TC Ord. No. 2002-18 Adding a use tax on construction materialsTOWN OF AVON
ORDINANCE NO. 02-18
SERIES OF 2002
AN ORDINANCE ADDING A USE TAX ON
CONSTRUCTION MATERIALS.
BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON,
COLORADO:
Section 1. Chapter 3.08 of the Avon Municipal Code is amended as follows:
(a) Title. The title of chapter 3.08 is amended to state "SALES AND USE TAX."
(b) 43.08.020. Taxable items. A new subpart D. is added to state as follows:
"D. Upon the purchase price paid for or the acquisition costs of
construction materials brought within the boundaries of the town for the
purpose of being used to build, construct, reconstruct, alter, expand, modify or
improve any building, dwelling or other structure or improvement to real
property in the town."
(c) 43.08.030. Sales tax levy.
(i) The title of §3.08.030 is changed to state "Sales and use tax levy."
(ii) Section 3.08.030C is repealed and reenacted to state as follow:
"The retailer shall add the sales tax imposed hereto to the sale or charge of the
item sold, showing such tax as a separate and distinct item, and, when added,
such tax shall constitute a part of such price or charge, shall be a debt from the
purchaser to the retailer until paid and shall be recoverable at law in the same
manner as other debts."
(iii) A new subpart E. is added to state as follows:
"E. (1) A use tax of four percent is imposed upon the purchase price paid for
or the acquisition costs of construction materials brought within the
boundaries of the town for the purpose of being used to build, construct,
reconstruct, alter, expand, modify or improve any building, dwelling or other
structure or improvement to real property in the town.
1
(2)(a) Any person who shall build or improve any dwelling or other
structure or improvement to realty within the town, including underground
improvements, and who shall purchase the necessary construction materials
needed therefor from any source inside or outside of the town, shall remit to
the Finance Director prior to the issuance of any building permit for such
improvement full payment of the use tax, to be calculated as provided herein.
The full amount of the use tax shall be due and payable at the time that the
applicable building permit is issued. The estimate of the cost of the
construction materials shall be determined by the Town Building Official in
the manner set forth below, and the amount of the tax shall be subject to
adjustment if the actual cost of the construction materials needed for the
improvement is either less than or greater than the estimate. Upon payment of
the use tax, the Finance Director shall issue the taxpayer a receipt identifying
the property that is the subject of the tax and the building permit number.
(b) For the purpose of calculating the amount of the use tax as
provided for herein, the value of the construction materials in the
improvement shall be estimated to be equal to fifty percent of the total value
of the improvement as determined by the Building Official for building permit
purposes. The use tax obligation shall be an amount equal to four percent of
such estimated value of the construction materials.
(c) If it is determined by the Finance Director through audit or other
means that the actual cost of the construction materials for the improvement is
greater than the estimate on which the tax was based, and that additional tax is
owing, then the Finance Director shall make a demand to the taxpayer for the
additional use tax owed together with interest calculated pursuant to §
3.08.353; provided, in no case may the Finance Director make a claim for
amounts due more than three years after a certificate of occupancy or final
inspection approval has been issued by the town for the improvement. A
taxpayer's failure to honor the Finance Director's claim for additional tax due,
as set forth in this paragraph, shall constitute a violation of this chapter.
(3) All use tax funds collected by the Town in accordance with the
provisions of this chapter shall be appropriated and spent solely for
transportation and recreation capital projects and services and infrastructure
related thereto."
(d) & 3.08.320. Sales tax - Credit for sales or use taxes previously paid to
another municipality.
(i) The title of § 3.08.320 is changed to state "Sales and use tax - Credit
for sales or use taxes previously paid to another municipality."
(ii) Section 3.08.320 is repealed and reenacted to state as follow:
2
"For transactions consummated on or after January 1, 1986, the town's sales tax shall
not apply to the sale of tangible property at retail or the furnishing of services if the
transaction was previously subjected to a sales or use tax lawfully imposed on the
purchaser or user by another statutory or home rule municipality equal to or in excess
of that provided for in Section 3.08.030. A credit shall be granted against the town's
lawfully imposed local sales or use tax previously paid by the purchaser or user to the
previous statutory or home rule municipality. The amount of the credit shall not
exceed the town's sales or use tax imposed pursuant to Section 3.08.030."
Section 2. Section 3.08.035 of the Avon Municipal Code is amended as follows:
"3.08.035 Tax Credit. Notwithstanding any other provisions of this chapter, there
shall be granted to each person owing 1) the sales tax on sales consummated within
The Village (at Avon) or 2) the use tax on the purchase price paid or the acquisition
costs of construction materials brought within the boundaries of the Town for the
purpose of being used to build, construct, reconstruct, alter, expand, modify or
improve any building, dwelling or other structure or improvement to real property
within The Village (at Avon) a temporary tax credit against collection of the tax equal
to the amount of any retail sales or use fee paid by or on behalf of such person. The
amount of the credit shall not exceed the amount of the tax. No such credit shall shall
be granted subsequent to termination of the collection of the retail sales fees and use
fees terminate pursuant to the Annexation and Development Agreement for The
Village (at Avon). Neither the ability of the Town to grant the temporary tax credit
nor the termination of the credit shall constitute a tax increase, the imposition of a
new tax or a tax policy change."
Section 3. Election and Effective Date.
Under Article X, Section 20 of the Colorado Constitution, the Council refers the tax
increase provided in this ordinance to the qualified electors of the Town for approval at the
regular Town election scheduled for November 5, 2002. If approved by a majority of the
electors voting thereon, this ordinance shall become effective when the Town Clerk or other
designated election official duly files the required certificate of election, or on January 1,
2003, whichever occurs last.
Section 4. Ballot Title and Question.
The ballot title and question submitted to the electors shall be
as follows:
SHALL TOWN OF AVON TAXES BE INCREASED $1.6
MILLION ($1,600,000) ANNUALLY IN 2003, AND BY
WHATEVER ADDITIONAL AMOUNTS ARE RAISED
ANNUALLY THEREAFTER, BY THE IMPOSITION OF A
FOUR PERCENT (4%) USE TAX ON THE PRIVILEGE OF
USING OR CONSUMING IN THE TOWN ANY
CONSTRUCTION MATERIALS, SUCH USE TAX
REVENUES TO BE APPROPRIATED AND SPENT
SOLELY FOR TRANSPORTATION AND RECREATION
CAPITAL PROJECTS AND SERVICES AND
INFRASTRUCTURE RELATED THEREO, ALL IN
ACCORDANCE WITH ORDINANCE NO. 02-18 ADOPTED
BY THE TOWN COUNCIL; AND SHALL THE REVENUES
COLLECTED FROM SUCH TAX AND ANY EARNINGS
FROM THE INVESTMENT OF SUCH REVENUES BE
COLLECTED AND SPENT AS A VOTER APPROVED
REVENUE CHANGE AND AN EXCEPTION TO THE
LIMITS WHICH WOULD OTHERWISE APPLY UNDER
ARTICLE X, SECTION 20 OF THE COLORADO
CONSTITUTION OR ANY OTHER LAW?
INTRODUCED, APPROVED ON FIRST READING, AND ORDERED
PUBLISHED IN FULL AND POSTED, this 9th day of July, 2002, and a public hearing on
this ordinance shall be held at the regular meeting of the Town Council of the Town of Avon,
Colorado on the 27th day of August, 2002, at 5:30 p.m. in the Municipal Building of the
Town of Avon, Colorado.
TOWN OF AVON, COLORADO:
ATT
To Cl rk
yor
4
INTRODUCED, APPROVED ON SECOND READING, AND ORDERED
PUBLISHED AND POSTED this 27th day of August, 2002.
TOWN OF AVON, COLORADO:
~Jyor
ATT
oc-
To Cl rk
EARS
APPROVED AS TO FORM:
Town ttorney
STATE OF COLORADO )
COUNTY OF EAGLE ) SS
TOWN OF AVON
NOTICE IS HEREBY GIVEN OF A PUBLIC HEARING BEFORE THE TOWN COUNCIL
OF THE TOWN OF AVON, COLORADO AT 5:30 P.M. ON THE 27TH DAY OF AUGUST
2002, AT THE TOWN OF AVON MUNICIPAL BUILDING FOR THE PURPOSE OF
CONSIDERING THE ADOPTION OF ORDINANCE NO. 02-18, SERIES OF 2002:
AN ORDINANCE ADDING A USE TAX ON
CONSTRUCTION MATERIALS.
A copy of said Ordinance is attached hereto, and is also on file at the office of the Town Clerk, and
may be inspected during regular business hours.
Following this hearing, the Council may consider final passage of this Ordinance.
This notice is given and posted by order of the Town Council of the Town of Avon, Colorado
Dated this 23rd day of August 2002.
TOWN OF AVON, COLORADO
BY: P ! "lc/
Patty Yel envy
Town Cie&
POSTED AT THE FOLLOWING PUBLIC PLACES WITHIN THE TOWN OF AVON ON
AUGUST 23, 2002:
AVON MUNICIPAL BUILDING, MAIN LOBBY
ALPINE BANK, MAIN LOBBY
AVON RECREATION CENTER, MAIN LOBBY
CITY MARKET, MAIN LOBBY
STATE OF COLORADO )
COUNTY OF EAGLE ) SS
TOWN OF AVON
NOTICE IS HEREBY GIVEN OF A PUBLIC HEARING BEFORE THE TOWN COUNCIL
OF THE TOWN OF AVON, COLORADO AT 5:30 P.M. ON THE 13TH DAY OF AUGUST
2002, AT THE TOWN OF AVON MUNICIPAL BUILDING FOR THE PURPOSE OF
CONSIDERING THE ADOPTION OF ORDINANCE NO. 02-18, SERIES OF 2002:
AN ORDINANCE ADDING A USE TAX ON
CONSTRUCTION MATERIALS.
A copy of said Ordinance is attached hereto, and is also on file at the office of the Town Clerk, and
may be inspected during regular business hours.
Following this hearing, the Council may consider final passage of this Ordinance.
This notice is given and posted by order of the Town Council of the Town of Avon, Colorado
Dated this 6`" day of August, 2002.
TOWN OF AVON, COLORADO
BY: 201 /~c
Pa " cKenn
Town Clerk
POSTED AT THE FOLLOWING PUBLIC PLACES WITHIN THE TOWN OF AVON ON
AUGUST 6, 2002:
AVON MUNICIPAL BUILDING, MAIN LOBBY
ALPINE BANK, MAIN LOBBY
AVON RECREATION CENTER, MAIN LOBBY
CITY MARKET, MAIN LOBBY
• •
STATE OF COLORADO )
COUNTY OF EAGLE ) SS
TOWN OF AVON
NOTICE IS HEREBY GIVEN OF A PUBLIC HEARING BEFORE THE TOWN COUNCIL
OF THE TOWN OF AVON, COLORADO AT 5:30 P.M. ON THE 23RD DAY OF JULY 2002,
AT THE TOWN OF AVON MUNICIPAL BUILDING FOR THE PURPOSE OF
CONSIDERING THE ADOPTION OF ORDINANCE NO. 02-18, SERIES OF 2002:
Ordinance 02-18, Series of 2002 - An Ordinance Adding a Use Tax on Construction
Materials
A copy of said Ordinance is attached hereto, and is also on file at the office of the Town Clerk, and
may be inspected during regular business hours.
Following this hearing, the Council may consider final passage of this Ordinance.
This notice is given and posted by order of the Town Council of the Town of Avon, Colorado
Dated this 19th day of July, 2002.
TOWN OF AVON, COLORADO
BY: c
Pay c envy
Town erk
POSTED AT THE FOLLOWING PUBLIC PLACES WITHIN THE TOWN OF AVON ON
JULY 19,2002:
AVON MUNICIPAL BUILDING, MAIN LOBBY
ALPINE BANK, MAIN LOBBY
AVON RECREATION CENTER, MAIN LOBBY
CITY MARKET, MAIN LOBBY
SARA.I. FISHER
EAGLE COUNTY CLERK & RECORDER
MEMORANDUM
TO: Colorado Secretary of State
Colorado River Water Conservation District
stern Eagle County Metropolitan Recreation District
own of Avon
Town of Basalt
Town of Gypsum
Town of Vail
RE-1 Roaring Fork School District
Crown Mountain Park & Recreation District
FROM: Sara J. Fisher
DATE: November 15, 2002
RE: November 5, 2002 General Election Results
P.O. Box 537
500 Broadwav
Eagle. Colorado 81631-0537
(970)328-8710
\V\V\V.ea2 1C-countv.com
Recording: (970) 328-872;;
Fax: (970) 328-8716
TDD: (970) 328-8797
Enclosed please find a certified copy of the Official Abstract of Votes Cast for the election. Also
enclosed is a copy of the TABOR Notice that was mailed to all registered voters in Eagle County and
all eligible property owners for whom you provided labels. Additionally enclosed is a copy of the
certification of publication from The Eagle Valley Enterprise and The Valley Journal.
If you need additional copies of the Official Abstract of Votes Cast, please use this original being
sent to you and certify the copies you make accordingly.
I will be sending the bill for your District's election under separate cover the first week of December.
EAGLE COUNTY, COLORADO
SARA J. FISHER
EAGLE COUNTY CLERK & RECORDER.
BOARD OF CANVASS CERTIFICATION
STATE OF COLORADO
COUNTY OF EAGLE
P.O. Boa 537
500 Broadwa'v
E-aglc. Colorado 81631-0537
(970) 328-8710
www.eagle-county.com
Recording: (970) 328-S72;
Fax: (970)328-8716
TDD: (970) 328-8797
We, the undersigned Board of Canvass of the Election Returns of Eagle County, Colorado,
do hereby certify that the attached record, consisting of ten pages, is a true, full and correct copy of
the OFFICIAL Abstract of all votes cast at the November 5, 2002, General Election, as appears by
the returns of the ballots cast and on file in the office of the Eagle County Clerk & Recorder.
Witness our hands and the Sea] of Eagle County this 14th day of November, 2002.
E. Jo rown - Republican Party
Stephen . Richards - Democrat Party
U._ 1
aillie-Eagle County Election Deputy
J. Fisher 'Eagle County Clerk & Recorder
EAGLE COUNTY, COLORADO
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u
ORDINANCE NO. 02-18
'gad
SERIES OF 2002
NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF
AVON,COLORADO:
Section 1. Chapter 3.08 of the Avon Municipal Code is amended as follows:
(a) Title. The title of chapter 3.08 is amended to state "SALES AND USE TAX."
(b) 43.08.020. Taxable items. A new subpart D. is added to state as follows:
"D. Upon the purchase price paid for or the acquisition costs of
construction materials brought within the boundaries of the town for the
purpose of being used to build, construct, reconstruct, alter, expand, modify or
improve any building, dwelling or other structure or improvement to real
property in the town."
(c) 43.08.030. Sales tax levy.
(i) The title of §3.08.030 is changed to state "Sales and use tax levy."
(ii) Section 3.08.030C is repealed and reenacted to state as follow:
"The retailer shall add the sales tax imposed hereto to the sale or charge of the
item sold, showing such tax as a separate and distinct item, and, when added,
such tax shall constitute a part of such price or charge, shall be a debt from the
purchaser to the retailer until paid, and shall be recoverable at law in the same
manner as other debts."
(iii) A new subpart E. is added to state as follows:
"E. (1) A tax of four percent is imposed upon the purchase price paid for or
the acquisition costs of construction materials brought within the boundaries
of the town for the purpose of being used to build, construct, reconstruct, alter,
expand, modify or improve any building, dwelling or other structure or
improvement to real property in the town.
AN ORDINANCE ADDING A USE TAX ON
CONSTRUCTION MATERIALS.
(2) Any person who shall build or improve any dwelling or other structure
or improvement to realty within the town, including underground
improvements, and who shall purchase the necessary construction materials
needed therefore from any source inside or outside of the town, shall keep all
invoices and statements regarding such materials from both the general and
subcontractors, along with a summary sheet showing such purchases, and
shall, on or before the tenth day of each succeeding month following the start.
of construction, file a return with the Finance Director, to which he shall
attach such invoices, statements and. summary for the construction materials
purchased the previous month, and . shall thereupon pay to the Finance
Director the full amount of the use tax due thereon for the preceding month or
months. Any failure to preserve such statements and invoices, and to make
such return and payment of such use tax, shall be deemed a violation of this
chapter. The full amount of any use tax due and not paid for construction
materials shall be a lien upon the real property benefited by such
improvements, and the Finance Director is authorized to file a notice of such
lien with the County Clerk and Recorder.
(3)(a) Any person who shall build or improve any dwelling or other
structure or improvement to realty within the town, including underground
improvements, and who shall purchase the necessary construction materials
needed therefore from any source inside or outside of the town, may, at such
person's option, remit a deposit to the Finance Director prior to the issuance
of any building permit for such improvement, such deposit to insure and
indemnify the town for the amount of use tax due. The amount of the deposit
shall be based upon an estimate of the use tax to be payable on the
construction materials used for the improvement. Such estimate shall be
made, and such deposit shall be paid, at the time that the applicable building
permit is issued. The estimate of the cost of the construction materials shall
be determined by the Town Building Official, and the estimate shall be
subject to adjustment if the actual cost of the construction materials needed for
the improvement is either. less than or greater than such estimate. If the
taxpayer elects the deposit procedure set forth in this subsection (3), then the
provisions of subsection (2) hereof shall be waived. Upon payment of the
deposit as set forth herein, the Finance Director shall issue the taxpayer a
receipt identifying the property that is the subject of the deposit and the
building permit number.
(b) For the purpose of calculating the amount of the deposit as
provided for herein, the value of the construction materials in the
improvement shall be estimated to be equal to fifty percent of the total value
of the improvement as determined by the Building Official for building permit
purposes. The deposit shall be in the amount of four percent of such estimated
value of the construction materials.
(c) If it is determined by the Finance Director that the actual cost of
the construction materials for the improvement is.greater than the estimate
therefore, and that the amount of the use tax deposit is not sufficient to
2
provide for full payment of the use tax, then the Finance Director shall make a
demand to the. taxpayer for the additional use tax owed; provided, in no case
may the Finance Director make a claim for amounts due over and above the
amount of the deposit more than three years after a certificate of occupancy or
final inspection approval has been issued by the town for the improvement. A
taxpayer's failure to honor the Finance Director's claim for additional tax due,
as set forth in this paragraph, shall constitute a violation of this chapter.
(d) If it is determined by the Finance Director that the deposit is
sufficient to provide for full payment of the use tax, then the deposit shall be
used to pay the amount of the use tax due. If the Finance Director determines
that the amount of the deposit is in excess of the use tax owned, then he shall
return any excess amount of the deposit to the person who made the deposit
within thirty days of such determination.
(4) If a taxpayer purchases construction materials subject to the use tax
imposed herein from a vendor possessing a valid Town of Avon retail sales
tax license, and if he pays the town's sales tax at the time of purchase of such
construction materials, then he shall be entitled to a credit, to the extent of
such sales tax paid, to be applied to the amount of use tax owed.
(5) Construction materials subjected at the time of purchase to a sales or use
tax lawfully imposed on the purchaser by another statutory or home rule
municipality in the State of Colorado, if taxed at a rate equal to or greater than
the four percent rate provided for herein, are exempted from the Town of
Avon's use tax. If the rate of the sales or use tax imposed by such other
Colorado statutory or home rule municipality is less than four percent, the
difference between the tax due under this chapter and the tan paid by the
purchaser shall be due to the Town of Avon, and shall be remitted to the
Finance Director.
(6) All use tax funds collected by the Town in accordance with the
provisions of this chapter shall be appropriated and spent solely for
transportation and recreation capital projects and services."
(d) 4 3.08.320. Sales tax - Credit for sales or use taxes previously paid to
another municipality.
(i) The title of § 3.08.320 is changed to state "Sales and use tax - Credit
for sales or use taxes previously paid to another municipality."
(ii) Section 3.08.320 is repealed and reenacted to state as follow:
"For transactions consummated on or after January 1, 1986, the town's sales tax shall
not apply to the sale of tangible property at retail or the furnishing of services if the
transaction was previously subjected to a sales or use tax lawfully imposed on the
3
purchaser or user by another statutory or home rule municipality equal to or in excess
of that provided for in Section 3.08.030. A credit shall be granted against the town's
lawfully imposed local sales or use tax previously paid by the purchaser or user to the
previous statutory or home rule municipality. The amount of the credit shall not
exceed the town's sales or use tax imposed pursuant to Section 3.08.030."
Section 2. Election and Effective Date.
Under Article X, Section 20 of the Colorado Constitution, the Council refers the tax
increase provided in this ordinance to the qualified electors of the Town for approval at the
regular Town election scheduled for November 5, 2002. If approved by a majority of the
electors voting thereon, this ordinance shall become effective when the Town Clerk or other
designated election official duly files the required certificate of election, or on January 1,
2003, whichever occurs last.
Section 3. Ballot Title and Question.
The ballot title and question submitted to the electors shall be
as follows:
SHALL TOWN OF AVON TAXES BE INCREASED $1.6
MILLION ($1,600,000) ANNUALLY IN 2003, AND. BY
WHATEVER ADDITIONAL AMOUNTS ARE RAISED
ANNUALLY THEREAFTER, BY THE IMPOSITION OF A
FOUR PERCENT (4%) USE TAX ON THE PRIVILEGE OF
USING OR CONSUMING IN THE TOWN ANY
CONSTRUCTION MATERIALS, SUCH USE TAX
REVENUES TO BE APPROPRIATED AND SPENT
SOLELY FOR TRANSPORTATION AND RECREATION
CAPITAL PROJECTS AND SERVICES, ALL IN
ACCORDANCE WITH ORDINANCE NO. 01-08 ADOPTED
BY THE TOWN COUNCIL; AND SHALL THE REVENUES
COLLECTED FROM SUCH TAX AND ANY EARNINGS
FROM THE INVESTMENT OF SUCH REVENUES BE
COLLECTED AND SPENT AS A VOTER APPROVED
REVENUE CHANGE AND AN EXCEPTION TO THE
LIMITS WHICH WOULD OTHERWISE APPLY UNDER
ARTICLE X, SECTION 20 OF THE COLORADO
CONSTITUTION OR ANY OTHER LAW?
YES
4
NO
Section 4. Repealer.
If the electors approve this ordinance, then on the effective date specified above, all
ordinances or parts of ordinances in conflict herewith are hereby repealed, but only to the extent
of such inconsistency.
Section 5. Severability.
The provisions of this ordinance. are severable, and invalidity of any part shall not affect the
validity or effectiveness of the rest of this ordinance.
INTRODUCED, APPROVED ON FIRST READING, AND ORDERED
PUBLISHED IN FULL AND POSTED, this day of July, 2002, and a public hearing on
this ordinance shallCaie held at t e regular meeting of the Town Council of the Town of Avon,
Colorado on the a3 day of , 2002, at 5:30 p.m. in the Municipal Building of the
Town of Avon, Colorado,,,-
ATT
7,
Cp`p
Town lerk
TOWN OF AVON, COLORADO:
Wor
5
INTRODUCED, APPROVED ON S COND READING, AND ORDERED
PUBLISHED AND POSTED this-'1 %ay of )t,,L-t , 2002.
Q-T~WN OF AVON, COLORADO:
Wor
ATT T:
o C~
To Cle
APPROVED AS TO FORM:
Town Attorney
6
STATE OF COLORADO )
COUNTY OF EAGLE ) SS
TOWN OF AVON )
NOTICE IS HEREBY GIVEN OF A PUBLIC HEARING BEFORE THE TOWN COUNCIL
OF THE TOWN OF AVON, COLORADO AT 5:30 P.M. ON THE 23R) DAY OF JULY 2002,
AT THE TOWN OF AVON MUNICIPAL BUILDING FOR THE PURPOSE OF
CONSIDERING THE ADOPTION OF ORDINANCE NO. 02-18, SERIES OF 2002:
Ordinance 02-18, Series of 2002 - An Ordinance Adding a Use Tax on Construction
Materials
A copy of said Ordinance is attached hereto, and is also on file at the office of the Town Clerk, and
may be inspected during regular business hours.
Following this hearing, the Council may consider final passage of this Ordinance.
This notice is given and posted by order of the Town Council of the Town of Avon, Colorado
Dated this 19th day o
0 F
TOWN OF AVON, COLORADO
% :SEA L L
BY:
Pa Mc envy
~®LOOA®® To k
POSTED AT THE FOLLOWING PUBLIC PLACES WITHIN THE TOWN OF AVON ON
JULY 19, 2002:
AVON MUNICIPAL BUILDING, MAIN LOBBY
ALPINE BANK, MAIN LOBBY
AVON RECREATION CENTER, MAIN LOBBY
CITY MARKET, MAIN LOBBY
Memo
To: Honorable Mayor and Town Council
Thru: Bill Efting, Town Manager
From: Scott Wright, Finance Director
Date: August 9, 2002
Re: Use Tax Ordinance
Summary:
On July 9, Council passed on 1st reading a use tax ordinance that levied a 4% use tax on the use,
storage, or consumption of building materials within the Town of Avon. Subsequent to the 1st reading,
there have been several reviews of the various administrative and collection provisions of the ordinance
that were prompted by the Town's Annexation and Development Agreement with the Village at (Avon)
entities. As a result of these reviews, there are changes to the ordinance for 2nd reading as
summarized below:
■ Section 3.08.030 E. (2) of the original ordinance regarding collection of the use tax has been
changed to reflect that only projects required to have a building permit would be required to
pay a use tax. This change eliminates the reporting and tax burden on individuals with small
home improvement projects that don't require permits and eliminates any consumer use tax
issues from the ordinance.
■ Sections 3.08.030 E. (2)(a), (b), and (c) of the original ordinance regarding payment of the tax
at the time a building permit is issued have been changed to reflect that the full payment of the
tax is made, rather than a deposit. This change was necessary to remain consistent with the
concept that the use tax is levied at the time a building permit is issued.
■ Sections 3.08.030 E. (4) and (5) have been eliminated as duplicative with existing sections of
the existing sales tax code and unnecessary due to the changes above.
■ Section 3.08.030 E. (3) has been changed to add language allowing the use tax funds to be
used for infrastructure related to transportation and recreation.
■ Section 3.08.035 has been added to grant a credit against the use tax fee collected by the
Village at (Avon) for permitted projects occurring within the Village.
Page 1
Town Manager Comments:
Attachments:
Ordinance No. 02-18 - Black Line Version
0 Page 2
ORDINANCE NO. 02-18
SERIES OF 2002
AN ORDINANCE ADDING A USE TAX ON
CONSTRUCTION MATERIALS.
NOW, THH FORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF
AVON,COLORADO:
Section 1. Chapter 3.08 of the Avon Municipal Code is amended as follows:
(a) Title. The title of chapter 3.08 is amended to state "SALES AND USE TAX."
(b) 43.08.020. Taxable items. A new subpart D. is added to state as follows:
"D. Upon the purchase price paid for or the acquisition costs of
construction materials brought within the boundaries of the town for the
purpose of being used to build, construct, reconstruct, alter, expand, modify or
improve any building, dwelling or other structure or improvement to real
property in the town."
(c) 43.08.030. Sales tax lees.
(i) The title of §3.08.030 is changed to state "Sales and use tax levy."
(ii) Section 3.08.030C is repealed and reenacted to state as follow:
"The retailer shall add the sales tax imposed hereto to the sale or charge of the
item sold, showing such tax as a separate and distinct item, and, when added,
such tax shall constitute a part of such price or charge, shall be a debt from the
purchaser to the retailer until paid and shall be recoverable at law in the same
manner as other debts."
(iii) A new subpart E. is added to state as follows:
"E. (1) A use tax of four percent is imposed upon the purchase price paid for
or the acquisition costs of construction materials brought within the
boundaries of the town for the purpose of being used to build, construct,
reconstruct, alter, expand, modify or improve any building, dwelling or other
structure or improvement to real property in the town.
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(2)(a) Any person who shall build or improve any dwelling or other
structure or improvement to realty within the town, including underground
improvements, and who shall purchase the necessary construction materials
needed therefore from any source inside or outside of the town, may, a4 sueh
p , shall remit a depesit to the Finance Director prior to the
issuance of any building permit for such improvement full payment of the use
tax, to be calculated as provided herein ,
the tew f - the ° nt of use tax a--° The full amount of the depesit use tax
shall be due and navable base' ueea an estimate of the use tam to be ~
paid, be made, and sueh depesit shall be at the time that the applicable
building permit is issued. The estimate of the cost of the construction
materials shall be determined by the Town Building Official in the manner set
forth below, and the °e amount of the tax shall be subject to adjustment
if the actual cost of the construction materials needed for the improvement is
either less than or greater than seeh the estimate. if the taxpa~,er- eleets
depesit pr-eeedufe set feAh in this s-74-4 b- Se e t i An (3), then the pmvisiefls 0
subseetien (2) her-eef shall be waived-. Upon payment of the use tax depesit-as
°t f fth h, the Finance Director shall issue the taxpayer a receipt
identifying the property that is the subject of the depesit tax and the building
permit number.
(b) For the purpose of calculating the amount of the depesit use tax as
provided for herein, the value of the construction materials in the
improvement shall be estimated to be equal to fifty percent of the total value
of the improvement as determined by the Building Official for building permit
purposes. The depesit use tax obligation shall berme an amount of equal to
four percent of such estimated value of the construction materials.
2
t
(c) If it is determined by the Finance Director through audit or other
means that the actual cost of the construction materials for the improvement is
greater than the estimate on which the tax was based tie, and that
additional tax is owing then nt of the use tax depe,it ; net suf- ei°nt t„
P=o vide f r- full payment of the • ° to*, then the Finance Director shall make a
demand to the taxpayer for the additional use tax owed together with interest
calculated pursuant to & 3.08.353; provided, in no case may the Finance
Director make a claim for amounts due over and above the amount of the
deposit more than three years after a certificate of occupancy or final
inspection approval has been issued by the town for the improvement. A
taxpayer's failure to honor the Finance Director's claim for additional tax due,
as set forth in this paragraph, shall constitute a violation of this chapter.
_(d) if it is determined b
the Fi
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(3) All use tax funds collected by the Town in accordance with the
provisions of this chapter shall be appropriated and spent solely for
transportation and recreation capital projects and services and infrastructure
related thereto."
(d) § 3.08.320. Sales tax - Credit for sales or use taxes previously paid to
another municipality.
(i) The title of § 3.08.320 is changed to state "Sales and use tax - Credit
for sales or use taxes previously paid to another municipality."
3
(ii) Section 3.08.320 is repealed and reenacted to state as follow:
"For transactions consummated on or after January 1, 1986, the town's sales tax shall
not apply to the sale of tangible property at retail or the furnishing of services if the
transaction was previously subjected to a sales or use tax lawfully imposed on the
purchaser or user by another statutory or home rule municipality equal to or in excess
of that provided for in Section 3.08.030. A credit shall be granted against the town's
lawfully imposed local sales or use tax previously paid by the purchaser or user to the
previous statutory or home rule municipality. The amount of the credit shall not
exceed the town's sales or use tax imposed pursuant to Section 3.08.030."
Section 2. Section 3.08.035 of the Avon Municipal Code is amended as follows:
"3.08.035 Tax Credit. Notwithstanding any other provisions of this chapter, there
shall be granted to each person owing 1) the sales tax on sales consummated within
The Village (at Avon) or 2) the use tax on the purchase price paid or the acquisition
costs of construction materials brought within the boundaries of the Town for the
purpose of being used to build, construct, reconstruct, alter, expand, modify or
improve any building, dwelling or other structure or improvement to real property
within The Village (at Avon) a temporary tax credit against collection of the tax equal
to the amount of any retail sales or use fee paid by or on behalf of such person. The
amount of the credit shall not exceed the amount of the tax. No such credit shall shall
be granted subsequent to termination of the collection of the retail sales fees and use
fees terminate pursuant to the Annexation and Development Agreement for. The
Village (at Avon). Neither the ability of the Town to grant the temporary tax credit
nor the termination of the credit shall constitute a tax increase, the imposition of a
new tax or a tax policy change_" .
4
Section 2 3. Election and Effective Date.
Under Article X, Section 20 of the Colorado Constitution, the Council refers the tax
increase provided in this ordinance to the qualified electors of the Town for approval at the
regular Town election scheduled for November 5, 2002. If approved by a majority of the
electors voting thereon, this ordinance shall become effective when the Town Clerk or other
designated election official duly files the required certificate of election, or on January 1,
2003, whichever occurs last.
Section -3 4. Ballot Title and Question.
The ballot title and question submitted to the electors shall be
as follows:
SHALL TOWN OF AVON TAXES BE INCREASED $1.6
MILLION ($1,600,000) ANNUALLY IN 2003, AND BY
WHATEVER ADDITIONAL AMOUNTS ARE RAISED
ANNUALLY THEREAFTER, BY THE IMPOSITION OF A
FOUR PERCENT (4%) USE. TAX ON THE PRIVILEGE OF
USING OR CONSUMING IN THE TOWN ANY
CONSTRUCTION MATERIALS, SUCH USE TAX
REVENUES TO BE APPROPRIATED AND SPENT
SOLELY FOR TRANSPORTATION AND RECREATION
CAPITAL PROJECTS AND SERVICES AND
INFRASTRUCTURE RELATED THEREO, ALL IN
ACCORDANCE WITH ORDINANCE NO. 01 08 02-18
ADOPTED BY THE TOWN COUNCIL; AND SHALL THE
REVENUES COLLECTED FROM SUCH TAX AND ANY
EARNINGS FROM THE INVESTMENT OF SUCH
REVENUES BE COLLECTED AND SPENT AS A VOTER
APPROVED REVENUE CHANGE AND AN EXCEPTION
TO THE LIMITS WHICH WOULD OTHERWISE .APPLY
UNDER ARTICLE X, SECTION 20 OF THE COLORADO
CONSTITUTION OR ANY OTHER LAW?
5
if the-eleeter-s fie-this -ewee, then en the-effies4ive date spesified abeve, all
er,dinamees or- aAs of ` r-di anew in ` enfl et herewith are hereby eale a but enAy to the °40..4
The provisions of tMs " -difial}se-ar~aei bleu and invalidity of an pap shall not a f f `.t thee
INTRODUCED, APPROVED ON FIRST READING, AND ORDERED
PUBLISHED IN FULL AND POSTED, this 9th day of July, 2002, and a public hearing on
this ordinance shall be held at the regular meeting of the Town Council of the Town of Avon,
Colorado on the 23rd day of July, 2002, at 5:30 p.m. in the Municipal Building of the Town
of Avon, Colorado.
TOWN OF AVON, COLORADO:
Mayor
ATTEST:
Town Clerk
6
INTRODUCED, APPROVED ON SECOND READING, AND ORDERED
PUBLISHED AND POSTED this _ day of , 2002.
TOWN OF AVON, COLORADO:
Mayor
ATTEST:
Town Clerk
APPROVED AS TO FORM:
Town Attorney
7