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CC 2020-07-14_10a Proposed Ballot Measure_Nov 2020 Election MEMORANDUM TO: CITY COUNCIL FROM: BILL ROBESON, ACTING CITY MANAGER SUBJECT: CONSIDERATION OF PLACING A LOCAL TRANSACTION AND USE TAX (“SALES TAX”) MEASURE ON THE NOVEMBER 3, 2020 BALLOT DATE: JULY 14, 2020 SUMMARY OF ACTION: Placement of a local transaction and use tax (“sales tax”) measure on the November 3, 2020 ballot. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The proposed sales tax measure would generate approximately $4 million in additional annual revenue, if approved. Funding for the November 2020 General Municipal Election has been included in the Fiscal Year 2020-21 Budget in the amount of $28,000, and is anticipated to cover costs associated with printing the ballot measure in the Sample Ballot booklet. However, as noted previously, the County has indicated that actual costs may shift up or down due to rapidly changing circumstances related to the COVID-19 pandemic, as a result of various legislative and process changes relating to elections. RECOMMENDATION: It is recommended the City Council: 1) adopt the proposed Resolution ordering the submission to the qualified electors of the City a measure relating to the establishment of a local transactions and use tax (hereinafter referred to as a "sales tax") at the General Municipal Election to be held on Tuesday, November 3, 2020, as called by Resolution No. 4994; 2) introduce the proposed Ordinance adding Chapter 3.23 to Title 3 of the AGMC regarding a transactions and use tax; 3) adopt the proposed Resolution setting priorities for filing a written argument regarding a City measure and directing the City Attorney to prepare an impartial analysis of the measure; 4) adopt the proposed Resolution providing for the filing of rebuttal arguments for City measures submitted at municipal elections; and 5) approve the argument to be submitted in favor of the measure. BACKGROUND: Over the past year, the City Council has received information and discussed the City’s revenue in general and potential opportunities to increase revenue in the face of rising business costs. Assessments of unfunded or severely underfunded needs for core City infrastructure, including pavement (streets and parking lots), sidewalks, drainage and stormwater facilities, parks, and public buildings have been completed indicating that the Item 10.a. - Page 1 CITY COUNCIL CONSIDERATION OF PLACING A LOCAL TRANSACTION AND USE TAX (“SALES TAX”) MEASURE ON THE NOVEMBER 3, 2020 BALLOT JULY 14, 2020 PAGE 2 City needs to invest an additional $2.4 million annually to maintain facilities already owned by and currently serving the community. It was also noted that this total still results in a decrease in the pavement condition index (PCI) over time and that an additional $1.16 million would be needed to keep the PCI at 70 in order to avoid larger maintenance costs in the future. Together, these needs total over $3.5 million in unfunded annual infrastructure maintenance. At its June 23, 2020 meeting, the City Council received a comprehensive presentation regarding a proposed revenue measure to address the City’s future funding needs and provided direction to staff to prepare a proposed 1% (7.75% to 8.75%) local sales tax revenue measure for the November 3, 2020 ballot. ANALYSIS OF ISSUES: If approved, the proposed sales tax revenue measure would generate approximately $4,000,000 annually and is intended to augment the existing Measure O-06 local sales tax fund created in 2006. Funding received from a new sales tax measure would allow the City to expand its increasingly underfunded Capital Improvement Projects (CIP) and public facility maintenance funds. This includes the City’s: - Annual Street Repairs Program - Annual Concrete (Sidewalks) Repairs Program - Maintenance of Parks and Open Space (Fire Hazard and Fuel Suppression) - Maintenance of Storm Water and Drainage Systems - Maintenance of Public Facilities (roof and structural repairs) - Savings plan for a new Recreation/Childcare Center The potential additional funding for these annual projects would result in more miles of street rehabilitation, more sidewalk repairs and improved maintenance of City parks and open space, and more rehabilitation of aging storm drain piping. In addition, Council expressed an interest in allocating revenue from the proposed sales tax measure to provide small/locally owned business recovery support, such as low interest loans. This use of sales tax revenue would directly support the City’s local businesses in their COVID-19 recovery efforts, which would, in turn, generate additional economic benefit for the entire Arroyo Grande community. Other factors that contribute to the need for the proposed sales tax revenue measure include: - A projection that COVID-19 economic impacts will result in a 10% to 15% drop in current sales tax revenue that will decrease funding for the projects listed above; - Uncertainty in the economic recovery timeframe which is projected to last 2 to 4 years, or possibly longer; Item 10.a. - Page 2 CITY COUNCIL CONSIDERATION OF PLACING A LOCAL TRANSACTION AND USE TAX (“SALES TAX”) MEASURE ON THE NOVEMBER 3, 2020 BALLOT JULY 14, 2020 PAGE 3 - The City of Arroyo Grande’s last sales tax increase was 13 years ago and has not kept pace with significant labor and material costs associated with capital projects; - In an effort to achieve comparable City services and maintain parity with other cities within the County of San Luis Obispo, an increase in sales tax would be necessary in Arroyo Grande as Atascadero, Grover Beach, Morro Bay, Paso Robles and San Luis Obispo are currently considering similar sales tax measures. (Atascadero City Council has approved the placement of a sales tax ballot measure on the November ballot and Pismo Beach City Council approved the placement of a ballot measure increasing their its TOT/hotel tax. - Cities within Monterey County and Santa Barbara County currently have a sales tax rate of at least 8.75% or higher. Structure of the Sales Tax Measure Following discussion at the June 23, 2020 meeting, the Council provided feedback and direction regarding a proposed 1% general sales tax measure to address the City’s future funding needs for critical City infrastructure, including maintenance and repair of streets, sidewalks, potholes, stormwater and drainage facilities, parks and open space, public building and facilities, and to provide financial assistance to local businesses. With regard to a sunset clause, there was consensus that including a sunset clause would present difficulties for Arroyo Grande because future funding needs identified consist primarily of major capital projects. As a result, a sunset clause would limit the City's ability to issue long-term debt for capital projects if there is no assurance the revenue would continue beyond the first five-year period. Therefore, a sunset clause was not recommended to be included in the proposed measure. The proposed measure does include provisions for citizen oversight to establish accountability and transparency, which is important when structuring government operations to maintain trust and efficiency. First, consistent with Measure O-06 funds, the measure will require the City to mail to every household an annual report of prior year expenditures and proposed expenditure of the additional sales tax proceeds for the following year. Secondly, the City Council will be required to conduct a review and public hearing every five (5) years to determine if the sales tax is still necessary. If other funding sources became available to replace the sales tax revenue, the City Council would have the authority to suspend, reduce or eliminate the local sales tax amount. In order to place a tax measure on the November 3, 2020 ballot, it takes a 2/3 vote of the City Council (at least 4 members). The proposed Ordinance, Resolutions, and Ballot Argument have been prepared and are included with this report for consideration. It is recommended the Council adopt the Resolutions, introduce the Ordinance, and approve the Ballot Argument as presented for placement on the November 3, 2020 ballot. It should Item 10.a. - Page 3 CITY COUNCIL CONSIDERATION OF PLACING A LOCAL TRANSACTION AND USE TAX (“SALES TAX”) MEASURE ON THE NOVEMBER 3, 2020 BALLOT JULY 14, 2020 PAGE 4 be noted that, if successfully introduced, the Ordinance will be considered for adoption at the July 28, 2020 City Council meeting. ALTERNATIVES: The following alternatives are provided for the Council's consideration: 1. Adopt the Resolutions, introduce the Ordinance, and approve the Ballot Argument pertaining to the placement of a ballot measure on the November 3, 2020 ballot; 2. Modify and adopt the Resolutions and Ordinance; make changes to and approve the Ballot Argument; or 3. Provide other direction to staff. ADVANTAGES: Adoption of the proposed Resolutions and Ordinance, and approval of the Ballot Argument will meet the provisions required by the California Elections and Revenue and Taxation Codes for submitting to the voters a measure relating to the establishment of a local sales tax in the City. DISADVANTAGES: There are no identified disadvantages related to proposed actions as they are required by State law in order to place a measure on the ballot. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. A notice regarding the placement of a measure on the November 2020 ballot will be published pursuant to the timeline prescribed by the Elections Code. Item 10.a. - Page 4 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE ORDERING THE SUBMISSION TO THE QUALIFIED ELECTORS OF THE CITY A MEASURE RELATING TO THE ESTABLISHMENT OF A LOCAL TRANSACTION AND USE TAX (SALES TAX) AT THE GENERAL MUNICIPAL ELECTION TO BE HELD ON TUESDAY, NOVEMBER 3, 2020, AS CALLED BY RESOLUTION NO. 4994 WHEREAS, while the City of Arroyo Grande is fortunate to have a diversified source of revenues to provide enhanced public services to its residents, businesses and visitors, despite fiscal prudence over the past decade it has been significantly and adversely impacted by growth in operating costs to provide municipal services and facilities that are not matched by projected increases in current levels and types of revenues; and WHEREAS, the City continues to have unfunded or severely underfunded needs to core City infrastructure, including: pavement (roads and parking lots), sidewalks/concrete, drainage facilities, parks and recreation facilities including the Soto Sports complex, courts, playgrounds, community centers, and government buildings; and WHEREAS, the City of Arroyo Grande is committed to securing local sources of future revenue to fund these vital general City services and provide fiscal sustainability; and WHEREAS, pursuant to California Elections Code section 9222, the City Council has authority to place measures on the ballot to be considered at a General Municipal Election and desires to place a local funding measure on the ballot at the consolidated Statewide General Election on November 3, 2020; and WHEREAS, the funding raised by this measure will allow the City to: keep pace with the increasing costs associated with basic repairs and maintenance to public facilities, storm drains, streets, and sidewalks and avoid more expensive repairs in the future; and provide high quality parks, open spaces, sports fields, and recreation programs help keep kids healthy, active, and away from drugs, gangs, and crime. WHEREAS, pursuant to the law of the State of California, a General Municipal Election to be held in the City of Arroyo Grande (“City”) on November 3, 2020, for the election of certain officers of the City has been called per Resolution No. 4994; and WHEREAS, a request for consolidating the General Municipal Election with the Statewide General Election on November 3, 2020 has been called per Resolution No. 4995; and WHEREAS, Revenue and Taxation Code section 7285.9 authorizes the City, subject to approval by a majority vote of the qualified voters of the City voting in an election on the issue, to levy a transactions and use tax pursuant to the Transactions and Use Tax Law at a rate of 0.125% or any multiple thereof for general purposes and projects; and Item 10.a. - Page 5 RESOLUTION NO. PAGE 2 WHEREAS, Section 2(b) of Article XIII C of the California Constitution, added by Proposition 218 effective November, 1996, requires that the measure proposing a general tax be submitted to the voters at an election consolidated with a regularly scheduled general election for members of the governing body of the local government; and WHEREAS, pursuant to California Constitution Article XIII C, section 2 and Elections Code section 10201, the City has determined to submit a measure to enact an ordinance establishing a transactions and use tax to the voters at the City’s next regular election; and WHEREAS, pursuant to Government Code Section 53724(b) and Revenue & Taxation Code Section 7285.9, the ordinance proposing the transactions and use tax, attached to this Resolution as Exhibit A, requires approval by a two-thirds (2/3) vote of all members of the City Council and approval of the ballot measure and the ordinance by majority of the voters casting votes at the General Municipal Election on November 3, 2020; and WHEREAS, if the measure is approved, the City Council also desires to continue its practice of receiving community input on the use of additional revenues generated by the additional sales tax revenues. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: SECTION 1. The City Council hereby finds and determines that the foregoing recitals are true and correct and are incorporated herein by this reference. SECTION 2. Under the provisions of the California Elections Code, the City Council, pursuant to its right and authority, does order submitted to the voters at the General Municipal Election to be held on November 3, 2020, the following question: CITY OF ARROYO GRANDE MEASURE ___ To provide funding for general city services in Arroyo Grande, including increasing maintenance and repair of streets, sidewalks, potholes, stormwater and drainage facilities, parks, open space, public facilities, and to provide financial assistance to local businesses; shall an ordinance establishing a one percent sales tax be adopted, providing approximately $4,000,000 annually until ended by voters that can’t be taken away by the State, requiring citizen oversight and review and all funds controlled locally? YES NO Item 10.a. - Page 6 RESOLUTION NO. PAGE 3 SECTION 3. That the full text of the measure is attached hereto as Exhibit A and incorporated herein by this reference, and should said measure be approved by the requisite vote, the ordinance shall be enacted. SECTION 4. All persons qualified to vote at municipal elections in the City on the day of the election herein provided for shall be qualified to vote on the measure hereby submitted at the General Municipal Election. SECTION 5. In all particulars not recited in this Resolution, the election shall be held and conducted as provided by law for holding general municipal elections in the City. SECTION 6. Notice of the time and place of holding the General Municipal Election is given and the City Clerk is authorized, instructed and directed to give further or additional notice of the election, in the time, form and manner as required by law. SECTION 7. If any section, subsection, sentence, clause, phrase or provision of this Resolution or the application thereof to any person or circumstances is held invalid or unconstitutional by any court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity of any other provision or applications, and to this end the provisions of this Resolution are declared to be severable. The City Council hereby declares that it would have passed this Resolution and each section, subsection, sentence, clause, phrase or provision thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases or provisions thereof be declared invalid or unconstitutional. SECTION 8. This Resolution shall take effect immediately upon its adoption by a two- thirds vote of the members of the City Council. SECTION 9. The City Clerk of the City of Arroyo Grande is hereby directed to certify to the passage and adoption of this Resolution and to file a certified copy of this Resolution with the Board of Supervisors of San Luis Obispo County and the Registrar of Voters of San Luis Obispo County at least eighty-eight (88) days before the date of the election. On motion by Council Member _________, seconded by Council Member _______, and on the following roll call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 14th day of June, 2020. Item 10.a. - Page 7 RESOLUTION NO. PAGE 4 ___________________________________ ______ CAREN RAY RUSSOM, MAYOR ATTEST: ___ ______ KELLY WETMORE, CITY CLERK APPROVED AS TO CONTENT: _________________________________ BILL ROBESON, ACTING CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Item 10.a. - Page 8 ORDINANCE NO. AN ORDINANCE OF THE CITY OF ARROYO GRANDE ADDING CHAPTER 3.23 TO TITLE 3 OF THE ARROYO GRANDE MUNICIPAL CODE RELATED TO A TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY THE CALIFORNIA DEPARTMENT OF TAX AND FEE ADMINISTRATION WHEREAS, Revenue and Taxation Code section 7285.9 authorizes the City of Arroyo Grande (“City”), subject to approval by a majority vote of the qualified voters of the City voting in an election on the issue, to levy a transactions and use tax pursuant to the Transactions and Use Tax Law at a rate of 0.125% or any multiple thereof for general purposes and projects; and WHEREAS, Section 2(b) of Article XIII C of the California Constitution, added by Proposition 218 effective November, 1996, requires that the measure proposing a general tax be submitted to the voters at an election consolidated with a regularly scheduled general election for members of the governing body of the local government; and WHEREAS, pursuant to California Constitution Article XIII C, section 2 and Elections Code section 10201, the City has determined to submit a proposition to enact an ordinance establishing a transactions and use tax to the voters at the City’s next regular election; and WHEREAS, pursuant to California Elections Code section 9222, the City Council has authority to place measures on the ballot to be considered at a General Municipal Election and desires to place a local funding measure on the ballot at the statewide general election on November 3, 2020; and WHEREAS, pursuant to Government Code Section 53724(b) and Revenue & Taxation Code Section 7285.9, this ordinance proposing the transactions and use tax requires approval by a two-thirds (2/3) vote of all members of the City Council and approval of the ballot measure and the ordinance by majority of the voters casting votes at the General Municipal Election on November 3, 2020. THE PEOPLE OF THE CITY OF ARROYO GRANDE, CALIFORNIA DO HEREBY ORDAIN AS FOLLOWS: SECTION 1. Addition of Chapter 3.23. Chapter 3.23 is hereby added to Title 3 of the Arroyo Grande Municipal Code to read as follows: Chapter 3.23 - TRANSACTIONS AND USE TAX. 3.23.010 - Short title. EXHIBIT A Item 10.a. - Page 9 ORDINANCE NO. PAGE 2 This chapter shall be known as the “Transactions and Use Tax” and shall be applicable in the incorporated territory of the City of Arroyo Grande (“city”). This chapter shall complement, and not replace or supersede, the city’s existing sales and use tax, as such tax is described in Chapter 3.20 and existing transaction and use tax Chapter 3.22 of Title 3 of the Arroyo Grande Municipal Code. 3.23.020 - Definitions. For the purpose of this chapter the following words terms shall have the meaning given in this section: “In the city” means and includes all territory within the city limits. “Operative Date” means the first day of the first calendar quarter commencing more than 110 days after the later of the adoption of this chapter and the approval by the voters of the city of a measure approving the imposition of an increased transactions and use tax; provided that, if the city shall not have entered into a contract with the California Department of Tax and Fee Administration as required by section 3.11.040 prior to such date, the operative date shall be the first day of the first calendar quarter following the execution of such a contract. 3.23.030 - Purpose. This chapter of the Arroyo Grande Municipal Code has been adopted for the following 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 of the Revenue and Taxation Code and Section 7285.9 of Part 1.7 of Division 2, which authorizes the city to adopt this tax. This chapter shall be operative if a majority 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 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 that imposes a tax and provides a measure therefor that can be administered and collected by the California Department of Tax and Fee Administration in a manner that adapts itself as fully as practicable to, and requires the EXHIBIT A Item 10.a. - Page 10 ORDINANCE NO. PAGE 3 least possible deviation from, the existing statutory and administrative procedures followed by the California Department of Tax and Fee Administration in administering and collecting the California State Sales and Use Taxes. D. To adopt a retail transactions and use tax that can be administered in a manner that will, to the greatest degree possible, be consistent with the provisions of Part1.6 of Division 2 of the said Revenue and Taxation Code, and thereby minimize the cost of collecting city transactions and use taxes, and at the same time minimize the burden of record keeping upon persons subject to taxation under the provisions thereof. 3.23.040 - Contract with state. Prior to the operative date, the city shall contract with the California Department of Tax and Fee Administration to perform all functions incidental to the administration and operation of this transactions and use tax ordinance. If the city has not contracted with the California Department of Tax and Fee Administration 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. The city council may make any technical amendments to this chapter required by the California Department of Tax and Fee Administration, except for any changes affecting the tax rate, tax methodology, or its manner of collection. 3.23.050 - Imposition of transactions and use tax – Rate. For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the incorporated territory of the city at the rate of one percent (1%) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in the city on and after the operative date of this chapter. 3.23.060 - Place of sale. For the purposes of this chapter, 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 of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be EXHIBIT A Item 10.a. - Page 11 ORDINANCE NO. PAGE 4 prescribed and adopted by the California Department of Tax and Fee Administration. 3.23.070 - Imposition of use tax – Use tax rate. An excise tax is hereby imposed on the storage, use, or other consumption in the city of tangible personal property purchased from any retailer on or after the operative date of this chapter for storage, use or other consumption in said territory at the rate of one percent (1%) of the sales price of the property subject to the tax. 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. 3.23.080 - Adoption of provisions of state law – Generally. Except as otherwise provided in the chapter 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 § 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this chapter as though fully set forth herein. 3.23.090 - Adoption of provisions of state law – Limitations; Limitations on 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 City shall be substituted therefore. 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 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 city or any agency, officer, or employee thereof rather than by or against the California Department of Tax and Fee Administration, in performing the functions incident to the administration or operation of this chapter. 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: EXHIBIT A Item 10.a. - Page 12 ORDINANCE NO. PAGE 5 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 “city” 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. 3.23.100 - 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 chapter. 3.23.110 - Exemptions and exclusions. A. Measure of Tax. There shall be excluded from the measure of the transactions and 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-Burns Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax. B. Transactions Tax Exemptions. 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. EXHIBIT A Item 10.a. - Page 13 ORDINANCE NO. PAGE 6 2. Sales of property to be used outside the city which is shipped to a point outside the city, 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 city 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-city 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-city 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 if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date. 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. 5. For the purposes of subsections (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. Use Tax Exemptions. There are exempted from the use tax imposed by this chapter, the storage, use or other consumption in this city 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. EXHIBIT A Item 10.a. - Page 14 ORDINANCE NO. PAGE 7 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 of the Revenue and Taxation Code of the 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. 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. 5. For the purposes of subsections (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. D. Exemption from Collection of Use Tax. Except as provided in subsection (E), a retailer engaged in business in the city 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 city or participates within the city 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 city or through any representative, agent, canvasser, solicitor, subsidiary, or person in the city under the authority of the retailer. E. Retailer Not Exempt from Collection of Use Tax. “A retailer engaged in business in the city” 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 city. EXHIBIT A Item 10.a. - Page 15 ORDINANCE NO. PAGE 8 F. Credit Against Use Tax for Transactions Tax Paid Elsewhere. Any person subject to use tax under this chapter may credit against that tax any transactions tax or reimbursement for transactions tax paid to a district 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. 3.23.120 - Adoption of amendments to state law. All amendments subsequent to the effective date of this chapter 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 chapter, provided however, that no such amendment shall operate so as to affect the rate of tax imposed by this chapter. 3.23.130 - Enjoining collection prohibited. 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 city, or against any officer of the State or the city, to prevent or enjoin the collection hereunder, or Parts 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected. 3.23.140. Annual Report. City shall annually mail to each household an annual report, which presents in summary form expenditures from the prior fiscal year from revenue generated from the Transactions and Use Tax and budgeted expenditures for the upcoming fiscal year. 3.23.150. Period Review. The City Council shall consider reduction or repeal of the Transactions and Use Tax at public hearings every five years after the effective date of this ordinance. SECTION 2. Use of Tax Proceeds. All proceeds of the tax levied and imposed EXHIBIT A Item 10.a. - Page 16 ORDINANCE NO. PAGE 9 hereunder shall be accounted for and paid into the City of Arroyo Grande General Fund, and may be used for any lawful purpose as designated by the City Council. SECTION 3. Effective Date. Pursuant to the California Constitution Article XIIIC(2)(b) and California Elections Code 9217, if approved by a majority vote of the qualified voters of the City voting on the issue at the November 3, 2020 General Municipal Election, this ordinance shall be deemed valid and binding and shall be considered adopted upon the date that the vote is declared by the City Council, and shall go into effect ten (10) days after that date. SECTION 4. Severability. If any section, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining provisions of this Ordinance. The People of the City of Arroyo Grande hereby declare that they would have adopted this Ordinance irrespective of the invalidity of any particular portion thereof and intends that the invalid portions should be severed and the balance of the Ordinance be enforced. SECTION 5. Statutory Authority for Tax. This ordinance is adopted pursuant to Revenue and Taxation Code section 7285.9. SECTION 6. Codification. Upon adoption of this ordinance pursuant to the voter approval referenced in this ordinance, the City Clerk is hereby authorized and directed to codify this ordinance in the Arroyo Grande Municipal Code. I HEREBY CERTIFY that the foregoing ordinance was adopted by a two-thirds vote of all members of the City Council of the City of Arroyo Grande as required by Revenue and Taxation Code Section 7285.9 and Government Code Section 53724 and submitted to the voters at the meeting of the City Council held on the 14th day of July, 2020, by the following roll call vote: AYES: NOES: ABSENT: EXHIBIT A Item 10.a. - Page 17 ORDINANCE NO. PAGE 10 _________________________________ CAREN RAY RUSSOM. MAYOR ATTEST: _________________________________ KELLY WETMORE, CITY CLERK Ordinance No. ____ was submitted to the People of the City of Arroyo Grande at the November 3, 2020 General Election. It is hereby certified that this ordinance was passed and approved by following vote of the People of the City of Arroyo Grande: YES: NO: This ordinance was thereby adopted by the voters at the November 3, 2020 General Election and shall take effect as provided by law. EXHIBIT A Item 10.a. - Page 18 ORDINANCE NO. AN ORDINANCE OF THE CITY OF ARROYO GRANDE ADDING CHAPTER 3.23 TO TITLE 3 OF THE ARROYO GRANDE MUNICIPAL CODE RELATED TO A TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY THE CALIFORNIA DEPARTMENT OF TAX AND FEE ADMINISTRATION WHEREAS, Revenue and Taxation Code section 7285.9 authorizes the City of Arroyo Grande (“City”), subject to approval by a majority vote of the qualified voters of the City voting in an election on the issue, to levy a transactions and use tax pursuant to the Transactions and Use Tax Law at a rate of 0.125% or any multiple thereof for general purposes and projects; and WHEREAS, Section 2(b) of Article XIII C of the California Constitution, added by Proposition 218 effective November, 1996, requires that the measure proposing a general tax be submitted to the voters at an election consolidated with a regularly scheduled general election for members of the governing body of the local government; and WHEREAS, pursuant to California Constitution Article XIII C, section 2 and Elections Code section 10201, the City has determined to submit a proposition to enact an ordinance establishing a transactions and use tax to the voters at the City’s next regular election; and WHEREAS, pursuant to California Elections Code section 9222, the City Council has authority to place measures on the ballot to be considered at a General Municipal Election and desires to place a local funding measure on the ballot at the statewide general election on November 3, 2020; and WHEREAS, pursuant to Government Code Section 53724(b) and Revenue & Taxation Code Section 7285.9, this ordinance proposing the transactions and use tax requires approval by a two-thirds (2/3) vote of all members of the City Council and approval of the ballot measure and the ordinance by majority of the voters casting votes at the General Municipal Election on November 3, 2020. THE PEOPLE OF THE CITY OF ARROYO GRANDE, CALIFORNIA DO HEREBY ORDAIN AS FOLLOWS: SECTION 1. Addition of Chapter 3.23. Chapter 3.23 is hereby added to Title 3 of the Arroyo Grande Municipal Code to read as follows: Chapter 3.23 - TRANSACTIONS AND USE TAX. 3.23.010 - Short title. Item 10.a. - Page 19 ORDINANCE NO. PAGE 2 This chapter shall be known as the “Transactions and Use Tax” and shall be applicable in the incorporated territory of the City of Arroyo Grande (“city”). This chapter shall complement, and not replace or supersede, the city’s existing sales and use tax, as such tax is described in Chapter 3.20 and existing transaction and use tax Chapter 3.22 of Title 3 of the Arroyo Grande Municipal Code. 3.23.020 - Definitions. For the purpose of this chapter the following words terms shall have the meaning given in this section: “In the city” means and includes all territory within the city limits. “Operative Date” means the first day of the first calendar quarter commencing more than 110 days after the later of the adoption of this chapter and the approval by the voters of the city of a measure approving the imposition of an increased transactions and use tax; provided that, if the city shall not have entered into a contract with the California Department of Tax and Fee Administration as required by section 3.11.040 prior to such date, the operative date shall be the first day of the first calendar quarter following the execution of such a contract. 3.23.030 - Purpose. This chapter of the Arroyo Grande Municipal Code has been adopted for the following 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 of the Revenue and Taxation Code and Section 7285.9 of Part 1.7 of Division 2, which authorizes the city to adopt this tax. This chapter shall be operative if a majority 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 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 that imposes a tax and provides a measure therefor that can be administered and collected by the California Department of Tax and Fee Administration in a manner that adapts itself as fully as practicable to, and requires the Item 10.a. - Page 20 ORDINANCE NO. PAGE 3 least possible deviation from, the existing statutory and administrative procedures followed by the California Department of Tax and Fee Administration in administering and collecting the California State Sales and Use Taxes. D. To adopt a retail transactions and use tax that can be administered in a manner that will, to the greatest degree possible, be consistent with the provisions of Part1.6 of Division 2 of the said Revenue and Taxation Code, and thereby minimize the cost of collecting city transactions and use taxes, and at the same time minimize the burden of record keeping upon persons subject to taxation under the provisions thereof. 3.23.040 - Contract with state. Prior to the operative date, the city shall contract with the California Department of Tax and Fee Administration to perform all functions incidental to the administration and operation of this transactions and use tax ordinance. If the city has not contracted with the California Department of Tax and Fee Administration 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. The city council may make any technical amendments to this chapter required by the California Department of Tax and Fee Administration, except for any changes affecting the tax rate, tax methodology, or its manner of collection. 3.23.050 - Imposition of transactions and use tax – Rate. For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the incorporated territory of the city at the rate of one percent (1%) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in the city on and after the operative date of this chapter. 3.23.060 - Place of sale. For the purposes of this chapter, 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 of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be Item 10.a. - Page 21 ORDINANCE NO. PAGE 4 prescribed and adopted by the California Department of Tax and Fee Administration. 3.23.070 - Imposition of use tax – Use tax rate. An excise tax is hereby imposed on the storage, use, or other consumption in the city of tangible personal property purchased from any retailer on or after the operative date of this chapter for storage, use or other consumption in said territory at the rate of one percent (1%) of the sales price of the property subject to the tax. 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. 3.23.080 - Adoption of provisions of state law – Generally. Except as otherwise provided in the chapter 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 § 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this chapter as though fully set forth herein. 3.23.090 - Adoption of provisions of state law – Limitations; Limitations on 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 City shall be substituted therefore. 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 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 city or any agency, officer, or employee thereof rather than by or against the California Department of Tax and Fee Administration, in performing the functions incident to the administration or operation of this chapter. 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: Item 10.a. - Page 22 ORDINANCE NO. PAGE 5 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 “city” 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. 3.23.100 - 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 chapter. 3.23.110 - Exemptions and exclusions. A. Measure of Tax. There shall be excluded from the measure of the transactions and 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-Burns Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax. B. Transactions Tax Exemptions. 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. Item 10.a. - Page 23 ORDINANCE NO. PAGE 6 2. Sales of property to be used outside the city which is shipped to a point outside the city, 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 city 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-city 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-city 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 if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date. 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. 5. For the purposes of subsections (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. Use Tax Exemptions. There are exempted from the use tax imposed by this chapter, the storage, use or other consumption in this city 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. Item 10.a. - Page 24 ORDINANCE NO. PAGE 7 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 of the Revenue and Taxation Code of the 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. 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. 5. For the purposes of subsections (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. D. Exemption from Collection of Use Tax. Except as provided in subsection (E), a retailer engaged in business in the city 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 city or participates within the city 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 city or through any representative, agent, canvasser, solicitor, subsidiary, or person in the city under the authority of the retailer. E. Retailer Not Exempt from Collection of Use Tax. “A retailer engaged in business in the city” 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 city. Item 10.a. - Page 25 ORDINANCE NO. PAGE 8 F. Credit Against Use Tax for Transactions Tax Paid Elsewhere. Any person subject to use tax under this chapter may credit against that tax any transactions tax or reimbursement for transactions tax paid to a district 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. 3.23.120 - Adoption of amendments to state law. All amendments subsequent to the effective date of this chapter 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 chapter, provided however, that no such amendment shall operate so as to affect the rate of tax imposed by this chapter. 3.23.130 - Enjoining collection prohibited. 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 city, or against any officer of the State or the city, to prevent or enjoin the collection hereunder, or Parts 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected. 3.23.140. Annual Report. City shall annually mail to each household an annual report, which presents in summary form expenditures from the prior fiscal year from revenue generated from the Transactions and Use Tax and budgeted expenditures for the upcoming fiscal year. 3.23.150. Period Review. The City Council shall consider reduction or repeal of the Transactions and Use Tax at public hearings every five years after the effective date of this ordinance. SECTION 2. Use of Tax Proceeds. All proceeds of the tax levied and imposed Item 10.a. - Page 26 ORDINANCE NO. PAGE 9 hereunder shall be accounted for and paid into the City of Arroyo Grande General Fund, and may be used for any lawful purpose as designated by the City Council. SECTION 3. Effective Date. Pursuant to the California Constitution Article XIIIC(2)(b) and California Elections Code 9217, if approved by a majority vote of the qualified voters of the City voting on the issue at the November 3, 2020 General Municipal Election, this ordinance shall be deemed valid and binding and shall be considered adopted upon the date that the vote is declared by the City Council, and shall go into effect ten (10) days after that date. SECTION 4. Severability. If any section, sentence, clause or phrase of this ordinance is for any reason held to be invalid or unconstitutional by a decision of a court of competent jurisdiction, such decision shall not affect the validity of the remaining provisions of this Ordinance. The People of the City of Arroyo Grande hereby declare that they would have adopted this Ordinance irrespective of the invalidity of any particular portion thereof and intends that the invalid portions should be severed and the balance of the Ordinance be enforced. SECTION 5. Statutory Authority for Tax. This ordinance is adopted pursuant to Revenue and Taxation Code section 7285.9. SECTION 6. Codification. Upon adoption of this ordinance pursuant to the voter approval referenced in this ordinance, the City Clerk is hereby authorized and directed to codify this ordinance in the Arroyo Grande Municipal Code. I HEREBY CERTIFY that the foregoing ordinance was adopted by a two-thirds vote of all members of the City Council of the City of Arroyo Grande as required by Revenue and Taxation Code Section 7285.9 and Government Code Section 53724 and submitted to the voters at the meeting of the City Council held on the 14th day of July, 2020, by the following roll call vote: AYES: NOES: ABSENT: Item 10.a. - Page 27 ORDINANCE NO. PAGE 10 _________________________________ CAREN RAY RUSSOM. MAYOR ATTEST: _________________________________ KELLY WETMORE, CITY CLERK Ordinance No. ____ was submitted to the People of the City of Arroyo Grande at the November 3, 2020 General Election. It is hereby certified that this ordinance was passed and approved by following vote of the People of the City of Arroyo Grande: YES: NO: This ordinance was thereby adopted by the voters at the November 3, 2020 General Election and shall take effect as provided by law. Item 10.a. - Page 28 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE SETTING PRIORITIES FOR FILING WRITTEN ARGUMENTS REGARDING A CITY MEASURE AND DIRECTING THE CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS WHEREAS, a General Municipal Election is to be held in the City of Arroyo Grande, California, on November 3, 2020, at which there will be submitted to the voters the following measure: CITY OF ARROYO GRANDE MEASURE ______ To provide funding for general city services in Arroyo Grande, including increasing maintenance and repair of streets, sidewalks, potholes, stormwater and drainage facilities, parks, open space, public facilities, and to provide financial assistance to local businesses; shall an ordinance establishing a one percent sales tax be adopted, providing approximately $4,000,000 annually until ended by voters that can’t be taken away by the State, requiring citizen oversight and review and all funds controlled locally? YES NO NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: SECTION 1. That the City Council, being the legislative body of the City of Arroyo Grande, hereby authorizes: Caren Ray Russom, Keith Storton, Kristen Barneich, Jimmy Paulding, and Lan George, members of that body, to file a written argument in favor of the City measure as specified above, accompanied by the printed names and signatures of the authors submitting it, in accordance with Article 4, Chapter 3, Division 9 of the Elections Code of the State of California, and to change the arguments until and including July 28, 2020, the date fixed by the City Clerk after which no arguments for or against the City measure may be submitted to the City Clerk. Item 10.a. - Page 29 RESOLUTION NO. PAGE 2 SECTION 2. That the City Council directs the City Clerk to transmit copies of the measures to the City Attorney, unless the organization or salaries of the office of the City Attorney are affected. a. The City Attorney shall prepare an impartial analysis of the measure not exceeding 500 words showing the effect of the measure on the existing law and the operation of the measure. If the measure affects the organization or salaries of the office of the City Attorney, the City Clerk shall prepare the impartial analysis. b. The analysis shall include a statement indicating that the measure was placed on the ballot by the governing body of the city. c. In the event the entire text of the measure is not printed on the ballot, nor in the voter information portion of the voter information guide, there shall be printed immediately below the impartial analysis, in no less than 10-point type, the following: “The above statement is an impartial analysis of Measure ___. If you desire a copy of the measure, please call the election official’s office at 805-473-5400 and a copy will be mailed at no cost to you.” d. The impartial analysis shall be filed by July 28, 2020, the date set by the City Clerk for the filing of primary arguments. SECTION 3. That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions. On motion by Council Member ____________, seconded by Council Member __________, and on the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this 14th day of July, 2020. Item 10.a. - Page 30 RESOLUTION NO. PAGE 3 CAREN RAY RUSSOM, MAYOR ATTEST: ______________________________________ KELLY WETMORE, CITY CLERK APPROVED AS TO CONTENT: BILL ROBESON, ACTING CITY MANAGER APPROVED AS TO FORM: TIMOTHY J. CARMEL, CITY ATTORNEY Item 10.a. - Page 31 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE PROVIDING FOR THE FILING OF REBUTTAL ARGUMENTS FOR CITY MEASURES SUBMITTED AT MUNICIPAL ELECTIONS WHEREAS, Section 9282 of the Elections Code of the State of California provides for written arguments to be filed in favor of or against city measures not to exceed 300 words in length; and WHEREAS, Section 9285 of the Elections Code of the State of California authorizes the City Council by majority vote, to adopt provisions to provide for the filing of rebuttal arguments for city measures submitted at municipal elections. NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Arroyo Grande as follows: SECTION 1. That pursuant to Sections 9220 and 9285 of the Elections Code of the State of California, when the City Clerk has selected the arguments for and against the measure which will be printed and distributed to the voters, the City Clerk shall send a copy of an argument in favor of the measure to the authors of any argument against the measure, and a copy of an argument against the measure to the authors of any argument in favor of the measure immediately upon receiving the arguments. The author or a majority of the authors of an argument relating to a city measure may prepare and submit a rebuttal argument not exceeding 250 words or may authorize in writing any other person or persons to prepare, submit, or sign the rebuttal argument. A rebuttal argument may not be signed by more than five. The rebuttal arguments shall be filed with the City Clerk, signed, with the printed name(s) and signature(s) of the author(s) submitting it, or if submitted on behalf of an organization, the name of the organization, and the printed name and signature of at least one of its principal officers, not more than 10 days after the final date for filing direct arguments. The rebuttal arguments shall be accompanied by the Form of Statement To Be Filed By Author(s) of Argument. Rebuttal arguments shall be printed in the same manner as the direct arguments. Each rebuttal argument shall immediately follow the direct argument which it seeks to rebut. SECTION 2. That all previous resolutions providing for the filing of rebuttal arguments for City measures are repealed. SECTION 3. That the provisions of Section 1 shall apply only to the election to be held on November 3, 2020, and shall then be repealed. SECTION 4. That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions. Item 10.a. - Page 32 RESOLUTION NO. PAGE 2 On motion of Council Member _____________, seconded by Council Member __________, and on the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this 14th day of July, 2020. Item 10.a. - Page 33 RESOLUTION NO. PAGE 3 CAREN RAY RUSSOM, MAYOR ATTEST: _________________________________________ KELLY WETMORE, CITY CLERK APPROVED AS TO CONTENT: BILL ROBESON, CITY MANAGER APPROVED AS TO FORM: TIMOTHY J. CARMEL, CITY ATTORNEY Item 10.a. - Page 34 ARGUMENT IN FAVOR OF MEASURE ___ Your “YES” vote on Measure ___ will provide important funding to meet local needs. The City has maintained its current level of service by increasing the efficiency of its operations; however, it cannot keep up with rapidly increasing public improvement costs and new State mandates, and the City has reached a point where existing revenues cannot fund important projects. If passed, Measure ___ will generate approximately $4 million in additional annual revenue to ensure ongoing services and public improvements to benefit City residents, businesses, and visitors. Of the current 7.75% sales tax rate, our City receives only 1%. Your “YES” vote will raise the current rate to allow the City to receive 2% and thus provide for the community’s increasingly underfunded capital improvement and public facility maintenance needs and local economic development, including:  Street Repairs;  Concrete (Sidewalk) Repairs;  Parks, Open Space Maintenance, Fire Hazard and Fuel Suppression;  Stormwater and Drainage Maintenance;  Public Facilities Repair/Maintenance;  New Recreation/Childcare Center;  Business assistance loans supporting COVID-19 recovery. Your “YES” vote will result in safer streets and sidewalks, improved maintenance of City parks and open space, and more rehabilitation of aging storm drains. Everyone who utilizes our infrastructure and services should contribute to these needs, including those who live outside of the City. Your “YES” vote provides the most fair and economical way to ensure this happens. Your City government will be held accountable. Citizens will receive an annual report on the tax revenue received and how it is spent. The City Council will conduct a public hearing every five years to evaluate the success and effectiveness of the tax. Measure ___ is important to meet current and future needs, maintain City infrastructure, and preserve quality of life for our community. Your City Council urges you to vote “YES” on Measure ___. ______________________________ ______________________________ Caren Ray Russom, Mayor Keith Storton, Mayor Pro Tem ______________________________ ______________________________ Kristen Barneich, Council Member Jimmy Paulding, Council Member ______________________________ Lan George, Council Member Item 10.a. - Page 35 THIS PAGE INTENTIONALLY LEFT BLANK Item 10.a. - Page 36