Details for Legal No. 372

Legal No. 372
NOTICE OF PUBLIC HEARING ON
PROPOSED CITY OF FLAGSTAFF TAX CODE CHANGES
(POSSIBLE INCREASE IN THE USE TAX RATE)
The City of Flagstaff hereby gives notice pursuant to A.R.S. § 9-499.15 of a proposed
Tuesday, July 2, 2019 at 6:00 p.m.
increase in the use tax rate from 1% to 2.281%, for the purpose of raising revenue
City Council Chambers
to help pay for expenses of the City, including its unfunded liability for police and fire
211 W. Aspen Avenue
fighter pensions.
Flagstaff, Arizona 86001
The Flagstaff voters have already approved a base local transaction privilege tax rate of A second reading and adoption of an ordinance to amend the City Tax Code to enact the
2.281% effective July 1, 2019. The majority of the revenues generated by this tax are
use tax rate increase may occur following the public hearing.
dedicated for public transportation, roads and trails related activities.
A schedule of the proposed increased use tax that includes the amount of the tax and a
The City proposes to amend the City Tax Code to impose a tax rate of 2.281% on
written report or data that supports the increased tax is attached, and a copy has been
storage or use in the City of tangible personal property for which an equivalent tax has placed on file with the City Clerk.
not been paid (“use tax”). A use tax is similar to the local transaction privilege tax, and
Please contact Sandy Corder, Revenue Director, (928) 213-2252 if you have any
is classified as “an affiliated excise tax.” A use tax is not paid in any circumstance when questions. The City Tax Code is part of the City Code and can be found on the City
an equivalent local transaction privilege tax has been paid. In other words, there is no
website, www.flagstaffaz.gov. The Arizona Department of Revenue is responsible for
“double taxation.”
administration of local tax collection, and maintains information about both state and
A first reading of an ordinance regarding the proposed use tax rate increase may
local taxes on its website, www.azdor.gov.
occur at the public meeting of Tuesday, June 18, 2019 at 6:00 p.m. in the City Council
Submitted by: Sandy Corder, Revenue Director
Chambers.
This notice is posted on the homepage of the City website on Thursday May 2, 2019.
The City Council will conduct a public hearing and consider approval of the proposed
This notice has been distributed to other social media accounts and electronic
use tax rate increase at the following date and time:
communication tools of the City at least 60 days prior to July 2, 2019.
Posted and distributed by: Jessica Drum, Communications Manager (928) 213-2061.
Attachments: A written report or data to support the increased tax
City of Flagstaff
Summary of Proposed Use Tax Rate Increase
General Fund
City Code and
Tax Schedule
Reference

Current
Use Tax

Customer Impacted
Representative Sample Contact Revenue Director for
Complete list

Existing Tax
Rate

Proposed
Tax Rate

Justification/
Cost Basis

Comparison

2.281% will
generate
approximately
$1.6 million
annually

The City is
considering
ways to
generate
revenues for
the purpose of
raising revenue
to help pay for
expenses of the
City, including
but not limited
to its unfunded
liability for
police and
fire fighter
pensions.
The current
unfunded
liability exceeds
$100 million.

The local
Transaction
Privilege Tax
(TPT) rate is
2.281%.

Effective August 1, 2019
City Code:
Div 3-05-06

A tax
on the
use or
storage
of
tangible
personal
property

Nonstore Retailers - 454000
New Car Dealers - 441110
Electronic Shopping - 454111
Electronic Shopping and Mail-Order Houses - 454110
Grocery Stores - 445100
Medical Dental and Hospital Equipment and Supplies Merchant
Wholesalers - 423450
Building Material and Supplies Dealers - 444100
Miscellaneous Store Retailers - 453000
Other Personal Services - 812900
Computer and Software Stores - 443120
Other Direct Selling Establishments - 454390
Medical Equipment and Supplies Manufacturing - 339110
Direct Selling Establishments - 454300
Electronics and Appliance Stores - 443100
Unknown - 452110
Full-Service Restaurants - 722110
Automotive Parts Accessories and Tire Stores - 441300
Special Food Services - 722300
Telecommunications - 517000
Office Supplies and Stationery Stores - 453210
Other Computer Related Services - 541519
All Other Miscellaneous Store Retailers (Except Tobacco Stores)
- 453998
Pharmacies and Drug Stores - 446110
Cut and Sew Apparel Manufacturing - 315200
Other General Merchandise Stores - 452900

1% generates
approximately
$700,000
annually

PUB: June 11, 12, 13, 14, 2019 372

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