REPORT TO COUNCIL
SUBJECT
Title
Adopt Resolutions Authorizing (1) the City Manager to Execute Certain Documents Required by the State Board of Equalization to Collect the City's Utility Users Tax on Prepaid Wireless Service; and (2) Establishing the List of City Staff and Consultants authorized to Examine Prepaid Mobile Telephony Services Surcharge and Local Charge Records of the State Board of Equalization
Report
BACKGROUND
The City of Sunnyvale collects a Utility Users Tax (UUT) at a rate of two percent on telecommunication, gas and electricity from businesses and residents in the City. The UUT assessed on wireless telecommunication charges is collected by service providers. However, prepaid wireless services sold by retailers historically avoided paying any UUT because services are provided without a contract or monthly invoice.
Beginning January 1, 2016, Assembly Bill 1717 enacted a new surcharge and required local jurisdictions to contract with the California State Board of Equalization (BOE) to receive UUT revenue imposed on prepaid wireless consumers. In order to contract with the BOE, a UUT ordinance that includes prepaid wireless services is required.
The telecommunication services defined in the City of Sunnyvale's original UUT ordinance referenced now-outdated federal laws. Due to numerous changes in technologies and changes to state and federal laws, the City Council placed Measure N on the ballot for voter approval to modernize the City's UUT ordinance in order to protect UUT revenue.
At the General Municipal Election held on November 8, 2016, the voters approved Measure N updating the existing UUT ordinance. The telecommunications section was modernized to reflect updated uses of telecommunications technology and to treat wired, wireless (contract or prepaid) and other telecom services equally.
ENVIRONMENTAL REVIEW
The adoption of the resolutions does not constitute a "project" with the meaning of the California Environmental Quality Act ("C...
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