(A) Each business engaging in banking business in the city that also maintains a banking location outside the city shall make a good faith allocation of its gross income in accordance with this section, subject to the approval of the Finance Director. Each bank subject to this regulation shall report gross income for municipal business and occupation tax purposes to reflect all gross income generated from loans originated and services provided to customers at or through each banking location within the municipal limits of the city and each such bank’s report shall fully reflect gross income earned from investments (other than loans) funded by deposits and repurchase agreements regularly maintained at or through each banking location within the municipal limits of the city. Other gross income shall be allocated in a reasonable manner that attributes all income to banking locations. No allocation methodology used to make such a report shall allocate or apportion gross income to locations other than a banking location.
(B) Without limiting the generality of the foregoing:
(1) The phrase BANKING LOCATION (and all derivations thereof) means a physical facility maintained by a bank engaged in banking business at which customers normally personally visit to conduct typical banking transactions, such as opening accounts, originating loans, making deposits and the like; and
(2) Gross income from loans is reportable (without adjustment, apportionment or allocation) to the banking location at which the loan originates. The transfer of loan files to a location outside of a municipality for processing or collection does not alter the taxability of the interest from such loans with respect to the banking location at which such loans originate.
(C) Gross income from investments (other than loans) acquired or repurchase agreements is reportable to banking location(s) in which deposits giving rise to the income are maintained, regardless of whether the investments function is managed or directed at a separate location. Deposits and repurchase agreements are considered maintained only at banking locations in accordance with reasonable procedures that reflect typical customer deposit activities and repurchase agreement relationships maintained at banking locations of the taxpayer subject to the approval of the Finance Director. Gross income from investments (other than loans) acquired or funded from sources other than deposits or repurchase agreements shall be reported to banking location(s) in a reasonable manner that fairly allocates all such gross income to banking locations.
(D) (1) Gross income from fees is reportable to the banking location at which the activity giving rise to the fee is primarily undertaken, using a reasonable method that fully reports fee income to one or more banking locations.
(2) The Finance Director shall have authority to review and approve reasonable allocation methods in accordance with this section.
(3) Each bank subject to this regulation shall establish and maintain sufficient records for review by the Finance Director and its designee as long as the contents of such records may be material in the administration of the municipal business and occupation tax of the city along with such additional information as may otherwise be required. Each bank subject to this regulation shall file reports on such forms designed from time to time by the Finance Director and shall follow all instructions in connection therewith.
(Ord. passed 11-12-2019)