CIT Y OF BURBANK 275 EAST OLIVE AVE N UE, P

.O

.BOX 6459

,BU R BANK

,CALIFOR
NI A 91510

-64 59 www

.ci.burbank

.ca

.us December

7, 2015 Mr. James T. Brown {Email: James.T.Brown@faa.gov) Finance Management Federal Aviation Administration 800 Independence Avenue SW Wash in gton, DC 20591 Subject: Action Plan Submission Pursuant toFAA Policy and Procedures Concerning the Use of Airport Revenue (79 Fed. Reg. 66282-01, November

7, 2014)

. Dear Mr. Brown: This letter is in responsetothe request for anaction plan for the City of Burbank, California tocon veyits intent to comply with the FAA ruling related tosales tax revenuesderived from aviation fuel sales tothe extent that ruling complies with federal law

.This includes the process likely necessary
to amend any non-compliant local ordinances
to achieve compliance and the development
of reporting requirements and tra cking systems for speci fic information onaviation fuel tax revenueswhich in California means "jet fuel" asother typesof aviation fuels are exempt from sales taxin this state.
It is our understanding that the State of California will be submitting anAction Plan pertaining only tothe state's portion of the tax. California's state and

l ocal governments already provide exten
sive services to airports including infrastructure maintenance, fire protect

i on, public safety, environmental protection and noise abatement. These services and improvements arefunded with general sa

l estaxes and other taxes and the City of Burbank believes these local expenditures exceed the sales tax revenuesderived from the sale of aviation fuel. Applicable Law that May Require Amendments for Compliance •California State Proposition 172 Public Safety Sales Tax- Prop 172 was approved by California votersin 1993, and imposes

ahalf cent sales tax. Revenue

is restricted to public safety purposes, and any change requires

astatewide ballot initiative

.A portion of P rop172 revenue

is allocated tocities based onthe amount of property taxloss resulting from previous state budget balancing efforts. •Burbank Bob Hope Airport In addition tothe locally imposed transaction and usetax rate,the City of Burbank receiv esrevenues derived from the state sales and usetaxratefor the purposesof (health and human services, criminal justice and transportat ion). These statew

i de voter-approved
taxrates have been designated for specific purposes.

It is our understanding that the statewill provide anaction plan res ponseasit relates to necessary stepsfor assuring compliance related tothese revenues. Reporting Requirement and Tracking System FINANCIAL SERVICES DEPARTMENT Administration

I Accounting

I Audit

I Budget

I Rtvcnue (818) 238-5500

•Accounts Payablt (818)238

-5495

• Payroll

• Purchasing (818)238

-5491 (818) 238- 5466The City of Burbank
in conjun ct ion with

i ts advisors has begun to identif
y the required data and steps necessary to comply. The int ernal process to undertake this effort, including developing

a tracking system for discrete information
on aviation fuel tax revenues,

is complex and extensive. For example, the State Board of Equalization, the tax collection agency with which the City of Burbank has a contract for sales tax collectio ns, does not requi

r e jet fuel se llers to segregate sales tax revenue derived from the sa

l e of jet fuel from other types of taxable sales made by the same vendor

.Therefore,

i t is presently impossible for the City of Burbank to determine the exact amount of sales tax deriv ed from sales of jet fuel. local agencies would need the state to change its tax reporting standards to require fuel sellers to quantify the amount of tax derived from the sale of aviation fuel to achieve compliance. Segregating and reporting the correct am ount of tax rev enue will further complicate California's already complex sales tax system and increase administrative costs. Transition Period If, contrary to current expectations, the City of Burbank determines that its expenditures
on airport capital and operating costs do not exceed sales tax revenues derived from aviation fuel, it will consider legislat ive so lutions

.It is the intent of the City of Burbank to attempt to comply with the requirements set forth by the FAA ruling, to the extent
it complies with federal law. The City of Burbank will notify the FAA of specific actions,
if any, to be completed during the transition period and work with the state to ensure comp liance before the D ecember
8, 2017 deadline. Financial Services Director cc: Bob Frutos, Mayor C

i ty of Burbank Mark Scott, City Manager Burbank Amy Albano

,City Attorney Burbank Jay Chamberlain, Department
of Finance (Jay.Chamberlain@dof.ca.gov)