resolution 81926 report 1

8/12/2019 Resolution 81926 Report 1

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years. The cannabis business classification tax and the transactions and use tax also will be be forethe City Council on A pril21,2009.

Resp ectfully submit-t-ed,

/ (ohn A. RkJsCity Attom eyAttorneyAssigned: Kathleen Salem-Boyd

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INTRODUCED BY CQUNCHt tA P P R O V E D A S T O FO R M A N D L E G A L ;

MBER /

OAKLAND CITY COUNCILRES OLU TION NO. C.M.S.

A RESOLUTION SUBMITTING TO THE VOTERS AT THE NEXT SPECIALELECTION, NOT LESS THAN 88 DAYS AND NOT MORE THAN 150 DAYSFROM PASSAGE OF THIS RESOLUTION A PROPOSED ORDINANCEAMENDING THE REAL PROPERTY TRANSFER TAX, CHAPTER 4.20 OF THEOAKLAND MUNICIPAL CODE, TO CLARIFY APPLICATION OF THE TAX TOTRANSFERS OF REAL ESTATE RESULTING FROM CHANGES IN THEOWNERSHIP AND CONTROL OF CORPORATIONS AND OTHER LEGALENTITIES WITHOUT INCREASING THE TAX R ATE ; TO ADD A DEFINITION OFP E R S O N TO THE TAX; REQUESTING THE SERVICES OF THE REGISTRAROF VOTERS; AND DIRECTING THE CITY CLERK TO TAKE ANY AND ALLACTIONS NECESSARY UNDER LAW TO PREPARE FOR AND CONDUCT THESPECIAL ELEC TION.

W HE RE AS , pursuant to Chapter 4 .20 o f the Oak land Mu nic ipa l Cod e, the C ity o fOakland imposes a real property t ransfer tax on t ransfers of real property located inO a k l a n d ; andW HE RE AS , the Counci l determines that a l though not express ly s ta ted in the langua geof the ordinance, i t was the intent of the Counci l to impose the tax on al l t ransfers of realproperty unless expressly excepted f rom taxat ion; andWHEREAS, t ransfers of real property occurr ing as a resul t of changes in the ownershipof corporat ions, and other legal ent i t ies, through mergers, consol idat ions, andacquis i tions escap e taxat ion, whi le Oak land h omeo wners and smal l bus inesses pay thereal estate t ransfer tax; andWHEREAS, the Counci l determines that i t is in the best interest of the Ci ty of Oaklandto submit an amended real property transfer tax to the voters that wi l l clari fy the intent ofthe ord inanc e to fa ir ly and equal ly tax all t ransfers o f real property, including t ransfers ofreal property that resul t f rom changes in ownership and control of corporat ions andother legal ent i t ies; andWHEREAS, accordingly, wi thout increasing the tax rate, the Ci ty Counci l of the Ci ty ofOakland desi res to amend Chapter 4.20, sect ions 4.20.020 and 4.20.030 of theOak land Munic ipa l ; and

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WHEREAS, all revenues received from the tax will be deposited in the general fund ofthe C ity to be expended for general fund purpose s; now, therefore, be itRESOLVED: That the City Council of the City of Oakland does hereby request that theBoard of Supervisors of Alameda County order the Special Municipal election consistentwith the provisions of state law; and be itFURTHER RESOLVED: That the City Council of the City of Oakland does herebysubmit to the voters at the special election not more than 88 days and not more than150 days from the da te of passage of this resolution the text of the proposed ordinance,which shall be as follows:AN OR DINANCE AMENDING THE REAL PROPERTY TRANSFER TAX, CHAPTER4.20 OF THE OAKLAND MUNICIPAL CODE, TO CLARIFY APPLICATION OF THETAX TRANSFERS OF REAL ESTATE RESULTING FROM CHANGES OWNERSHIPAND CONTROL OF CORPORATIONS AND OTHER LEGAL ENTITIES.Be it ordained by the People of the City of Oakland :

Se ct ion 1. The Municipal Code is hereby amended to ad d, delete, or modifysections as set forth below (section numbers and titles are indicated in bold type;additions are indicated by underscoring and deletions are indicated by strike-throughtype; portions of the regulations not cited or not shown in underscoring or strike-throughtype are not changed).Se ctio n 2. Co de Am en dm en t. Section 4.20.020 of the Oakland MunicipalCode is hereby amended to read as follows:4.20.020 Imposition of tax.There is imposed a tax on all transfers by deed s, instruments, writings, or anyother docum ent, or changes in control and ownership of legal entities, bv whichany lands, tenements or other interests in real property located in the city, are oris granted, ass igned, transferred, orothenA/ise conveyed to or invested in atransferee, or transferees thereof, w hich shall be levied at the rate of one andone-half (1.50) percent of the value of consideration.Such tax shall be administered to conform to California state law, tho statowidoftjles-Qverning tho dooumontary transfer tax as stated in California Revenue andTaxa tion C ode S octions 11911 through 11930, as codified on the date ofpassag e of the ordinance cod ified in this se ction, including tho ox emptions fromtax4i^t are itemizod therein, except where the exemptions appearing within thisQhapiQrA.2Q, provide greater protection to tho taxpavor. The express definitionsand provisions of this Chapter shall determine application of the real propertytransfer tax.Se ctio n 3. Cod e Am en dm en t. Section 4.20.030 of the Oakland MunicipalCode is hereby amended to read as follows:

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4.20.030 Defini t ions.As used in this chapter:Chanc es in control and ownership of legal entities means any direct or indirectacGuisition or transfer of ownership interest or control in a legal entity that

constitutes a change in ownership or transfer of the real property of the entityunder California Revenue and Taxation Cede section 64 . as such statute existson June 3. 2009.Person and persons mean any natural person, receiver, administrator,executor, assigne e, trustee in bankruptcy, trust, estate,f irm, co-partnership, iointventure, club, company , ioint stock compan y, business trust, limited liabilitycom pany, municipal corporation, political subdivision o f the state of C alifornia,dom estic or foreign corpo ration, association, syndicate, society, or any group ofindividuals acting as a unit, whether mutua l, cooperative, fraternal, nonprofit, orotherw ise, and the United States or any instrumentality thereof, and any natural

person,who as an individual or with a spouse, owns fifty-one (51%) percent ormore of the capital stock of a corporation obligated to file a declaration and paytax pursuant to this chapter: and in addition, is a person with the power to controlthe fiscal decision-making process by which the corporation allocates funds tocreditors in preference to its tax obligations under the provisions of this chapter.A person as defined herein, who is also an officer or director of a corporationobligated to file declarations and pay tax pursuant to this chapter, shall bepresumed to be a person with the power to control the fiscal decision-makingprocess. W heneve r the term person is used in any clause prescribing andimposing a penalty, the term as applied to association shall mean the owners or.part owners thereof, and as applied to c orporation, the officers thereof.Real property and realty mean real property as defined by and under the lawsof the state of California.Value of consideration means the total consideration, valued in money of theUnited States, paid or delivered, or contracted to be paid or delivered in return forthe transfer of real property, including the amount of any indebtedness existingimmed iately prior to the transfer which is secured by alien,deed of trust or otherencumbrance on the property conveyed and which continues to be secured bysuch lien,deed of trust or encumbrances after such transfer, and also includingthe amount of any indebtedness which is secured by a lien,deed of trust orencum brance given or placed upon the property in connection with the transfer to

secure the paym ent of the purchase price or any part thereof which remainsunpaid at the time of transfer.Value of the consideration also includes the amount of any special assessm entlevied or imposed upon the property by a public body, district or agency, wheresuch special assessm ent is a lien or encumbrance on the property and thepurchaser or transferee agrees to pay such special assessm ent or takes theproperty subject to the lien of such special assessment. The value of any lien orencum brance of a type other than those which are hereinabove specifically549142 - 3 -


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included, existing immediately prior to the transfer and remaining after suchtransfer, shall not be included in determining the value of the consideration. If thevalue of the consideration cannot be definitely determ ined, or is left open to befixed by future contingencies, value of the consideration shall be deemed tomean the fair m arket value of the property at the time of transfer, after deductingthe amount of any lien or encum brance, if any, of a type which w ould beexcluded in determining the value of the consideration pursuant to the aboveprovisions of this section.Unless a transfe r is a gift , i.e., free and clear of liens or encum brances, it ispresumed that the value of consideration of a given property being transferred isthe fair market value of that property, unless circumstances supporting adeparture the refrom can be furnished to the sole satisfaction of the D irector or hisor her designee{s).Se ct ion 4 . Se ve rab ility. Should any provision of this Ordinance, or its .application to any person or circumstance, be determined by a court of competentjurisdiction to be un lawful, unenforceable or otherwise void, that determination shall

have no effect on any other provision of this Ordinance or the application of thisOrdinance to any other person or circumstance a nd, to that end, the provisions hereofare severable.Se ction 5. Ma iori tv Ap pr ov al: Effective Date. This Ordinance shal l beeffective only if approved by a majority of the voters voting thereon and shall go intoeffect ten (10) days after the vote is declared by the City Counc il.Se ction 6. C ou nc il Am en dm en ts. The City Council of the City of Oakland ishereby authorized to amend Sections 4.20.020 and 4.20.030of the Oakland MunicipalCode as adopted by this Ordinance in any m anner that does not increase the rate of the

real estate transfer tax, othenwise constitute a tax increase for which voter approval isrequired by Article XIII C of the California Constitution or entirely dispense with therequirement for independent audits stated in Section 4.28.190.FURTH ER R ES OL VE D: That the City Council of the City of Oakland does hereby findand de termine that pursuant to Article XIIIC, section 2(b) of the California Constitutionthe C ity C ouncil of the City of Oakland has ad opted a resolution declaring the existenceof a fiscal em ergency in tlie C ity of Oakland that necessitates asking the voters toapprov e the am endm ent to the real estate transfer tax tax before the next regularelection of the Oakland City C ouncil; and be it

FURTHER RESOLVED: That in accordance with the Elections Code and Chapter 3 ofthe O akland Municipal Cod e, the City Clerk shall fix and determine a date forsubmission of arguments for or against said proposed ordinance , and said date shall beposted in the Office of the City Clerk; and be itFURT HER RE SO LVE D: That in accordance with the Elections Code and Chapter 3 ofthe Oakland Municipal Code, the City Clerk shall provide for notice and publication as tosaid proposed ordinance in the manner provided for by law; and.be it5 49 14 2 - 4 -


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FUR THER RE SO LVE D: That the City Council does hereby request that the Registrarof Voters of the C ounty of Alameda perform necessary services in connection with saidelection.FUR THE R R ES OL VE D: That the City Clerk is hereby directed to obtain printing,supplies and services as required.FUR THER RE SO LVE D: That the City Clerk is hereby authorized to provide such otherservices and supplies in connection with said election as m ay be required by theStatutes of the State of C alifornia and the Charter of the City of Oakland.FUR THER RE SO LVE D: That the City Clerk and City Adm inistrator are herebyauthorized and d irected to take any and all actions necessary under law to prepare forand conduct the special election and appropriate all monies necessary for the CityAdm inistrator and C ity Clerk to prepare and conduct the spe cial election, consistent withlaw.

IN COUNCIL, OAKLAND, CALIFORNIA, , 2009PASSED BY THE FOLLOWING VOTE:AYES- BROOKS, PRESIDENT BRUNNER, KAPLAN, KERNIGHAN, NADEL, QUAN.

REID,AND DE LA FUENTENOES-ABSENT-ABSTENTION

Attest: LaTonda SimmonsCity Clerk and Clerk of theCouncil of the City ofOakland,California

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resolution 81926 report 1

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