HomeMy Public PortalAbout11-06-2001LPFA
COPIES OF THE STAFF REPORTS OR OTHER WRITTEN DOCUMENTATION RELATING TO
EACH ITEM OF BUSINESS REFERRED TO ON THE AGENDA ARE ON FILE /N THE OFFICE
OF THE CITY CLERK
A PERSON WHO HAS A QUESTION CONCERNING ANY OF THE AGENDA ITEMS MAY
CALL THE CITY MANAGER
RICARDO SAN
VICE PRESIDE
AT THE REGULAR MEETING OF ~ E C E I V E V
THE LYNWOOD PUBLIC FINANCE AUTHORITY pin' OF LYNWppp
TO BE HELD ON NOVEMBER 6 2001 CITY CLERKS OFFICE
6:00 P.M. f1`(~V 0 i ~n.r,~
COUNCIL CHAMBERS ~~(
AGENDA ITEMS ON FILE FOR CONSIDERATION ~j~ ~D ;~~
~'~8~~r~0~llr~p1~ '3~ ~5~~
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CHEZ LOUIS BYRD
NT MEMBER
ARTURO REYES
MEMBER
CHIEF ADMINISTRATIVE OFFICER
RALPH W. DAVIS, III
SECRETARY
ANDREA L. HOOPER
1. CALL TO ORDER
PAUL H. RICHARDS, II
PRESIDENT
OPENING CEREMONIES
2. ROLL CALL OF MEMBERS
Louis Byrd
Armando Rea
Arturo Reyes
Ricardo Sanchez ~ ~_
Paul Richards
TREASURER
IRIS PYGATT
3. CERTIFICATION OF AGENDA POSTING BY SECRETARY
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
PUBLIC ORAL COMMUNICATIONS
IF AN ITEM IS NOT ON THE AGENDA, THERE SHOULD BE NO SUBSTANTIAL
DISCUSSION OF THE ISSUE BY THE LYNWOOD PUBLIC FINANCE
AUTHORITY, BUT IT IS ALL RIGHT FOR THE LYNWOOD PUBLIC FINANCE
AUTHORITY MEMBERS TO REFER THE MATTER TO THE STAFF OR
SCHEDULE SUBSTANTIVE DISCUSSION FOR A FUTURE MEETING.
(The Ralph M. Brown Act, Government Code Section 54950-54962, Part III,
Paragraph 5.)
ARMANDO REA
MEMBER
FINANCE DIRECTOR
ALFRETTA EARNEST
. ~ •
4. .MINUTES OF PREVIOUS MEETLNG:
Special .Meeting,. September 24, 2001
Regular Meeting,. October 2, 2001
Special Meeting, October 5, 2001
Special Meeting, October 8, 2001
Special Meeting, October 15, 2001
Regular Meeting,. October 16, 2001
Special Meeting, October 23, 2001
Special Meeting, October 26, 2001
5. LEGISLATION APPROVING EXTENDED MORATORIUM ON INTERNET
TAXATION
Comments:
The Internet Tax ,.'Freedom. Act (ITFA) was initially signed into law on October
21, 1998. The act imposed a moratorium on levying of new state and local
taxes on internet access services. The purpose of this item is to have the
Lynwood Public Financing Authority review the attached. information
regarding the Senate's approval to extend the moratorium on internet
taxation and receive and file information.
Recommendation:
Staff respectfully recommends that the Public Financing. Authority receive
and file attached, information regarding federal legislative action extending
the moratorium on internet sales tax.
ADJOURNMENT
MOTION TO .ADJOURN TO THE REGULARLY SCHEDULED MEETING ON
NOVEMBER 6, 2001 AT 6:00 P.M., IN THE COUNCIL CHAMBERS OF THE CITY
HALL, 11330 BULLIS ROAD., CITY OF_LYNWOOD, .CALIF.ORNIA.
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LYNWOOD PUBLIC FINANCE AUTHORITY
SPECIAL MEETING -
SEPTEMBER 24, 2001
.The :Public Finance Authority of the City of Lynwood' met in a Special Meeting at
11330 Bullis Road on the above date at 9:20 a.m.
- President Richards presiding.
.Members Byrd, Rea, Reyes, Sanchez and Richards answered the joint roll call
. for all agencies.
Also present were Chief Administrative Officer Davis, City Attorney Thever,
Assistant City Attorney Calsada, Secretary Hooper and Treasurer Pygatt.
Secretary Hooper announced that the agenda had been posted in accordance
with the Brown Act.
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda. Items Only)
NONE
PUBLIC ORALS COMMUNICATIONS
NONE
Member Rea left at 11:30 a.m.
Item.#4: PARKING ENFORCEMENT PROGRAM COST & REVENUES
ASSESSMENT
Parking Enforcement Officer Jerron Whitaker gave a brief presentation on the
Parking Enforcement. Program Cost and Revenues Assessment.
Member Reyes stated he would like to hire six (6) fulltime Parking Enforcement
Officers.
President Richards thanked Officer Jerron Whitaker-for the presentation, stated
he is very impressed.
It was moved Vice President Sanchez, seconded by Member Byrd to approve
three fulltime Officers and one fulltime Supervisor for the Parking Enforcement
Department.
. ROLL CALL:
AYES: MEMBER BYRD, REYES, SANCHEZ, RICHARDS
NOES: NONE
ABSENT: MEMBER' REA
ADJOURNMENT
Having no further discussion, it was moved by Member Reyes, seconded by
.Member Byrd and carried to adjourn the meeting at 12:30 p.m. -
Paul H. Richards, il, Mayor
Andrea L. Hooper, City Clerk
A(}ENVA ITEM
LYNWOOD PUBLIC FINANCE AUTHORITY
REGULAR MEETING
OCTOBER 2, 2001 -
The Public Finance Authority of the City of Lynwood met in a Regular Meeting at
11330 Bullis Road on the above date at 6:15 p.m.
President Richards presiding
Members Byrd, Rea, Reyes, Sanchez and Richards answered the joint roll call
for all of the Agencies.
Also present were Chief Administrative Officer Davis, City Attorney Thever,
Secretary Hooper and Treasurer Pygatt.
Secretary Hooper announced that the agenda had been posted in accordance
with the Brown Act.
PUBLIC ORAL COMMUNICATIONS
NONE
Item #4:. Minutes from Previous Meetings
It was moved by Member Byrd, seconded by Vice President Sanchez and carried
to approve the following minutes:
• Special Meeting September 6, 2001
• Special Meeting September 12, 2001
• Special Meeting September 17, 2001
ADJOURNMENT
Having no further discussion, it was moved by Vice Chairman Sanchez,
seconded by Member Byrd, and carried to adjourn the meeting at 10:20 p.m.
~,-~_
Paul H. Richards, II, Mayor
Andrea L. Hooper, City Clerk
OCTOBER2.2001 LPFA
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LYNWOOD PUBLIC FINANCE AUTHORITY
SPECIAL MEETING
OCTOBER 8, 2001
The Public Finance Authority of the City of Lynwood met in a Special Meeting at
11330 Bullis Road on the above date at 9:22 a.m.
President Richards presiding.
Members Byrd, Rea, Reyes, Sanchez and Richards answered the joint roll call
for all agencies.
Also present were Chief Administrative Officer Davis, City Attorney Thever,
Secretary Hooper and Treasurer Pygatt.
Secretary Hooper announced that the agenda had been posted in accordance
with the Brown Act.
PUBLIC ORAL COMMUNICATIONS
NONE
Item #4: Property Tax Revenue Allocations -Audits
It was moved by Member Reyes, seconded by Member Byrd and carried to
receive and file the information.
ADJOURNMENT
Having no further discussion, it was moved by Councilman Reyes, seconded by
Councilman Byrd and carried to adjourn the meeting at 11:17 a.m.
Paul H. Richards, II, Mayor
Andrea L. Hooper, City Clerk
OCTOBER8.2001 LRA
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LYNWOOD PUBLIC FINANCE AUTHORITY
SPECIAL MEETING
OCTOBER 15, 2001
The Public Finance Authority of the City of Lynwood met in a Special Meeting at
11330 Bullis Road on the above date at 9:25 a.m.
President Richards presiding:.
Members Byrd, Rea, Reyes, Sanchez and Richards answered the Joint Roll Call
for all. Agencies.
Also present were Chief ,Administrative Officer Davis, City Attorney Thever,
Secretary Hooper and Treasurer Pygatt.
Secretary Hooper announced that the agenda had been .posted in accordance
with the Brown Act.
. PUBLIC ORAL COMMUNICATIONS
Fidias Monson - 10808 California Avenue
Discussed with Council tickets he has received for parking his semi and
automobile in the parking lot at Lynwood Plaza. Stated he has received two (2)
tickets and that other vehicles that park there are not being cited.
Item #4: Review of the City's Revenues Relating to Towing Activities
Presentation: J.D. Whitaker, Parking Enforcement
Distributed packets to Council and discussed:
• Vehicle Removal
• Revenue. Totals
• Seven Point Plan
• Increasing Parking. Enforcement Staff
• Rotating Schedules
• Revenue Generation
Member Reyes asked .staff to look into a blue panted curb on Pope Street.
Stated there are not any handicapped people living at the residence and believes
the blue curb is being used for commercial purposes.
Vice President Sanchez asked who does the ticketing in the evenings, -and
discussed other trucks that are parking at the Lynwood Plaza. Asked if someone
on the property is collecting money for renting space to the truckers.
. President Richards asked staff about parking issues in the evenings.. Asked to
. see the Productivity Report from Parking Enforcement relating to the night the
gentleman who spoke is making reference to.
Member Byrd asked if the trucks that are being ticketed paying their tickets. Also
discussed a man living in a truck on Wright Road for the past year and nothing
has been done about it.
Member Reyes discussed problems with evening and weekend parking on Lilita
and Benwell Streets.
Member Rea stated Council needs to address the issue of Code Enforcement
parking fees. Stated let Parking Enforcement do their jobs.
Member Byrd discussed his concern with the increase in canopies in the city
being. used as garages.
.ADJOURNMENT
Having no further discussion, it was moved by Member Reyes, seconded by
Member Byrd and carried to adjourn the meeting at 11:07 a.m.
Paul H. Richards, II, Mayor
Andrea L. Hooper, City Clerk
OCTOBER15.2001 LPFA
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LYNWOOD PUBLiC FINANCE AUTHORITY
REGULAR MEETING
OCTOBER 16, 2001.
The Public Finance Authority of the City of Lynwood met in a Regular Meeting at
11330 Bullis Road on the above date at 6:30 p.m.
President. Richards presiding.
Members Byrd, Rea, Reyes, Sanchez and Richards answered the roll call
Also present were City Manager Davis, City Attorney Thever, Secretary Hooper
and Treasurer Pygatt.
Secretary. Hooper announced that the agenda had been posted in accordance
with the Brown Act.
City Manager Davis explained that at approximately 5:30 p.m. the City received.
two separate .calls regarding a bomb threat at two of its city facilities -City Hall-
and Bateman Hall. Both facilities were immediately evacuated to ensure the
safety of city employees and .members of the public.
It was moved by President Richards, seconded by Member Rea and carried due
to an emergency situation and to allow the Sheriff and County Fire Departments
to thoroughly check the city facilities. Members will recess to Wednesday
morning, October 17, 2001 at 7:00 a.m.
Meeting recess at 6:30 p.m.
Paul H. Richards, II, Mayor
Andrea L. Hooper, City Clerk
OCTOBER16.2001 LPFA.
LYNWOOD PUBLIC FINANCE AUTHORITY MEETING
OCTOBER 17, 2001
RECONVENED FROM OCTOBER 16, 2001 -
The Public Finance Authority of the City of Lynwood met in a Regular Meeting at
11330 Bullis Road on ,the above date at 7:07 p.m. Due to an emergency the
meeting of October 16, 2001 was recessed to October 17, 2001.
President Richards presiding.
Members Byrd, .Reyes, :Sanchez and Richards answered the Joint Roll Call for all
Agencies.
Member .Rea was absent.
Also present were City Manager Davis, City Attorney Thever, .Secretary Hooper
and Treasurer Pygatt.
Secretary Hooper announced that the agenda had been posted in accordance
with the Brown Act.
Member Rea arrived at 7:15 a.m.
Item #4: Minutes of Previous Meetings
It was moved by Member Byrd, seconded. by Vice-President Sanchez and carried
to approve the following Minutes:
• Regular Meeting September 18, 2001
• Special Meeting September 21, 2001
• Special Meeting October 1, 2001
Item #5: Internet Tax Freedom Act
It was moved by Member Reyes, seconded by Member Byrd and carried to
receive and file the information.
ADJOURNMENT
Hearing no further discussion, it was moved by Cvta~cilman Byrd, seconded by
.Mayor Pro Tem. Sanchez and carried to adjourn the meeting at 7:17 a.m. ,
Paul H. Richards, II, Mayor
Andrea L. Hooper, City Clerk
OCTOBER17.2001 LPFA
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LYNWOOD PUBLIC FINANCE AUTHORITY
SPECIAL MEETING
OCTOBER 23, 2001
The Public Finance Authority of the City. of Lynwood met in a Special Meeting at
Bateman Hall on the above date at 9:00.
Secretary Hooper announced due to a lack of a quorum the meeting scheduled
for 9:00 a.m. October 2;3, 2001 is adjourned.
Paul H. Richards, 11, Mayor '
Andrea L. Hooper, City.Clerk
OCTOBER23.2001 LPFA
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LYNWOOD PUBLIC FINANCE AUTHORITY
SPECIAL MEETING -
OCTOBER 26, 2001
The Lynwood Public Finance Authority of the City of Lynwood met in a Special
Meeting at 11330 Bullis Road on the above date at 12:48 p.m..
President Richards convened the Special Meeting of the Lynwood City Council,
Lynwood Redevelopment Agency, Lynwood Information Inc., Lynwood Public
Finance Authority,
President Richards presiding.
Members Byrd, Reyes, Sanchez and Richards answered the roll call.
Also present were Chief Administrative Officer Davis, City Attorney Thever, and
Assistant City Manager,Hempe.
Member Rea was absent.
Secretary Hooper was absent.
Treasurer Pygatt was absent.
Assistant City Manager announced that the agenda had been posted in
accordance with the Brown Act.
PUBLIC ORAL COMMUNICATIONS
Agenda Items of Any Aforementioned Agencies
NONE
PUBLIC ORAL COMMUNICATIONS
NONE
ITEM # 4 VEHICLE IMPOUND/STORAGE ADMINISTRATIVE FEE
It was moved by Member Reyes for staff to get the full recovery fee by increasing
it to $119, seconded Byrd. ~-
ROLL CALL:
AYES: MEMBER BYRD, REYES, SANCHEZ, RICHARDS
NOES: NONE
ABSTAIN: NONE
ABSENT: MEMBER REA
ADJOURNMENT
Having no further.discussion, it was moved by Mayor Richards seconded by
Councilman Byrd .and carried to adjourn the meeting at 2:22 p.m.
., .
DATE: November 6, 2001
TO: THE HONORABLE PRESIDENT AND MEMBERS OF THE AUTHORITY
FROM: Ralph W. Davis ill; City Manager
BY: Alfretta F. Earnest, Finance Director ~~1
SUBJECT: LEGISLATION APPROVING EXTENDED MORATORIUM ON
.INTERNET TAXATION.
PURPOSE:
The purpose of this item is to have the Lynwood Public Financing Authority
review the attached information regarding the Senate's approval to extend the
moratorium on internet taxation and receive and file information.
BACKGROUND:
The Internet Tax Freedom Act (ITFA) was initially signed into law on October 21,
1998. The act imposed a moratorium on levying of new state and local taxes on
internet access services (i.e typical $20.00_ monthly fee for an electronic mail
account, the capability to access the World Wide Web, etc.) The moratorium
also prohibits certain discriminatory and multiple state and local taxes as defined
in ITFA.
The ITFA does not directly affect the ability of states and local government to
impose sales taxes on purchases of .goods processed over .the internet. Such
power has already been constrained ,by U.S. Supreme Court decisions. The
court decisions noted that states may only require a mail order catalog company
to charge sales tax to its customers and remit the tax to the treasury of the state
in which the customer resides. This condition is allowed if the company has
some kind of physical presence (i.e. facilities or employees within. the states
borders)..
Timeline of Events: ~_
/ April 24, 2001, Representative Christopher Cox introduced bill H.R. 1552.
The bill initially extended the moratorium enacted by the Internet Tax
Freedom Act through 2006.
/ On October 16, 2001 =. Bill reported. with amendments, committed to the
committee of the whole House of the Union, and ordered to be printed: The
-final bill was amended prior to printing. Section 1101(a) was amended
striking 3 years after the date of enactment and inserting an extension
through November 1, 2003.
CONCLUSION:
The extention of moratorium to November 1, 2003 .notes that more than 10,000
state and local agencies with taxing authority over the internet will continue to be
barred. not only from taxing internet. access, but also from subjecting buyers and
sellers of electronic commerce to taxation in multiple states, or discriminating
against internet commerce with taxes which don't apply off-line.
A(~Ei1vA FTEM
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October 19, 2001
Issue #38-2001
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ON THE FEDERAL FRONT: E-COMMERCE
This week the House approved by voice vote H.R.
1552, which would extend the moratorium on new
and discriminatory Internet taxes (set to expire on
October 21, 2001) for two years (until November 1,
2003). The bill originally extended the ban for five
years, but .last week .in a surprise to Nouse leadership
and Internet retailers, the House Judiciary Commit-
tee, on a 19-15 vote, adopted an amendment by
Representatives Spencer Bachus (R-AL), Melvin Watts
(D-NC) and William Delahunt (D-MA) to trim back the
time frame to two years. The amendment was
adopted .after Committee Chairman James
Sensenbrenner (R-WI) refused to consider amend-
ments by Representatives Bachus and Watts address-
ing state and local government concerns with the
collection of taxes on remote sales.
Senator John McCain (R-AZ), who has proposed a
similar two-year extension, wrote .Senate Majority
Leader Daschle urging that the House bill be consid-
ered by the Senate before the moratorium expires.
No action has been scheduled yet in the Senate.
-~-
;Bill Summery R Stnais `
• ~/thomes.lx.gov/cgi-bin/bdquay/z?d107:HR01552:` ~.
Bill Summary & Status jor the 107th Congress
H.R1552
Sponsor: Rep Cox, Christopher introduced 4/24/2001)
Related Bills: H.R.1675
Latest Major Action: 10/17/2001 Received in the Senate.
Title: To extend the moratorium enacted by the Internet Tax Freedom Act through 2006, and for other
purposes.
STATUS: (color indicates Senate actionc)
4/24/2001:
Referred to the House Committee on the Judiciary.
5/9/2001:
Referred to the Subcommittee on Commercial and Administrative La~i~.
6/26/2001:
Subcommittee Hearings Held.
8/2/2001:
Subcommittee Consideration and Mark-up Session Held.
8/2/2001:
Forwarded by Subcommittee to Full Committee by Voice Vote.
10/10/2001:
Committee Consideration and Mark-up Session Held.
10/10/2001:
Ordered to be. Reported (Amended) by Voice Vote.
10/16/20013:06pm:
Reported (Amended) by the Committee on Judiciary, H. Rept. 107-240.
10/16/2001 3:07pm:
Placed on the Union Calendar, Calendar No. 143.
10/16/2001 3:14pm:
Mr. Sensenbrenner moved to suspend the rules and pass the bill, as amended.
10/16/2001 3:14pm:
Considered under suspension of the rules. (consideration: CR H6803-6808)
10/16/2001 3:Slpm:
On motion to suspend the rules and pass the bill, as amended Agreed to by-voice vote. (text: CR
H5803)
10/16/2001 3:51 pm:
Motion to reconsiderlaid on the table Agreed to without~cction.
10/16/20013:S1pm:
The title of the measure was amended. Agreed to without objection.
10/17/2001:
Received in the Senate.
_.. ....
Internet Tax Nondiscrimination Act (Reported in the House)
HR 1.5 52 RH
Union Calendar No. 143
107th CONGRESS
1st Session
H. R 1552
[Report No. 107-240]
To extend the. moratorium enacted by the Internet Tax Freedom Act through 2006, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
April 24, 2001
Mr. COX (for himself, Mr. GOODLATTE; and Mr. TOM DAMS of Virginia) introduced the following
bill.; which was referred to the Committee on the Judiciary_
October 1.6, 2001
Additional sponsors: Mr. HORN,: Mr. MCKEON, Mr. CALVERT, Mr. DREIER, Mr. OSE, Mr. GARY
G. MILLER of California, Mr. ROYCE, Mr. POMBO, Mr. ISSA, Mr. ROHRABACHER, Mr. HERGER,
Mr. CANNON, Mr. WELDON of Florida, Ms. MCKINNEY, and Mr. SCHAFFER
October 16, 2001
Reported with amendments, committed to the Committee of themhole House on the State of the Union,
and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic)
A BILL
To extend the moratorium enacted by the Internet Tax Freedom Act through ?006, and for other
..purposes.
Be it enacted by the Senate and House c f Representatives c f the United States of America in
Congress assembled,
[Struck out->] SECTION 1. SHORT TITLE . [<-Struck Out)
[Struck OUt->] This Act may be cited as the Internet Tax Nondiscrimination Act'.
[<-Struck out] -
[Struck out->] SEC. 2. EXTENSION OF INTERNET TAX FREEDOM ACT MORATORIUM.
[<-Struck out]
[Struck OUt->] (a) EXTENSION; INTERNET ACCESS TAXES- Section 11.01 of 'the Internet
Tax Freedom Act (47 U.S.C. 151 note) is amended-- {<-StrUCk Out]
[StrUCk OUt->] (1) by stri}:ing 'taxes during the period beginning on October
1, 1998, and ending 3 years after the date of enactment of this Act--' in
subsection (a) and inserting 'taxes:'; (<_StrUCk Out]
[StrUCk Out->] (2) by striking paragraph (1) of subsection (a) and inserting
the following: [<-Struck OUt]
[StrUCk OUt->] (1) "Taxes on Internet access . ' ; [GStrUCk OUt]
[StrUCk Out->] (3) by inserting before 'multiple' in paragraph (2) of
•subsection (a) the following: 'During the period beginning on October 1,
.1998, and ending on December 31, 2006, ' ; [<_StrUCk OUt]
[Struck OUt->] (4) by striking subsection (dsand [<-StrUCk oUt]
[Struck OUt->] (5) by redesignating subsections (e) and (f) as subsections
(d) and (e) , respectively. [<_StrUCk Out]
{StrUCkOUt->] (bJ CONFOR'~II:~'G AMEtiTD:~;DNi- Sectic„ 1104(10) of Internet Tax Freedom
Act (47 U.S.C. 151 note) is amended by stri};ing .'services unless such tax was
generally imposed and actually enforced prior to October 1, 1998.' and
inserting 'services.' . [GStrUCk Out]
. SECTION 1. SHORT TITLE
This Act maybe cited as the 'Internet Tczr Nondiscrimination Act'.
•
SEC. 2. EXTENSION OFINTERNET TAX FREEDOMACT MORATORIUM.
Section 1101(a) of the Internet Tax Freedom .Act (;~7 U.S.C. 1 ~ 1 note) is amended by striking '3
years after the date of the enactment of this Act' and inserting 'on November 1, 2003'.
Amend the title so as to read: 'A bill to extend the moratorium enacted by the Internet Tax Freedom Act
through November 1, 2003; and for other purposes.'.
Union Calendar No. 143
107th CONGRESS
1st Session
A. R. 1552
[Report No. 107-240]
A BILL
To extend the moratorium enacted by the Internet Tax Freedom Act through ?006, and for other
purposes.
October 16, 2001
Reported with amendments, committed to the Committee of the Whole. House on the State of the
Union, and ordered to be printed
Internet Tax Freedom Law.
® http://www.freedom.gov/library/itfa/f
The Internet Tax Freedom Bill, H.R. 4328
signed into law October 21, 1998
TITLE XI-MORATORNM ON CERTAIN TAXES
SEC. 1100. SHORT TITLE.
This title may be .cited as the ' `Internet Tax Freedom Act "
SEC. 1101. MORATORIUM.
(a) MORATORIUM.-No State or political subdivision thereof shall impose any of the
following taxes during the period beginning on October 1, 1998,. and ending 3 years after the
date of the enactment of this Act-
(1) taxes on Internet access, unless such tax was gen-erally imposed and actually enforced prior
to October 1, 1998; and
(2) multiple or discriminatory taxes on electronic commerce.
(b) PRESERVATION OF STATE AND LOCAL TAXING AUTHORITY.-Except as
provided in this section, nothing in this title shall be construed to modify, impair, or
super-sede, or authorize the modification, impairment, or super-seding of, any State or local
law pertaining to taxation that is otherwise permissible by or under the Constitution of the
United States or other Federal law and in effect on the date of enactment of this Act.
(c) LIABILITIES AND PENDING CASES.-Nothing in this title affects liability for taxes
accrued and enforced be-fore the date of enactment of this Act, nor does this title affect
ongoing litigation relating to such taxes.
(d) DEFINITION OF GENERALLY IMPOSED AND ACTU-ALLY ENFORCED.-For
purposes of this section, a tax has been generally imposed and actually enforced prior to
Oc-tober 1, 1998, if, before that date, the tax was authorized by statute and either-
(1) a provider of Internet access services had a rea-sonable opportunity to know by virtue of a
rule or other public proclamation made by the appropriate administra-tive agency of the State
or political subdivision thereof, that such agency has interpreted and applied such tax to
Internet access services; or
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(2) a State or political subdivision thereof generally collected such tax on charges for Internet
access.
(e) EXCEPTION TO MORATORIUM
(1) IN GENERAL.-Subsection (a) shall also not apply in the case of any person or entity who
knowingly and with knowledge of the character of the material, in inter-state or foreign
commerce by means of the World Wide Web, makes any communication for commercial
purposes that is available to any minor and that includes any ma-terial that is harmful to minors
unless such person or en-tity has restricted access by minors. to material that is harmful to
l of I I
10/25/200! )0:54 ,
lntemet Tau Freedom [.aw
• • http://www.freedom.gov/-ibrary/itfa/fin
minors-
(A) by requiring use of a credit card, debit account, adult access code, or adult personal
identification number;
(B) by accepting a digital certificate that verifies age; or
(C) by any other reasonable measures that are feasible under available technology.
{2) SCOPE OF EXCEPTION.-For purposes of para-graph
(1), a person shall not be considered to making a communication for commercial purposes of
material to the extent that the person is-
(A) a telecommunications carrier engaged in the pro-vision of a telecommunications service;
(B) a person engaged in the business of providing an Internet access service;
{C) a person engaged in the business of providing an Internet information location tool; or
{D) similarly engaged in the transmission, storage, retrieval, hosting, formatting, or translation
(or any com-bination thereof) of a communication made by another person, without selection
or alteration of the communica-tion.
(3) DEFINITIONS.-In this subsection:
(A) BY MEANS OF THE WORLD WIDE-WEB.-The term "by means of the World Wide
Web" means by placement of material in a computer server-based file archive so that it is
publicly accessible, over the Internet, using hypertext transfer protocol, file transfer protocol, or
other similar protocols.
(B) COMMERCIAL PURPOSES; ENGAGED IIV THE BUSI-NESS.-
(i) COMMERCIAL PURPOSES.-A person shall be con-sidered to make a communication for
commercial purposes only if such person is engaged in the business of making such
communications.
(ii) ENGAGED IN THE BUSINESS.-The term "engaged in the business" means that the
person who makes acorn-munication, or offers to make a communication, by means of the
World Wide Web, that includes any material that is harmful to minors, devotes time, attention,
or labor to such activities, as a regular course of such person's trade or business, with the
objective of earning a profit as a re-suit of such activities (although it is not necessary that the
person make a profit or that the making or offering to make such communications be the
person's sole or prin-cipal business or source of income). A person may be con-sidered to be
engaged in the business of making, by means of the World Wide Web, communications for
commercial purposes that include material that is harmful to minors, only if the person
knowingly causes the material that is harmful to minors to be posted on the World Wide Web
or knowingly solicits such material to be posted on the World Wide Web.
(C) INTERNET.-The term "Internet" means collec-tively the myriad of computer and
telecommunications fa-cilities, including equipment and operating software, which comprise
the interconnected world-wide network of networks that employ the Transmission Control
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ProtocoV Internet Protocol, or any predecessor~or successor protocols to such protocol, to
communicate information of all kirids li}% wire or radio.
{D) INTERNET ACCESS SERVICE.-The term "Internet access service" means a service
that enables users to access content, information, electronic mail, or other services of-fered
over the Internet and may also include access to pro-prietary content, information, and other
services as part of a package of services offered to consumers. Such term does not include
telecommunications services.
- (E) INTERNET INFORMATION LOCATION TOOL.-The term "Internet information
location tool" means, a service that refers or links users to an online location on the World
Wide Web. Such term includes directories, indices, references, pointers, and hypertext links.
(F) MATERIAL THAT IS I~ARMFUL TO MINORS.-The term "material that is harmful to
minors" means any communication, picture, image, graphic image file, article, recording,
writing, or other matter of any kind that is ob-scene or that-
(i) the average person, applying contemporary com-munity standards, would find, taking the
material as a whole and with respect to minors, is designed to appeal to, or is designed to
pander to, the prurient interest;
(ii) depicts, describes, or represents, in a manner pa-tently offensive with respect to minors, an
actual or simu-lated sexual act or sexual contact, an actual or simulated normal or perverted
sexual act, or a lewd exhibition of the genitals orpost-pubescent female .breast; and
(iii) taken as a whole, lacks serious literary, artistic, political, or scientific value for minors.
(G) MINOR.-The term "minor" means any person under 17 years of age.
(H) TELECOMMUNICATIONS CARRIER; TELECOMMUNI-CATIONS SERVICE.-The
terms "telecommunications car-rier" and "telecommunications service" have the meanings
..given such terms in section 3 of the Communications Act of 1934 (47 U.S.C. 153).
(f) ADDITIONAL EXCEPTION TO MOR-ATORIUM.-
(I) INGENERAL.-Subsection (a) shad also not apply with respect to an Internet access
provider, unless, at the time of entering into an agreement with a customer for the provision of
Internet access services; such provider offers such customer (either for a fee or at no charge)
screening software that is designed to permit the customer to limit access to material on the
Internet that is harmful to mi-nors.
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(2) DEFINITIONS.-In this subsection:
(A) INTERNET ACCESS PROVIDER.-The term "Internet access provider" means a person
engaged in the business of providing a computer and communications facility through which a
customer may obtain access to the Internet, but does not include a common carrier to the extent
that it provides only telecommunications serv-ices.
(B) INTERNET ACCESS SERVICES.-The term "Internet access services" means the
provi-sion of computer and communications services through which a customer using a
computer and a modem or other communications device may obtain access to the Internet, but
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does not include telecommunications services provided by a com-mon carrier.
(C) SCREENING SOFTWARE.-The term "screening software" means software that is
de-signed to permit a person to limit access to ma-terial on the Internet that is harmful to
minors.
(3) APPLICABILITY.-Paragraph (1) shall apply to agreements for the provision of Internet
access serv-ices entered into on or after the date that is 6 months after the date of enactment of
this Act.
SEC. 1102. ADVISORY COMMISSION ON ELECTRONIC COM-MERCE.
(a) ESTABLISHMENT OF COMMISSION.-There is es-tablished a commission to be kno~~n
as the Advisory Com-mission on Electronic Commerce (in this title referred to as the
"Commission"). The Commission shall-
(1) be composed of 19 members appointed in ac-cordance with subsection (b), including the
chair-person who shall be selected by the members of the Commission from among
themselves; and
(2) conduct its business in accordance with the provisions of this title.
(b) MEMBERSHIP.-
(1) IN GENERAL.-The Commissioners shall serve for the life of the. Commission. The
membership of the Commission shall be as follows:
(A) 3 representatives from the Federal Government, comprised of the Secretary of Com-merce,
the Secretary of the Treasury, and the United States Trade Representative (or their re-spective
delegates).
(B) 8 representatives from State and local governments (one such representative shall be from a
State or local government that does not impose a sales tax and one representative shall be from
a State that does not impose an income tax).
(C) 8 representatives of the electronic com-merce industry (including small business),
tele-communications carriers, local retail businesses, and consumer groups, comprised of-
(i) 5 individuals appointed by the Majority Leader of the Sg~te;
(ii) 3 individuals appointed by the Minority Leader of the Senate;
(iii) 5 individuals appointed by the Speaker of the House of Representatives; and
(iv) 3 individuals appointed by the Minority Leader of the House of Represent-atives.
(2)APPOINTMENTS.-Appointments to the Com-mission shall be made not later than 45
days after the date of the enactment of this Act. The chairperson shall be selected not later than
60 days after the date of the enactment of this Act.
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(3) VACANCIES.-Any vacancy in the Commis-sion shall not affect its powers, but shall be
filled in the same manner as the original appointment.
(c) ACCEPTANCE OF GIFTS AND GRANTS.-The Com-mission may accept, use, and
dispose of gifts or grants of services or property, both real and personal, for purposes of aiding
or facilitating the work of the Commission. Gifts or grants not used at the expiration of the
Commission shall be returned to the donor or grantor.
(d) OTHER RESOURCES.-The Commission shall have reasonable access to materials,
resources, data, and other information from the Department of Justice, the Depart-ment of
Commerce, the Department of State, the Depart-ment of the Treasury, and the Office of the
United States Trade Representative. The Commission shall also have rea-sonable access to use
the facilities of any such Department or Office for purposes of conducting meetings.
(e) SUNSET.-The Commission shall terminate 18 months after the date of the enactment of
this Act.
(f) RULES OF THE COMMISSION.-
(1) QUORUM.-Nine members of the Commission shall constitute a quorum for conducting
the business of the Commission.
(2) MEETINGS.-Any meetings held by the Com-mission shall be duly noticed at least 14
days in ad-vance and shall be open to the public.
(3) OPPORTUNITIES TO TESTIFY.-The Commis-sion shall provide opportunities for
representatives of the general public, taxpayer groups, consumer groups, and State and local
government officials to testify.
(4) ADDITIONAL RULES.-The Commission may adopt other rules as needed.
(g) DUTIES OF THE COMMISSION.-
(1) IN GENERAL.-The Commission shall conduct a thorough study of Federal, State and
local, and international taxation and tariff treatment oftrans-actions using the Internet and
Internet access and other comparable intrastate, interstate or inter-national sales activities.
(2) ISSUES TO BE STUDIED.-The Commission may include in the study under subsection
(a}-
(A) an examination of-
(i) barriers imposed in foreign markets on United States providers of property, goods, services,
or information engaged in electronic commerce and on United States providers of
telecommunications services; and
(ii) how the imposition of such barriers will affect United States consumers, the
competitiveness of United States citizens providing property, goods, services, or infor mation
in foreign markets, and the growth and maturing of the Internet;
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(B) an examination of the collection and administration of consumption taxes on elec-tronic
. ~ commerce in other countries and the Unit-ed States, and the impact of such collection on the
global economy, including an examination of the relationship between the collection and
ad-ministration of such taxes when the transaction uses the Internet and when it does not;
(C) an examination of the impact of the Internet and Internet access (particularly voice
transmission) on the revenue base for taxes im-posed under section 4251 of the Internal
Revenue Code of 1986;
(D) an examination of model State legisla-tion that-
(i) would provide uniform definitions of categories of property, goods, service, or information
subject to or exempt from sales and use taxes; and
(ii) would ensure that Internet access services, online services, and communica-tions and
transactions using the Internet, Internet access service, or online services would be treated in a
tax and techno-logically neutral manner relative to other forms of remote sales;
(E) an examination of the effects of tax-ation, including the absence of taxation, on all
interstate sales transactions, including trans-actions using the Internet, on retail businesses and
on State and local governments, which ex-amination may include a review of the efforts of
State and local governments to collect sales and use taxes owed on in-State.purchases from
out-of- State sellers; and
(F) the examination of ways to simplify Federal and State and local taxes imposed on the
provision of telecommunications services.
(3) EFFECT ON THE COMMUNICATIONS ACT OF 1934.-Nothing in this section shall
include an examina-tion of any fees or charges imposed by the Federal Com-munications
Commission or States related to-
(A) obligations under the Communications Act of 1934 (47 U.S.C. 1 ~ 1 et seq.); or
(B) the implementation of the Telecommunications Act of 1996 (or of amendments made by
-that Act).
(h) NATIONAL TAX ASSOCIATION COMMUNICATIONS AND ELECTRONIC
COMMERCE TAX PROJECT.-The Com-1796 mission shall, to the extent possible, ensure
that its work does not undermine the efforts of the National Tax Asso-ciation Communications
and Electronic Commerce Tax Project.
SEC. 1103. REPORT. '~-
Not later than 18 months after the date of the enact-ment of this Act, the Commission shall
transmit to Con-gress for its consideration a report reflecting the results, including such
legislative recommendations as required to address the findings of the Commission's study
under this title. Any recommendation agreed to by the Commission shall be tax and.
technologically neutral and apply to all forms of remote commerce. No finding or
recommendation shall be included in the report unless agreed to by at least two-thirds of the
members of the Commission serving at the time the finding or recommendation is made.
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SEC. 1104. DEFINITIONS.
For the purposes of this title:
http://www.freedom.gov/library/itfa/f
(1) BIT TAX.-The term "bit tax" means any tax on electronic commerce expressly imposed
on or measured by the volume of digital information transmitted electroni-cally, or the volume
of digital information per unit of time transmitted electronically, but does not include taxes
im-posed on the provision of telecommunications services.1797
(2) DISCRIMINATORY TAX.-The term "discriminatory taz" means-
(A) any tax imposed by a State or political subdivi-lion thereof on electronic commerce that-
(i) is not generally imposed~and legally collectible by such State or such political subdivision
on transactions in-volving similar property, goods, services, or information accomplished
through other means;
(ii) is not generally imposed and legally collectible at the same rate by such State or such
political subdivision on transactions involving similar property, goods, services, or information
accomplished through other means, unless the rate is lower as part of a phase-out of the tax.
;over not more than a 5-year period;
(iii) imposes an obligation to collect or pay the tax on a different person or entity than in the
case of trans-actions involving similar property, goods, services, or in-formation accomplished
through other means;
(iv) establishes a classification of Internet access serv-ice providers or online service providers
for purposes of es-tablishing a higher tax rate. to be imposed on such provid-ers than the tax
rate generally applied to providers of similar information services delivered through other
means; or1798
(B) any tax. imposed by a State or political subdivi-sion thereof, if-
. (i) except with respect to a tax (on Internet access) that was generally imposed and actually
. enforced prior to October 1, 1998, the sole ability to access a site on a re-mote seller's
out-of--State computer server is considered a factor in determining a remote seller's tax
collection obli-gation; or
(ii) a provider of Internet access service or online services is deemed to be the agent of a
remote seller for de-termining tax collection obligations solely as a result of-
(I) the display of a remote seller's information or con-tent on the out-of--State computer server
of a provider of Internet access service or online services; or
(II) the processing of orders through the out-of--State computer server of a provider of Internet
access service or online services.
(3) ELECTRONIC COMMERCE.-The term "electronic commerce" means any transaction
conducted over the Intetet or through Internet access, comprising the sale, lease, license, offer,
or delivery of property, goods, services, or information, whether or not for consideration, and
in-cludes the provision of Internet access.
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(4) INTERNET.-The term "Internet" means collectively the myriad of computer and
telecommunications fa-1799 cilities, including equipment and operating software, which
comprise the interconnected world-wide network of networks that employ the Transmission
Control ProtocoU Internet Protocol, or any predecessor or successor protocols to such protocol,
to communicate information of all kinds by wire or radio.
(5) INTERNET ACCESS.-The term "Internet access" means a service that enables users to
access content, infor-mation, electronic mail, or other services offered over the Internet, and
may also .include access to proprietary con-tent; information, and other services as part of a
package of services offered to users. Such term does not include tele-communications services.
(6) MULTIPLE TAX.-
(A} IN GENERAL.-The term "multiple tax" means any tax that is imposed by one State or
political subdivi-sion thereof on the same or essentially the same electronic commerce that is
also subject to another taz imposed by another State or political subdivision thereof (whether or
not at the same rate or on the same basis), without a cred-it (for example, a resale exemption
certificate) for taxes paid in other jurisdictions.
(B) EXCEPTION.-Such term shall not include a sales or use tax imposed by a State and 1 or
more political sub-divisions thereof on the same electronic commerce or a tax 1800 on persons
engaged in electronic commerce which also may have been subject to a sales or use tax
thereon.
(C) SALES OR USE TAX.-For purposes of subpara-graph (B), the term "sales or use tax"
. means a tax that is imposed on or incident to the sale, purchase, storage, consumption,
distribution, or other use of tangible personal property or services as may be defined by laws
imposing such tax and which is measured by the amount of the sales price or other charge for
such property or service.-
(7) STATE.-The term "State" means any of the sev-eral States, the District of Columbia, or
any common-wealth, territory, or possession of the United States.
(8) TAX.-
(A) IN GENERAL.-The term "tax" means-
(i)-any charge imposed by any govern-mental entity for the purpose of generating revenues for
governmental purposes, and is not a fee imposed for a specific privilege, service, or benefit
conferred; or
-s_
(ii) the imposition on a seller of an ob-ligation to collect and to remit to agovern-mental entity
any sales or use tax imposed on a buyer by a governmental entity.
(B) EXCEPTION.-Such term does not in-elude any franchise fee or similar fee imposed
by1801 a State or local franchising authority, pursuant to section 622 or 653 of the
Communications Act of 1934 (47 U.S.C. 542, 573), or any other fee related to obligations or
telecommunications car-riers under the Communications Act of 1934 (47 U.S.C. 151 et seq.).
(9) TELECOMMUNICATIONS SERVICE.-The term "telecommunications service" has the
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meaning given such term in section 3(46) of the Communications Act of 1934 (47 U.S.C..
153(46)) and includes commu-nications services (as defined in section 4251 of the Internal
Revenue Code of 1986).
(10) TAX ON INTERNET ACCESS.-The term "tax on Internet .access" means a tax on
.Internet access, including the enforcement or application of any new or preexisting tax on the
sale or use of Internet serv-ices unless such tax was generally imposed and actu-ally enforced
prior to October I, 1998.
TITLE XII-OTHER PROVISIONS
SEC. 1201. DECLARATIO_ N THAT INTERNET SHOULD BE FREE OF NEW
FEDERAL TA7iES.
• It is the sense of Congress that no new Federal taxes similar. to the taxes described in section
1101(a) should be enacted with respect to the Internet and Internet access during the
moratorium provided in such section.1802
SEC. 1202. NATIONAL TRADE ESTIMATE.
Section 181 of the Trade Act of 1974 (19 U.S.C. 2241) is amended- (1) in subsection (a)(1 }-
(A) in subparagraph (A)-
(i) by striking- "and" at the end of clause (i);
(ii) by inserting "and" at the end of clause (ii); and
(iii) by inserting after clause (ii) the following new clause: "(iii) United States electronic
com-merce, "; and
{B) in subparagraph (C}- (i) by striking "and" at the end of clause (i);
(ii) by inserting "and" at the end of clause (ii);
.(iii) by insertingafter clause (ii) the following new clause: "(iii) the value of additional United
States electronic commerce, "; and
(iv) by inserting "or transacted with," after "or invested in";
(2) in subsection (a)(2)(E)-1803 (A) by striking "and" at-tfl~ end of clause (i);
(B) by inserting "and" at the end of clause (ii); and
(C) by inserting after clause (ii) the follow-ing new clause: "(iii) the value of electronic
commerce transacted with,"; and
(3) by adding at the end the following new sub-section: "(d) ELECTRONIC
COMMERCE.-For purposes of this section, the term `electronic commerce' has the meaning
given that term in section 1104(3) of the Internet Tax Freedom Act.".
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. SEC. 1203. DECLARATION THAT.THE INTERNET SHOULD BE FREE OF
FOREIGN TARIFFS, TRADE BARRIERS, AND OTHER RESTRICTIONS.
(a) IN GENERAL.-It is the sense of Congress that the President should seek bilateral,
regional, and multilateral agreements to remove barriers to global electronic com-merce
through the World Trade Organization, the Organi-nation for Economic Cooperation and
Development, the Trans-Atlantic Economic Partnership, the Asia Pacific Economic
Cooperation forum, the Free Trade Area of the 1804 America, the North American Free Trade
.Agreement, and other appropriate venues.
(b) NEGOTIATING OBJECTIVES.-The negotiating ob jectives of the United States shall
be=-
(1) to assure that electronic commerce is free from-
(A) tariff and nontariff barriers;
(B) burdensome and discriminatory regula-tion and. standards; and
(C) discriminatory taxation; and (2) to accelerate the growth of electronic com-merce by
expanding market access. opportunities for-
(A) the development of telecommunications infrastructure;
(B) the procurement of telecommunications equipment;
(C) :the provision of Internet access and tele-communications services; and
(D) the exchange of goods, services, and digitalized information.
(c) ELECTRONIC COMMERCE.-For purposes of this section, the term "electronic
commerce" has the meaning given that term in section 1104(3).
..SEC. 1204. NO EXPANSION OF TAX AUTHORITY.
Nothing in this title shall be construed to expand the duty of any person to collect or pay taxes
beyond that which existed immediately before the date of the enactment of this Act.
SEC: 1205. PRESIERVATION OF AUTHORITY.
Nothing in this title shall limit or otherwise affect the impleu~ptation of the
Telecommunications Act of 1996 (Public Law 104-104) or the amendments made by such Act.
SEC..1206. SEVERABILITY.
If any provisions of this title, or any amendment made by this title, or the application of that
provision to any person or circumstance, is held by a court of com-petent jurisdiction to violate
any provision of the Constitu-tion of the United States, then the other provisions of that title,
and the application of that provision to other persons and circumstances, shall not be affected.
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