HomeMy WebLinkAboutOrdinance 2761 N.C.S. 12/07/2020 Ordinance No. 2761 N.C.S. Page 1
EFFECTIVE DATE
OF ORDINANCE
December 17, 2020
ORDINANCE NO. 2761 N.C.S.
ORDINANCE OF THE CITY OF PETALUMA
ADDING A NEW CHAPTER 4.18 ENTITLED “TRANSACTIONS AND USE TAX” TO THE
PETALUMA MUNICIPAL CODE TO IMPOSE A ONE-CENT, GENERAL
TRANSACTIONS AND USE TAX TO BE ADMINISTERED BY THE CALIFORNIA
DEPARTMENT OF TAX AND FEE ADMINISTRATION
FINDINGS
WHEREAS, the City of Petaluma has had General Fund budgetary challenges for many years, at
least since the Great Recession approximately a decade ago, and the City’s response to the Great
Recession was a multi-faceted approach that attempted to retain the most critical services while
balancing expenditures with available revenues, utilizing. strategies including the following:
• Reductions to, elimination of and contracting-out of various General Fund services;
• Reduction of 26% of General Fund staff positions;
• Negotiation of various concessions with our employee bargaining units; including furloughs,
pension cost-sharing, and no cost-of-living-adjustments for up to 7 consecutive years; and
• Spending down of nearly all the City’s General Fund reserves; and
WHEREAS, after the Great Recession, from approximately 2013 to 2018, the City continued to
make the necessary decisions to balance its General Fund each year during a period that saw few staff
compensation increases, and although some key positions were added back to the General Fund over
time; and the City accomplished a slow build-up of reserves, the General Fund budget was balanced
during this time by little-to-no investment in technology, roads, facilities and other key infrastructure
components; and
WHEREAS, the City has not had the benefit of a dedicated, locally-approved revenue measure to
bolster City services and improve infrastructure maintenance and investment; and
WHEREAS, since the beginning of the COVID-19 pandemic, the City has been working to
provide essential City services to residents and businesses and provide additional COVID support
where possible, such as the implementation of a rental assistance program, small business loan
program, and assistance with permitting outdoor dining and other business modifications to support
the economy; nonetheless, due to the sheltering orders and corresponding business shutdowns, the
City is anticipating a revenue loss of $2.7 million in Fiscal Year 2019/2020 and an additional
$2.0 million loss in Fiscal Year 2020/2021, with future fiscal years expected to see estimated revenues
down approximately $1.3 million annually on an ongoing basis; and
WHEREAS, since 2019, the City has been engaged in a two-pronged effort to: (1) gather as much
community feedback as possible about City services and priorities, including online and paper surveys,
in-person workshops, emails and phone calls, and statistically-valid professionally-conducted public
opinion research; and (2) to conduct comprehensive analysis and educate the community on the City’s
Ordinance No. 2761 N.C.S. Page 2
long-term fiscal challenges and the level of revenue / investment required by the City’s General Fund
to maintain quality-of-life services and infrastructure; and
WHEREAS, the City Council and City staff have employed a multi-faceted community outreach
effort to engage the Petaluma community to gather their feedback about City services, projects, goals
and priorities, which efforts have taken many forms over the past eighteen months and have included
input from thousands of Petaluma residents, businesses and other stakeholders, including:
• Over 300 participants at City workshops (e.g. Goals and Priorities Workshop, Parks Measure
M Workshop, Housing Priorities Workshop, etc.);
• 2,131 respondents to online surveys;
• Over 1,000 respondents to paper mail-in surveys;
• 3,617 unique visitors to the City’s www.cityofpetaluma.org/jointheconvo web page;
• 800 participants in statistically-valid, professionally conducted public opinion research; and
WHEREAS, the extensive community feedback the City has received makes clear that the
community’s interests and spending priorities for enhanced locally-controlled funding include:
• Maintaining and preventing cuts to firefighting equipment/fire engines and adequate 24-hour
staffing;
• Ensuring public health, wildfire, natural disaster emergency preparedness and maintaining 911
emergency response times to ensure first responders can respond quickly to calls for services;
• Continuing homeless prevention programs and community partnerships while ensuring our
local businesses, public areas, and neighborhoods are safe, stable, and secure for everyone;
• Maintaining properly trained community based public safety officers, community outreach
programs, and ensuring adequate 24-hour staffing;
• Keeping public areas safe and clean; supporting local business and job retention through
recovery;
• Enhancing street maintenance, repaving, and pothole repair on Petaluma’s 396 miles of streets;
• Addressing existing road hazards and improving road safety for drivers, bicyclists, and
pedestrians, including maintaining safe routes to schools; and
• Improving conditions of local roads by better addressing $141 million in repairs backlog and
preventing road ratings from further decreasing per the standard Pavement Condition Index;
and
WHEREAS, staff has been engaged in a Fiscal and Organizational Sustainability (“FOS”) effort
consisting of significant research and analysis into all facets of the City’s General Fund finances as
well as a series of informational workshops to present the data and findings on each topic to the City
Council and the public to identify options and solutions to ensure that City services, programs and
infrastructure are provided and maintained in a sustainable way, with the FOS process analyzing what
the City should be investing in order to be sustainable in the long run, and then identifying the amount
of revenue necessary to achieve those goals; and
WHEREAS, per the forecast presented during the Fiscal Year 2020/21 budget process, the City
has an average structural General Fund deficit over the lifetime of the 5-Year General Fund Forecast
Ordinance No. 2761 N.C.S. Page 3
of approximately $6.4 million annually, with an initial projected annual deficit of $5.1 million in Fiscal
Year 2021/2022, increasing to a projected annual deficit of $7.7 million in Fiscal Year 2025/2026,
which means that in order to continue to fund the existing core services, programs and staffing levels
currently funded by the General Fund, given reasonable growth assumptions on revenues and
expenditures, the City would need approximately an additional $6.4 million annually, assuming no
new programs or staff positions are added, or, stated differently, if the City takes no other action to
ameliorate its financial situation, the City will need to cut approximately $6.4 million permanently
from its annual budget to stay balanced; and
WHEREAS, the City of Petaluma maintains a vast array of infrastructure for the benefit of its
constituents, including streets, sidewalks, storm drains, bridges, parks, pathways, islands & medians,
buildings and facilities, but in efforts to balance the annual budget, the City has invested very-little-
to-zero General Fund dollars to maintain this infrastructure over time, which has resulted in hundreds
of millions of dollars in deferred maintenance for these facilities, including:
• Petaluma’s having the worst roads in the entire nine-county Bay Area; to bring the road
condition up to a pavement condition index of “Good / 70” would require an investment of
more than $100 million;
• The City’s three antiquated fire stations require nearly $10 million in improvements to seismic,
accessibility and functional adequacy for these important public safety facilities to remain
viable; and
WHEREAS, the Petaluma community has indicated that maintaining public health, wildfire, and
natural disaster emergency preparedness; ensuring firefighters have the equipment they need;
maintaining 911 emergency response times, fire protection services, and well-trained community-
based police officers; supporting local businesses through recovery; repairing roads and fixing
potholes; and keeping public spaces safe and clean are top community priorities; and
WHEREAS, although Petaluma has been spared from recent wild fires, the City needs to continue
to ensure the Petaluma Fire Department has the equipment and adequate staffing it needs to protect
Petaluma effectively in any emergency; and
WHEREAS, Petaluma’s 396 miles of roadways are in dire need of maintenance and are rated the
worst in the Bay Area, and the City’s roads will only get more expensive to fix the longer they go
without repair, and Petaluma residents deserve safe streets, including for first responders who need to
reach people quickly that need help; and
WHEREAS, as the financial fallout from the COVID-19 pandemic continues, the City needs to
maintain homeless prevention programs that keep our community safe, stable, and secure; and
WHEREAS, calls for emergency response to the Fire Department continue to increase to record
levels, have gone up 95% in the past decade, and as calls for services continue to rise, emergency
response times have also increased; and
WHEREAS, the City must ensure Petaluma is fiscally stable and prepared for any future wildfire,
natural disaster or public health and safety emergency; the City cannot depend on adequate state or
federal funding to address local emergency preparedness and recovery needs; and as a result, the City
Ordinance No. 2761 N.C.S. Page 4
must effectively address its own unique local needs and ensure local control with funding that cannot
be taken by the State; and
WHEREAS, ideally, the City would be able to invest upwards of $10 million annually to maintain
all of its infrastructure categories and take care of the significant backlog of deferred maintenance;
however, as a reasonable middle ground, staff is suggesting an annual investment target of
approximately $4.6 million to significantly reduce existing maintenance needs; and
WHEREAS, the City Manager’s Office and City departments have identified a number of areas
that do not appear sustainable without additional staff to continue maintaining community needs and
priorities that City residents expect and deserve; and, although staff identified approximately 29 new
staff positions that would be required to bolster and augment the City’s General Fund operations to
ensure they are sustainable, the City Manager recommends 19 new positions for the General Fund at
a cost of approximately $2.2 million annually that would not provide significant new services to the
community but would help to provide resiliency, reliability, and proactivity to existing services to
ensure that they are sustainable; and
WHEREAS, the City’s FOS process has identified that the City needs more than $15 million in
additional annual revenue to provide sustainable, high-quality services and ensure that City
infrastructure is reliably maintained, and, accordingly, staff recommends placing a one-cent general
purpose sales tax on the November 3, 2020 ballot, which is estimated to generate approximately $13.5
million annually to be spent in alignment with the FOS recommendations and community-identified
spending priorities; and
WHEREAS, the measure that has been prepared for placement before Petaluma voters at the
November 3, 2020 general election includes strict transparency and accountability requirements,
including: independent citizen oversight, biannual independent financial audits, all funds spent
locally, and no funding that can be taken by the State; and
WHEREAS, Section 7285.9 of the California Revenue and Taxation Code provides that the
governing body of any city may levy, increase or extend a transactions and use tax for general purposes
at a rate of 0.125 percent or a multiple thereof, if the ordinance proposing that tax is approved by a
two-thirds vote of all members of that governing body and the tax is approved by a majority vote of
the qualified voters of the city voting in an election on the issue, if the transactions and use tax
conforms to the Transactions and Use Tax Law in Part 1.6 (commencing with Section 7251) of the
California Revenue and Taxation Code; and
WHEREAS, Section 7251.1 of the California Revenue and Taxation Code provides that the
combined rate of all transactions and use taxes in any county may not exceed 2 percent; and
WHEREAS, current sales tax rates in Sonoma County are as follows:
Cloverdale 8.25%
Cotati 9.25%
Healdsburg 8.75%
Petaluma 8.25%
Rohnert Park 8.75%
Santa Rosa 9.00%
Ordinance No. 2761 N.C.S. Page 5
Sebastopol 9.00%
Sonoma 8.75%
Sonoma County 8.25%
Windsor 8.25%; and
WHEREAS, in accordance with California Revenue and Taxation Code section 7251.1, the
Petaluma voters may adopt a local transactions and use tax of up to 1.0% to be applicable in the City;
and
WHEREAS, imposition of a one-cent transactions and use tax in Petaluma would generate
approximately $13.5 million annually; and
WHEREAS, in accordance with Article 13C, Section 2,of the California Constitution, any tax
imposed for general governmental purposes the proceeds of which are placed in the general fund and
available for expenditure for any and all governmental purposes is a general tax, including where such
proceeds are monitored and tracked separately from other tax receipts (see, e.g., Weisblat v. City of
San Diego (2009) 176 CA4th 1022); and
WHEREAS, Subdivision (b) of Section 2 of Article XIIIC of the California Constitution requires
that elections to approve a general tax must be consolidated with a regularly-scheduled general election
for members of the governing body of the local Government; and
WHEREAS, November 3, 2020 is the date of the City’s next regular municipal election for
members of the City Council; and
WHEREAS, Section 4 of Article III of the Petaluma City Charter provides that except as
otherwise specified in the charter, all regular and special City elections are to be held in accordance
with the California Elections Code, as amended; and
WHEREAS, Section 76 of Article XII of the Petaluma City Charter provides that ordinances may
be enacted by and for the city pursuant to Division 4 of Chapter 3 of Article 1 of the California
Elections Code, as amended; and,
WHEREAS, in accordance with Section 76A of Article XII of the Petaluma City Charter and
California Revenue and Taxations Code section 7285.9, if the transactions and use tax measure to be
submitted to Petaluma voters pursuant to this ordinance is approved by a unanimous vote of the City
Council Members present and by a majority vote of qualified City voters, the measure would impose
a one-cent general tax based on the retail sales price of personal property sales and use; and
WHEREAS, this ordinance is not a project subject to the requirements of the California
Environmental Quality Act (“CEQA”) or its Guidelines in accordance with paragraph (2) of
subdivision (c) of Section 15060 of the CEQA Guidelines, because this ordinance will not result in a
direct or reasonably foreseeable indirect physical change in the environment, and in accordance with
paragraph (4) of subdivision (b) of Section 15378 of the CEQA Guidelines, because this ordinance
involves the creation of government funding mechanisms and other government fiscal activities that
do not involve any commitment to any specific project that may result in a potentially significant
physical impact on the environment;
Ordinance No. 2761 N.C.S. Page 6
NOW, THEREFORE, THE PEOPLE OF THE CITY OF PETALUMA DO ORDAIN
AS FOLLOWS:
Section 1. Chapter 4.18 entitled “Transactions and Use Tax” is hereby added to Title 4 of the
Petaluma Municipal Code, to read as follows:
4.18.010 TITLE. This chapter is entitled “Transactions and Use Tax” and shall be applicable
in the incorporated territory of the city.
4.18.020 OPERATIVE DATE. “Operative Date” means the first day of the first calendar
quarter commencing more than 110 days after the adoption of this chapter, the date of such adoption
being as set forth below.
4.18.030 PURPOSE. This chapter 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 of the Revenue and Taxation Code and Section 7285.9
of Part 1.7 of Division 2 which authorizes the city to adopt this chapter which 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 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 California Department of Tax and Fee
Administration 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 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 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 chapter.
4.18.040 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 incident to the
administration and operation of this chapter; provided, that if the city shall not have 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.
Ordinance No. 2761 N.C.S. Page 7
4.18.050 TRANSACTIONS 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 1.0% 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 chapter.
4.18.060 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 prescribed and adopted by the California Department of Tax and Fee
Administration.
4.18.070 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 and after the
operative date of this chapter for storage, use or other consumption in said territory at the rate of 1.0%
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.
4.18.080 ADOPTION OF PROVISIONS OF STATE LAW. Except as otherwise provided
in this 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 Section 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.
4.18.090 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
the city 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
Treasury, or the Constitution of the State of California;
2. The result of that substitution would require action to be taken by or against the 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:
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
Ordinance No. 2761 N.C.S. Page 8
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.
1. “A retailer engaged in business in the District” shall also include any retailer that, in the
preceding calendar year or the current calendar year, has total combined sales of tangible
personal property in this state or for delivery in the State by the retailer and all persons related
to the retailer that exceeds five hundred thousand dollars ($500,000). For purposes of this
section, a person is related to another person if both persons are related to each other pursuant
to Section 267(b) of Title 26 of the United States Code and the regulations thereunder.
4.18.100 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.
4.18.110 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-Burns 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 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,
Ordinance No. 2761 N.C.S. Page 9
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 of this chapter.
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 chapter.
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 chapter, the storage, use or other
consumption in the 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.
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 of this chapter.
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 chapter.
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.
Ordinance No. 2761 N.C.S. Page 10
6. Except as provided in subparagraph (7), 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.
7. "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.
D. 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.
4.18.120 AMENDMENTS. 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.
4.18.130 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 city, or against any officer of the State or the city, to prevent or enjoin the collection under
this chapter, 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.
4.18.140 USE OF TAX PROCEEDS AND ACCOUNTABILITY MEASURES.
A. The proceeds of the tax imposed pursuant to this chapter shall be placed in the city’s General
Fund and available for expenditure for any and all governmental purposes, including such purposes
as: maintaining and preventing cuts to firefighting equipment/fire engines and adequate 24-hour
staffing; ensuring public health, wildfire, natural disaster emergency preparedness and maintaining
911 emergency response times to ensure first responders can respond quickly to calls for services;
continuing homeless prevention programs and community partnerships while ensuring our local
businesses, public areas, and neighborhoods are safe, stable, and secure for everyone; maintaining
properly trained community based public safety officers, community outreach programs, and ensuring
adequate 24-hour staffing; keeping public areas safe and clean; supporting local business and job
retention through recovery; enhancing street maintenance, repaving, and pothole repair on Petaluma’s
396 miles of streets; addressing existing road hazards and improving road safety for drivers, bicyclists,
and pedestrians, including maintaining safe routes to schools; and improving conditions of local roads
Ordinance No. 2761 N.C.S. Page 11
by better addressing $141 million in repairs backlog and preventing road ratings from further
decreasing per the standard Pavement Condition Index, among other purposes. The proceeds of the
tax imposed pursuant to this chapter and expenditures using such proceeds shall be monitored and
proceeds tracked separately from other city tax receipts.
B. The city council shall appoint an independent citizen oversight committee consisting of five
members to review and report on the use of proceeds of the tax imposed pursuant to this chapter. The
committee members shall be city residents who pay the tax imposed pursuant to this chapter and who
are not employees or elected officials of the city or members of any other city body. The city will
provide administrative support necessary for the oversight committee to carry out its functions.
C. The city’s finance director will oversee preparation of biannual reports for submission to
the oversight committee and publication on the city’s website on all tax proceeds collected pursuant
to this chapter and use of the proceeds. The citizen oversight committee will meet biannually to review
and comment on the reports. The meetings and records of the oversight committee will be open to the
public in accordance with Article 1, Section 3, subdivision (b) of the California Constitution, and the
requirements of the Ralph M. Brown Act, California Government Code Section 54950 and following,
and the California Public Records Act, California Government Code Section 6250 and following, as
amended from time to time.
Section 3. 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 4. EFFECTIVE DATE. This ordinance relates to the levying and collecting of city
transactions and use taxes and shall take effect immediately.
Section 5. TERMINATION DATE. The authority to levy the tax imposed by this ordinance shall
expire when such authority is suspended or terminated in accordance with applicable law.
PASSED AND ADOPTED by the qualified electors of the City of Petaluma, State of California, on
December 7, 2020, by the following vote:
AYES: 20,961
NOES: 13,502