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HomeMy WebLinkAbout4150 Resolution - Opposing Local State Income Tax Option RES�LUTION NO. 4150 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON, EXPRESSING ITS OPPOSITION TO A LOCAL INCOME TAX ON THE RESIDENTS AND BUSINESSES OF THE CITY OF PASCO. WHEREAS, Article VII, § 1 of the Washington State Constitution establishes the basic framework for taxation in the State of Washington, including what shall be permitted as a tax; and WHEREAS, after the City of Seattle attempted to enact an income tax on certain individuals applicable within its municipal boundaries, the Washington State Court of Appeals, Division I, ruled that such a tax, when selectively applied, was unconstitutional and invalid. Kunath v. City ofSeattle, 10 Wash. App. 2d 205,444 P.3d 1235 (2019), review denied 195 Wn.2d 1013 (2020)); and WHEREAS, certain language in the Kunath ruling has caused discussion in various communities across Washington as to whether cities have authority to impose a local income tax, which, under Washington law, is legally considered a tax on property; and WHEREAS, the Washington State Supreme Court denied the request for appeal of the Kunath case such tliat the ruling stands at this time; and WHEREAS, the Washington State Legislature recently introduced a bill (Senate Bill 5554) which proposed to repeal existing statutory language prohibiting local government from levying a net income tax, and would authorize counties, cities and towns to levy a graduated tax on personal or business net income - if the jurisdiction makes a corresponding reduction in the amounts collected in certain uniform local taxes; and WHEREAS, the City Council wishes to join many other Washington local jurisdictions, including Battle Ground, DuPont, Granger, Kennewick, Longview, Moses Lake, Richland, Spokane, Spokane Valley, Union Gap, West Richland and Yakima, as well as Chelan County, Franklin County, Grant County, Spokane County and Yakima County, in publicly declaring its position opposing the imposition of a local income t�on its residents and businesses; and WHEREAS, businesses large and small provide the economic lifeblood in our City, the County, the region, state and country; and WHEREAS,businesses are already subject to a highly regressive business and occupation tax imposed by the state of Washington, and although many cities across the state additionally impose a local business and occupation tax, the Pasco City Council has deliberately chosen not to do so, electing, instead, to create a regulatory and taxing climate based on opportunity in which businesses may operate; and Resolution Opposing Local State Income Tu�Option- 1 WHEREAS, the City Council knows that a strong and encouraging business climate is one of the best ways to attract and retain good businesses to employ people in family wage jobs; and WHEREAS, use of a local income tax may generate additional revenue in the short term, but would most likely result in less long-term revenue due to the dampening effect it would have on our businesses. NOW THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO,WASHINGTON: That the imposition of a local income tax on the businesses and residents of the City of Pasco is opposed. Such a tax would be a direct conflict with the high value the City places on promoting economic development through the attraction and expansion of financially healthy, family wage paying employers. Small businesses are the backbone of our local, regional, state, and national economy and it is imperative that the Ciry not put unnecessary hurdles in the way of their success. As such, the City Council of the City of Pasco opposes the imposition of a local income tax in the event a local income tax is determined legal and permissible by the Washington State Supreme Court or the Washington State Legislature, and Be It Further Resolved that the City Manager is authorized and directed to forward executed copies of this Resolution to the appropriate representatives of both houses of the Washington State Legislature, and of the Association of Washington Cities, in Olympia, Washington, and Be It Further Resolved that this Resolution shall be effective upon adoption. PASSED by the City Council of the City of Pasco, Washington, this 7�' day of February, 2022. �� Blanche Barajas Mayor APPROVED AS TO FORM: � � � Debra Barham, CMC Kerr Ferguson Law, PLL City Clerk City Attorney Resolution Opposing Local State Income Tax Option-2