approving the imposition of the tax imposed by this ordinance, such election to be held on November 4, 2014; or (2) the effective date of legislation adopted by the California Legislature permitting the County of Sonoma to impose a transactions and use tax exceeding the limit in Revenue and Taxation Code section 7251.1 by at least the amount of tax imposed by this ordinance.

Section 3.      PURPOSE.  This ordinance is adopted to achieve the following, among other purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:

A.      To impose a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 ofthe Revenue and Taxation Code and Section 7285.5 of Part 1.7 of Division 2 which authorizes the County to adopt this tax ordinance to fund library operations, maintain and enhance library hours, programs, and purposes described in the attached Expenditure Plan.  This ordinance shall be operative if two-thirds (2/3) of the electors voting on the measure vote to approve the imposition of the tax at an election called for that purpose.

B.      To adopt a retail transactions and use tax ordinance that incorporates provisions identical to those of the Sales and Use Tax Law of the State of California insofar as those provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of Division 2 of the Revenue and Taxation Code.

C.      To adopt a retail transactions and use tax ordinance that imposes a tax and provides a measure  therefore  that can be administered and collected  by the State Board of Equalization in a manner that adapts itself as fully as practicable  to, and requires the least possible  deviation  from, the existing statutory and administrative procedures followed by the State Board of Equalization in administering and collecting the California State Sales and Use Taxes.

D.      To adopt a retail transactions and use tax ordinance that can be administered in a manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of Division 2 of the Revenue  and Taxation Code, minimize the cost of collecting the transactions and use taxes, and at the same time, minimize  the burden of record keeping  upon persons subject to taxation under the provisions  of this ordinance.

Section 4.     USE OF THE TAX; EXPENDITURE PLAN; ANNUAL REPORT.

A.      After the reimbursement of the County for the costs of the election, as provided  in Section 14, and payment  for any fee charged by the State Board  of Equalization for preparing to administer the tax, revenues  from the tax shall  be deposited  into a special fund and used exclusively to fund projects  and purposes described in the Expenditure Plan, attached  hereto.  Such revenues shall be used only to supplement existing  Library funding, provided  by a portion of the property tax designated for Library purposes, and shall not be used to supplant existing  funding for the support of the Library.

B.      The Sonoma County Library Commission has approved the Expenditure Plan as set forth in this ordinance pursuant to its authority  to do so in the First Amended and Restated Joint Powers Agreement for the County-Wide Provision of Library Services  by the Sonoma  County Library.

C.      The County shall contract  with the Library for administration of the Expenditure Plan, and shall require the Library Director to report annually the amount of funds collected, and the status of any projects funded  by the tax revenue  pursuant  to the Expenditure Plan.

Section 5.     CONTRACT WITH STATE.  Prior to the operative date, the County shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of this transactions and use tax ordinance; provided, that if the County shall not have contracted with the State Board of Equalization prior to the operative  date, it shall nevertheless so contract  and in such a case the operative  date shall be the first day of the first calendar quarter following the execution of such a contract.

Section 6.     TRANSACTIONS TAX RATE.  For the privilege  of selling tangible personal property at retail, a tax is hereby imposed  upon all retailers  in the incorporated and unincorporated territory of the County at the rate of one-eighth of one percent  (0.125 %) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in said territory on and after the operative date of this ordinance.

Section 7.      PLACE OF SALE.  For the purposes of this ordinance, all retail sales are consummated  at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination.  The gross receipts from such sales shall include delivery charges, when such charges are subject to the state sales and use tax, regardless of the place to which delivery is made.  In the event a retailer has no permanent place of business in the State or has more than one place ofbusiness, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the State Board of Equalization.

Section 8.      USE TAX RATE.  An excise tax is hereby imposed on the storage, use or other consumption in the County of tangible personal property purchased from any retailer on and after the operative date of this ordinance for storage, use or other consumption in said territory at the rate of one-eighth of one percent (0.125 %) of the sales price of the property.  The sales price shall include delivery charges when such charges are subject to state sales or use tax regardless of the place to which delivery is made.

Section 9.      ADOPTION OF PROVISIONS  OF STATE LAW.  Except as otherwise provided in this ordinance and except insofar as they are inconsistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this ordinance as though fully set forth herein.

Section 10.   LIMITATIONS ON ADOPTION OF STATE LAW AND COLLECTION OF USE TAXES.  In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:

A.         Wherever the State of California is named or referred to as the taxing agency, the name of this County shall be substituted therefor.  However, the substitution shall not be made when:

1.  The word "State'' is used as a part of the title of the State Controller, State Treasurer, State Board of Control, State Board of Equalization, State Treasury, or the Constitution of the State of California;

2.   The result of that substitution would require action to be taken by or against this County or any agency, officer, or employee thereof rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation ofthis Ordinance.

3.   In those sections,  including,  but not necessarily limited  to sections referring to the exterior  boundaries of the State of California, where the result of the substitution would be to:

a.   Provide  an exemption from this tax with respect to certain sales, storage, use or other consumption of tangible  personal property which would not otherwise  be exempt  from this tax while such sales, storage, use or other consumption remain  subject  to tax by the State under the provisions of Part 1 of Division  2 of the Revenue and Taxation Code, or;

b.   Impose this tax with respect to certain  sales, storage,  use or other consumption of tangible personal  property  which would not be subject to tax by the state under the said provision of that code.

4.   In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code.

B.         The word "County"  shall be substituted for the word "State"  in the phrase "retailer engaged  in business  in this State" in Section  6203 and in the definition of that phrase in Section  6203.

Section  11.         PERMIT  NOT REQUIRED. If a seller's  permit has been issued to a retailer under Section  6067 of the Revenue  and Taxation  Code, an additional transactor's permit shall not be required  by this ordinance.

Section  12.         EXEMPTIONS AND EXCLUSIONS.

A.      There shall be excluded  from the measure  of the transactions tax and the use tax the amount  of any sales tax or use tax imposed by the State of California or by any city, city and county, or county pursuant  to the Bradley-Bums Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax.

B.      There are exempted from the computation of the amount  of transactions tax the gross receipts  from:

1.   Sales of tangible  personal property, other than fuel or petroleum products,  to operators of aircraft to be used or consumed principally outside the County in which the sale is made and directly and exclusively in the use of such aircraft as common carriers of persons or property  under the authority  of the laws of this State, the United States, or any foreign  government.

2.   Sales of property to be used outside the County  which is shipped  to a point outside  the County, pursuant to the contract  of sale, by delivery to such point by the retailer  or his agent, or by delivery  by the retailer to a carrier for shipment to a consignee at such point.  For the purposes of this paragraph, delivery to a point outside the County shall be satisfied:

a.   With respect to vehicles (other than commercial vehicles) subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, and undocumented vessels registered under Division 3.5 (commencing with Section 9840) of the Vehicle Code by registration to an out-of-County address and by a declaration under penalty of perjury, signed by the buyer, stating that such address is, in fact, his or her principal place of residence; and

b.   With respect to commercial vehicles, by registration to a place of business out-of-County and declaration under penalty of perjury, signed by the buyer, that the vehicle will be operated from that address.

3.   The sale of tangible personal property ifthe seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date ofthis ordinance.

4.  A lease of tangible personal property which is a continuing sale of such property, for any period of time for which the lessor is obligated to lease the property for an amount fixed by the lease prior to the operative date of this ordinance.

5.  For the purposes of subparagraphs (3) and (4) of this section, the sale or lease of tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.

C.         There are exempted from the use tax imposed by this ordinance, the storage, use or other consumption in this County of tangible personal property:

1.  The gross receipts from the sale of which have been subject to a transactions tax under any state-administered  transactions and use tax ordinance.

2.   Other than fuel or petroleum products purchased by operators of aircraft and used or consumed by such operators directly and exclusively in the use of such aircraft as common carriers of persons or property for hire or compensation under a certificate of public convenience and necessity issued pursuant to the laws of this State, the United States, or any foreign government.  This exemption is in addition to the exemptions provided in Sections 6366 and 6366.1 ofthe Revenue and Taxation Code ofthe  State of California.

3.   If the purchaser is obligated to purchase the property for a fixed price pursuant to a contract entered into prior to the operative date of this ordinance.

4.   If the possession of, or the exercise of any right or power over, the tangible personal property arises under a lease which is a continuing purchase of such property for any period of time for which the lessee is obligated to lease the property for an amount fixed by a lease prior to the operative date of this ordinance.

5.   For the purposes of subparagraphs (3) and (4) of this section, storage, use, or other consumption, or possession of, or exercise of any right or power over, tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.

6.   Except as provided in subparagraph (7), a retailer engaged in business in the County shall not be required to collect use tax from the purchaser of tangible personal property, unless the retailer ships or delivers the property into the County or participates within the County in making the sale of the property, including, but not limited to, soliciting or receiving the order, either directly or indirectly, at a place of business of the retailer in the County or through any representative, agent, canvasser, solicitor, subsidiary, or person in the County under the authority of the retailer.

7.   "A retailer engaged in business in the County" shall also include any retailer of any of the following:  vehicles subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, or undocumented vessels registered under Division 3.5 (commencing with Section 9840) of the Vehicle Code.  That retailer shall be required to collect use tax from any purchaser who registers or licenses the vehicle, vessel, or aircraft at an address in the County.

D.         Any person subject to use tax under this ordinance may credit against that tax any transactions tax or reimbursement for transactions tax paid to a County imposing, or retailer liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and Taxation Code with respect to the sale to the person of the property the storage, use or other consumption of which is subject to the use tax.

Section 13.         AMENDMENTS. All amendments subsequent to the effective date of this ordinance to Part 1 of Division 2 of the Revenue and Taxation Code relating to sales and use taxes and which are not inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically become a part of this ordinance, provided however, that no such amendment shall operate so as to affect the rate of tax imposed by this ordinance.

Section 14.         ELECTION COSTS.  Payment for the costs ofthe election shall be the responsibility of the County.  If the election is successful, the County shall be reimbursed for the cost of the election from the proceeds of the tax prior to the first distribution to the Library.

Section 15.          INCREASE IN APPROPRIATIONS  LIMIT.  The appropriations limit of the County of Sonoma shall be increased by the anticipated amount of revenue generated by the tax to allow spending of the tax for the period allowed by law.

Section 16.         ENJOINING COLLECTION FORBIDDEN.  No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action or proceeding in any court against the State or the County, or against any officer of the State or the County, to prevent or enjoin the collection under this ordinance, or Part 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.

Section 17.          SEVERABILITY.   If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, the remainder of the ordinance and the application of such provision to other persons or circumstances shall not be affected thereby.

Section 18.         EFFECTIVE DATE.  This ordinance relates to the levying and collecting of the County transactions and use taxes and shall take effect immediately.

 

Section 19.         TERMINATION DATE.  The authority to levy the tax imposed by this ordinance shall expire ten (10) years from the operative date.

 

PASSED AND ADOPTED by the Board of Supervisors, County of Sonoma. State of

California, on the 5th day of August, 2014, by the following vote:

Gorin:  Aye     Zane:  Aye    McGuire:  Aye     Carrillo:  Aye     Rabbitt:  Aye

 

Ayes: _5_ Noes: -----"0'------ Absent: -----"0'------ Abstain: _0        

 

EXPENDITURE PLAN

A.         Proceeds from this tax shall be deposited into the County Treasury in a special fund entitled "Library Special Tax Fund" (hereinafter the "Fund").

B.         The revenues collected from the tax shall be used only to supplement existing revenue collected for the Library and shall not be used to supplant existing Library funding.

C.         Monies deposited into the Fund, together with any interest that accrues thereon, shall be used exclusively for library purposes, including preserving the existing libraries; reversing the deterioration in services at the existing libraries, upgrading of facilities, services, and collections; and extending branch library services to the unserved and under-served areas of the County. Expenditures are intended to provide the residents of Sonoma County with vital, quality libraries comparable to those operated in other Bay Area communities.

D.         Specific projects for which the revenues from the transactions and use tax may be expended are as follows:

(1) Maintaining and enhancing local public libraries and the Library collections throughout the county;

(2) Restoring pre-2011 service hours and enhancing service hours at Sonoma County Library branches in the cities of Cloverdale, Healdsburg, Petaluma, Rohnert Park­ Cotati, Santa Rosa, Sebastopol, Sonoma, Windsor, and Libraries in the unincorporated areas of the County;

(3) Creating young readers and supporting children in school by providing classes, materials, and services that educate and entertain the children and young adults of Sonoma County;

(4) Creating lifelong learning opportunities by providing the residents of Sonoma County with the assistance, books and materials, educational workshops, and technology necessary to succeed as parents, students, citizens, and workers.

(5) Assuring that the public library provides access to information of all types and in any appropriate format, including traditional, digital, and forthcoming formats, so that all residents of Sonoma County shall enjoy the same rights to information, knowledge, entertainment, and wisdom; and

(6) Acquiring new technology that would enhance the Library's ability to serve the public.

E.          As provided in sections 14 and 15 of the Ordinance imposing this transactions and use tax, funds from the tax may be used to reimburse the County for the share of the cost of conducting the election allocated to this measure, and to pay any fee imposed by the State Board of Equalization to administer tax collection.