Title
Recommendation to Set June 20, 2017 for a Public Hearing to Consider Collection of Delinquent Business License Taxes and Delinquent Integrated Waste Management Accounts Via the Property Tax Bills. (Finance 2450)
Body
To: Honorable Mayor and Members of the City Council
From: Jill Keimach, City Manager
Re: Recommendation to Set June 20, 2017 for a Public Hearing to Consider Collection of Delinquent Business License Taxes and Delinquent Integrated Waste Management Accounts Via the Property Tax Bills
BACKGROUND
City of Alameda Ordinance No. 2655, adopted on January 18,1994, added Section 5-7.2, “License a Debt” to the Municipal Code. Specifically, the ordinance provides for the collection of delinquent business license taxes and other service charges via the property tax bill.
In accordance with Chapter XXI, Solid Waste and Recycling, Section 21-20.6 of the Alameda Municipal Code (AMC), Alameda County Industries (ACI) may assign delinquent Integrated Waste Management (IWM) accounts to the City for collection. Prior to assigning their rights to the City, ACI is obligated to make at least four attempts to collect the delinquent accounts.
In addition to the delinquent business licenses, staff typically includes delinquent Integrated Waste Management bills in the property tax attachment process, as is recommended under this agenda item. These delinquent bills will be processed along with the delinquent business licenses in order to improve efficiency in the collection of both types of billings.
DISCUSSION
The Finance Department continually pursues collection of business license taxes from owners and managers of commercial and multi-family residential rental properties who have no current business license. Annually, the City conducts this two-step process by first formally setting the date of the public hearing and second by holding the public hearing on the date specified. Property owners are notified by mail using the last mailing address shown in the County tax records and are given ample time to respond prior to the City sending final collection notices. The notices contain contact information written in the six languages most commonly spoken within the city.
While the Business License Ordinance states that a renewal notice or bill it not required, the Finance Department sends out three renewal notices to property owners starting in May (in this case May 2016) by mail using the last mailing address shown in the County tax records for business license taxes due in July 2016. As such, they are given ample time (9 to 12 months) to respond prior to the City sending final (delinquent) collection notices. This year, the first delinquent notice was mailed on March 16, 2017 for business license taxes that were due in July 2016. The Finance Department mailed a second notice in April 2017 and a third and final notice in May 2017. Payments will be accepted through June 30, 2017. Those parcels for which licenses and fees are paid will not be placed on the tax roll. However, all unpaid fees as of June 30, 2017 will be recorded on the County tax roll on July 1, 2017.
As part of its Franchise Agreement with ACI, the City is obligated to pay ACI for all delinquent accounts. In accordance with the AMC, the City may send a letter requesting payment to each account’s property owner, and if not promptly received, the City can collect delinquent accounts through their property tax bills at a noticed public hearing. Property owners are notified twice by mail; once following the City’s receipt of the list, and once after the City Council sets the hearing date to consider collecting the delinquent amount, plus City fees, through the tax roll. Payments are accepted until 2:00 PM on the scheduled hearing date. With City Council direction, property owners’ payments may be accepted until June 30.
All unpaid fees, as of June 30, 2017, will be recorded on the County tax roll on July 1, 2017.
FINANCIAL IMPACT
Delinquent business license taxes will be determined at the close of business on June 30, 2017.
The City receives a 10% franchise fee from ACI, which is revenue for the General Fund. Unpaid IWM fees, therefore, result in a loss in General Fund revenues. Under City Council direction, delinquent IWM fees may continue to be collected until the close of business on June 30, 2017, consistent with the business license fee final day of acceptance.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The City’s IWM Program is consistent with the General Plan Health & Safety Element Guiding Policy 8.4.k and is consistent with the Waste and Recycling Initiative of the Local Action Plan for Climate Protection.
ENVIRONMENTAL REVIEW
This activity is not a project and is exempt from the California Environmental Quality Act (CEQA) pursuant to section 15378 (b)(4) of the CEQA Guidelines, because it involves governmental fiscal activities (collection of delinquent business license taxes), which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment.
RECOMMENDATION
Set June 20, 2017 for a public hearing to consider collection of delinquent business license taxes and delinquent integrated waste management accounts via the property tax bills.
Respectfully submitted,
Elena Adair, Finance Director
By
Carrie Dole, Finance Supervisor