§ 5.04.430. Rental of commercial/industrial property—Exemption—Gross receipts.

A.

Every person engaged in the business of renting or letting a building, structure, or other property for commercial/industrial purposes, or a portion of such building, structure or property within the city for a purpose other than dwelling, sleeping, or lodging to a tenant shall pay a business tax of thirteen dollars and ninety-five cents ($13.95) for each one thousand dollars ($1,000.00) of gross receipts or fractional part thereof.

B.

A lessor otherwise subject to the business tax described in subsection A of this section shall not be exempt therefrom by reason of the fact that one or more persons may reside within a building or structure where the primary purpose of the particular tenancy or the primary use or right to use by the tenant is for some purpose other than dwelling, sleeping, or lodging.

C.

Five-Year Exemption.

1.

All new buildings and those buildings on which major renovations are completed after July 1, 1981 will be eligible for a five-year exemption from the business tax rate described in subsection A of this section.

2.

A lessor that qualifies for this exemption shall pay a business tax of sixty dollars ($60.00) per year or fractional part thereof for the first thirty-three thousand three hundred thirty-five dollars ($33,335.00) or less of gross receipts, plus one dollar and eighty cents ($1.80) for each additional one thousand dollars ($1,000.00) of gross receipts or fractional part thereof in excess of forty-four thousand four hundred forty-five dollars ($44,445.00), during the five-year exemption period.

3.

In determining the five-year exemption period:

a.

The five-year exemption shall be deemed to commence in the year in which new buildings and/or major renovations are completed and to end in the fifth year from the year of completion irrespective of the date on which an application for exemption is filed.

b.

There will be no extensions of the five-year exemption period for subsequent major renovations after the first major renovations are completed.

c.

All lessors are entitled to only one five-year exemption for each business location. The five-year exemption applies to the building or structure and not the lessor.

d.

There will be no proration in applying for the first year of the five-year exemption. The year in which new buildings are completed or major renovations are completed shall be considered to be a full year regardless of the date of completion.

4.

To qualify for an exemption, the lessor of commercial/industrial property must file an annual exemption on a form prescribed by the Business Tax Section.

5.

Definitions applicable to this subsection are as follows:

"Major renovation" means any instance where the cost of renovation is equal to or exceeds fifty (50%) percent of the after-renovation appraised value of the building as determined by a certified, independent appraiser.

"New building" means any newly constructed building completed after July 1, 1981 for which a temporary certificate of occupancy or certificate of occupancy has been issued by the city.

"New lessor" means any change which results in an eighty (80%) percent or more change of ownership.

D.

Gross Receipts for Rental of Commercial/Industrial Property. The tax basis for persons, taxed pursuant to subsection A of this section shall include gross receipts as defined per Section 5.04.030 plus all payments made to the lessor, and/or paid to third parties on behalf of the lessor as part of said lease agreement, including but not limited to, all taxes, insurance, mortgage payment, rent, and the cash value of all services rendered to or on behalf of the lessor by said lessee in lieu of rental or lease fee payments.

Note: If the business tax is paid by the lessee on behalf of the lessor, said tax payment, including penalty and interest payments, shall be included in the tax base for the immediately succeeding business tax period.

(Ord. 12838 § 3 (part), 2007; prior code §§ 5-1.38, 5-1.38(d), 5-1.38(f))