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Ordinance Fact Sheet |  |  |  |  |  |  |  |  |  | Ordinance Number
Brief Title |  |  |  | Approval Deadline |  |  | Reason
Wireless Telephone Tax Settlement |  |  |  |  |  |  | Acceptance of Settlement
Details |  |  |  |  |  |  | Positions/Recommendation
Reason for Legislation |  |  |  |  |  |  | Sponsor
 |  |  |  |  |  |  |  |  | Galen Beaufort, City Attorney
Acceptance of the settlement between Missouri cities,
including Kansas City, and T-Mobile requires enact- |  |  |  |  |  |  | Programs,
ment of an ordinance. |  |  |  |  |  |  | Departments
 |  |  |  |  |  |  | or Groups |  | Finance / Budget Office
 |  |  |  |  |  |  | Affected
 |  |  |  |  |  |  | Applicants/
 |  |  |  |  |  |  | Proponents |  | Applicant
Discussion |  |  |  |  |  |  |  |  | City Department
(including relationship to other Council actions)
 |  |  |  |  |  |  |  |  | Other
T-Mobile is the final large wireless telephone company
reaching a settlement with Missouri cities concerning
its obligation to pay telephone taxes on wireless |  |  |  |  |  |  | Opponents
services. |  |  |  |  |  |  |  |  | Groups or Individuals
The tentative settlement was approved by the Circuit
Court of St. Louis County June 28, 2010. |  |  |  |  |  |  |  |  | Basis of Opposition
Unlike prior settlements (Verizon, AT & T, Sprint) a
separate payment is required from certain cities in
recognition of the negotiations required to bring the |  |  |  |  |  |  | Staff |  | For
settlement to a conclusion and in recognition of different |  |  |  |  |  |  | Recommendation |  | Against
legal issues arising among some cities and T-Mobile.
The City is obligated to return to the Settlement Admin- |  |  |  |  |  |  |  |  | Reason Against
istrator $260,000.00. Other cities involved in these
negotiations unique to the T-Mobile settlement will pay
into this fund. These cities are St. Joseph, Gladstone, |  |  |  |  |  |  | Board or
Blue Springs, Independence, and St. Louis. Those cities |  |  |  |  |  |  | Commission |  | By
will pay no less than $5,437,429. |  |  |  |  |  |  | Recommendation
This settlement commits T-Mobile to continue to pay |  |  |  |  |  |  |  |  | For | Against | No action taken
the City's telephone tax on its wireless services. |  |  |  |  |  |  |  |  | For, with revisions or conditions
 |  |  |  |  |  |  |  |  | (see details column for conditions)
Money that has been paid under protest by T-Mobile |  |  |  |  |  |  | Council
during the pendency of this litigation will be released to |  |  |  |  |  |  | Committee Actions
the City. This amount is about $6.4 million today. It |  |  |  |  |  |  |  |  | Do pass
increases about $225,000 per month. |  |  |  |  |  |  |  |  | Do pass (as amended)
 |  |  |  |  |  |  |  |  | Committee Sub.
 |  |  |  |  |  |  |  |  | Without Recommendation
 |  |  |  |  |  |  |  |  | Hold
 |  |  |  |  |  |  |  |  | Do not pass
 |  |  |  |  |  |  |  |  |  |  | (Continued on reverse side)
Details |  |  |  |  |  |  | Policy / Program Impact
 |  |  |  |  |  |  | Policy or Program
 |  |  |  |  |  |  | Change |  | No | Yes
Payments made by T-Mobile are the smallest of the
settlement amounts because of T-Mobile's smaller
share of the wireless telephone market in Kansas City
during the tax years addressed in the litigation.
 |  |  |  |  |  |  | Operational Impact
 |  |  |  |  |  |  | Assessment
 |  |  |  |  |  |  | Finances
 |  |  |  |  |  |  | Cost & Revenue
 |  |  |  |  |  |  | Projections |  | Cost of Legislation |  | Payment to the
 |  |  |  |  |  |  |  |  | City of $4,934,449.80 and payments
 |  |  |  |  |  |  |  |  | by the City of $549,815.89
 |  |  |  |  |  |  |  |  | Increase/Decrease in Revenue Expected Annually
 |  |  |  |  |  |  |  |  | Because T-Mobile has been paying
 |  |  |  |  |  |  |  |  | its proper taxes those payments will
 |  |  |  |  |  |  |  |  | continue. Because they will not be
How will this contribute to a sustainable Kansas |  |  |  |  |  |  | Fund Sources |  | paid under protest the City will
City? |  |  |  |  |  |  |  |  | receive about $225,000 per month in
 |  |  |  |  |  |  |  |  | accessable tax revenue.
This ordinance does not relate to specific programs, but
rather contributes to the City's general fund. |  |  |  |  |  |  | (Use this space for further discussion, if necessary)
Is it good for the children?
This ordinance does not relate to specific programs, but
rather contributes to the City's general fund. By making
additional funds available for consideration by the
Council for programs designed to improve the lives of
children, the ordinance is good for the children.
Applicable Dates |  | Settlement form must be mailed by September 14, 2010
 |  | or the City will forfeit its right to participate in the settlement.
Fact Sheet prepared by: |  |  | [NAME], Assistant City Attorney
Reviewed by:
Reference Numbers