R-6778
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CA:RMM:rm6100r
C1ty Counc11 Meeting 11-8-83
Santa Mon1ca, California
RESOLUTION NUMBER
6778
(C1ty Counc11 Ser1es)
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SANTA MONICA
ESTABLISHING APPORTIONMENT GUIDELINES
WHEREAS, on November 9, 1983, the C1ty Counc11 of the C1ty
Council of the City of Santa Monica adopted Ordinance Number 1289
(CCS) revis1ng the bus1ness license tax structure of the C1ty of
Santa Monica; and
WHEREAS, because the reV1S1ons contained in the ordinance
e11rn1nate eX1Stl.ng maX1mum tax levels, issues of apport1onment
are 11kely to arise in the adminl.stratl.on of the City's business
11cense tax; and
WHEREAS. the City Council desires to prov1de general
gU1delines for apport1onment,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA
MONICA DOES RESOLVE AS FOLLOWS:
SECTION 1.
In developing apportlonment rules and
regulat1ons, the followlng guide11nes shall be cons1dered:
A. The C1ty of Santa Monica may l.nclude withl.n gross
rece1pts upon which the bus1ness l1cense tax 15 measured recelpts
from both within the City of Santa Monl.ca and outside of the City
so long as such gross rece1pts are apportioned 1n a manner by
Wh1Ch the gross recel.pts fairly reflect that portion of gross
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receipts attr1butable to activlty Wh1Ch 1S carr1ed on w1thin the
City. See General Motors Cor~. v. C1ty of Los Angeles, 5 Cal.
3d 229, 486 P.2d 163, 95 Cal. Rptr. 635 (1971): City- of Los
Anseles v. Shell 011 Co., 4 Cal. 3d 108, 480 P.2d 953, 93 Cal. 1
(1971).
B. No measure of apportlonment shall be developed
Wh1Ch does not lim1t the measure of the City's business license
tax to act1vitles which bear a falr relationship to activity
actually taklng place wlthln the Clty. See General Motors Cor~.
v. Clty of Los Angeles, 5 Cal. 3d 229,486 P.2d 163,95 Cal.
Rptr. 635 (1971): City of Los Angeles v. Shell 011 Co., 4 Cal. 3d
108, 480 P.2d 953, 93 Cal. 1 (1971).
C. Wholesale sales of products manufactured in the
City shall be taxed on the basis of total gross rece1pts
regardless of where the sales occur. See General Motors Corp.
v. City of Los Anse1es, 5 Cal. 3d 229, 486 P. 2d 163, 95 Cal.
Rptr. 635 (1971); Carnation Co. v. Clty of Los Angeles, 65 Cal.
2d 36, 416 P.2d 129, 52 Cal. Rptr. 225 (1966).
D. Wholesale sales of products manufactured outside
of the C1ty and shipped W1th1n the Clty shall be taxed only on
the baS1S of gross receipts apportloned to reflect sell1ng
act1vit1es withln the C1ty. See General Motors Corp. v. C1ty of
Los An<;1e1es, 5 Cal. 3d 229, 486 P.2d 163, 95 Cal. Rptr. 635
(1971); C1ty of Los Anseles v. Belridge Oil Co., 42 Cal. 2d 823,
271 P.2d 5 (1954).
E. Wholesale sales of products manufactured outslde
of the City and shlpped to pOlnts outside the Clty shall be taxed
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only on the bas~s of gross receipts apportioned to reflect
sell~ng activ~t~es w~thin the C~ty. See General Motors corp. v.
C~ty of Los Angeles, 5 Cal. 3d 229, 486 P.2d 163, 95 Cal. Rptr.
635 (1971); City of Los Angeles v. Moore Bus~ness Forms, Inc.,
247 Cal. App. 2d 353, 55 Cal. Rptr. 820 (1966).
F. Retail sales delivered from reta~l outlets wlth~n
the City shall be taxed on the bas~s of total gross receipts from
such reta~l outlets.
G. Reta~l sales del~vered from outlets outside the
C~ty to customers w~thin the City of Santa Monica after ~n-C~ty
solic~tat~on or consurnmatlon of orders shall be taxed only on the
bas~s of gross rece1pts apportioned to reflect sell~ng act~vltles
with~n the C~ty. See General Motors Cor~. v. Clty of Los
Angeles,S Cal. 3d 229, 486 P.2d 163, 95 Cal. Rptr. 635 (1971).
H. Gross rece~pts of bus~nesses subJect to an annual
11cense fee under Mun~c1pal Code Sect1.0n 6236 (professions and
occupations) and Munlcipal Code Sect~on 6240 (services) shall not
include the gross receipts attributable to bus1.ness locations
outs1de the C1.ty of Santa Monica and on which a bUSlness license
tax was pa1.d in the ]Ur1.Sd1ct1.0n l.n wh1.ch the bus1.ness 1S
located.
I. In determ1ning the amount of act1.Vlty to be
attr~buted to act1v~t~es w~th~n the City and the amount of
act1.vit1.es to be attributed to actiV1.tles outs1.de the Clty in
accordance with the gU1.dellnes establlshed l.n SUbsectlons A-H
above, a varlety of factors may be considered lncludlng:
employee tlme spent l.ns1.de and outs1.de the C1.ty; operating costs
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within the C~ty; locat~on of business act~v~ty w~th~n the C~ty;
negot~at~ng and sol~c~t~ng with~n the C~ty; display~ng of samples
w~th~n the City; processing of orders w~th~n the C~ty; acceptance
of orders w~th~n the C~ty; arrang~ng for del~very w~ th~n the
C~ty; del~very with~n the C~ty; and collect~on and b~ll~ng w~th~n
the City.
J. The apportionment rules and regulat~ons may be based
upon either separate or unitary account~ng principles.
SECTION 2. The C~ty Clerk shall cert~fy to the adoption of
th~s Resolut~on, and thenceforth and thereafter the same shall be
in full force and effect.
APPROVED AS TO FORM:
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Robert M. Myers
C~ty Attorney
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ADOPTED AND APPROVED THIS
8th
DAY
OF
November
, 1 983 .
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MAYOR Pro Tempore
I HEREBY CERTIFY THAT THE FOREGOING RESOLUTION
NO.
6778
_WAS DULY ADOPTED BY THE CITY COUNCIL OF THE
CITY OF SANTA MONICA ~T A MEETING THEREOF HELD ON
November 8 , 1983 BY THE FOLLOWING COUNCIL VOTE:
AYES: COUNC I U1EMBERS: Conn, EpsteJ.n, JennJ.ngs, Press,
Reed and Zane
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: Edwards
ABSTAI~:
COUNCILMEMBER.S: None
ATTEST:
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CITY CLERK