Councilmember Jack Evans
A PROPOSED RESOLUTION IN THE COUNCIL OF THE
DISTRICT OF COLUMBIA
To declare the existence of an emergency with respect to the need to act now to
increase the amount of the arena fee to be remitted on June 15, 2001 and to terminate the
arena fee beginning in fiscal year 2002. RESOLVED, BY THE COUNCIL OF THE DISTRICT OF
COLUMBIA, That this resolution may be cited as the "Arena Fee Rate Adjustment and
Elimination Emergency Declaration Resolution of 2001".
Sec. 2. (a) The Committee on Finance and Revenue held a public roundtable on Bill
14-23, the permanent version of the "Arena Fee Rate Adjustment and Elimination
Emergency Act of 2001", on February 8, 2001. At that public roundtable, no opposition
was voiced concerning an increase in the arena fee, a gross receipts tax, which is only
paid by businesses with annual gross receipts over $2 million. The D.C. Chamber of
Commerce submitted a letter in support of the legislation.
(b) Increasing the arena fee for qualifying tax payers will ensure that
enough revenue is collected in the coming tax year to pay off the arena bond and eliminate
the arena fee for future years.
(c) The arena fee is
paid by taxpayers with annual gross receipts over $2 million. The increase proposed in
both the permanent and emergency legislation is as follows:
(1) Taxpayers with annual District
gross receipts of $2,000,000 to $3,000,000 will pay $1,300 instead of $1,000;
(2) Taxpayers with annual District
gross receipts of $3,000,001 to $10,000,000 will pay $4,325 instead of $3,300;
(3) Taxpayers with annual District
gross receipts of $10,000,001 to $15,000,000 will pay $8,500 instead of $6,500; and
(4) Taxpayers with annual District
gross receipts over $15,000,000 will pay $14,250 instead of $11,000.
(d) There is no current requirement
in the law for excess collections to be returned to the taxpayers. For example, if $12
million were collected to pay off a balance to $2.8 million, the city would have a surplus
of $9.2 million after retiring the bonds.
(e) Eliminating the arena fee is a business-friendly move, since it not only eliminates
a monetary payment, but also eliminates administrative costs and burdens associated with
collecting the fee.
(f) The Committee on Finance and Revenue approved the permanent legislation on February
27, 2001.
(g) The permanent legislation will not be effective before the July 15, 2001 arena fee
is due to be paid by qualifying businesses.
Sec. 3. The Council of the District of Columbia determined that the circumstances
enumerated in section 2 constitute emergency circumstances making it necessary that the
"Arena Fee Rate Adjustment and Elimination Emergency Act of 2001" be adopted
after a single reading.
Sec. 4. This resolution shall take effect immediately.
1. The Tax Parity Act
of 1999 eliminated the arena fee for businesses with annual gross receipts under $2
million.