Chapter 3.49
LIFT TAX
Sections:
3.49.030 State-shared sales and use tax (“LIFT tax”) imposed as of July 1, 2017.
3.49.010 Definitions.
Capitalized terms not otherwise defined in this chapter have the meanings given in RCW 39.102.020, or as hereafter amended. (Ord. 3539-17 § 1, 2017)
3.49.020 Findings.
The city council of the city of Everett, Washington (the “city”) hereby makes the following findings and determinations:
A. Based on an analysis of the businesses in the RDA, the city has determined that state excise tax allocation revenues in 2016 were six hundred fifty-six thousand two hundred ninety-nine dollars and the state property tax allocation revenues for 2017 are estimated at zero dollars.
B. The city council finds that the city has satisfied all prerequisites for imposing the LIFT tax and for receiving the state contribution, including, without limitation, the conditions set forth in RCW 39.102.040 and 82.14.475.
C. Prior to June 30, 2018, the city may incur indebtedness via general obligation bonds, pursuant to RCW 39.102.150, to finance the public improvements. (Ord. 3539-17 § 2, 2017)
3.49.030 State-shared sales and use tax (“LIFT tax”) imposed as of July 1, 2017.
The sales and use tax authorized under RCW 82.14.475 is imposed as of July 1, 2017, as follows:
A. Effective Date and Duration. The sales and use tax authorized by this chapter shall be imposed and become effective as of July 1, 2017. It shall expire when all indebtedness issued under the authority of RCW 39.102.150 is retired and all other contractual obligations relating to the financing of public improvements under Chapter 39.102 RCW are satisfied, but not later than July 1, 2042, which is twenty-five years after the date the LIFT tax is first imposed.
B. Rate. The tax rate shall initially be set at 0.02951 percent of the selling price (in the case of a sales tax) or value of the article used (in the case of a use tax). The tax rate may be adjusted by resolution of the city council from time to time so that it is set at the rate reasonably necessary to receive the state contribution over ten months, in accordance with RCW 82.14.475(3)(b), but shall not exceed the rate of 0.02951 percent established by Resolution No. 6178.
C. Use of LIFT Tax Receipts. Subject to RCW 39.102.195, receipts of the LIFT tax may be applied either to provide for the payment of debt service on bonds issued under RCW 39.102.150 by the city or to pay public improvement costs on a pay-as-you-go basis, or both.
D. Other Statutory Requirements.
1. In accordance with RCW 82.14.475(7):
a. The LIFT tax authorized by this chapter shall first be imposed on July 1, 2017, which is the first day of the state fiscal year.
b. The cumulative amount of LIFT tax distributions received by the city in any fiscal year shall not exceed the amount of the state contribution.
c. The LIFT tax shall cease to be distributed to the city for the remainder of any state fiscal year in which either:
(1) The amount of tax received by the city equals five hundred thousand dollars or the amount of state contribution as defined in RCW 39.102.020(28);
(2) The amount of revenue from taxes imposed under this section by all sponsoring and cosponsoring local governments equals the annual state contribution limit; or
(3) The amount of tax received by the sponsoring local government equals the amount of project awarded granted in the approval notice described in RCW 39.102.040.
d. Neither the local excise tax allocation revenues nor the local property tax allocation revenues may constitute more than eighty percent of the total local funds as described in RCW 39.102.020(28)(b). This requirement applies beginning January 1, 2022, which is the fifth calendar year after the calendar year in which the sponsoring local government begins allocating local excise tax allocation revenues under RCW 39.102.110.
2. The LIFT tax shall be distributed again, should it cease to be distributed for any reason provided in subsection (D)(1)(c) of this section, at the beginning of July 1st, the next state fiscal year, subject to the restrictions in RCW 82.14.475.
3. Any revenue generated by the LIFT tax in excess of the amounts specified in subsection (D)(1)(c) of this section shall belong to the state of Washington.
4. In accordance with RCW 82.14.475(11), if the city fails to comply with RCW 39.102.140, no tax will be distributed in the subsequent state fiscal year until such time as the city complies and the department calculates the state contribution amount for such state’s fiscal year.
5. In accordance with RCW 82.14.475(16), the LIFT tax shall cease to be imposed if the city fails to issue indebtedness pursuant to RCW 39.102.150, or fails to commence construction on public improvements, by June 30, 2022, which is the fifth fiscal year in which the LIFT tax is imposed. (Ord. 3539-17 § 3, 2017)