(a) Establishment of gas users' tax. There is hereby imposed a tax upon every person in the City using gas that is delivered through a pipeline distribution system. The tax imposed by this section shall be at the rate of 3.95% of the charges made for such gas, including all services related to the storage, transportation and delivery of such gas.
(b) Gas charges. As used in this section, the term “charges” shall include, but is not limited to, the following charges:
(1) The commodity charges for purchased gas, or the cost of gas owned by the service user (including the actual costs attributed to drilling, production, lifting, storage, gathering, trunk-line, pipeline, and other operating costs associated with the production and delivery of such gas), which is delivered through a gas pipeline distribution.
(2) Gas transportation charges (including interstate charges to the extent not included in commodity charges).
(3) Storage charges; provided, however, that the service supplier shall not be required to apply the tax to any charges for gas storage services when the service supplier cannot, as a practical matter, determine the jurisdiction where such stored gas is ultimately used.
(4) Capacity or demand charges, late charges, service establishment or reestablishment charges, transition charges, customer charges, minimum charges, annual and monthly charges, and any other charges, which are necessary or common to the receipt, use and enjoyment of gas service.
(5) Charges, fees, or surcharges for gas services or programs, which are mandated by the California Public Utilities Commission or the Federal Energy Regulatory Commission, whether or not such charges, fees, or surcharges appear on a bundled or line item basis on the customer billing,
(c) Gas charges further defined. As used in this section, the term “charges” shall include the value of any other services, credits, property of every kind or nature, or other consideration provided by the service user in exchange for the gas or services related to the delivery of such gas.
(d) Exclusions. There shall be excluded from the base on which the tax imposed in this section is computed:
(1) Charges made for gas that is to be resold and delivered through a pipeline distribution system or by mobile vehicle transport.
(2) Charges made for gas sold for use in the generation of electrical energy by an electric corporation, by a public utility or governmental agency, or by an exempt wholesale generator.
(3) Charges made by a gas public utility for gas used and consumed in the conduct of the business of gas public utilities.
(4) Charges made for gas used in the propulsion of a motor vehicle, as defined in the California Vehicle Code, utilizing natural gas and other natural gas clean-air technologies.
(5) Charges made for gas used by a non-utility service supplier to generate electricity for its own use or for sale to others, provided the electricity so generated is subject to the electricity users' tax in accordance with Section 3.26.070.
(6) Propane purchased by a user for personal or household use.
(e) Survey of gas service suppliers; authority for administrative rulings. The Tax Administrator shall, from time to time, survey the gas service suppliers in the City to identify the various unbundled billing components of the gas retail service that are being offered to customers within the City, and the charges therefor, including those items that are mandated by State or Federal regulatory agencies as a condition of providing such gas service. The Tax Administrator may, thereafter, issue and disseminate to such gas service suppliers an administrative ruling identifying those components and items that are: (1) necessary or common to the receipt, use and enjoyment of gas service; or (2) currently, or historically have been, included in a single or bundled rate for gas service by a local distribution company to a class of retail customers. Unbundled charges for such components and items shall be subject to the tax of subsection (a) above.
(f) Collection of gas users' tax. Taxes on charges for gas imposed by this section shall be collected from the service user by the gas service supplier or its billing agent. The amount of tax collected in one month shall be remitted to the Tax Administrator, and must be received by the Tax Administrator, on or before the twentieth day of the following month; or, at the option of the person required to collect and/or remit the tax, such person shall remit an estimated amount of tax, measured by the tax billed in the previous month or upon the payment pattern of the service user, which must be received by the Tax Administrator on or before the twentieth day of the following month.
(Ord. 177, passed 11-6-2018)