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Home My WebLink AboutSB 743 - Internet Sales Tax EqualizationCITY OF PALM DESERT OFFICE OF THE CITY MANAGER STAFF REPORT REQUEST: RATIFY THE CITY MANGER'S APPROVAL TO SUBMIT A LETTER OF SUPPORT FOR U.S. SENATE BILL 743 (Enzi). SUBMITTED BY: Stephen Y. Aryan, Risk Manager DATE: May 9, 2013 CONTENTS: Senate 743 Support Letter Recommendation By Minute Motion, ratify the City Manager's approval to submit a letter of support for U.S. Senate Bill No. 743 (Enzi). Background On April 22, the City Manager prepared and submitted to Palm Desert's Federal legislative representatives a letter of support for Senate Bill 743 (Enzi). This legislation would provide equitable tax treatment for sales of tangible goods between brick -and -mortar establishments and remote sellers over the Internet. The additional revenues collected would assist our city both fiscally and in the delivery of quality public services to the community. As this bill is set for a vote in the Senate at any moment, the normal process of vetting such legislation before the City's Legislative Review Committee was not enacted. With the increasing volume of sales occurring on the Internet, staff is concemed with the competitive disadvantage faced by local retailers and the inability to collect revenue from remote sellers. Given the urgency of this bill and impending vote, a letter of support was submitted and staff respectfully recommends ratification of this action by the City Council. Fiscal Analysis No fiscal impact related to the recommended action. Submitted By: Step en Y. ryan, Risk anager Approval: JohryM. Wohlmuth, City Manager CITY COUNCIL ACTION APPROVED t/ DENIED RECEIVED OTHER MEETING DATE AYES:13&)5an, Tdf mi- uJrbef-la 77(K. NOES: None. ABSENT: 11.1.0nr ABSTAIN? NO e- VERIFIED BY: Original on File with City Clerk's Office 0111(1 (H 1111 CI11 M\N %GIR April 22, 2013 The Honorable Dianne Feinstein 331 Hart Senate Office Building Washington, DC 20510 CITY Of POL OESERT 73 510 FRFI) WARING DRIVI PALM DESERT, CALIFORNIA 92260 TEL:760 346--0611 FAX: 760 340. 0574 info@palm desert.org 2578 The Honorable Barbara Boxer 112 Hart Senate Office Building Washington, DC 20510 RE: S. 743 - The Marketplace Fairness Act of 2013 Dear Senators Feinstein and Boxer. The City of Palm Desert supports S. 743, the "Marketplace Fairness Act of 2013.* This legislation wiU provide equitable tax treatment for sales of tangible goods between brick -and -mortar establishments and remote sellers over the Internet. The additional revenues collected will assist our city in the delivery of quality public services to our residents. With the increasing volume of sales occurring on the Internet, our city has long been concerned with the competitive disadvantage faced by our local retailers which have made investments and provided jobs in our communities and the inability to collect revenue from remote sellers. The California Board of Equalization recently estimated that $1.1 billion of use taxes related to remote electronic and mail sales from out-of-state vendors are uncollected (of this total, $755 miflion is due the State's General Fund, with the balance owed to local governments). About three -fourths of this gap relates to business -to -consumer sales, with the rest relating to business -to -business sales. Based on use tax collections, there is only about 1 percent consumer compliance with use tax obligations. Following drastic cuts to state and federal funding, including sequestration, these taxes are critical to the continuing fiscal stability of our city. For these reasons, the City of Palm Desert supports S. 743 but is opposed to any future amendments that would negatively impact the ability of local governments to collect sales and/or transient occupancy taxes. Please let us know if you have any questions or need any additional information by contacting Stephen Y. Aryan, Risk Manager, at (760) 776-6326. Thank you for your consideration and support. Win•=rel N M. WOHLMUTH MANAGER : City Council Erin Sasse, League of California Cities, esasse�arcacities.orc Anthony Gonsalves, Gonsalves and Sons, gonsalves cgonsalvi.com Barbara deBoom, President/CEO, Palm Desert Area Chamber of Commerce Paul S. Gibson, Director of Finance/City Treasurer Stephen Y. Aryan, Risk Manager CITY �F PO[ffl DESERI 73 510 FRI D WARING DRIVE PALM DESERT, CALIFORNIA 92260 2578 TEL:760 346-0611 I•AX: 760 340 0574 infnW palm dewrr.org Om( „iuuCmDivsuaa April 22, 2013 The Honorable Raul Ruiz 1319 Longworth House Office Building Washington, D.C., 20515 RE: S. 743 - The Marketplace Fairness Act of 2013 Dear Congressman Ruiz: The City of Palm Desert supports S. 743, the "Marketplace Faimess Act of 2013.* This legislation will provide equitable tax treatment for sales of tangible goods between brick -and -mortar establishments and remote sellers over the Internet. The additional revenues collected will assist our city in the delivery of quality public services to our residents. VVith the increasing volume of sales occurring on the Internet, our city has long been concerned with the competitive disadvantage faced by our local retailers which have made investments and provided jobs in our communities and the inability to collect revenue from remote sellers. The California Board of Equalization recently estimated that $1.1 billion of use taxes related to remote electronic and mail sales from out-of-state vendors are uncollected (of this total, $755 million is due the State's General Fund, with the balance owed to local governments). About three -fourths of this gap relates to business -to -consumer sales, with the rest relating to business -to -business sales. Based on use tax collections, there is only about 1 percent consumer compliance with use tax obligations. Following drastic cuts to state and federal funding, including sequestration, these taxes are critical to the continuing fiscal stability of our city. For these reasons, the City of Palm Desert supports S. 743 but is opposed to any future amendments that would negatively impact the ability of local governments to collect sales and/or transient occupancy taxes. Please let us know if you have any questions or need any additional information by contacting Stephen Y. Aryan, Risk Manager, at (760) 776-6326. Thank you for your consideration and support. (A, HN M. WOHLMUTH TY MANAGER cc: City Council Erin Sasse, League of Califomia Cities, esassecacities.orq Anthony Gonsalves, Gonsalves and Sons, aonsalvesc gonsaivi.com Barbara deBoom, President/CEO, Palm Desert Area Chamber of Commerce Paul S. Gibson, Director of Finance/City Treasurer Stephen Y. Aryan, Risk Manager MIS illP