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R112781 City Council Meeting: July 28, 2020 Santa Monica, California RESOLUTION NUMBER 11278 (CCS) (City Council Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA SUBMITTING TO THE VOTERS A MEASURE TO AMEND SANTA MONICA MUNICIPAL CODE CHAPTER 6.96 AND SET THE REAL PROPERTY TRANSFER TAX RATE AT SIX DOLLARS PER THOUSAND DOLLARS OF CONSIDERATION OR PROPERTY VALUE TRANSFERRED FOR ALL SALES OR TRANSFERS OF FIVE MILLION DOLLARS OR GREATER WHEREAS, on November 28, 1967, the City Council of the City Of Santa Monica adopted Ordinance No. 761 (CCS), which established the Real Property Transfer Tax Ordinance of the City of Santa Monica (the “City Real Estate Transfer Tax”), and set a real estate transfer tax rate of $0.55 per $1,000 of consideration or property value transferred; and WHEREAS, on August 13, 1991, the City Council adopted Ordinance No. 1596 (CCS), which, among other things, amended the City Real Estate Transfer Tax to establish a real estate transfer tax rate of $3.00 per $1,000 of consideration or property value transferred; and WHEREAS, many residents live in the City of Santa Monica because the City invests in community priorities, offering extensive services and programs that substantially enhance the quality of life of its residents; and DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 2 WHEREAS, the ongoing COVID-19 global pandemic has devastated nearly all of the City’s long-trusted revenue streams, including sales tax, transient occupancy tax, parking revenue, and business license revenue; and WHEREAS, the City Council has taken proactive steps to reduce expenses, save money, and maintain the level of services the community has come to expect; and WHEREAS, in response to a significant reduction in local revenues, the City Council has reduced service positions and deferred infrastructure maintenance; and WHEREAS, sustaining a lower level of services and deferring infrastructure maintenance until the local economy recovers will erode the progress that the City has made over time in meeting community needs; and WHEREAS, the City is working closely with small businesses, employers, and other stakeholders to implement an economic recovery plan, but it is expected that it will take time for national and local economies to recover; and WHEREAS, a new, locally-controlled revenue source is needed to preserve Santa Monica’s essential city services; and WHEREAS, increasing the City Real Estate Transfer Tax rate to $6.00 per $1,000 of consideration or property value transferred for properties that are sold or transferred with a valuation of $5,000,000.00 or higher would partially fill the revenue gap created by COVID-19 and help preserve Santa Monica’s essential city services; and WHEREAS, the current City Real Estate Transfer Tax rate is set at only three dollars per thousand dollars of consideration or property value transferred for all sales and transfers of commercial and residential properties; and DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 3 WHEREAS, the City Real Estate Transfer Tax rate is 33% lower than the real estate transfer tax rates in the nearby cities of Culver City and Los Angeles; and WHEREAS, an incremental increase on the one-time tax for each time a property with a valuation of $5,000,000.00 or higher is sold or otherwise transferred will only impact approximately 10% of the sales and transfers in the City; and WHEREAS, the proposed incremental increase would help provide new, ongoing revenue to help preserve key foundational services, including: keeping public spaces such as parks, beaches, and beach restrooms clean and safe; homelessness prevention planning and programs; tenant protection programs; afterschool and mental health support programs for youth; emergency response; library programs; economic recovery programs; infrastructure maintenance; and food programs for the hungry; and WHEREAS, under applicable law, the City Council of the City of Santa Monica must present any proposed increase to the City Real Estate Transfer Tax to the electorate of the City of Santa Monica for adoption by majority vote of the electorate. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AND PROCLAIM AS FOLLOWS: SECTION 1. A General Municipal Election has been called for November 3, 2020, for the purpose of, among other things, electing City Council members and submitting measures and ballot propositions to the voters. SECTION 2. At the General Municipal Election called for November 3, 2020, the following measure to amend the Santa Monica Municipal Code shall be placed on the ballot and submitted to the qualified electors of the City of Santa Monica: DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 4 MEASURE “_”: To protect essential services including addressing homelessness, cleaning beaches/parks, public safety/ fire/ emergency response, protections for tenants and seniors, supporting libraries, small business recovery, food for the hungry, and after-school/ mental health services for youth, shall the City of Santa Monica increase the one-time real estate transfer tax paid on each sale of property for $5 million or more by $3.00 per $1,000 of sales price, exempting affordable housing projects, providing $3 million annually for local services? YES _________ NO SECTION 3. The City of Santa Monica recognizes that additional costs may be incurred by the County by reasons of the addition of this measure to the ballot and agrees to reimburse the County for any additional costs performed upon presentation of a bill pursuant to Elections Code Section 10002. SECTION 4. The City Clerk shall transmit to the City Attorney, in accordance with Elections Code Section 9280, a copy of this ballot measure. The City Attorney shall prepare an impartial analysis of the ballot measure, which shall not exceed 500 words in length. The impartial analysis shall be filed by the date set by the City Clerk for the filing of primary arguments. In accordance with Santa Monica Municipal Code section 11.04.190 and California Elections Code Section 9295, not less than 10 calendar days before the City Clerk submits the official elections materials for printing, the City Clerk shall make a copy of all applicable election materials available for public examination in the City Clerk’s office. DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 5 SECTION 5. The City Council authorizes its members, as follows, to file written arguments for or against the ballot measure: FOR: Mayor Kevin McKeown AGAINST: _____________________________________ All written arguments filed by any person in favor of or against the ballot measure, including any rebuttal arguments, shall be accompanied by the names and signatures of the persons submitting the arguments as required by applicable law, and any names, signatures and arguments may be filed until the time and date fixed by the City Clerk in accordance with applicable law, after which no change may be submitted to the City Clerk unless permitted by law. SECTION 6. The City Clerk shall cause the text of the ballot measure, which is contained in Exhibit 1, together with the City Attorney’s impartial analysis, and any arguments for or against the measure, as well as any rebuttal, to be mailed to all qualified voters with the sample ballot. In addition to other notices and publications required by law, the City Clerk, not less than forty (40) days and not more than sixty (60) days before the statewide general election, shall cause the text of the ballot measure to be published once in the official newspaper and in each edition thereof during the day of publication. The City Clerk is authorized to give such notice and to fix such times and dates as are required by law or which are appropriate to conduct properly the election. SECTION 7. The provisions of Resolutions 11254 and 11255 (CCS) are referred to and incorporated into this Resolution. Those Resolutions provide necessary particulars concerning the General Municipal Election to be held on November 3, 2020, and among DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 6 other things, deal with the placing on the ballot of this and other measures as well as the conduct, consolidation and coordination of the General Municipal Election with the General Statewide Election, which will also be conducted on November 3, 2020. In all respects, the election shall be held and conducted as provided for by applicable law, including but not limited to the above referenced Resolutions. The City Clerk is authorized and directed to procure and furnish any official ballots, notices, printed materials and all supplies or equipment that may be necessary in order to conduct the election properly and lawfully. SECTION 8. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: _________________________ GEORGE S. CARDONA Interim City Attorney DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 1 Exhibit 1 CITY COUNCIL PROPOSED MEASURE TO AMEND SANTA MONICA MUNICIPAL CODE CHAPTER 6.96 AND SET THE REAL PROPERTY TRANSFER TAX RATE AT SIX DOLLARS PER THOUSAND DOLLARS OF CONSIDERATION OR PROPERTY VALUE TRANSFERRED FOR ALL SALES OR TRANSFERS OF FIVE MILLION DOLLARS OR GREATER WHEREAS, on November 28, 1967, the City Council of the City Of Santa Monica adopted Ordinance No. 761 (CCS), which established the Real Property Transfer Tax Ordinance of the City of Santa Monica (the “City Real Estate Transfer Tax”), and set a real estate transfer tax rate of $0.55 per $1,000 of consideration or property value transferred; and WHEREAS, on August 13, 1991, the City Council adopted Ordinance No. 1596 (CCS), which, among other things, amended the City Real Estate Transfer Tax to establish a real estate transfer tax rate of $3.00 per $1,000 of consideration or property value transferred; and WHEREAS, many residents live in the City of Santa Monica because the City invests in community priorities, offering extensive services and programs that substantially enhance the quality of life of its residents; and WHEREAS, the ongoing COVID-19 global pandemic has devastated nearly all of the City’s long-trusted revenue streams, including sales tax, transient occupancy tax, parking revenue, and business license revenue; and WHEREAS, the City Council has taken proactive steps to reduce expenses, save money, and maintain the level of services the community has come to expect; and DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 2 WHEREAS, in response to a significant reduction in local revenues, the City Council has reduced service positions and deferred infrastructure maintenance; and WHEREAS, sustaining a lower level of services and deferring infrastructure maintenance until the local economy recovers will erode the progress that the City has made over time in meeting community needs; and WHEREAS, the City is working closely with small businesses, employers, and other stakeholders to implement an economic recovery plan, but it is expected that it will take time for national and local economies to recover; and WHEREAS, a new, locally-controlled revenue source is needed to preserve Santa Monica’s essential city services; and WHEREAS, increasing the City Real Estate Transfer Tax rate to $6.00 per $1,000 of consideration or property value transferred for properties that are sold or transferred with a valuation of $5,000,000.00 or higher would partially fill the revenue gap created by COVID-19 and help preserve Santa Monica’s essential city services; and WHEREAS, the current City Real Estate Transfer Tax rate is set at only three dollars per thousand dollars of consideration or property value transferred for all sales and transfers of commercial and residential properties; and WHEREAS, the City Real Estate Transfer Tax rate is 33% lower than the real estate transfer tax rates in the nearby cities of Culver City and Los Angeles; and WHEREAS, an incremental increase on the one-time tax for each time a property with a valuation of $5,000,000.00 or higher is sold or otherwise transferred will only impact approximately 10% of the sales and transfers in the City; and DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 3 WHEREAS, the proposed incremental increase would help provide new, ongoing revenue to help preserve key foundational services, including: keeping public spaces such as parks, beaches, and beach restrooms clean and safe; homelessness prevention planning and programs; tenant protection programs; afterschool and mental health support programs for youth; emergency response; library programs; economic recovery programs; infrastructure maintenance; and food programs for the hungry; and WHEREAS, under applicable law, the City Council of the City of Santa Monica must present any proposed increase to the City Real Estate Transfer Tax to the electorate of the City of Santa Monica for adoption by majority vote of the electorate. NOW, THEREFORE: SECTION 1. Chapter 6.96 of the Santa Monica Municipal Code is amended to read as follows: 6.96.010 Title. This Chapter shall be known as the “Real Property Transfer Tax Ordinance of the City of Santa Monica.” It is adopted pursuant to the authority contained in Part 6.7 (commencing with Section 11901) of Division 2 of the Revenue and Taxation Code of the State of California and other authority held as a charter city. 6.96.015 Definitions. For purposes of this Chapter, the following terms shall have the following meanings: (a) “Affordable Housing Transfer” shall mean a transfer of property to: (1) a nonprofit corporation; (2) a limited partnership or limited liability company in which a nonprofit corporation is the managing general partner or managing member; or (3) a community land trust (as defined by Revenue and Taxation Code Section 402.1) and operated in accordance with Revenue and Taxation Code Section 214.18, if the property is subject to a binding agreement or covenant recorded on the real property and enforceable by the City to provide all residential units on the property (other than units reserved for on-site property managers) at an affordable rent or affordable housing cost to lower income households as defined in California Health and Safety Code Section 50079.5; (b) “City” shall mean the City of Santa Monica; DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 4 (c) “City Collected Portion” shall mean, with respect to any Second Tier Tax owed, one half of that Second Tier Tax; (d) “County” shall mean the County of Los Angeles; (e) “County Collected Portion” shall mean, with respect to any Second Tier Tax owed, one half of that Second Tier Tax; (f) “First Tier Tax” shall mean the City-imposed tax pursuant to this Chapter to be paid at the First Tier Tax Rate on any sale or transfer within the City; (g) “First Tier Tax Rate” shall mean the tax rate of three dollars for each one thousand dollars of consideration or property value, or fractional part thereof, which tax rate is equivalent to the tax rate that shall remain in effect prior to March 1, 2021; (h) “Second Tier Tax” shall mean the City-imposed tax pursuant to this Chapter to be paid at the Second Tier Tax Rate on any sale or transfer within the City; (i) “Second Tier Tax Agreement” shall mean a fully executed and binding agreement between City and County that requires the County to administer the entirety of the Second Tier Tax; (j) “Second Tier Tax Rate” shall mean the tax rate of six dollars for each one thousand dollars of consideration or property value, or fractional part thereof. 6.96.020 Transfers affected and amount of tax. Effective October 15, 1991 March 1, 2021, there is hereby imposed on each deed, instrument, or writing by which any lands, tenements, or other realty sold within the City of Santa Monica shall be granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by his, her or their direction, when the consideration or value of the interest or property conveyed (exclusive of the value of any lien or encumbrance remaining thereon at the time of sale) exceeds one hundred dollars, a tax at the rates set forth below: (a) for sales or transfers when the consideration or value of the interest or property conveyed is less than $5,000,000.00, the First Tier Tax Rate; and (b) for sales or transfers when the consideration or value of the interest or property conveyed is greater than or equal to $5,000,000.00, the Second Tier Tax Rate. Prior to October 15, 1991 March 1, 2021, the tax at the rate of fifty-five cents three dollars for each one thousand dollars of consideration or property sale value, or fractional part thereof, shall remain in effect. 6.96.030 Taxpayer designated. Any tax imposed pursuant to Section 6.96.020 hereof shall be paid by: (1) any person who makes, signs or issues any document or instrument subject to the tax; or (2) any person for whose use or benefit any document or instrument subject to the tax the same is made, signed or issued; or (3) any combination thereof. The obligation to pay any tax imposed pursuant to Section 6.96.020 shall be a joint and several liability of the taxpayers identified in this section. DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 5 6.96.035 Payment of First Tier Tax to County, Payment of Second Tier Tax to County and City Any taxes due under this Chapter shall be paid prior to recording any deed, instrument, or writing subject to the tax. Payment shall be made as follows: (a) Any First Tier Tax owed shall be paid directly to the County on behalf of the City; (b) Unless the County enters into a Second Tier Tax Agreement, any Second Tier Tax owed shall be paid in two equal parts: i. The County Collected Portion (three dollars for each one thousand dollars of consideration or property value, or fractional part thereof) shall be paid to the County on behalf of the City; and ii. The City Collected Portion (three dollars for each one thousand dollars of consideration or property value, or fractional part thereof) shall be paid directly to City. 6.96.036 Payment of Entire Second Tier Tax to County Upon Execution of Binding Agreement - Notice. In the event that the City and County enter into a Second Tier Tax Agreement, the County is authorized to collect the entirety of the Second Tier Tax as if Section 6.96.035(b) did not exist. The City shall provide at least 90-days notice of the effective date of any Second Tier Tax Agreement on its website. 6.96.040 Debt-securing instrument exempted. Any tax imposed pursuant to this Chapter shall not apply to any instrument in writing given to secure a debt. 6.96.050 Certain governmental units exempted. The United States or any agency or instrumentality thereof, any state or territory, or political subdivision thereof, including any city, county, or the District of Columbia shall not be liable for any tax imposed pursuant to this Chapter with respect to any deed, instrument, or writing to which it is a party, but the tax may be collected by assessment from any other party liable therefor. 6.96.051 Partial exemption for certain affordable housing developments by non- profit corporations and community land trusts. For an Affordable Housing Transfer in which the consideration or value of the interest or property conveyed is greater than or equal to $5,000,000.00: (a) If prior to the time an obligation to collect the City Collected Portion of the Second Tier Tax arises under Section 6.96.095 of this Chapter, a taxpayer with respect to the transfer, as defined in Section 6.96.030 of this Chapter, obtains from the Director of Finance a certification that the transfer is an Affordable Housing Transfer, no DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 6 taxpayer with respect to the Affordable Housing Transfer shall be required to pay the City Collected Portion of the Second Tier Tax on the Affordable Housing Transfer; (b) If the City Collected Portion of the Second Tier Tax is paid on an Affordable Housing Transfer, any taxpayer with respect to the transfer, as defined in Section 6.96.030 of this Chapter, may apply to the Director of Finance for a refund of that portion of the City Collected Portion of the Second Tier Tax paid by the taxpayer on the Affordable Housing Transfer; any such application for a refund must be submitted within 120-days of the transfer subject to the Second Tier Tax. 6.96.060 Plans of reorganization or adjustment. Any tax imposed pursuant to this Chapter shall not apply to the making, delivering, or filing of conveyances to make effective any plan of reorganization or adjustment: (a) Confirmed under the Federal Bankruptcy Act, as amended; (b) Approved in an equity receivership proceeding in a court involving a railroad corporation, as defined in subdivision (m) of Section 205 Section 101 of Title 11 of the United States Code, as amended; (c) Approved in an equity receivership proceeding in a court involving a corporation, as defined in subdivision (3) of Section 506 Section 101 of Title 11 of the United States Code, as amended, or (d) Whereby a mere change in identity, form or place of organization is effected. Subsections (a) to (d), inclusive, of this Section shall only apply if the making, delivery or filing of instruments of transfer or conveyances occurs within five years from the date of such confirmation, approval or change. 6.96.070 Securities and Exchange Commission orders. Any tax imposed pursuant to this Chapter shall not apply to the making or delivery of conveyances to make effective any order of the Securities and Exchange Commission, as defined in subdivision (a) of Section 1083 of the Internal Revenue Code of 195486, but only if: (a) The order of the Securities and Exchange Commission in obedience to which such conveyance is made recites that such conveyance is necessary or appropriate to effectuate the provisions of Section 79k of Title 15 of the United States Code relating to the Public Utility Holding Company Act of 1935; (b) Such order specifies the property which is ordered to be conveyed; and (c) Such conveyance is made in obedience to such order. 6.96.080 Partnerships. (a) In the case of any realty held by a partnership, no levy shall be imposed pursuant to this Chapter by reason of any transfer of an interest in a partnership or otherwise, if: (1) Such partnership (of another partnership) is considered a continuing partnership within the meaning of Section 708 of the Internal Revenue Code of 195486; and DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 7 (2) Such continuing partnership continues to hold the realty concerned. (b) If there is a termination of any partnership within the meaning of Section 708 of the Internal Revenue Code of 195486, for purposes of this Chapter, such partnership shall be treated as having executed an instrument whereby there was conveyed, for fair market value (exclusive of the value of any lien or encumbrance remaining thereon), all realty held by such partnership at the time of such termination. (c) Not more than one tax shall be imposed pursuant to this Chapter by reason of a termination described in subsection (b), and any transfer pursuant thereto, with respect to the realty held by such partnership at the time of such termination. 6.96.090 Administration by County Recorder as to First Tier Tax and County Collected Portion of Second Tier Tax Absent Second Tier Tax Agreement. The County Recorder shall administer this Chapter in conformity with the provisions of Part 6.7 of Division 2 of the Revenue and Taxation Code and the provisions of any County ordinance adopted pursuant thereto. The City Manager of the City of Santa Monica is authorized to negotiate and enter into a contract with the County of Los Angeles or one of its officials for the administration of this Chapter and payment to the County for its costs of administration. Until the effective date of a Second Tier Tax Agreement, the County shall administer and collect: (1) the entirety of any First Tier Tax; and (2) the County Collected Portion of any Second Tier Tax. Following the effective date of a Second Tier Tax Agreement, the County will collect: (1) the entirety of any First Tier Tax; and (2) the entirety of any Second Tier Tax as provided in the Second Tier Tax Agreement. The City Manager is authorized to negotiate, modify, and enter into a contract with the County or one of its officials for the administration of this Chapter and payment to the County for its costs of administration. 6.96.095 Administration of City Collected Portion of Second Tier Tax by recording party or agent. Unless a Second Tier Tax Agreement has been executed and the City has provided at least 90-days notice on its website of the effective date of said agreement in accordance with Section 6.96.036, the City Collected Portion of any Second Tier Tax shall be administered as follows: (a) Any entity (including any escrow company, title company, or taxpayer as defined in Section 6.96.030, or agent thereof) that records any deed or written instrument subject to the Second Tier Tax Rate set forth by Section 6.96.020(b) shall be responsible for ensuring that the City Collected Portion of the Second Tier Tax is collected and paid prior to said recording. (b) Escrow companies that are involved in a property sale or transfer to which the Second Tier Tax Rate applies shall ensure that either: (i) the City Collected Portion of the Second Tier Tax has been paid to the City prior to recording any deed or written instrument subject to the Second Tier Tax Rate; or DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 8 (ii) funds sufficient to cover the City Collected Portion of the Second Tier Tax have been set aside to be distributed to City at the time of recording. (c) the Director of Finance is authorized to promulgate any rules or regulations reasonably necessary to administer the City Collected Portion of the Second Tier Tax, as well as necessary forms and receipts. Following the effective date of a Second Tier Tax Agreement, the obligations imposed by subsections (a) and (b) of this Section 6.96.095 will cease to exist. 6.96.100 Refunds. Claims for refund of taxes imposed pursuant to this Chapter shall be governed by the provisions of Chapter 5 (commencing with Section 5096), of Part 9 Division 1 of the Revenue and Taxation Code of the State of California. The Director of Finance may issue rules or regulations reasonably necessary to establish and administer a refund application process (including any necessary forms or declarations) to issue any refunds due pursuant to the partial exemptions in Section 6.96.051. 6.96.110 Authority of Finance Director. (a) The Director of Finance is hereby designated as the officer of the City responsible for maintaining relations with the County of Los Angeles for the purpose of administering the tax imposed under this Chapter and receiving and accounting for the funds collected thereunder. (b) If the County of Los Angeles or the entities identified in Section 6.96.095 does not collect or administer the tax due under this Chapter, or if any tax owed is otherwise unpaid, then the Director of Finance shall have the power and duty to enforce all of the provisions of this Chapter. The Director of Finance, designee, or any third-party agent authorized by the Director of Finance may collect any unpaid tax through any lawful means. (c) The Director of Finance is authorized to issue any rules and regulations reasonably necessary to implement and administer this Chapter. In such case, the City tax is due prior to any recordation with the County of Los Angeles of any written instrument subject to the tax and the Director of Finance may make an assessment for taxes not paid and make refunds. 6.96.120 Due dates, delinquencies, penalties, interest, and administrative charges. The tax imposed under this Chapter is due and payable at the time the deed, instrument, or writing effecting a transfer subject to the tax is delivered to the County Recorder. Any such tax is delinquent if unpaid at the time of recordation. In cases where a transfer is effected but not recorded with the County Recorder within ninety (90) days of acceptance, all statutes of limitation regarding liability for this tax will be tolled until the City has actual knowledge of the transfer or recording, at which time the tax, penalties, and interest on the unrecorded transfer will relate back to the actual DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 9 transfer date of such unrecorded transfer. Any unpaid tax pursuant to this Chapter will be a joint and several liability of all taxpayers, as designated by Section 6.96.030 of this Chapter. If any tax is not paid prior to becoming delinquent, the Director of Finance may impose a delinquency penalty of up to ten percent of the amount of the tax due. To the extent permitted by law, the Director of Finance may establish rules and regulations that establish an applicable interest rate. The Director of Finance shall have the power to reduce or waive any penalty or interest applicable under this Chapter so long as such reduction or waiver is in writing and in compliance with any City-issued rules or regulations concerning this Chapter. Any request for reduction or waiver of any penalty or interest assessed pursuant to this Chapter shall be made in writing no later than thirty days following the assessment of such penalty or interest. 6.96.130 Declaration or additional records may be required. The tax imposed by this Chapter shall be paid to the City by the taxpayers referred to in Section 6.96.030. The Director of Finance shall have the authority as part of any rules and regulations promulgated by him or her as provided for herein to require that the payment shall be accompanied by a declaration of the amount of tax due signed by the person paying the tax or by his agent. The declaration shall include a statement of the value of the consideration on which the tax due was computed. The declaration also shall identify the property address and deed, instrument or writing effecting the transfer for which the tax is being paid. The Director of Finance, or designee, may require delivery of a copy of such deed, instrument or writing whenever reasonably necessary to adequately identify such writing or to administer the provisions of this Chapter. The Director of Finance, or designee, may rely on the declaration as to the amount of the tax due; provided, he or she has no reason to believe that the full amount of the tax due is not shown on the declaration. Whenever the Director of Finance, or designee, has reason to believe that the full amount of tax due is not shown on the declaration or has not been paid, he or she may, by notice served upon any person liable for the tax, require him or her to furnish a true copy of his or her records relevant to the value of the consideration or fair market value of the property transferred. Such notice may be served at any time within three years after recordation of the deed, instrument or writing which transfers such property. 6.96.140 Determination of deficiency. If on the basis of such information as the Director of Finance receives pursuant to the last paragraph of Section 6.96.130 and/or on the basis of such other relevant information that comes into his or her possession, he or she determines that the amount of tax due as set forth in the declaration, or as paid, is insufficient, he or she may recompute the tax due on the basis of such information. If the declaration required by Section 6.96.130 is not submitted, the Director of Finance may make an estimate of the value of the consideration for the property DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 10 conveyed and determine the amount of tax to be paid on the basis of any information in his or her possession or that may come into his or her possession. One or more deficiency determinations may be made of the amount due with respect to any transfer. 6.96.150 Notice of determination. The Director of Finance, or designee, shall give written notice to a person liable for payment of the tax imposed under this Chapter of his or her determination made under Section 6.96.140. Such notice shall be given within three years after the recordation of the deed, instrument or writing effecting the transfer on which the tax deficiency determination was made. 6.96.160 Manner of giving notice. Any notice required under this Chapter may be served personally or by mail; if by mail, service shall be made by depositing the notice in the United States mail, in a sealed envelope with postage paid, addressed to the person on whom it is to be served at his or her address as it appears in the records of City or as ascertained by the Director of Finance, or designee. The service is complete at the time of the deposit of the notice in the United States mail, without extension of time for any reason. 6.96.170 Petition for redetermination. Any person against whom a determination is made under this Chapter or any person directly interested may petition the Director of Finance for a redetermination within sixty (60) days after service upon the person of notice thereof. If a petition for redetermination is not filed in writing with the Director of Finance within the sixty (60) day period, the determination becomes final at the expiration of the period. 6.96.180 Consideration of petition for redetermination — Hearing. If a petition for redetermination is filed within the sixty (60) day period, the Director of Finance, or designee, shall reconsider the determination and, if the person has so requested in his petition, shall grant the person an oral hearing, and shall give him ten days' notice of the time and place of hearing. The Director of Finance may designate one or more deputies for the purpose of conducting hearings and may continue a hearing from time to time as may be necessary. 6.96.190 Determination of petition. The Director of Finance, or designee, may decrease or increase the amount of the determination before it becomes final, but the amount may be increased only if a claim for the increase is asserted by the Director of Finance, or designee, at or before the hearing. DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 11 6.96.200 Finality of determination. The order or decision of the Director of Finance, or designee, upon a petition for redetermination becomes final thirty (30) days after service of notice thereof upon the petitioner or at the time of hearing of redetermination. There is no appeal of the Director of Finance's (or designee’s) decision to the City Council; writs challenging the Director's decision conveyed by his/her deputies at an administrative hearing must be filed with the appropriate court within ninety (90) days of the final date of such redetermination. (California Code of Civil Procedure § 1094.6.) 6.96.210 Tax a debt. The amount of any tax, penalties, and interest imposed under the provisions of this Chapter shall be deemed a debt to the City. Any person owing money to the City under the provisions of this Chapter shall be liable to an action brought in the City’s name for the recovery of such amount. 6.96.220 Tax a lien. The amount of tax, penalties and interest imposed under the provisions of this Chapter is assessed against the property upon the transfer of which the tax is imposed, and if not paid when due, such tax shall constitute an assessment against such property and shall be a lien on the property for the amount thereof, which lien shall continue until the amount thereof including all penalties and interest are paid, or until it is discharged of record. Any person owing money to the City under the provisions of this Chapter shall be liable to an action brought in the name of the City for the recovery of such amount. 6.96.230 Notice of hearing on lien. The Director of Finance shall file with the City Manager a written notice of those persons on whom the City will file liens. Upon the receipt of such notice the City Manager shall present same to the City Council, and the City Council shall forthwith, by resolution, fix a time and place for a public hearing to confirm such liens. The Director of Finance shall cause a copy of such resolution and notice to be served upon the transferor or transferee of property not less than ten days prior to the time fixed for such hearing. Such service shall be by mailing a copy of such resolution and notice to the transferor or transferee of property at his or her last known address. Service shall be deemed complete at the time of deposit in the United States mail. 6.96.240 Collection of delinquent taxes by special tax roll assessment. With the confirmation of the lien by the City Council pursuant to the hearing set forth in Section 6.96.220, the delinquent tax charges contained therein which remain unpaid by the transferor or transferee shall constitute a special assessment against said DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 12 property, and shall be collected at such time as is established by the County Auditor- Controller for inclusion in the next property tax assessment. The Director of Finance shall turn over to the County Auditor-Controller for inclusion in the next property tax assessment the total sum of unpaid delinquent charges consisting of the delinquent transfer taxes, penalties and interest at the rate of twelve (12) percent per annum from the date of recordation to the date of lien. Thereafter, said assessment may be collected at the same time and in the same manner as ordinary municipal taxes are collected, and shall be subject to the same penalties and the same procedure of sale as provided for delinquent, ordinary, municipal taxes. The assessment lien previously imposed upon the property are paramount to all other liens except for those of state, county, and municipal taxes with which it shall be upon parity. The lien shall continue until the assessment and all interest and charges due and payable thereon are paid. All taxes applicable to the levy, collection and enforcement of municipal taxes shall be applicable to said special assessments. 6.96.250 Administrative Penalties. Any person violating or failing to comply with any provision of this Chapter may be subject to any of the penalties set forth in Section 1.08.010 of the Santa Monica Municipal Code. Each such violation or failure shall constitute a separate offense. Neither the City’s pursuit of any such penalties nor the imposition of any such penalties shall excuse any person from the payment, collection or remittance of any tax provided for in this Chapter. 6.96.260 Authority of City Council to establish rules and amend Chapter The City Council is authorized to establish by resolution any rules that are necessary and desirable for implementation of this Chapter. The City Council is authorized to amend any aspect of this Chapter as long as the amendment does not result in an increase in the authorized tax rate. 6.96.270 Severability If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this Chapter or any part thereof is for any reason held to be invalid, unlawful or unconstitutional, such decision shall not affect the validity of the remaining portions of this Chapter or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases be declared unconstitutional. DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 13 SECTION 2. Any provision of the Santa Monica Municipal Code inconsistent with the provisions of this measure, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this measure. SECTION 3. If any section, subsection, sentence, clause, or phrase of this measure is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this measure. The City Council hereby declares that it would have placed this measure and the resulting Santa Monica Municipal Code amendment, and the voters declare that they would have adopted this measure and the resulting Santa Monica Municipal Code amendment, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional, without regard to whether any portion may be subsequently declared invalid or unconstitutional. DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27 Adopted and approved this 28th day of July 2020. __________________________ Kevin McKeown, Mayor I, Denise Anderson-Warren, City Clerk of the City of Santa Monica, do hereby certify that Resolution No. 11278 (CCS) was duly adopted at a meeting of the Santa Monica City Council held on the 28th day of July 2020, by the following vote: AYES: Councilmembers Davis, Himmelrich, McCowan, Jara, Winterer, Mayor Pro Tem O’Day, Mayor McKeown NOES: None ABSENT: None ATTEST: _____________________________________ Denise Anderson-Warren, City Clerk DocuSign Envelope ID: 65E666B7-DBEC-4F45-B627-51FCACAA1E27