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13 <br /> <br /> <br /> <br />Business License Tax (BLT) <br />Most cities and a few counties have enacted business license taxes. Business license tax rates are <br />set individually by each city and county most commonly based on gross receipts (overall business <br />revenue) or levied at a flat rate, but may be based on the quantity of goods produced, number of <br />employees, number of vehicles, square footage of the business or some combination of factors. <br />If a business operates in more than one city, a city may only tax that portion of the business’s <br />activities conducted within the city. In most cases, business license taxes are not imposed for <br />regulatory purposes (as the term “license” might imply) but to raise revenues for general municipal <br />purposes (i.e. a tax). If imposed as a fee to pay for the cost of regulating the business, the fee may <br />not exceed the reasonable cost of regulating the business. (See “regulatory fees.”) <br />Transient Occupancy Tax (TOT) or Hotel Bed Tax <br />Most cities and some counties impose a transient occupancy tax or hotel bed tax on persons staying <br />thirty days or less in hotels, motels and similar lodgings, including mobile homes. A county may <br />impose a transient occupancy taxes only in the county area outside city limits. Typically, the lodging <br />provider collects the tax from guests and turns the funds over to the county or city. <br />Transient occupancy taxes are imposed by most cities and counties and range from three and a half <br />percent to 15 percent. For cities with a transient occupancy tax, it provides seven percent of general <br />revenues on average, and as much as 17 percent in some cities. Any increase or extension of a local <br />tax requires voter approval. <br />Utility User Tax (UUT) <br />Many cities impose utility user taxes on the consumption of utility services, including (but not limited <br />to) electricity, gas, water, sewer, telephone (including mobile phone and long distance), sanitation <br />and cable television. Counties may levy utility user taxes in county area outside city limits. Any <br />increase or extension of a local tax requires voter approval. <br />Utility companies usually collect utility user's taxes from their customers as part of their regular billing <br />procedures and remit the funds collected to the city or county which imposed the tax. <br />Over 150 cities and a few counties levy utility user rates varying from one to 11 percent. For those <br />jurisdictions with utility user taxes, it provides an average of 15 percent of general revenue and often <br />as much as 22 percent. <br />Parcel Tax <br />A parcel tax is a special tax on a parcel – or unit – of real property. Unlike the property tax, a parcel <br />tax may not be based on the value of property. Instead, parcel taxes are generally based on a flat <br />per-parcel rate. <br />A parcel tax may be enacted, increased or extended by a city, county, special district or school district <br />only with two-thirds voter approval, even for general purposes. <br />Documentary Transfer Taxes and Property Transfer Taxes <br />A documentary transfer tax is a tax imposed on the transfer of interests in real estate. Counties tax at <br />a rate of 55 cents per $500 of the property’s value. Cities may impose the tax at up to one half of that <br />amount, which is credited to the payment of the county tax. The Constitution allows charter cities ix to <br />Page 31 of 109