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HomeMy WebLinkAboutOrdinance-1986-0696INTRODUCED BY COUNCILMEMBER Johnson ORDINANCE NO. 596 Series of 1986 TITLE: AN ORDINANCE REPEALING AND REENACTING, WITH AMENDMENTS, CHAPTER 21, TAXATION, ARTICLE 1, RETAIL SALES, OF THE CODE OF LAWS OF THE CITY OF WHEAT RIDGE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF WHEAT RIDGE, COLORADO: Section 1. Chapter 21, Taxation, Article 1, Retail Sales, of the Code of Laws of the City of Wheat Ridge is hereby repealed and reenacted, with amendments, as follows: Section 21-1. Definitions. As used herein, the following words and phrases shall have the following meanings: Auction: "Auction" means any sale conducted or transacted at a permanent place of business operated by an auctioneer, or a sale conducted and transacted at any other location where tangible personal property is sold by an auctioneer when such auctioneer when such auctioneer is acting either as agent for the owner of such personal property or is in fact the owner thereof. For purposes of this Chapter, the auctioneer at any sale defined in this Subsection is a retailer or vendor and the sale made by him is a retail sale as defined herein, and the business conducted by the auctioneer in accomplishing such sale constitutes the transaction of a business, except when the auctioneer is action as an agent for a duly licensed retailer or vendor when selling any tangible personal property which is exempt. Automotive Vehicle: "Automotive Vehicle" means any vehicle or device in, upon, or by which any person or property is or may be transported or drawn upon a public highway, or any device used or designed for aviation or flight in the air and upon which a specific ownership tax is imposed by the State of Colorado . Automotive vehicle includes, but is not limited to, motor vehicles, trailers, semi-trailers, mobile homes, mobile machinery or self-propelled construction equipment, as defined by the Colorado Revised Statutes for purposes of the imposition of specific ownership taxes and the registration of such vehicles or aircraft. Automotive vehicle shall not include devices moved by human power or used exclusively upon stationary rails or tracks. Carrier Access Service: "Carrier Access Service" means any charge by local telephone exchange companies to providers of telecommunications services for the latter's use in providing telecommunications services. Charitable Organization: "Charitable Organization" is an organization which, consistently with existing laws and for the benefit of an indefinite number of persons, freely and voluntarily ministers to the physical, mental, or spiritual needs of persons, and thereby lessens the burdens of government, which has applied for, been assigned, and furnished to the City a copy of their State of Colorado Certificate of Exemption. City: "City" means the City of Wheat Ridge, Colorado. Computer Software: "Computer Software" means the internalized instruction code which controls the basic operations (i.e., arithmetic and logic) of the computer, causing it to execute instructions contained in system programs, as an integral part of the computer. It is not normally accessible or modifiable by the user. A software program is one in which instructions and routines (programs) are determined necessary to program the customer's electronic data processing equipment to enable the customer to accomplish specific functions with his EDP system. The software may be in the form of: 1) Systems programs (except are considered tangible property that control the hardware itself assemble and process application 2) Applications programs perform business functions, or c for the instruction codes which in this definition) programs and allow it to compile, programs. programs that are created to ontrol, or monitor processes. 3) Pre-written (canned) programs that are either systems programs or application programs and are not written specifically for the user. 4) Custom programs created specifically for the user. Customer Access Service: "Customer Access Service" means any direct charge by local telephone exchange companies to the consumer. Gross Taxable Sales and Services: "Gross Taxable Sales and Services" means the total amount received in ;money, credit, property or other consideration valued in money from sales, leases, rentals and purchases at retail within the City, and taxable under the provisions of this Chapter, and shall include the cost of goods purchased tax free by the taxpayer or taken from his stock and used or consumed by him personally or used by him in the rendering of a service. 2 Local Exchange Company: "Local Exchange Company" means any person which provides public telephone or telecommunication exchange access lines, mobile telecommunications or channels necessary to effect the transfer of two-way voice or data grade information between the final user and the local telecommunications network. Mobile Machinery: "Mobile Machinery" means those vehicles, self-propelled or otherwise, which are not designed primarily for the transportation of person or cargo over the public highways, and those motor vehicles which may have originally been designed for the transportation of persons or cargo over the public highways, and those motor vehicles which may have originally been designed for transportation of persons or cargo, but which have been redesigned or modified by the mounting thereon of special equipment or machinery, and which may be only incidentally operated or moved over the public highways. This definition includes, but is not limited to, wheeled vehicles commonly used in the construction, maintenance and repair of roadways, the drilling of wells, and the digging of ditches. Newspaper: "Newspaper" means (a) a publication printed on newsprint, intended for general circulation, and published regularly at short intervals, containing information and editorials on current events and news of general interest; or (b) publications which meet the requisites of a legal newspapers as provided in Section 24-70-101 et seq., C.R.S. The term newspaper may not be extended to include: magazines, trade publications or journals, credit bulletins, advertising pamphlets, circulars, directories, maps, racing programs, reprints, newspaper clipping and mailing service or listings, publications that include an updating or revision service, books or pocket editions of books or other newspapers not otherwise qualifying under this Subsection. Non-Resident Vendor: "Non-resident Vendor" shall mean any retailer/vendor whose place of business is located outside the city. Person: "Person" shall mean any individual, firm, co-partnership, joint venture, corporation, estate or trust, receiver, trustee, assignee, lessee or any person acting in fiduciary or representative capacity, whether appointed by a court or otherwise, and any group or combination acting as a group and the plural as well as singular number. Purchase Price: "Purchase Price" means the price or cost to the user or consumer exclusive of any direct tax imposed by the federal and state governments and those imposed by this article, inclusive of sales by exchange for property, less the fair market value of property exchanged. 3 Retail sale: "Retail sale" means any sale, except sale for resale, within the city. The phrases "retail sales," "to engage in the business of sales at retail" and "on the purchase price paid or charged upon all sales and purchases of tangible personal property at retail within the City of Wheat Ridge," as used in the sentence and paragraph structure in this article, shall relate to retail sales as defined hereby. Retailer/vendor: "Retailer/vendor" means any person selling, leasing or a person doing a retail business, known to the trade and public as such, making sales to a purchaser, or leasing or renting to a purchaser or consumer at retail and not for resale, in the City or elsewhere, of tangible personal property or services subject to the tax imposed by this Chapter for use, storage, distribution or consumption within the City. To prevent evasion and to provide for more efficient administration, the term prevent evasion and to provide for more efficient administration, the term "retailer" shall include any salesman, representative, peddler or canvasser, whom, s an agent, directly or indirectly of the dealer, distributor, supervisor or employer under whom he operates or from whom he obtains the tangible personal property or services sold by him, makes sales or tangible personal property or services subject to the tax imposed herein; and in such event the agent shall be responsible for the collection and payment of the tax imposed, including but not limited to, whenever the principal of such agent refuses to become licensed as a vendor hereunder. Sale: "Sale" shall mean the exchange of property for property as well as for money, including installment and credit sales, conditional or otherwise, leases of personal property; and also including the sale of electrical energy, natural and manufactured gas, and telecommunications service. Sales Tax: "Sales Tax" means the tax levied on all sales, leases and rentals at retail on the basis of the purchase or sale price of purchases of tangible personal property and specific services taxable hereunder. Sales Tax Inspector: "Sales Tax Inspector" shall mean the City Treasurer, or other person or person designated by him, and shall likewise refer to the sales tax auditor or administrator. Storage: "Storage" means the keeping or retention of, or exercise of dominion or control over, or possession of tangible personal property under lease or purchase at retail within or without the city from a vendor. Tangible Personal Property: "Tangible Personal Property" shall mean any corporeal personal property which is in any manner perceptible to the senses. 4 Tax: "Tax" means the tax payable as provided in this article by the purchaser of a commodity or service subject to tax, or the aggregate amount of taxes due from the retailer or vendor for taxable sales during a collection and reporting period applicable as required herein. Taxable Sales: "Taxable Sale" means the sale to the user or consumer, exclusive of exempt sales as provided in this article. Taxpayer: "Taxpayer" means any person obligated to account to the Treasurer for taxes collected or to be collected under the terms of this article. Telecommunications Service: "Telecommunication Service" means the transport of signs, signals, writing, images, sounds, messages, data, or other information of any nature by wire, radio, light waves, electromagnetic, digital, or electronic means. Treasurer: "Treasurer" shall mean the City Treasurer, or his designee, including, not by way of limitation, the building inspector and the sales tax inspector. Use: "Use" means the exercise, for any length of time, by any person within the city, of any right, power, or dominion over tangible personal property by lease or purchase. Use Tax: "Use Tax" means the tax levied upon the privilege of using, storing, distributing or otherwise consuming tangible personal property and taxable services which property or service is purchased, leased or rented at retail and not subjected to the wheat Ridge Sales Tax, without regard to whether the property or service is purchased either from sources within or without the City. Wholesale Sale: "Wholesale Sale" means a sale by wholesalers to retail merchants, jobbers, dealers, or other wholesalers for resale and does not include a sale by wholesalers for resale and does not include a sale by wholesalers to users or consumers not for resale; and the latter sales shall be deemed retail sales, and subject to the provisions of this article. Wholesaler: "Wholesaler" means a person doing a regular organized wholesale or jobbing business, known to the trade as such, selling to retailers. Section 21-2. License - Required to engage in retail sales. (a) It shall be unlawful for any person to engage in the business of retail sales within the city, on and after the effective date of this article, without first having obtained a license therefor, which license shall be granted at no charge and issued by the treasurer upon the filing of an application in the form prescribed by the sales tax auditor. Such license shall be 5 in force until revoked, suspended, or transferred as hereinafter provided. A license shall be applied for and issued for each location if more than one location is used by the applicant in the conduct of business of sales at retail. (b) The Treasurer shall make available to any requesting vendor a map/location guide showing the boundaries of the city. For transactions consummated on or after January 1, 1986, the requesting vendor may rely on such map/location guide and any update thereof made available to such vendor in determining whether to collect a sales or use tax. No penalty shall be imposed or action for deficiency maintained against such a vendor who in good faith complies with the most recent map/location guide available to it. Section 21-3 Same - Transfer; revocation. (a) A license issued hereunder designating the place of business may be transferred to a new location by the filing with the treasurer of a notice of location change. In case a licensee shall sell his business, the then-existing license shall become void and a new license shall be issued by the treasurer for the location of the business upon the filing of an application for license by the new owner. The sales tax inspector shall have the power, at any time, upon violation by any holder of a license as provided for in this article of any of the regulations lawfully prescribed hereunder, or for violation of any provisions of the Code of the City or the Colorado State Statutes, to suspend or revoke any such license after ten days notice and a hearing before the Treasurer. Any device or method employed by the holder of a license to evade the payment of the tax provided for by this article shall be sufficient cause for revocation. (b) Continued operation/use of the license after revocation shall constitute a violation of this Chapter. Section 21-4. Sales tax - Property and service subject to tax. There is hereby levied and there shall be collected and paid a tax in the amount stated in section 21-7 as follows: on all sales and services taxable by the State of Colorado under the sales tax provisions of the Colorado Revised Statutes 1973, section 39-26-104, as amended, including, but not limited to, the following: The sale, purchase, lease, rental, or grant of license for use of tangible personal property, and any subsequent lease, rental, or sale of tangible personal property by any person to any consumer or purchaser, regardless of whether the person purchasing the subsequently leasing, renting or selling the personal property paid the tax imposed on his initial purchase and use of the property so acquired which is subsequently leased, rented, or sold. When a retail sale involves the exchange or trade-in of property, the tax shall be collected on the purchase 6 price paid or charged, including the fair market value of the property exchanged or traded-in at the time and place of exchange or trade-in. (b) There shall be levied a tax upon telecommunications services, except carrier access services as designated in section 21-5(i)(11), whether furnished by public or private corporations or enterprises for all interstate and intrastate telecommunications service originating from or received on telecommunications equipment in this city if the charge for the service is billed to a person in this city or billed to an affiliate or division of such person in any state or city on behalf of a person utilizing a service address within this city. For purposes of this section "telecommunication service" includes the installation of any telecommunications equipment or apparatus. A credit shall be allowed to the extent provided in section 21-11(d) for any telecommunications services subject to the tax herein that are also subject to a sales tax outside of this city. (c) Upon the charge within the city for electrical energy and natural or manufactured gas sold for domestic or commercial consumption and not for resale. (d) Meals furnished in any restaurant, eating house, hotel, motel, drugstore, club, resort or other place as follows: (1) on the selling price of meals, whether sold to the public or to employees. (2) on the cost of meals which are given to employees in return for their labor or services rendered or otherwise given away. (3) Meals provided to employees of the places mentioned in this paragraph (d) at no charge or at a reduced charge and which are considered as part of their_ salary, wages, or income shall be exempt from taxation under the provisions of this article. (e) Pay, cable or subscription television services sold, purchased, leased, rented, furnished, or used, including charges for service connections, installations, connection charges and all and any other similar charges made for such services. (f) Every retailer or vendor vending items of tangible personal property through coin-operated vending -machines shall be taxable and such retailer or vendor shall pay retail sales or use tax at the rate specified in Section 21-7 on the tangible personal property sold or vended in the coin-operated machine unless the sale shall be otherwise exempt as provided in this Chapter. Owners of vending machines that vend articles of tangible personal property are subject to sales or use tax on the 7 cost of the vending machines; provided that owners of coin operated devices that do not vend articles of tangible personal property are not subject to the sales or use tax on the cost of such devices; instead, the utilization of such machines are considered short term rentals of tangible personal property and the gross receipts are subject to the sales tax. (g) On the purchase price paid for sales of tangible personal property at retail to national banking associations and banks organized and chartered under the laws of the State of Colorado, for use within the city. (h) Machinery, machine tools and specific processing equipment and repair parts and replacements thereof, exclusively and directly used in manufacturing or processing tangible personal property. (i) On the entire amount charged for clothing purchased at retail. (j) Upon "used merchandise" which has previously been purchased and which has been remanufactured or rebuilt and, as so remanufactured or rebuilt, been sold to a subsequent owner. (k) Upon farm equipment not titled or registered as a motor vehicle. (1) On the design, development, writing, translation, fabrication, maintenance, lease, or transfer of computer program (software) services. (m) On the total lease or rental charges for storage lockers/units. Section 21-5. Same Exempt Sales. There shall be exempt from taxation under the provisions of this article the items of sales and services exempt from taxation by the state under the sales tax provisions of the Colorado Revised Statutes 1973, section 39-26-114, including, but not limited to, the following: (a) All direct sales to the United States government, to the State of Colorado, its departments and institutions, and the political subdivisions thereof in their governmental capacities only. (b) All direct sales, except of building materials and supplies as specified in Section 21-13, to charitable corporations, as defined in Section 21-1 in the conduct of their regular religious, charitable and elemosynary functions and activities. Any exempt organization which makes sales of tangible personal property to the public and which otherwise meets the definition of a retailer as set forth herein must have 8 a sales tax license and collect and remit tax in the same manner as any other retailer. The fact that the merchandise sold may have been acquired by gift or donation, or that the proceeds are to be used for charitable purposes, does not make the sales exempt from tax. (c) All sales which the city is prohibited from taxing under the constitution or laws of the United States or the State of Colorado. (d) All sales of cigarettes. (e) All charges for rooms and accommodations (see Chapter 21-53; Lodger's tax). (f) Motor fuel upon which there has been accrued or has been paid either the gasoline tax or special fuel tax required by Article 27 of Title 39, C.R.S., and which is not subject to refund. (g) Consideration received for labor or services sold, except those specific services defined as taxable, if such services are separately stated from the tangible personal property sold. Manufacturing or fabrication labor is not exempt. (h) Newspapers as defined in C.R.S. 24-70-102. (i) Construction and building materials, if the purchaser of such materials presents to the retailer a building permit or other documentation acceptable to the City evidencing that a local use tax has been paid or is required to be paid on the materials. (j) Tangible personal property 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 municipality, equal to or in excess of the rate established pursuant to Section 21-7. A credit shall be granted against the City's sales tax with respect to such transaction equal to the lawfully imposed local sales or use tax previously paid by the purchaser or user to the previous municipality. The amount of the credit shall not exceed the rate established pursuant to Section 21-7. (k) The sale price of property returned by the purchaser when the full sale price including the tax levied is refunded, either in cash or by credit. (1) Discounts from the original selling price if such discount or decrease in purchaser price and the corresponding decrease in sales tax due is actually passed on to the consumer. An anticipated cash discount to be allowed for payment on or before a given date is not an allowable adjustment to the selling price in determining gross taxable sales on any vendor's return 9 prior to the date when the customer actually receives the discount. Any adjustments in sale price such as allowable discounts, rebates, and credits cannot be anticipated and the tax must be based upon the original selling price unless such adjustments have actually been made prior to the filing of the return wherein such sale is reported; except that, if the price upon which the tax was computed and paid to the City by the vendor is subsequently readjusted, prior to the payment of the tax by the purchaser, a property credit may be taken against the tax due on the next subsequent return. (m) Additional provisions of exemption from the tax under this article: (1) All sales of tangible personal property if both the following conditions exist: the sales are to those who reside or do business outside the city for their use outside the city, and the article or commodity is delivered to the purchaser by common carrier, by mail or conveyed by the seller. (2) All sales of tangible personal property to a public utility doing business both within and outside the city, for use in its business outside the city, even though sale and/or delivery thereof is made within the city. (3) All sales of farm machinery, machinery parts, livestock, poultry, and livestock and poultry feeds and drugs, seeds and fertilizers to purchasers for use outside the city even though sale and/or delivery is made within the city, except that trucks of one-ton manufacturer-rated capacity or less and lawn and garden tillers, mowers and renovators are not to be considered as farm machinery. (4) All permits, licenses, service charges, fines and assessments, for benefit or penalty, charged by and in accordance with the Code of the City of Wheat Ridge. (5) All sales of personal property, provided that such sales are infrequently conducted, that the sale occurs at the residence of the owner, that the property to be sold was originally purchased for use by members of the household (i.e., garage sales, yard sales, etc.). (6) (a) All wholesale sales or sales of tangible personal property purchased for resale. Sales of tangible personal property to a person engaged in manufacturing or compounding for sale shall be deemed a wholesale sale when it meets all of the following conditions: 10 (i) The property is transformed in fact by the process of manufacture; (ii) The property becomes by the manufacturing processes a necessary and recognized ingredient, component and constituent part of the finished product; and (iii) The physical presence of the property in the finished product is essential to the use thereof in the hands of the ultimate consumer. (b) Sales of tangible personal property for use as containers, labels, and shipping cases to a person engaged in manufacturing or compounding for sale shall be deemed to be a wholesale sale when it meets all of the following conditions: (i) The property is used by the manufacturer or compounder to contain or label the finished product so manufactured or compounded; (ii) The property is sold by the manufacturer or compounder along with and as a part of the finished product; and (iii) The property is not returnable to the manufacturer for reuse. (7) The fair market value of any exchanged or traded-in property which is to be resold thereafter in the usual course of the retailer's business, if included in the full price of an article sold. (8) The exemption stated herein shall not include natural gas and/or electricity used in the processing or manufacturing of goods or commodities or substances. (9) All sales of drugs dispensed in accordance with a prescription, all sales of insulin in all its forms dispensed pursuant to the direction of a licensed physician, and all sales of prosthetic devices. (i) A "prescription" means any order in writing, dated and signed by a practitioner, or given orally by a practitioner, and immediately reduced to writing by the pharmacist, assistant pharmacist, or pharmacy intern, specifying the name and address of the person for whom a medicine, drug, or poison is ordered and directions, if any, to be placed on the label. (ii) A "prosthetic device" is an artificial part which aids or replaces a bodily function and which is 11 designed, manufactured or adjusted to fit a particular individual. The foregoing definitions also apply to prescription drugs and prosthetic devices for animals. (10) The sale of construction and building materials, as the term is used in section 29-2-109, C.R.S., if such materials are picked up by the purchaser and if the purchaser_ of such materials presents to the retailer a building permit or other documentation acceptable to the City evidencing that a local use tax has been paid or is required to be paid in another city. (11) "Carrier Access Services" by local telephone exchange companies to providers of telecommunication service for use in providing such service shall be deemed to be wholesale sales and shall be exempt from taxation under this section. (12) All sales of electrical energy and natural or manufactured gas sold for direct use in the commercial growth, for sale whether wholesale or retail, of plants and flowers. Section 21-6. Same - Disputes - Refunds - Limitation of Actions. (a) Should a dispute arise between the seller and purchaser as to whether or not any purchase, storage, use or consumption of a service or commodity is exempt under this article, nevertheless the seller shall collect and the purchaser shall pay such tax, and the seller shall thereupon issue to the purchaser an appropriate receipt showing the details of the transaction. Refunds may be applied for by submittal to the treasurer on forms prescribed and furnished by the sales tax auditor within sixty days of the date of purchase in instances of dispute, unintentional payment of tax on exempt purchases, or an overpayment of taxes reported and paid by any taxpayer to the treasurer. The treasurer shall forthwith, after receipt of the application for refund, submit same to the sales tax auditor for a determination of applicability. The treasurer shall disburse to the applicant a refund when such has been approved by the sales tax auditor, or notify the applicant in instances of disapproval by the sales tax auditor. (b) An application for refund of sales or use tax paid by a person who establishes that a tax was paid by another_ on a purchase, storage, use, or consumption made on behalf of a person entitled to an exemption and that a refund has not been granted to the person making the purchase, storage, use, or consumption, or of tax monies paid in error or by mistake, shall be made within three years after_ the date of purchase, storage, use, or consumption of the goods for which the refund is claimed. (c) All claims for refund shall be processed in the manner provided in section 21-20. 12 Section 21-7. Same - Schedule. There is hereby imposed a tax on all sales of commodities and services specified in section 21-4 and not otherwise exempted in section 21-5, in the amount of two percent of the purchase price. In order to avoid fractions of pennies, the following brackets shall be applicable to all taxable transactions: (a) On sales amounting to $0.19 to and including $0.84, a tax of ........................$0.01 (b) On sales amounting to $0.85 to and including $1.18, a tax of ........................$0.02 On sales in excess of one dollar, the tax shall be two cents on each full dollar of the sales price, plus the tax shown on the above schedule for the applicable fractional part of a dollar of each such sale price. Section 21-8. Same - Liability of retailer or vendor for collection. (a) Every retailer, vendor and wholesaler_ shall be liable for the collection of the tax as provided for in this article for sales at retail to the user or consumer, by adding the tax imposed hereby or the average equivalent to the sale price or charge as a separate and distinct item, and when added, such tax shall constitute a part of such total price or charge and shall be a debt from the consumer or user to the vendor until paid and shall be recoverable at law in the same manner as other debts. (b) Except provided in Subsections (1) and (2) of this Section, it shall be unlawful for any retailer to advertise or hold out or state to the public or to any consumer, directly or indirectly, that the Wheat Ridge Sales tax or any part thereof shall be assumed or absorbed by the retailer, or that it will not be added to the selling price of the property sold, or if added, that it or any part thereof shall be refunded. Any person violating any provision of this Section shall be subject to the penalties provided in this Chapter. (1) Nothing contained in this Section shall be deemed to prohibit any retailer selling malt, vinous or spirituous liquors by the drink from including in his sales price any Wheat Ridge Sales Tax. (2) Nothing contained in this Section shall be deemed to prohibit any owner or operator of vending machines or coin-operated devices from including in his sales price any Wheat Ridge Sales Tax. (3) No retailer shall advertise or hold out to the public in any manner, directly or indirectly, that the 13 tax levied by this chapter is not considered as an element in the sales price to the consumer. (c) The amount of gross sales which are represented by accounts not secured by a conditional sales contract or chattel mortgage and which are found to be worthless and are actually and properly charged off as bad debts for the purpose of the income tax imposed by the laws of the State of Colorado may be credited upon a subsequent payment of the tax herein. However, if any such accounts are hereafter collected by the taxpayer the tax shall be paid upon the amount so collected. Provided, such credit shall not be allowed with respect to any account or item therein arising from the sale of any article under a conditional sales contract or other title retention agreements for all or part of the purchase price or from the sale of any article when the seller takes a chattel mortgage on the tangible personal property to secure all or part of the purchase price. (d) The amount paid by the purchaser as, or in the nature of, interest or finance charges on credit extended in connection with the sale of any tangible personal property, if the interest or finance charges are separately stated from the consideration received for the tangible personal property transferred in the retail sale, and if included in the report of gross sales and services, are deductible from the gross sales and services. (e) If any vendor shall, during any reporting period, collect as a tax an amount in excess of the percentages set forth in Section 21-7 of his total taxable sales, he shall remit to the City Treasurer the full net amount of the tax herein imposed, and also such excess. The retention by the retailer to vendor of any excess tax collections or the intentional failure to remit punctually to the City Treasurer the full amount required to be remitted by the provisions of this Chapter is hereby declared to be a violation of this Chapter. Section 21-9. Same - Reports by vendor, payment of tax; monies collected to be held in trust. (a) Every vendor shall be liable as a taxpayer and responsible for the reporting to the treasurer and paying the tax at the rate of two percent of the net total of taxable sales or charges for service during the reporting period, plus any overage of collections of tax on sales or charges for service resulting from the use of the bracket system herein prescribed, less two percent of such total of the two, to cover the taxpayer's cost of collection and reporting. This two percent vendor's fee is 14 disallowed on any delinquent report. A reporting period shall be monthly for vendors exceeding a $100 tax liability per month, quarterly for a vendor with less than $300 in tax liability per quarter, and annual only upon approval of the sales tax inspector. A report shall be made and tax paid under the provisions of this article on or before the twentieth day of the month following the reporting period. Timely filing shall be evidenced by the postmark date. A report shall be made for each place of business if more than one location is used in the business of sales at retail within the city. (b) All monies paid by the purchaser to the retailer as taxes imposed by this Chapter shall be and remain the property of the city while in the hands of the retailer. Until paid to the treasurer, the monies shall be held in trust by the retailer for the sole use and benefit of the city. Failure by the retailer to pay the monies to the treasurer shall be a violation of this Code. Section 21-10. Sales or use tax - Deficiency. (a) The treasurer shall, as soon as practical after receipt of a taxpayer's report, recompute the tax by the use of known and visible factors and if the resulting recomputed tax is less than that shown and paid by the taxpayer, the difference shall be credited toward the taxpayer's obligation for the next reporting period. If the recomputed tax is more than that shown and paid by the taxpayer, the difference shall be recorded as a deficiency. The taxpayer shall be notified of the deficiency as provided in section 21-20. Willful disregard of the requirements for reporting, and remittance of tax due, or failing to respond within ten days to the treasurer's notice of deficiency, shall, in addition to constituting a violation of this Code, subject the taxpayer to penalties and interest provided in section 21-18(d). Section 21-11. Use Tax - Property subject to tax. (a) It is hereby declared to be the legislative intent of the city council that for the purposes of this article every person who, on and after the effective date of this article, stores, uses, distributes or consumes within the city any article of tangible personal property purchased at retail, and not stored or distributed in the normal function of wholesaling, is exercising a taxable privilege and shall be taxed therefor at the rate specified in section 21-13 hereof. It is hereby declared that every resident of the city or any person doing business within the city who purchases or leases tangible personal property for use, storage or consumption within the city from sources outside the city and taxable hereunder, and who has not paid the tax imposed by this article, shall make an application, file a return and pay the tax to the treasurer. The use, storage or consumption of tangible personal property includes for the purpose of this article materials, commodities and items of tangible personal property affixed to or made a part of 15 facilities and structures on real property owned or leased within the city. (b) Acquisition of business: The Wheat Ridge use tax shall be remitted on the price paid for tangible personal property which is acquired with the purchase of a business, and for use in the operation of a business. The tax shall be based on the price paid for such chattels as recorded in the bill of sale or agreement and constituting a part of the total transaction at the time of the sale or transfer, provided the valuation is as great or greater than the fair market value of such merchandise or chattels. Where the transfer of ownership is a package deal made by a lump sum transaction, the use tax shall be paid on the book value established by the purchaser for income tax depreciation purposes, or fair market value if no determination has been made. When a business is taken over in return for the assumption of outstanding indebtedness owed by former owners, the tax shall be paid on the fair market value of all taxable tangible personal property acquired by the purchaser. Such tax shall be reported on the intitial use tax return and remitted on or before the twentieth day of the month following the date of sale. Timely remittance shall be evidenced by the postmark date. (c) For purposes of this article, the storage of any article of tangible personal property, other than any construction and building materials purchased at retail and any motor and other vehicles purchased at retail on which registration is required, is subject to the provision that any article of tangible personal property located within the city for a continuous period of longer than sixty days shall be presumed to be in use or consumption rather than in storage and shall be subject to any applicable use tax the incidence of which tax shall apply from the date of the property's acquisition, subject to rebuttal as provided in subparagraph (1) of this subsection. (1) The taxpayer may rebut such presumption by satisfactory evidence that: (i) Such property is in fact in storage for use or consumption outside the jurisdiction of the city; and (ii) The taxpayer is doing business in another local jurisdiction and the nature of the taxpayer's business is such that storage is likely to occur for future use in another local jurisdiction. (2) For purposes of this section, storage ends and a taxable incident occurs when the property is taken out of storage and placed into use or is consumed. Such use or consumption includes removal from storage and being made available for 16 immediate or subsequent use or consumption at will, even if the use or consumption is not completed within the city. (c) Taxation of Leases. (1) In the case of any payment under a lease of thirty days or less, or in the case of any payment during the first thirty days of a lease or longer than thirty days, the sales tax on any lease payment shall be paid by the lessee and shall be remitted by the lessor to the city providing delivery of the property to the lessee occurs in the city. In the case of any payment after the first thirty days, the sales tax on any lease payment shall be paid by the lessee and shall be remitted by the lessor to the city providing the property is located in the city at the time the payment is due. (2) Payment and remittance of sales tax to the city pursuant to subparagraph (1) above shall be made on each payment made under the lease, including but not limited to each payment under any option to purchase contained in the lease, each payment for termination of the lease, and each payment for purchase of the leased property if the same is sold to the lessee after termination of the lease, regardless of the subsequent location of the property. (3) The city will collect use tax only from the lessee and only on any lease payment which is due when the property is located within the jurisdiction of the city. Such collection of use tax on a lease payment shall be subject to the credit provisions of section 21-11(d). (4) Any applicable use tax shall be imposed on the lessee and not on the lessor. (5) Any applicable use tax shall be based upon the full purchase price of the property. (6) If a lease is renewed, it shall be treated in the same manner as provided in this section. (d) Use Tax - Credit for Sales or Use Tax Previously Paid to Another Municipality. The City's sales and use tax shall not apply to the storage, use, or consumption of any article or tangible personal property the sale or use of which has already been subjected to a sales or use tax of another statutory or home rule municipality 17 legally imposed on the purchaser or user equal to or in excess of two percent (2%). A credit shall be granted against the city's use tax with respect to the person's storage, use, or consumption in the city of tangible personal property, the amount of the credit to equal the tax paid by him by reason of the imposition of a sales or use tax of the previous statutory or home rule municipality on his purchase or use of the property. The amount of the credit shall not exceed two percent (2%). (e) Use Tax - Nonapplicability to Use or Consumption Occurring More Than Three Years After Most Recent Sale. The City's u the use or consumption city which occurs more sale of the property, sale, the property has for the principal purp "Significant use" shal sales tax inspector on se tax shall not be imposed with respect to of tangible personal property within the than three (3) years after the most recent if, within the three years following such been significantly used within the state ose for which it was purchased. 1 be determined in the discretion of the a case-by-case basis. (f) Use Tax - Proration as Applied to Certain Construction Equipment. (1) Construction equipment located within the boundaries of the city for a period of more than thirty (30) consecutive days shall be subjected to the full applicable use tax of the city. (2) Construction equipment which is located within the boundaries of the city for a period of thirty (30) consecutive days or less shall be subjected to the city's use tax in an amount which does not exceed the amount calculated as follows: the purchase price of the equipment shall be multiplied by a fraction, the numerator of which is one and the denominator of which is twelve, and the result shall be multiplied by two (2%) percent. (3) Where the provisions of subsection (f)(2) of this section are utilized, the credit provisions of this section shall apply at such time as the aggregate sales and use taxes legally imposed by and paid to other statutory or home rule municipalities on any such equipment equal two (2%) percent. (4) In order to avail himself of the provisions of this section, the taxpayer shall comply with the following procedure: (i) Prior to or on the date the equipment is located within the boundaries of the city, 18 the taxpayer shall file with the city an equipment declaration on a form provided by the city. Such declaration shall state the dates on which the taxpayer anticipates the equipment will be located within and removed from the boundaries of the city, shall include a description of each such anticipated piece of equipment, and shall include such other information as reasonably deemed necessary by the city. (ii) The taxpayer shall file with the city an amended equipment declaration reflecting any changes in the information contained in any previous equipment declaration no less than once every ninety (90) days after the equipment is brought into the boundaries of the city or, for equipment which is brought into the boundaries of the city for a project of less than ninety (90) days duration, no later than ten (10) days after substantial completion of the project. (iii) The taxpayer need not report on any equipment declaration any equipment for which the purchase price was under $2,500. (5) If the equipment declaration is given as provided in subsection (f)(4) of this section, then as to any item of construction equipment for which the customary purchase price is under $2,500 which was brought into the boundaries of the city temporarily for use on a construction project, it shall be presumed that the item was purchased in a jurisdiction having a local sales or use tax as high as two percent and that such local sales or use tax was previously paid. In such case the burden of proof in any proceeding before the city, the Executive Director for the Department of Revenue, or the district court, shall be on the city to prove such local sales or use tax was not paid. (6) If the taxpayer fails to comply with the provisions of subsection (f)(4) of this section, the taxpayer may not avail himself of the provisions of subsection (2) of this section and shall be subject to the provisions of subsection (1) of this section (f). However, substantial compliance with the provisions of subsection (4) of this section shall allow the taxpayer to avail himself of the provisions of subsection (2) of this section M. 19 Section 21-12. Same Exemptions. There shall be exempt from the tax provided in section 21-11, the storage, use, distribution and consumption of the following: (a) Any tangible personal property or taxable services upon which the City retail sales tax has been paid to a vendor authorized and licensed to collect the same. (b) Tangible, personal property, which if it were sold at retail within the city, would be exempt from sales tax under the provisions of section 21-5, with the exception of disposable medical accessories, including, but not limited to, hypodermic syringes and needles or related accessories. (c) Tangible personal property brought into the city by a nonresident for his own use, storage, or consumption while temporarily within the city. (d) Tangible personal property of a resident which was acquired prior to his becoming a resident. (e) Any right to the continuous possession or use for three years or less of any article of tangible personal property under a lease or contract, only if the lessor has sought and been granted permission from the city to pay and has paid to the city a sales or use tax on such tangible personal property upon its acquisition. If such permission has not been sought or granted pursuant to this section the provisions of section 21-11(c) shall apply. (1) With regard to the right to the continuous possession or use for three years or less of any article of tangible personal property under a lease or contract, the lessor shall collect and remit sales tax on each lease payment received on such property, subject to the provisions of this section. (2) Where the lessor does not lease tangible personal property in the ordinary course of business and wishes to engage in a one-time transaction with respect to an article of tangible personal property, he may request permission from the city to pay a sales or use tax on such article of tangible personal property upon its acquisition, and the city may grant such permission. Section 21-13. Provisions Relative to Building materials and supplies. (a) Every person who builds, constructs, reconstructs, alters, expands, modifies or improves any building, dwelling, or 20 other structure or improvement to real property in the City, including all Federal, State, County, exempt institutions or private construction job sites, who is required to obtain a building permit for such activity, and who purchases lumber, fixtures, or any other building materials and supplies used therefore, or any other article or articles of any tangible personal property used therein, and every owner or lessee of realty or improvements thereon situate in this City, upon which any article or articles of tangible personal property acquired from sources within or without the City, are installed, attached or affixed, shall pay a use tax in either of two (2) ways: (1) By determining an estimated amount of the total cost of construction as established by the City Building inspector_ and stated on the building permit and multiplying that value by fifty percent (50%). This shall establish an estimated value upon which the City sales or use tax shall be computed and collected, either through the owner, lessee or general contractor. The term "cost of construction" shall include the cost of interior decoration but shall not include land cost; or (2) By obtaining a City sales and use tax license and making monthly reports and returns and remitting the tax on an actual cost basis. (b) City Treasurer or his authorized agent subsequently may conduct an audit to recompute the tax by comparing the estimated value of the building materials and supplies used therefore and the articles of tangible personal property used therein to the actual cost of the same. If the recomputed tax is greater than that shown and paid by the taxpayer, the taxpayer shall be notified of the deficiency in the manner set forth in Section 21-20. (c) No final inspection shall be made by the City Building Inspector, and no certificate of occupancy shall be issued unless all taxes due as provided in this Chapter, on all lumber, fixtures, and any other building materials and supplies used in or connected with the construction, reconstruction, alteration, expansion, modification, or improvement of any building, dwelling, or other structure or improvement to real property within the City have been paid or arrangement therefor made with the City Treasurer. In addition to the previously stated authority of the Chief Building Inspector, said Chief Building Inspector is expressly authorized to issue "Stop Work orders" upon discovery of the failure or refusal of a person subject to the use tax hereby imposed to remit the same or work adequate arrangements for remitting said use taxes. Section 21-14. Non-Resident Vendor. (a) It shall be unlawful for any nonresident vendor to engage in business in the city without first having obtained a license in accordance with section 21-2. Any nonresident vendor 21 engaged in business in the city shall have the same tax liability and responsibility for reporting and collecting the city use tax on sales to city residents as a resident vendor has with respect to sales tax pursuant to this chapter. (b) For purposes of this section, "Engaged in business in the City" means the selling, leasing, renting, delivering or installing in the City of tangible personal property or taxable services by a retail sale as defined in this Section for purchase, use, storage, distribution, or consumption within the City. This term shall include, but shall not be limited to the following acts or methods of transacting business: (1) Maintaining within the City, directly indirectly or by a subsidiary, an office, distributing house, sales room or house, warehouse or other place of business. (2) Soliciting, either by direct representatives, indirect representatives manufacturers' agents or by distribution of catalogues or other advertising, or by use of any communication media, or by use of the newspaper, radio or television advertising media, or by any other mans whatsoever, of business from persons residing in the City, and by reason thereof receiving orders from, or purchasing, leasing, or renting tangible personal property or taxable services to such persons residing in the City or selling, leasing or renting for use, consumption, storage or distribution in the City. In the event that the sales tax inspector has reasonable cause to believe that a nonresident vendor is engaged in business in the city without first having obtained a license, he may schedule a hearing before the treasurer or his designee, upon not less then ten days' written notice to the nonresident vendor, to determine whether or not such vendor is engaged in business within the city, and order shall issue, directing the vendor to obtain a license or cease doing business in the city, which order shall be appealable to the district court in accordance with law. (c) In the event that a nonresident vendor fails to comply with such order and continues to engage in business in the city, the sales tax inspector may seize and impound any personal property of the vendor, or his agent, located in the city and used in any manner in furtherance of or to facilitate the transaction of the vendor's business in the city. The vendor shall be notified of the impoundment and shall have the right to demand an administrative hearing to be held not later than five working days from the date of seizure, unless the vendor requests a later date. The hearing officer at such hearing shall determine only whether or not the impounded property was used in furtherance of or to facilitate the transaction of business by 22 the vendor_ in the city. If no hearing is demanded or if a hearing is held and it is determined that the property was so used, it shall be held until the vendor has obtained a license. If it is determined at the hearing that the property was not so used, it shall be released forthwith. The determination of the hearing officer shall be appealable to the district court pursuant to Rule 106(a)(4) of the Colorado Rules of Civil Procedure. (d) If the vendor fails to apply for a license within the thirty days from the date of impoundment, the sales tax inspector may estimate the taxes due in accordance with section 21-18 and collect such taxes pursuant to this article from the proceeds of the impounded property. Section 21-15. Motor Vehicles. (a) No motor vehicle, defined as any vehicle, including any device in or upon which any person or property is or may be transported or drawn upon a public highway, road or street, or any device used or designed for aviation or for flight in the air and upon which a specific ownership tax is imposed by the state, which is purchased by a resident of the city or other person for use within the city, shall be registered in Jefferson County, nor shall title to a motor vehicle as defined herein be transferred within Jefferson County by the county clerk of the respective county, if the tax imposed by the provisions of this article has not been paid. (b) The determination of the address of registration for the purpose of establishing liability under this article for sales or use taxes on motor and other vehicles required to be registered shall be made pursuant to the criteria established in C.R.S. 42-6-137: Section 21-16. Burden of proof as to exemption; keeping of records. (a) The burden of proving that any person is exempt from taxation or any article or commodity is exempt under the provisions of this article shall be upon the person asserting the claim for exemption. It shall be the duty of every person engaging or continuing in business within the city or otherwise subject to the tax under the provisions of this article or a person requiring a license under section 21-2 or 21-14 hereof to keep and preserve suitable records of all sales and transactions as may be necessary from time to time to determine the applicability of the provisions of this article thereto, and to keep such invoices, sales memoranda, books and records for a period of three years; and they shall be open at any time for examination by the sales tax inspector or his agents. Failure to keep and preserve suitable records as required by this section shall be a violation of this code. 23 (b) Required records need not be stored or kept within the city, but if they are not, they must be, upon request of the sale tax inspector, produced for inspection either at the taxpayer's place of business within the city or at the Wheat Ridge City Hall no later than fourteen days from the date of request. (c) When the sales tax inspector has scheduled an audit_ or examination of the records required herein not less than fourteen days in advance, and has so notified the vendor or taxpayer, and the taxpayer fails to make available the records required hereunder at the appointed time, he shall pay to the city costs of twenty-five dollars; provided, however, that costs shall not be assessed if: (1) A postponement is approved by the sales tax inspector, for good cause shown, not less than seven days before the scheduled audit; or (2) Sufficient notice is given within seven days that the sales tax inspector is able to schedule and conduct an audit of another taxpayer at the appointed time in lieu thereof. Section 21-17. Transfer of ownership of Business; Renewal, Transfer or Issuance of Business License: (a) Any retailer who shall sell out his business or stock of goods, or shall quit business shall be required to file a final return as provided in this Chapter within ten (10) days of the date of the sale of his business or stock of goods or of quitting business. The purchaser of any business shall be responsible for determining whether any sales or use tax including penalties and interest, is owed for that business and shall withhold a sufficient amount from the purchase money to cover the amount of all outstanding sales and use tax due the City, including any penalties and interest, until such time as the former owner shall produce a receipt from the City Treasurer showing that the taxes, and any penalties and interest, have been paid or a certificate that no taxes, penalties or interest are due. if the purchaser of a business or stock of goods fails to withhold the purchase money as provided in this Section, and the taxes, penalties or interest are due and unpaid after the ten (10) day period allowed he, as well as the vendor, shall be personally liable for the payment of the taxes, penalties and interest unpaid by the former owner. Likewise, anyone who takes any stock of goods or business fixtures of or used by a retailer under lease, installment sales contract, or other contract arrangement, by purchase, foreclosure sale, or otherwise, shall be liable for the payment of all delinquent sales and use taxes on the value of property so taken or acquired. 24 (1) The seller or his agent will be held liable for sales and use tax remittance on the sale of business in the event the purchaser fails to remit the tax due on the purchaser. (2) The Wheat Ridge use tax shall be remitted on the price paid for tangible personal property and taxable services which are purchased to establish a new business or business location within the City. Such tax shall be reported on the initial use tax return and be remitted on or before the twentieth day of the month following the opening day of business. Timely filing shall be evidenced by the postmark date. Section 21-18. Refusal to report; estimate of tax; emergency collection procedures; penalties and interest calculated; fraud (a) In the event any taxpayer: (1) Refuses to report in accordance with the provisions of this article; (2) Fails to comply with the provisions of section 21-13 of this article; (3) Who, being the seller of a business, fails to file the report and remit the taxes required in section 21-17 of this article; (4) Intends to leave the city without paying any taxes which are lawfully owed; (5) Removes, or intends to remove, property subject to tax hereunder from the city, or to sell any such property with the intent to remove the proceeds of sale from the city without paying tax thereon; Or (6) Engages or intends to engage in any activity which the Treasurer reasonably believes to jeopardize collection of taxes authorized hereunder, thereby prohibiting the establishment by the treasurer of an accurate and exact amount of tax due, the treasurer may, in any reasonable manner possible, estimate the amount of tax due, to which penalties and interest in accordance with (d) of this section will be added. (b) When an estimate of taxes is made, the sales tax inspector shall serve notice thereof on the taxpayer by personal 25 service, certified or registered mail to the taxpayer's last known address, or by leaving a copy with the person in charge at the taxpayer's business establishment or last known address. In the event that the taxpayer cannot be found at its last known address or notices sent by the city are returned by the post office, no further attempts at providing notice shall be required. The burden shall at all times be on the taxpayer to inform the city of the taxpayer's current address. Unless the taxpayer files a written demand for administrative hearing and determination of tax liability, as provided in section 21-20 hereof, within ten (10) days from the date of receipt of such notice, he shall conclusively be deemed to have accepted the estimate as a fair and accurate determination of his tax obligation and shall thereby waive the right to contest that determination. In the event that such a hearing is held, the determination of the hearing officer shall be reviewable as provided in section 21-20 hereof. (c) In any case wherein it appears that collection of revenues from taxes lawfully imposed hereby is in jeopardy, the treasurer may immediately issue demand for payment. Upon issuance of said demand for payment, the tax required therein shall be due and payable, and the treasurer may proceed forthwith to collect said taxes by any lawful means, including, not by way of limitation, filing of liens upon the property subject to tax, issuance and execution of distraint warrants, or filing of summons and complaint in any competent court; provided, however, that collection under this section 21-18 may be stayed upon the provision by taxpayer to the treasurer of such security as, in the opinion of the treasurer, shall be satisfactory to insure payment to the city of all taxes lawfully owed by taxpayer. (d) When a sales and use tax deficiency exists from under reporting or failure to pay due to negligence or a knowing, intentional disregard of the provisions of this Chapter or rules and regulations promulgated thereunder, without the intent to defraud, penalty and interest shall be assessed as follows: (1) For transactions consummated prior to January 1, 1986, the penalty shall be twelve percent (12%) of the delinquent tax or deficiency. Interest shall be one percent (1%) of the delinquent tax or deficiency per month from the date due. (2) For transactions consummated on or after January 1, 1986: Penalty shall be fifteen dollars ($15.00) or ten percent (108) of the delinquent sales tax or deficiency, whichever is greater. Interest shall be the rate imposed under Subsection (a) of this Section plus one-half percent (1/2%) per month from the date when due: except that all interest shall not exceed eighteen percent (18%) per annum. 26 (a) For transactions consummated on or after January 1, 1986, the annual rate of interest assessed pursuant to this Section shall be the rate established by the State Commissioner of Banking Pursuant to Section 39-21-110.5, C.R.S. (e) Penalty for Fraud: For transactions consummated on or after January 1, 1986, if any part of delinquent tax or deficiency is due to fraud with the intent to evade the tax, the penalty shall be fifty percent (50%) of the total amount of the deficiency. The City Treasurer shall mail a written notice of assessment to the taxpayer. The amount of the tax due, including the penalty and interest, shall become due and payable within ten (10) days after the notice of assessment is mailed by the Treasurer. Interest shall be one (1%) per month of the tax due from the date the tax was due until paid. For transactions consummated on or after January 1, 1986, penalty and interest shall be assessed at the rate specified in (d)(2) and (d)(2)(a) of this section. (f) Special Penalty for Enforcement Proceedings: When any person liable for the payment for a tax imposed by this Chapter has repeatedly failed, neglected or refused to pay the tax within the time specified for such payments, and the Treasurer has been required to exercise enforcement proceedings against the taxpayer three (3) or more times to collect such taxes due, the treasurer is hereby authorized to assess and collect the amount of such taxes due together with all the interest and penalties thereon provided by law and also an additional amount equal to fifteen percent (15%) of the delinquent taxes or deficiency, interest and penalties due, or the sum of twenty five dollars ($25.00) whichever amount is greater. (g) City Treasurer May Waive Penalty: For good cause shown, the Treasurer is authorized to waive any penalty assessed in this Chapter. For purposes of this Chapter interest shall never be deemed a penalty. Section 21-19. Limitation of action. (a) No sales or use tax, or interest_ thereon or penalties with respect thereto, shall be assessed, nor shall any notice of lien be filed, or distraint warrant issued, or suit for collection be instituted, nor any other action to collect the same be commenced, more than three years after the date on which the tax was or is payable nor shall any lien continue after such period, except for actual or estimated taxes assessed before the expiration of such period, notice of lien with respect to which has been filed prior to the expiration of such period. (b) In the case of a false or fraudulent return with intent to evade tax, or in the case of a failure to file a return, the tax together with interest and penalties thereon may be assessed, 27 or proceedings for the collection of such taxes may be begun at any time. (c) Before the expiration of such period of limitation, the taxpayer and the treasurer may agree in writing to an extension thereof and the period so agreed on may be extended by subssequent agreements in writing. (d) The period of limitation provided herein shall not run against the City for an audit period if written notice is given to the taxpayer prior to the expiration of the statute of limitations that the latter's records will be audited pursuant to this chapter. "Audit Period" is the thirty six (36) month reporting period preceding thee date of the notice of audit. Section 21-20. Taxpayer's remedies. (a) For transactions consummated on or after January 1, 1986, when the city asserts that sales or use taxes are due in an amount greater than the amount paid by a taxpayer, the city shall mail a deficiency notice to the taxpayer by certified mail. The deficiency notice shall state the additional sales and use taxes due. The deficiency notice shall contain notification, in clear and conspicuous type, that the taxpayer has the right to elect a state hearing of the deficiency pursuant to 29-2-106.1(3), C.R.S. As used in this section, "state hearing" means a hearing before the executive director of the department of revenue or delegate thereof as provided in 29-2-106.1(3), C.R.S. (b) In the event that the taxpayer disputes the tax liability imposed by any deficiency notice, he shall file a written demand for an administrative hearing and determination of tax liability within ten (10) days of receipt of the notice, which demand will stay the sale under any distraint warrant until the conclusion of the hearing. This demand shall include the name, business address and license number of the taxpayer, a copy of the notice sent by the city, the taxable periods and the amounts of tax which are being disputed, and a statement of the grounds upon which the taxpayer bases his claim. Upon receipt of the taxpayer's written demand, the city treasurer shall set the time and place for the hearing, to be held as quickly as possible, and shall appoint as the hearing officer any qualified person who has education or experience in tax administration matters and who can render a proper decision. In the event that it is determined at the hearing that the taxpayer's liability is less than the amount in the possession of the treasurer, such excess shall be paid to the taxpayer forthwith. Failure to demand an administrative hearing and termination of tax liability shall constitute a waiver of the right to contest such liability; however, when such determination is requested or when a request for a refund is timely made, the final decision rendered therein shall be appealable as provided herein. 28 (c) The hearing provided in subsection (b) shall be informal and no transcript, rules of evidence, or filing of briefs shall be required, but the taxpayer may elect to submit a brief, in which case the city may submit a brief. The city shall hold such hearing and issue the final decision thereon within ninety days after the receipt of the taxpayer's written request therefor, except the city may extend such period if the delay in holding the hearing or issuing the decision thereon was occasioned by the taxpayer, but, in any such event, the city shall hold such hearing and issue the decision thereon within one hundred eighty (180) days of the taxpayer's request in writing therefor. (d) If the dispute was not resolved by the informal hearing, the taxpayer may elect one of the following avenues of appeal within thirty days of the city's final decision: (1) The taxpayer may request a formal hearing on the record before a city hearing officer, which shall be held within sixty days of the taxpayer's request. Any appeal from the decision rendered after such formal hearing shall be pursuant to Rule 106(a)(4) of the Colorado Rules of Civil Procedure. (2) If the deficiency notice or claim for refund involves only the city, the taxpayer may appeal such deficiency or denial of a claim for refund to the district court of the County of Jefferson as provided in C.R.S. X29-2-106.1(8). (3) The taxpayer may elect a state hearing on the deficiency or denial of claim pursuant to C.R.S. §29-2-106.1(3). (e) The taxpayer shall have no right to any form of appeal if he has not exhausted his administrative remedies or if he fails to request a hearing within the time period provided in this subsection. For purposes of this subsection, "exhaustion of administrative remedies" means: (1) The taxpayer has timely requested in writing a hearing before the city and the city has held such hearing and issued a final decision thereon or (2) The taxpayer has timely requested in writing a hearing before the city and the city has failed to hold such hearing or has failed to issue a final decision thereon within the time periods provided in subparagraph (c) above. (f) Except in the event that the taxpayer elects the avenue of appeal specified in subsection (d)(1) above, the taxpayer 29 shall post a bond or other security as required by state law as a condition precedent to exercising his right to appeal. Section 21-21. Additional remedies of city. (a) Any sales or use tax imposed by this article, together with the interest and penalties herein provided and the cost of collection which may be incurred by the city, shall be and, until paid, remain a first and prior lien upon: (1) the goods, stock-in-trade, and business fixtures of or used by any retailer under lease, title-retaining contract or other contractual arrangement; and (2) the real and personal property owned or leased by any person, and shall take precedence on all such property over other claims and mortgages. (b) The lien provided herein may be foreclosed by seizing under distraint warrant and selling so much of the property covered by the lien as may be necessary to discharge said lien. Such distraint warrant may be issued by the treasurer whenever the taxpayer or vendor is in default on the payment of sales or use tax, interest and penalty, and may be served and the goods or property subject to such liens seized and sold by the treasurer or any member of the city police department. (c) Goods or property seized pursuant to distraint warrant shall be sold at public auction after ten days' public notice by publication not less than two times in a newspaper of general circulation within the city. Such goods or other property whether real or personal may be redeemed by the taxpayer any time prior to sale by paying such tax, penalty, and interest as is due, together with such costs as have accrued from the seizure and preparation for sale. (d) A notice of lien shall be served on the taxpayer and a copy of such notice shall be filed in the real estate records of Jefferson County prior to the issuance of a distraint warrant. (e) In lieu of seizure of property pursuant to a distraint warrant, the treasurer may cause a civil action to be filed in the district court of Jefferson County to enforce the city's lien for such tax upon the real property situated in that county or in any other county in the state which may be subject to such lien or to subject any real property or any right, title, or interest in real property to the payment of such tax. The court shall adjudicate all matters involved in such action and may decree a sale of the real property and distribute the proceeds of such sale according to the findings of the court in respect to the interest of the parties and of the city. The proceedings in such action and the manner of sale, the period for and manner of redemption from such sale, and the execution of a deed of conveyance shall be in accordance with the law and practice relating to foreclosures of mortgages upon real property. In any such action, the court may appoint a receiver of the real property involved in such action if equity so requires. 30 (f) Recovery of Unpaid Tax by Action of Law: (1) The Treasurer may also treat any such taxes, penalties or interest due and unpaid as a debt due the city from the taxpayer. (2) In case of failure to pay the taxes, or any portion thereof, or any penalty or interest thereon, when due, the treasurer may recover at law the amount of such taxes, penalties and interest in any county or district court of the county wherein the taxpayer resides or has his principal place of business having jurisdiction of the amounts sought to be collected. (3) The return of the taxpayer or the assessment made by the city, as herein provided, shall be prima facie proof of the amount due. (4) No such civil action may be filed by the city until the time for the taxpayer to exercise his administrative remedies or to file an appeal has expired. (5) This remedy shall be in addition to all other existing remedies available to the city. (g) Whenever the business or property of any taxpayer subject to this Chapter is subject to receivership, bankruptcy of assignment for the benefit of creditors, or seized under distraint for property taxes, all taxes, penalties and interest imposed by this Chapter and for which the taxpayer is in any way liable under the terms of this Chapter shall be a prior and preferred lien against all the property of the taxpayer. No sheriff, receiver, assignee or other officer shall sell the property of any person subject to this Chapter under process or order of any court, without first ascertaining from the City Treasurer the amount of any taxes due under this Chapter. If any tax is due, the officer shall pay the amount of the taxes out of the proceeds less costs before making payment to any judgment creditor or other claimants. For the purpose of this Section, the term "taxpayer" shall include "retailer". (h) Violations; Summons and Complaint; Penalty: It shall be a violation of this Chapter to refuse to make any return provided to be made in this Chapter, or to make any false or fraudulent return, or any false statement in any return, or to fail or refuse to make timely payment to the City Treasurer or his authorized agent of any taxes collected or due to the City, or in any manner to evade the collection and timely payment of the tax, or any part thereof, imposed by this Chapter, or for any person or purchaser to fail or refuse to pay such tax or evade the timely payment thereof, or to aid or abet another in any 31 Section 2. Ordinance 650, Series of 1985, is hereby specifically repealed. Section 3. Safety Clause. The City Council hereby finds, determines, and declares that this ordinance is promulgated under the general police power of the City of Wheat Ridge, that it is promulgated for the health, safety, and welfare of the public, and that this ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The City Council further determines that the ordinance bears a rational relation to the proper legislative object sought to be attained. Section 4. Severability. If any clause, sentence, paragraph, or part of this ordinance or the application thereof to any person or circumstances shall for any reason be adjudged by a court of competent jurisdiction invalid, such judgment shall not affect application to other persons or circumstances. Section 5. This ordinance shall take effect November 1, 1986. INTRODUCED, READ, AND ADOPTED on first reading by a vote of P, to n on this 13th day October, 1986, ordered published in full in a newspaper of general circulation in the City of Wheat Ridge and Public Hearing and consideration on final passage set for October 27, 1986, at 7:30 o'clock p.m., in the Council Chambers, 7500 West 29th Avenue, Wheat Ridge, Colorado READ, ADOPTED, AND ORDERED PUBLISHED on second and final reading by a vote of 7 to 1 this 97th day of nrtnher , 1986. 1986SIGNED by the Mayor on this 28th day of pctober . Frank Stites, Mayor ATTEST: Wanda Sang, City Clork 1st Publication: Oct. 16, 1986 APPROVED AS TO F M BY 2nd Publication: Oct. 30, 1986 OFFICE F Y TT N Wheat Ridge Sentine: , I/O j Effective Date: Nov. 1, 1986 j Joo/hp,'E. Hayes v / 33