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<br />39 <br />Other Taxes and Revenues <br />Utility User’s Tax. The City imposes a tax on users of utilities, including gas, electric <br />and communications in the City (the “Utility Users Tax”), which is the third largest revenue <br />generator for the City. The Utility Users Tax is composed of the following rates: <br />TABLE 15 CITY OF SAN LEANDRO <br />UTILITY USERS TAX RATES <br /> <br />Utility Rate <br />Electric*, Gas*, TV, Telephone 6.0% <br />Cable 6.0 <br />Telecommunication 5.7 <br /> * Exemption on first $34 of gas or electric charges for residential properties. Source: City of San Leandro. <br />The Utility Users Tax became effective on July 1, 1970. Originally, the Utility Users Tax consisted of a 5% tax on electric, gas, cable television and telephone utilities (subject to the <br />exemptions noted in the table above). In 1993, the Utility Users Tax was increased without voter <br />approval to 6% for non–residential users. On November 4, 2008, the City’s voters approved Measure RR, which authorized application of the Utility Users Tax to situations where there <br />have been changes in technology and laws. Post–1984 technology had rendered the City’s <br />telephone tax less effective in taxing communication services that have, to a significant extent, replaced traditional telephone service. Unless precluded by federal law, Measure RR expanded <br />the City’s Utility Users Tax applicable to telephone utilities to apply to all types of telecommunication, video communication, text messaging, and paging services in addition to the telephone, cellular telephone and voice over internet protocol services. Measure RR also <br />reduced the tax rate applicable to such utilities from the original 6.0% to 5.7%. Measure RR <br />does not apply to digital downloads (e.g., games, ringtones, music and books). There is no sunset date for the changes effected by Measure RR. <br /> Transient Occupancy Tax. The City levies a transient occupancy tax on hotel and motel bills equal to 14% (the “TOT Tax”). The transient occupancy tax is a tax paid by hotel and <br />motel guests who spend fewer than 30 consecutive days in a hotel or motel in the City. Prior to the approval of Measure PP by the City’s voters on November 8, 2016, the TOT Tax was 10% <br />of the rent charged by hotel and motels in the City. Pursuant to Measure PP, the TOT Tax was <br />increased by 4% to 14%. The increase approved by the City’s voters pursuant to Measure PP was approved by the City Council on December 19, 2016, pursuant to Ordinance No. 2016-026. <br />There is no sunset date for the changes effected by Measure PP. <br /> Franchise Fee. Prior to the passage of State Bill AB 2987, the “Digital Infrastructure <br />and Video Competition Act of 2006,” Federal and State laws allowed cities to grant franchises to cable companies to use the public right–of–way to install and provide video service. Under the current franchise agreement, the cable company pays the City an annual franchise fee of 5% of <br />gross revenues. <br />In addition, the City also receives revenue from Electric & Gas Franchises, as well as <br />Refuse & Recycling. Electric/Gas franchise fees are based on gross receipts for the sale of electricity or gas within the City, and is the greater of these two calculations: