[HISTORY: Adopted by Common Council of City
of North Tonawanda as L. L. No. 1, 1937; became a law 7-15-1937. Amendments
noted where applicable.]
By section 20-b of the General City Law, as
added by chapter 331 of the laws of 1937, cities were authorized to
enact local laws imposing a tax such as is imposed by section 186-a
of the Tax Law. Pursuant to such authority, this city enacted local
law number one of 1937 modeled upon said section 186-a. Said section
was enacted upon the recommendation of the governor of the state as
an emergency measure to aid in financing the extraordinary cost of
relief. It was intended thereby and likewise by the local law enacted
in this city pursuant to the above mentioned authority, to impose
a tax on utility services whether rendered by utilities in the strict
sense or not, and whether such services were in the main or incidental
part of their business and regardless of whether the public streets
were used in any manner. Accordingly, such a utility was defined for
the purposes of the tax, as including every person subject to the
supervision of the department of public service and every other person
furnishing utility services. It was intended to include persons and
corporations which were directly in competition with ordinary utilities,
such as, landlords and submeterers, who buy their services from the
other utilities and, in turn, resell such services. For that reason
the tax was imposed on receipts from sales to ultimate consumers.
Receipts from the sale of such utility services to submeterers were
not taxed, but receipts of submeterers from their own customers were
intended to be taxed. Any other construction would have resulted in
a complete exemption from taxation of utility services sold or furnished
by this particular method. Furthermore, these submeterers or landlords,
prior to a decision of the appellate courts construing section 186-a
of the Tax Law, which decided that submeterers were not subject to
tax, considered themselves subject to tax and took into consideration
in computing their operating cost the additional burden of the tax.
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In view of the fact that these
landlords or submeterers have considered themsleves as subject to
tax, have based their charges to their customers in consideration
of the tax and are in competition with ordinary utilities, this local
law, making it clear that they are required to include in gross operating
income receipts from sales or services similar to those rendered by
ordinary utilities, is made retroactive to the original enactment
of this tax.
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Furthermore, it is believed
that submeterers have common characteristics that distinguish them
from other businesses and justify the conclusion that the method,
character and nature of their business, in this aspect, is substantially
similar to the business of an ordinary utility and requires similar
treatment for purposes of the tax. This conclusion is strongly fortified
by the fact that such landlords and submeterers are in direct competition
with ordinary utilities, and hence should bear similar tax burdens
in order to avoid inequality of treatment.
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[1]
Editor's Note: Added by L.L. No. 1, 1941,
which became a law 7-8-1941. Filed in Department of State 5-1-1948.
A.
Tax imposed. Pursuant to the authority granted by
section 20-b of the General City Law of the state of New York, a tax
equal to 1% of its annual gross income, from and after July first,
1937, is hereby imposed upon every utility doing business in the city
of North Tonawanda, which is subject to the supervision of the state
department of public service, which has a gross income for the 12
months ending May 31st in excess of $500, except motor carriers or
brokers, subject to such supervision under article three-b of the
Public Service Law, and a tax equal to 1% of its gross operating income
is hereby imposed, from and after July first, 1937, upon every other
utility doing business in the city of North Tonawanda which has a
gross income for the 12 months ending May 31st in excess of $500 which
taxes shall have application only within the territorial limits of
the city of North Tonawanda, and shall be in addition to any and all
other taxes and fees imposed by any other provision of law for the
same period. Such taxes shall not be imposed on any transaction originating
or consumated[1] outside of the territorial limits of the city of North
Tonawanda, notwithstanding that some act be necessarily performed
with respect to such transaction within such limits.
[As amended by L.L. No.
1-1950]
[1]
So in original. [Word misspelled.]
B.
Definitions.[2] As used in this section, (a) the word "Utility" includes
every person subject to the supervision of either division of the
state department of public service, except persons engaged in the
business of operating or leasing sleeping and parlor railroad cars
or of operating railroads other than street surface, rapid transit,
subway and elevated railroads, and also includes every person who
sells gas, electricity, steam, water, refrigeration, telephony or
telegraphy, delivered through mains, pipes or wires, or furnishes
gas, electric, steam, water, refrigerator, telephone or telegraph
service, by means of mains, pipes, or wires; regardless of whether
such activities are the main business of such person or are only incidental
thereto, or of whether use is made of the public streets; (b) the
word "person" means persons, corporations, companies, associations,
joint-stock associations, co-partnerships, estates, assignee of rents,
any person acting in a fiduciary capacity, or any other entity, and
persons, their assignees, lessees, trustees or receivers, appointed
by any court whatsoever, or by any other means, except the state municipalities,
political and civil subdivisions of the state or municipality, and
public districts; (c) the word "gross income" means and include receipts
received in or by reason of any sale, conditional or otherwise, made
or services rendered for ultimate consumption or use by the purchaser
in the city of North Tonawanda, including cash, credits, and property
of any kind or nature, without any deduction therefrom on account
of the cost of the property sold, the cost of the materials used,
labor or services or other costs, interest or discount paid, or any
other expense whatsoever; also profits from the sale of securities;
also profits from the sale of real property growing out of the ownership
or use of or interest in such property; also profit from the sale
of personal property; also receipts from interest, dividends, and
royalties, derived from sources within the city of North Tonawanda
other than such as are received from a corporation a majority of whose
voting stock so owned by the taxpaying utility, without any deduction
therefrom for any expenses whatsoever incurred in connection with
the receipt thereof, and also profits from any transaction within
the city of North Tonawanda whatsoever; and (d) the words "gross operating
income" mean and include receipts received in or by reason of any
sale, conditional or otherwise, made for ultimate consumption or use
by the purchaser of gas, electricity, steam, water, refrigeration,
telephony or telegraphy, or in or by reason of the furnishing for
such consumption or use of gas, electric, steam, water, refrigerator,
telephone or telegraph service in the city of North Tonawanda, including
cash, credits and property of any kind or nature, without any deduction
therefrom on account of the cost of the property sold, the cost of
materials used, labor or services or other costs, interest or discount
paid, or any other expenses whatsoever.
[As amended by L.L. No.
1-1941, filed 5-1-1948]
[2]
Note: In the event that the amendments made to § 87-1B by this local law are declared by a court of competent jurisdiction to be invalid to the extent that they are made retroactive to July 15, 1937, then the tax imposed or continued by such amendments shall be applicable to recent transactions since January first, 1940.
C.
Records to be kept. Every utility subject to tax under
this section shall keep such records of its business and in such form
as the city treasurer may require, and such records shall be preserved
for a period of three years, except that the city treasurer may consent
to their destruction within that period or may require that they be
kept longer.
D.
Returns to be filed; forms; affidavits. Every utility
subject to tax hereunder shall file, on or before September 25th,
December 25th, March 25th, and June 25th, a return for the three-calendar
months preceding each return date including any period for which the
tax imposed hereby or by an amendment is effective, each of which
returns shall state the gross income or gross operating income for
the period covered by each return. Returns shall be filed with the
city treasurer on a form to be furnished by him for such purpose and
shall contain such other data, information or matters as the city
treasurer may require to be included therein. Notwithstanding the
foregoing provisions of this section any utility whose average gross
income or average gross operating income, as the case may be for the
aforesaid three-months' period is less than $1,500, may file a return
annually on June 25th for the twelve-preceding calendar months. The
city treasurer, in order to insure payment of the tax imposed, may
require at any time a further[3] supplemental return which shall contain any data that
may be specified by the city treasurer. Every return shall have annexed
thereto an affidavit of the head of the utility making same, or of
the owner[4] of a copartner thereof, or of a principal officer of the
corporation, if such business be conducted by a corporation to the
effect that the statements contained therein are true.
[As amended by L.L. No.
1-1950]
E.
Payment of tax. At the time of filing a return as
required by this section, each utility shall pay to the city treasurer
the tax imposed by this section for the period covered by such return.
Such tax shall be due and payable at the time of filing the return
or, if a return is not filed when due, on the last day of which the
return is required to be filed.
F.
Insufficent returns; hearing; review. In case any
return filed pursuant to this section shall be insufficient or unsatisfactory
to the city treasurer, and if a corrected or sufficient return is
not filed within 20 days after the same is required by notice from
the city treasurer, or if no return is made for any period, the city
treasurer shall determine the amount of tax due from such information
as he is able to obtain, and, if necessary, may estimate the tax on
the basis of external indices or otherwise. The city treasurer shall
give notice of such determination to the person liable for such tax.
Such determination shall finally and irrevocably fix such tax, unless
the person against whom it is assessed shall, within 30 days after
the giving of notice to such determination, apply to the city treasurer
for a hearing, or unless the city treasurer, of his own motion shall
reduce the same. After such hearing, the city treasurer shall give
notice of his decision to the person liable for the tax. The decision
of the city treasurer may be reviewed by a proceeding under article
78 of the Civil Practice Act of the state of New York, if application
therefor is made within 30 days after the giving of notice of such
decision. An order to review such decision shall not be granted unless
the amount of any tax sought to be reviewed, with interest and penalties
thereon, if any, shall be first deposited with the city treasurer
and an undertaking filed with him, in such amount and with such sureties
as a justice of the Supreme Court shall approve, to the effect that
if such proceeding be dismissed or the tax confirmed, the applicant
will pay all costs and charges which may accrue in the prosecution
of such proceeding, or at the option of the applicant, such undertaking
may be in a sum sufficient to cover the tax, interest, penalties,
costs and charges aforesaid, in which event the application[5] shall not be required to pay such tax, interest and penalties
as a condition precedent to the granting of such order.
[As amended by L.L. No.
1-1940]
[5]
So in original. [Evidently should be "applicant."]
G.
Mailing of notice; presumption; time. Any notice authorized
or required under the provisions of this section may be given by mailing
the same to the person for whom it is intended, in a postpaid envelope,
addressed to such person at the address given by him in the last return
filed by him under this section, or, if no return has been filed,
then to such address as may be obtainable. The mailing of such notice
shall be presumptive evidence of the receipt of the same by the person
to whom addressed. Any period of time, which is determined according
to the provisions of this section by the giving of notice, shall commence
to run from the date of mailing of such notice.
H.
Penalty for late return. Any person failing to file
a return or corrected return, or to pay any tax or any portion thereof,
within the time required by this section shall be subject to a penalty
of 5% of the amount of tax due, plus 1% of such tax for each month
of delay or fraction thereof, excepting the first month, after such
return was required to be filed or such tax became due; but the city
treasurer, if satisfied that the delay was excusable, may remit all
or any portion of such penalty.
I.
Refunds. If, within one year from the payment of any
tax or penalty, the payer thereof shall make application for a refund
thereof and the city treasurer or the court shall determine that such
tax or penalty or any portion thereof was erroneously or illegally
collected, the city treasurer shall refund the amount so determined.
For like cause and within the same period, a refund may be so made
on the initiative of the city treasurer. However, no refund shall
be made of a tax or penalty paid pursuant to a determination of the
city treasurer as hereinbefore provided unless the city treasurer,
after a hearing as hereinbefore provided, or on his own motion, shall
have reduced the tax or penalty or it shall have been established
in a proceeding under article 78 of the Civil Practice Act of the
state of New York that such determination was erroneous or illegal.
All refunds shall be made out of moneys collected under this section.
An application for a refund, made as hereinbefore provided, shall
be deemed an application for the revision of any tax or penalty complained
of and the city treasurer may receive additional evidence with respect
thereto. After making this determination, the city treasurer shall
give notice thereof to the person interested, and he shall be entitled
to an order to review such determination under said article 78, subject
to the provisions hereinbefore contained relating to the granting
of such an order.
[As amended by L.L. No.
1-1940]
J.
By whom tax to be paid. The tax imposed by this section
shall be charged against and be paid by the utility and shall not
be added as a separate item to bills rendered by the utility to customers
or others but shall constitute a part of the operating costs of such
utility.
K.
Action to enforce payment; lien. Whenever any person
shall fail to pay any tax or penalty imposed by this section, the
city attorney shall, upon the request of the city treasurer, bring
an action to enforce payment of the same. The proceeds of any judgment
obtained in any such action shall be paid to the city treasurer. Each
such tax and penalty shall be a lien upon the property of the person
liable to pay the same, in the same manner and to the same extent
that the tax and penalty imposed by section 186 A of the Tax Law is
made a lien.
L.
Administration. In the administration of this section
the city treasurer shall have power to make such reasonable rules
and regulations, not inconsistent with law, as may be necessary for
the exercise of his powers and the performance of his duties, and
to prescribe the form of blanks, reports and other records relating
to the administration and enforcement of the tax, to take testimony
and proofs, under oath, with reference to any matter within the line
of his official duty under this section, and to subpoena and require
the attendance of witnesses and the production of books, papers and
documents.
M.
Confidential nature of returns; exceptions. Except
in accordance with the proper judicial order or as otherwise provided
by law, it shall be unlawful for the city treasurer, or any agent,
clerk or employee of the city of North Tonawanda to divulge or make
known in any manner the amount of gross income or gross operating
income, or any particulars set forth or disclosed in any return under
this section. The officer charged with the custody of such returns
shall not be required to produce any of them or evidence of anything
contained in them in any section or proceeding in any court, except
on behalf of the city of North Tonawanda in an action or proceeding
under the provisions of this section, or on behalf of the state tax
commission in an action or proceeding under the provisions of the
Tax Law of the state of New York, or on behalf of any party to any
action or proceeding under the provisions of this section when the
returns or facts shown thereby are directly involved in such action
or proceeding, in either of which events the court may require the
production of, and may admit in evidence, so much of said returns
or of the facts shown thereby, as are pertinent to the action or proceeding,
and no more. Nothing herein shall be construed to prohibit the delivery
to a person, or his duly authorized representative, of a copy of any
return filed by him, nor to prohibit the publication of statistics
so classified as to prevent the identification of particular returns
and the items thereof, or the publication of delinquent lists showing
the names of persons who have failed to pay their taxes at the time
and in the manner provided for by this section, together with any
relevant information which in the opinion of the city treasurer may
assist in the collection of such delinquent taxes; or the inspection
by the city attorney or other legal representatives of the city of
North Tonawanda of the return of any person who shall bring action
to set aside or review the tax based thereon, or against whom an action
has been instituted in accordance with the provisions of this section.
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Any offense against the foregoing
secrecy provisions shall be punishable by a fine not exceeding $1,000
or by imprisonment not exceeding six months, or both, and if the offender
be an officer, agent, clerk or employee of the city of North Tonawanda
he shall be dismissed from office, and shall be incapable of holding
any office or employment in the city of North Tonawanda for a period
of five years thereafter.
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Notwithstanding any provisions
of this section the city treasurer may exchange with the chief fiscal
officer of any other city in the state of New York information contained
in returns filed under this section, provided such other city grants
similar privileges to the city of North Tonawanda, and provided such
information is to be use for tax purposes only, and the city treasurer
shall, upon request, furnish the state tax commission with any information
contained in such returns.
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N.
Disposition of taxes and penalties. [As amended by
L.L. No. 1, 1950] All taxes and penalties received by the city treasurer
for taxes heretofore and hereafter imposed under this section shall
be credited and deposited by him in the general fund of the city.
This local law shall take effect immediately.
