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City of Littleton

Littleton Center 2255 West Berry Avenue Littleton, CO 80120

Meeting Agenda City Council Tuesday, December 5, 2017

6:30 PM

Council Chamber

Regular Meeting

1. Roll Call 2. Pledge of Allegiance 3. Approval of Agenda 4. Public Comment 5. Consent Agenda Items Consent agenda items can be adopted by simple motion. All ordinances must be read by title prior to a vote on the motion. Any consent agenda item may be removed at the request of a Council Member.

a)

Resolution 53-2017

A resolution approving an Intergovernmental Agreement between the City of Littleton and the City of Centennial for pavement rehabilitation on South Broadway between West Caley Avenue and East Arapahoe Road.

Attachments:

Resolution No. 53-2017 IGA for Pavement Rehab

b)

ID# 17-334

Approval of the November 21, 2017 regular meeting minutes

Attachments:

11-21-2017 CC Minutes - DRAFT

6. Ordinances on First Reading a)

Ordinance 35-2017

Ordinance on first reading amending Title 3, Chapter 9, Sections 3-9-1-2, 3-9-3-2, 3-9-1-10 and 3-9-6-12 of the city code, enacting and implementing standardized sales and use tax definitions

Attachments:

Ordinance 35-2017 - First Reading Definitions Tax Matrix CML Letter

City of Littleton

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Printed on 12/4/2017

City Council

b)

c)

d)

Meeting Agenda

December 5, 2017

Ordinance 36-2017

An ordinance on first reading amending Ordinance No. 21 Series of 2016 known as the Annual Appropriation Bill for all municipal purposes for the fiscal year beginning January 1, 2017 and ending December 31, 2017.

Attachments:

Ordinance No. 36-2017

Ordinance 39-2017

An ordinance on first reading amending the 2017 Emergency Medical Transportation Enterprise Budget.

Attachments:

Ordinance No. 39-2017

Ordinance 37-2017

An ordinance on first reading adopting and entering into the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust and taking other actions in connection therewith

Attachments:

Ordinance No. 37-2017 Trust Agreement

7. Ordinances on Second Reading and Public Hearing 8. General Business 9. Comments / Reports a) City Manager b) Council Members c) Mayor

10. Adjournment The public is invited to attend all regular meetings or study sessions of the City Council or any City Board or Commission. Please call 303-795-3780 at least forty-eight (48) hours prior to the meeting if you believe you will need special assistance or any reasonable accommodation in order to be in attendance at or participate in any such meeting. For any additional information concerning City meetings, please call the above referenced number.

City of Littleton

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PUBLIC COMMENT

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City of Littleton


Staff Communication File #: Resolution 53-2017, Version: 3 Agenda Date: 12/05/2017 Subject: A resolution approving an Intergovernmental Agreement between the City of Littleton and the City of Centennial for pavement rehabilitation on South Broadway between West Caley Avenue and East Arapahoe Road. Presented By:

Keith Reester, Public Works Director

POLICY QUESTION: Does city council support an Intergovernmental Agreement with the City of Centennial for pavement rehabilitation on South Broadway between West Caley Avenue and East Arapahoe Road? BACKGROUND: South Broadway is generally the municipal boundary between the City of Littleton and the City of Centennial. Each city is responsible for maintenance of the street within its jurisdiction. The City of Littleton initiated pavement rehabilitation on a segment of South Broadway between West Caley Avenue and East Arapahoe Road. The municipal boundaries run down the centerline of Broadway for a portion of this project. The city contracted with PLM Asphalt and Concrete, Inc. to perform the pavement rehabilitation work on this segment of Broadway. The city agreed to manage the project, and contracted with Alfred Benesch and Company for design and construction inspection services. The City of Centennial agreed to reimburse the City of Littleton for its share of the material, labor, and construction management. STAFF ANALYSIS: Both cities realize a cost savings in undertaking projects with mutual benefit. Joint projects such as this result in a higher quality finished product versus being constructed independently. OPTIONS/ALTERNATIVES: N/A FISCAL IMPACTS: The total project cost as bid for the 2017 Street Rehabilitation - Mill and Overlay Project is $837,265.30. The City of Centennial will reimburse the City of Littleton for the portion of work within its jurisdiction in the amount of $67,389.83. STAFF RECOMMENDATION: Staff recommends city council approve the Intergovernmental Agreement with the City of Centennial for the City of Littleton

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Printed on 11/30/2017 powered by Legistar™

File #: Resolution 53-2017, Version: 3 Staff recommends city council approve the Intergovernmental Agreement with the City of Centennial for the pavement rehabilitation project on South Broadway. PROPOSED MOTION: I move to approve Resolution 53-2017 approving an Intergovernmental Agreement between the City of Littleton and the City of Centennial for pavement rehabilitation on South Broadway between West Caley Avenue and East Arapahoe Road.

City of Littleton

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CITY OF LITTLETON, COLORADO Resolution No. 53 Series, 2017 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, AUTHORIZING AN INTERGOVERNMENTAL AGREEMENT WITH THE CITY OF CENTENNIAL FOR PAVEMENT REHABILITATION ON SOUTH BROADWAY BETWEEN WEST CALEY AVENUE AND EAST ARAPAHOE ROAD.

WHEREAS, the Council may, by resolution, enter into contracts with other governmental bodies to furnish or receive governmental services, to make or pay charges for such service, and to enter into cooperative or joint activities with other governmental bodies; and WHEREAS, the City of Littleton has entered into a contract with PLM Asphalt and Concrete Inc. for a pavement rehabilitation project on South Broadway between West Caley Avenue and East Arapahoe Road with a contract price of $837,265.30; and WHEREAS, the municipal boundary between the City of Littleton and the City of Centennial traverses a portion of said pavement rehabilitation project, with each city being responsible for maintenance of the street within its jurisdiction; and WHEREAS, the City of Centennial has agreed to reimburse the City of Littleton for their share of the material, labor, and construction management services for the 2017 Pavement Rehabilitation Program, in the amount of $67,389.83. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, THAT: Section 1. An Intergovernmental Agreement with the City of Centennial for pavement rehabilitation on South Broadway between West Caley Avenue and East Arapahoe Road, is hereby approved. INTRODUCED, READ AND ADOPTED at a regularly scheduled meeting of the

39

City Council of the City of Littleton, Colorado, on the 5th day of December, 2017, at 6:30 p.m. at

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the Littleton Center, 2255 West Berry Avenue, Littleton, Colorado.

41 42 43

Resolution No.53 Page 2 of 2 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58

ATTEST:

__________________________ Wendy Heffner CITY CLERK APPROVED AS TO FORM: __________________________ Lena McClelland ASSISTANT CITY ATTORNEY

__________________________ Debbie Brinkman MAYOR

INTERGOVERNMENTAL AGREEMENT 2017 PAVEMENT REHABILITATION PROGRAM THIS INTERGOVERNMENTAL AGREEMENT is made and entered into this ____ day of ____________, 2017, by and between the CITY OF CENTENNIAL, a home rule municipal corporation of the State of Colorado, hereinafter referred to as “Centennial,” and the CITY OF LITTLETON, a home rule municipal corporation of the State of Colorado, hereinafter referred to as “Littleton.” Centennial and Littleton are individually referred to herein as “Party” and collectively as the “Parties.” RECITALS WHEREAS, the Parties are home-rule cities formed under the authority granted Article XX, Section 6 of the Colorado Constitution, and are authorized by C.R.S. §29-1-203 and their home-rule charters to enter into a contract or agreement for the sharing of the cost of concrete repair and pavement rehabilitation, as set out below; and WHEREAS, Littleton is undertaking to perform pavement rehabilitation of that portion of South Broadway between West Caley Avenue and East Arapahoe Road (the “Project Road”); and WHEREAS, the Project Road lies within the jurisdictions of Littleton and Centennial; and WHEREAS, Littleton desires to enter into a construction contract with P L M Asphalt and Concrete Inc. d/b/a PLM Asphalt and Concrete (hereinafter referred to as “Pavement Contractor”) to perform the pavement rehabilitation work on the Project Road; and WHEREAS, Littleton and Centennial have determined to utilize the services of Pavement Contractor through a construction contract with Littleton to accomplish the pavement rehabilitation on the Project Road, with Centennial reimbursing Littleton for Centennial’s share of the materials and labor as described in Exhibit A to this Agreement. NOW, THEREFORE, in consideration of the mutual covenants and agreements, and the premises herein contained, the parties hereto agree: 1. Term: This Agreement shall be effective as of September 30, 2017 and shall continue through December 31, 2017. 2. Work by Littleton: Littleton shall act as the Project Manager. A map of the Project Road, consisting of one page, is attached hereto as Exhibit B and is incorporated herein by reference. The performance obligation of Littleton hereunder shall be limited to funds appropriated by Centennial for the purpose of this Agreement and paid to Littleton pursuant to this Agreement. 3. Statements and Payment: Upon receipt and approval of partial pay requests from Pavement Contractor, Littleton shall make periodic payments to the Pavement Contractor. Upon payment to the Pavement Contractor, Littleton will submit billing to Centennial for the portion of work performed on the Project Road within Centennial’s jurisdiction during the applicable pay Page 1 of 7

period(s) and Centennial shall reimburse Littleton said full amount of billing within thirty (30) days of receipt of billing from Littleton. Billing will be based the applicable contract unit price for contract bid items associated with work on the Project Road, and as more specifically set forth in Exhibit A. All payments by Centennial to Littleton contemplated in this Agreement have been appropriated or otherwise lawfully authorized by Centennial in Centennial’s 2017 budget. 4. Waiver: In no event shall any performance by one party hereunder constitute or be construed to be a waiver by such party of any breach of covenant or condition or any default which may then exist on the part of the other party, and the rendering of any such performance when any such breach or default shall exist shall in no way impair or prejudice any right or remedy available to the non-breaching party with respect to such breach or default, and no assent, expressed or implied, to any breach of any one or more covenants, provisions or conditions of the Agreement shall be deemed or taken to be a waiver of any succeeding or other breach. 5. Liability: Each party shall be responsible for its own negligence hereunder to the extent provided by law. Neither party shall be deemed to be an agent for the other party. 6. Subject to Local Laws; Venue: Each and every term, provision or condition herein is subject to and shall be construed in accordance with the provisions of Colorado law. Venue for any action arising hereunder shall be in Arapahoe County, Colorado. 7. Assignment and Subcontracting: Neither party is obligated or liable under this Agreement to any party other than those specified herein. Centennial and Littleton understand and agree that they shall not assign or subcontract with respect to any of the rights, benefits, obligations or duties under this Agreement except upon prior written consent and approval of the other party, which consent or approval may be withheld in the absolute discretion of that other party, and in the event any such assignment or subcontracting shall occur, such action shall not be construed to create any contractual relationship between either of the parties and such assignee or subcontractor, and Centennial and Littleton shall remain responsible to each other according to the terms of this Agreement. 8. Conflict of Interest: The parties agree that no official, officer or employee of Centennial shall have any personal or beneficial interest whatsoever in the services or property described herein and Littleton further agrees not to hire or contract for services any official, officer or employee of Centennial which would be in violation of any applicable Centennial rules and regulations. 9. No Third Party Beneficiary: It is expressly understood and agreed that enforcement of the terms and conditions of this Agreement, and all rights of action relating to such enforcement, shall be strictly reserved to Centennial and Littleton, and nothing contained in this Agreement shall give or allow any such claim or right of action by any other or third person on such Agreement. It is the express intention of Centennial and Littleton that any person other than Centennial or Littleton receiving services or benefits under this Agreement shall be deemed to be an incidental beneficiary only. 10. Status of Parties: It is understood and agreed by and between the parties that the status of each of the parties hereto shall be that of an independent contractor and it is not Page 2 of 7

intended, nor shall it be construed, that either party or any employer or subconsultant of such party is an employee, officer, or agent of the other party for purposes of unemployment compensation, workers' compensation, or for any purpose whatsoever. 11. Examination of Records: Littleton agrees that any duly authorized representative of Centennial, shall, until the expiration of three (3) years after the final payment made by Littleton to the Pavement Contractor, have access to and the right to examine any directly pertinent books, documents, papers and records of Littleton involving transactions related to this Agreement, including but not limited to all records of Littleton related to the Project Road and Littleton’s construction contract with Pavement Contractor. 12. Paragraph Headings: The captions and headings set forth herein are for convenience of reference only, and shall not be construed so as to define or limit the terms and provisions hereof. 13. Severability: It is understood and agreed by the parties hereto that if any part, term, or provisions of this Agreement is by the courts held to be illegal or in conflict with any law of the State of Colorado, the validity of the remaining portions or provisions shall not be affected, and the rights and obligations of the parties shall be construed and enforced as if the Agreement did not contain the particular part, term, or provision held to be invalid. 14. Agreement as Complete Integration; Amendments: This Agreement is intended as the complete integration of all understandings between the parties, their successors and assigns. No prior or contemporaneous addition, deletion or other amendment hereto shall have any force or effect whatsoever, unless embodied herein in writing. No subsequent notation, renewal, addition, deletion, or other amendment hereto shall have any force or effect unless embodied in written amendatory or other Agreement executed by the parties and signed by the signatories of the original Agreement. This Agreement and any amendments shall be binding upon the parties, their successors and assigns. 15. Legal Authority: a. Each Party assures and guarantees that it possesses the legal authority, pursuant to any proper, appropriate and official motion, resolution or action passed or taken, to enter into this Agreement. b. The person or persons signing and executing this Agreement on behalf of each Party, do hereby warrant and guarantee that he/she or they are fully authorized to execute this Agreement on behalf of Centennial or Littleton and to validly and legally bind Centennial or Littleton to all the terms, performances and provisions herein set forth. 16. Execution in Counterparts: This Agreement may be executed in several counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. 17. Project Representatives; Project Management: a. Project Representatives:

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1. Littleton Representative. Littleton hereby designates Brent Thompson ([email protected] (303) 795-3798) as the Littleton Representative to coordinate all communication with Centennial related to the Project and issues arising under this Agreement. 2. Centennial Representative. Centennial hereby designates Kelsey Deckert ([email protected] (303) 754-3349) as the Centennial Representative to coordinate all communication with Littleton related to the Project and issues arising under this Agreement. b. Project Management: It is mutually agreed between the Parties that Littleton shall be responsible for management of the project through direction to the Pavement Contractor, approval of traffic control plans, testing, and inspection. It is further agreed that the Centennial Representative will work through the Littleton Representative to provide direction or comments to the Pavement Contractor. 18. Traffic: It is mutually agreed that Centennial will issue the appropriate permit to the Pavement Contractor for execution of work within Centennial's jurisdiction at no cost and will allow Pavement Contractor to utilize Centennial's arterial roadways for transport of material to project site. 19. Cost Overruns: Centennial and Littleton understand that if the actual project cost exceeds the costs described in Exhibit A, Littleton will notify Centennial and receive authorization to proceed with the work from the Centennial Representative before any those additional costs are incurred. If actual costs exceed the amounts stated in Exhibit A due to actual field constructed quantities, Centennial agrees to work with Littleton to amend this Agreement to reflect the actual cost of Centennial's portion of the project and reimburse said amount to Littleton. [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. CITY OF CENTENNIAL, COLORADO

By: __________________________________ Matt Sturgeon, City Manager pursuant to the authority provided in Section 2-2-130(c)(1) of the Centennial Municipal Code Attest:

Reviewed by:

______________________________ City Clerk or Deputy City Clerk

_____________________________________ For City Attorney’s Office

DEPARTMENT/POSITION RESPONSIBLE CONTRACT: Public Works

FOR

ADMINISTRATION

OF

CITY OF LITTLETON, COLORADO

By: Title: Mayor Attest:

Approved as to form:

______________________________ City Clerk or Deputy City Clerk

_____________________________________ City Attorney

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EXHIBIT A Costs 2017 Littleton Street Rehabilitation Program – City of Centennial Portion of Broadway

Removal of Asphalt Mat (Planning) Removal of Curb and Gutter Removal of Sidewalk Sawcutting Concrete and Asphalt Adjust Valve Covers to Final Grade Aggregate Base Course (Class 6) Hot Mix Asphalt (SX)(75)(PG 64-22) Concrete Sidewalk (6”) Concrete Curb Ramp Truncated Domes Detectable Warning Joint Seal Concrete Driveway (10”) Curb and Gutter, Type 2 (Section IIB) Epoxy Pavement Marking Preformed Thermoplastic (Xwalk - Stop Line) Preformed Thermoplastic (Word/Symbol)

Unit

Quantity

SY LF SY LF EA TN TN SY SY EA LF SY LF Gal SF SF

4,600 99 18 220 4 5 589.49 9 7 2 15 15 99 9 178 39

Cost per Unit $2.15 $9.85 $27.00 $2.75 $50.00 $38.80 $69.30 $60.75 $107.00 $138.00 $4.50 $122.00 $22.00 $97.00 $12.50 $19.00

Total $9,890.00 $975.15 $486.00 $605.00 $200.00 $194.00 $40,851.81 $546.75 $749.00 $276.00 $67.50 $1,830.00 $2,178.00 $873.00 $2,225.00 $741.00

Estimated $62,688.21 Total Cost Construction Management $4,701.62 (7.5%) Total Project $67,389.83 Cost

*All quantities are actual construction quantities in project limits that lies within City of Centennial boundaries.

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EXHIBIT B Map of Project Road

Extents of Centennial Contribution

Littleton/ Centennial Boundary

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City of Littleton


Staff Communication File #: ID# 17-334, Version: 1 Agenda Date: 12/05/2017 Subject: Approval of the November 21, 2017 regular meeting minutes Presented By:

Wendy Heffner, City Clerk

RECORDING SECRETARY’S CERTIFICATION: I hereby certify that the attached minutes are an accurate representation of motions made and action taken at the November 21, 2017, regular meeting of the city council. I have also reviewed the video recording for the November 21, 2017 regular meeting of the Littleton City Council and certify that the video recording is a full, complete, and accurate record of the proceedings and there were no malfunctions in the video or audio functions of the recording. PROPOSED MOTION: I move to approve the minutes for the November 21, 2017 regular meeting of the Littleton City Council.

City of Littleton

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City of Littleton


Meeting Minutes - Draft City Council

Tuesday, November 21, 2017

6:30 PM

Council Chamber

Regular Meeting

1. Roll Call Council Member Clark arrived at 6:34 p.m. Present:

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Mayor Pro-Tem Brinkman, Council Member Cernanec, Mayor Beckman, Council Member Clark, Council Member Cole, Council Member Hopping and Council Member Valdes

2. Pledge of Allegiance 3. Approval of Agenda 4. Public Comment Heidi Schlossberg - The schools would benefit from more counselors than SRO officers. She would also appreciate it if the SWAT team exercises be conducted in/on/around tax-payer funded facilities versus populated areas such as her neighborhood. Pam Chadbourne - Thanked the four outgoing council members for their service.

5. Consent Agenda Items a)

Resolution 42-2017

A resolution approving an Intergovernmental Agreement between Littleton Public Schools and the City of Littleton for School Resource Officers approved

b)

Resolution 52-2017

A resolution approving an agreement between the City of Littleton and The Greenway Foundation for participation in the Environmental Pool for conservation and restoration of the South Platte River approved

c)

ID# 17-322

Approval of the November 7, 2017 regular meeting minutes approved

Approval of the Consent Agenda Council Member Cernanec moved and Council Member Hopping seconded to approve consent agenda items 5(a), 5(b) and 5(c). The vote is 7-0. The motion City of Littleton

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City Council

Meeting Minutes - Draft

November 21, 2017

carries unanimously. Aye:

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Mayor Pro Tem Brinkman, Council Member Cernanec, Mayor Beckman, Council Member Clark, Council Member Cole, Council Member Hopping and Council Member Valdes

6. Ordinances on First Reading 7. Ordinances on Second Reading and Public Hearing a)

Ordinance 24-2017

An ordinance on second reading establishing the tax levy to defray the costs of municipal government of the City of Littleton, counties of Arapahoe, Douglas, and Jefferson, State of Colorado, for the city’s fiscal year beginning January 1, 2018 and ending December 31, 2018 Mayor Beckman opened the public hearing at 6:42 p.m. With no public comment, closed the public hearing at 6:43 p.m. Council Member Cernanec moved and Council Member Cole seconded to approve on second reading the ordinance establishing the tax levy of 6.662 mills to defray the costs of municipal government of the City of Littleton, counties of Arapahoe, Douglas, and Jefferson, State of Colorado, for the city's fiscal year beginning January 1, 2018 and ending December 31, 2018. The vote is 7-0. The motion carries unanimously.

Aye:

7-


8. General Business 9. Comments / Reports a) City Manager No report

b) Council Members Council Member Cole - reminded everyone of the Candlelight walk this Friday, November 24 and Holiday Eve scheduled at the Museum on December 10. Tickets are required for the museum event. Proceeds help support Friends of the Library and Museum. Council Member Clark - no report Council Member Hopping -Encouraged remaining and new council members to continue with: (1) The design guidelines to preserve Littleton's culture while encouraging reinvestment in the community; (2) Focus on suicide prevention. Encourages council to consider having a youth commission; (3) Nesting owls in South Platte Park are being harassed with drones. Encourages council to pass legislation to protect the wildlife from drones. Council Member Cernanec - The federal grant money for the Area Agency on Aging is caught up in Washington. The impact for us is transportation contracts and City of Littleton

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City Council


November 21, 2017

nutrition providers for our seniors. Council Member Valdes - thanked outgoing council members for their hard work, especially Mayor Beckman for his more than 35 years of service to the city. Mayor Pro Tem Brinkman - no report

c) Mayor Thanked the citizens of Littleton for the turn out in the recent election. Thanked this council and past councils for contributions to the city. Thanked new council members for their upcoming service.

10. Recognition of Outgoing Council Members 11. Appoint a Temporary Chair a) Appoint City Clerk as Temporary Chair Council Member Valdes moved and Council Member Cernanec seconded to make the city clerk the temporary chair. The vote is 7-0. The motion carries unanimously. Aye:

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12. Adjournment Sine Die City Council Transitional Meeting 1. Temporary Chair calls the transitional City Council meeting of November 21, 2017 to order Temporary Chair calls the transitional City Council meeting of November 21, 2017 to order at 7:24 p.m.

2. Oath of Office for new City Council Members - Administered by Presiding Judge Ethan Feldman a) District I - Council Member Driscoll (4-year term) b) District III - Council Member Fey (4-year term) c) At Large - Council Member Elrod (4-year term) d) At Large - Council Member Schlachter (2-year term)

3. Roll Call Present: Council Member Brinkman, Council Member Cole, Council Member Driscoll, Council Member Elrod, Council Member Fey, Council Member Schlachter, Council Member Valdes

City of Littleton

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City Council


November 21, 2017

4. Election of Mayor Temporary Chair will entertain nominations for Mayor The temporary chair called for nominations for Mayor. Council Member Valdes nominated Council Member Brinkman. With no other nominations, Clerk Heffner closed nominations and asked for a motion. Council Member Cole moved and Council Member Schlachter seconded to appoint Council Member Brinkman as mayor for a two-year term. The vote is 6-1 with Council Member Fey voting no. The motion carries.

5. Election of Mayor Pro Tem Temporary Chair will entertain nominations for Mayor Pro Tem The temporary chair called for nominations for Mayor Pro Tem. Council Member Elrod nominated Council Member Valdes as Mayor Pro Tem for a two-year term. With no other nominations, Clerk Heffner closed nominations and asked for a motion. Council Member Cole moved and Mayor Brinkman seconded to appoint Council Member Valdes as Mayor Pro Tem for a two-year term. The vote is 7-0. The motion carries unanimously.

6. Temporary Chair relinquishes meeting to newly appointed Mayor 7. Adjournment by Mayor Mayor Brinkman adjourned the meeting at 7:37 p.m.

The public is invited to attend all regular meetings or study sessions of the City Council or any City Board or Commission. Please call 303-795-3780 at least forty-eight (48) hours prior to the meeting if you believe you will need special assistance or any reasonable accommodation in order to be in attendance at or participate in any such meeting. For any additional information concerning City meetings, please call the above referenced number.

City of Littleton

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City of Littleton


Staff Communication File #: Ordinance 35-2017, Version: 2 Agenda Date: 12/05/2017 Subject: Ordinance on first reading amending Title 3, Chapter 9, Sections 3-9-1-2, 3-9-3-2, 3-9-1-10 and 3-9-6-12 of the city code, enacting and implementing standardized sales and use tax definitions Presented By:

Tiffany Hooten, Finance Director

POLICY QUESTION: Does city council support an amendment to Chapter 3 of the City of Littleton Municipal Code regarding the Sales Tax Standardization Definitions Project and conform to Colorado Revised Statutes? BACKGROUND: The largest revenue source (52%) for the General Fund is from sales and use taxes. Every vendor must collect a 3.00% sales tax on the purchase price or sales price paid or charged for tangible personal property and certain taxable services when purchased, leased, rented or sold at retail within the City of Littleton. The city is a homerule municipality meaning the city self-collects sales taxes directly from taxpayers. In 1991, self-collecting home-rule municipalities worked with the Colorado Municipal League (CML) to adopt a series of standardized sales and use tax definitions to make it easier on businesses that had locations or made sales/deliveries in multiple jurisdictions. Having consistent definitions across the multiple home-rule municipalities simplified the sales tax recordkeeping and administrative burden on the business community. Since then, the standardization of the definitions has eroded as various cities have added and modified existing definitions to address new technologies and issues raised by various taxpayers, and to provide better clarification where ambiguities potentially existed. In 2014, the Colorado General Assembly adopted Senate Joint Resolution 14-038, asking CML to again work with its member municipalities to adopt a package of standard definitions related to sales and use tax. CML formed a Sales Tax Standardized Definitions subcommittee to work on a package of standard definitions. There were many meetings and lots of hours dedicated to this project, which included good discussion, some give and take, and ultimately an agreed upon package of definitions for each municipality to take to their elected officials for adoption. It is important to note that many of the current definitions include language related to taxability or exemption and not all municipalities have the same tax treatment for each definition. As part of the standardization project, taxability/exemption language was removed from the proposed new definitions - thus requiring other changes to the code to address the taxability or exemption as applicable. With the constraints of TABOR, it is important to recognize and demonstrate that the revised definitions do not create a tax policy change that results in the creation of new taxes or additional revenues. To help demonstrate that the definitions and other corresponding changes to the code are revenue neutral and don’t violate TABOR, City of Littleton staff utilized a matrix developed by the City of Golden. The matrix identifies the definitions, tax treatment and references to the code sections of the existing code, and then refers to the new definitions, City of Littleton

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File #: Ordinance 35-2017, Version: 2 tax treatment and references to the code sections of the existing code, and then refers to the new definitions, identifies similar tax treatment and references to new code sections. As this relates to the City of Littleton, the matrix clearly identifies that the recommended code changes have not changed the City’s position on the taxability or exemption of any provisions in the code. A letter a letter from CML and various heads of business associations further explaining the project are attached for additional background information. This is a statewide effort and 20 self-collecting municipalities have adopted the standardized sales tax definitions as of October 2017. Additional amendments to the code are required in order to comply with Colorado Revised Statutes (CRS), 292-106-1. A study session was held on November 28, 2017 with city council regarding this amendment. STAFF ANALYSIS: Staff, along with the city attorney’s office, is supportive of the standardized definitions and have attached the tax matrix as mentioned above. Additional changes to section 3-9-3-2 Exemptions, is required because of the standardized definitions. Section 3-1-1-10 Hearings and Procedure for Review and section 3-9-6-12 Refusal to Make Return of the city code must be amended to allow for thirty (30) days for a taxpayer to petition a tax assessment to conform to Colorado Revised Statutes. FISCAL IMPACTS: There are no fiscal impacts in adopting these amendments to the city code. STAFF RECOMMENDATION: Staff recommends council consider amending Title 3, Chapter 9 of the City of Littleton City Code, adopting the standard definitions and amending other sections of Chapter 9 affected by the new definitions to maintain the tax policy within the City and conform to CRS 29-2-106-1 with first reading on December 5, 2017. PROPOSED MOTION: I move to approve ordinance 35-2017 amending Title 3, Chapter 9, Sections 3-9-1-2, 3-9-3-2, 3-9-1-10 and 3-96-12 of the city code, enacting and implementing standardized sales and use tax definitions on first reading and to schedule a second reading and public hearing for December 19, 2017.

City of Littleton

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CITY OF LITTLETON, COLORADO ORDINANCE NO. 35 Series, 2017 INTRODUCED BY COUNCILMEMBERS: AN ORDINANCE OF THE CITY OF LITTLETON, COLORADO, AMENDING TITLE 3, CHAPTER 9, SECTION 1-2, OF THE CITY CODE, ENACTING AND IMPLEMENTING STANDARDIZED SALES AND USE TAX DEFINITIONS AND MAKE RELATED CHANGES TO TITLE 3, CHAPTER 9, SECTIONS 1-10, 3-2, AND 6-12 WHEREAS, the Colorado General Assembly adopted Senate Joint Resolution (SJF) 14-038, asking the Colorado Municipal League (CML) to work with its members to develop a package of standardized definitions; and WHEREAS, CML formed a Sales Tax Standardized Definitions Committee (“Committee”) comprised of members from self-collecting home-rule municipalities that worked diligently to prepare a list of standard definitions that would be acceptable to such municipalities; and WHEREAS, City Council has determined that the city should cooperate in furtherance of a statewide goal to have all self-collecting municipalities agree to use standard definitions in their sales and use tax codes; and WHEREAS, City Council has determined that maintaining the local collection of sales and use taxes for the city is important to insure the continued financial strength of the city; and WHEREAS, these changes to the city code are for the purpose of clarification and uniformity only, and will not result in the implementation of any new tax policy, nor will they result in the implementation of any new taxes, nor will it result in the elimination of any current tax exemptions. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, THAT: Section 1: Section 3-9-1-2 of the City Code is hereby amended as follows: 3-9-1-2: STANDARDIZED DEFINITIONS: When not clearly indicated by the context, the following words and phrases, as used in this Chapter, shall have the following meanings:

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AGRICULTURE means a person regularly engaged in the business of using land for the production of commercial crops or commercial livestock. The term includes farmers, market gardeners, commercial fruit growers, livestock breeders, dairymen, poultrymen, and other persons similarly engaged, but does not include a person who breeds or markets animals, birds, or fish for domestic pets nor a person who cultivates, grows, or harvests plants or plant products exclusively for that person's own consumption or casual sale.

AUTOMOTIVE VEHICLE: means Aany vehicle or device in, upon, or by which any person or property is or may be transported or drawn upon a public highway, or any device used or designed for aviation or flight in the air. Automotive vehicle includes, but is not limited to, motor vehicles, trailers, semitrailers, or mobile homes. Automotive vehicle shall not include devices moved by human power or used exclusively upon stationary rails or tracks. BUSINESS: means Aall activities engaged in, or caused to be engaged in, with the object of gain, benefit, or advantage, direct or indirect. BUSINESS: means Aall activities engaged in, or caused to be engaged in, with the object of gain, benefit, or advantage, direct or indirect. CANDY means a preparation of sugar, honey, or other natural or artificial sweeteners in combination with chocolate, fruit, nuts, or other ingredients or flavorings in the form of bars, drops, or pieces. “Candy” does not include any preparation containing flour, products that require refrigeration or marijuana infused products. CARRIER ACCESS SERVICES means the services furnished by a local exchange company to its customers who provide telecommunications services which allow them to provide such telecommunications services. CHARITABLE ORGANIZATION: means Aany entity which: (1) has been certified as a nonprofit organization under Section 501(c)(3) of the Internal Revenue Code, and (2) is an organization which exclusively, and in a manner consistent with existing laws and for the benefit of an indefinite number of persons or animals, freely and voluntarily ministers to the physical, mental, or spiritual needs of persons or animals, and thereby lessens the burden of government. organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation, and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of any candidate for public office. CITY or TOWN means the municipality of Littleton, CO. CITY TREASURER: means Tthe City Finance Director or his or her designee. COINS means monetized bullion or other forms of money manufactured from gold, silver, platinum, palladium or other such metals now, in the future or heretofore designated as a medium of exchange under the laws of this State, the United States or any foreign nation. COIN OPERATED DEVICE means any device operated by coins or currency or any substitute therefor.

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COMMERCIAL PACKAGING MATERIALS means containers, labels, and/or cases, that become part of the finished product to the purchaser, used by or sold to a person engaged in manufacturing, compounding, wholesaling, jobbing, retailing, packaging, distributing or bottling for sale, profit or use, and is not returnable to said person for reuse. Commercial Packaging Materials does not include Commercial Shipping Materials. COMMERCIAL SHIPPING MATERIALS means materials that do not become part of the finished product to the purchaser which are used exclusively in the shipping process. Commercial Shipping Materials include but are not limited to containers, labels, pallets, banding material and fasteners, shipping cases, shrink wrap, bubble wrap or other forms of binding, padding or protection. CONSTRUCTION EQUIPMENT means any equipment, including mobile machinery and mobile equipment, which is used to erect, install, alter, demolish, repair, remodel, or otherwise make improvements to any real property, building, structure or infrastructure. CONSTRUCTION MATERIALS: means Ttangible personal property which, when combined with other tangible personal property, loses its identity to become an integral and inseparable part of a completed structure or project including public and private improvements. Construction materials include, but are not limited to, such things as: asphalt, bricks, builders' hardware, caulking material, cement, concrete, conduit, electric wiring and connections, fireplace inserts, electrical heating and cooling equipment, flooring, glass, gravel, insulation, lath, lead, lime, lumber, macadam, millwork, mortar, oil, paint, piping, pipe valves and pipe fittings, plaster, plumbing fixtures, putty, reinforcing mesh, road base, roofing, sand, sanitary sewer pipe, sheet metal, site lighting, steel, stone, stucco, tile, trees, shrubs and other landscaping materials, wallboard, wall coping, wallpaper, weather stripping, wire netting and screen, water mains and meters, and wood preserver. The above materials, when used for forms, or other items which do not remain as an integral or inseparable part of a completed structure or project, are not construction materials. CONSUMER: means (A) Aany individual person, or (B) Any person engaged in business in the City who purchases, uses, stores, distributes or otherwise consumes, in the City, tangible personal property or taxable services, purchased from sources inside or outside the City. COVER CHARGE means a charge paid to a club or similar entertainment establishment which may, or may not, entitle the patron paying such charge to receive tangible personal property, such as food and/or beverages. DIGITAL PRODUCT means an electronic product including, but not limited to: (1) “digital images” which means works that include, but are not limited to, the following that are generally recognized in the ordinary and usual sense as “photographs,” “logos,” “cartoons,” or “drawings.” (2) “digital audiovisual works” which means a series of related images which, when shown in succession, impart an impression of motion, together with accompanying sounds, if any, (3) “digital audio works” which means works that result from the fixation of a series of musical, spoken, or other sounds, including ringtones. For purposes of the definition of “digital audio works”, “ringtones” means digitized sound files that are downloaded onto a device and that may be used to alert the customer with respect to a communication, and (4) “digital books” which means works that are generally recognized in the ordinary and usual sense as “books”.

DRUGS DISPENSED IN ACCORDANCE WITH A PRESCRIPTION: Drugs dispensed in accordance with any order in writing, dated and signed by a licensed practitioner of the healing arts, or

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given orally by a practitioner, and immediately reduced to writing by the pharmacist, assistant pharmacist, or pharmacy intern, specifying the name and address of the person for whom the medicine, drug or poison is offered and directions, if any, to be placed on the label. "Drugs dispensed in accordance with a prescription" do not include drugs which may be purchased over-the-counter. DWELLING UNIT means a building or any portion of a building designed for occupancy as complete, independent living quarters for one (1) or more persons, having direct access from the outside of the building or through a common hall and having living, sleeping, kitchen and sanitary facilities for the exclusive use of the occupants. ENGAGED IN BUSINESS IN THE CITY: means pPerforming or providing services or selling, leasing, renting, delivering or installing tangible personal property for storage, use or consumption within the City. "Engaged in business in the City" includes, but is not limited to, any one of the following activities by a person who: (A) (1) Directly, indirectly, or by a subsidiary maintains a building, store, office, salesroom, warehouse, or other place of business within the City-taxing jurisdiction; ( B) (2) Sends one or more employees, agents or commissioned sales persons into the City to solicit business or to install, assemble, repair, service, or assist in the use of its products, or for demonstration or other reasons-taxing jurisdiction; (C) (3) Maintains one or more employees, agents or commissioned sales persons on duty at a location within the City-taxing jurisdiction; (D) (4) Owns, leases, rents or otherwise exercises control over real or personal property within the City-taxing jurisdiction; or (E) (5) Makes more than one delivery into the City-taxing jurisdiction within a twelve (12) month period-by any means other than a common carrier. EXEMPT COMMERCIAL PACKAGING MATERIALS: Containers, labels and shipping cases sold to a person engaged in manufacturing, compounding, wholesaling, jobbing, retailing, packaging, distributing or bottling for sale, profit or use, that meets all of the following conditions: (A) Is used by the manufacturer, compounder, wholesaler, jobber, retailer, packager, distributor or bottler to contain or label the finished product; (B) Is transferred by said person along with and as a part of the finished product to the purchaser; and (C) Is not returnable to said person for reuse. FARM CLOSEOUT SALE: means The full and final disposition of all tangible personal property previously used by a farmer or rancher in farming or ranching operations which are being abandoned. FARM OPERATIONS means the production of any of the following products for profit, including, but not limited to, a business that hires out to produce or harvest such products: Agricultural, viticultural, fruit, and vegetable products; (2) Livestock; (3) Milk; (4) Honey; and (5) Poultry and eggs.

FINANCE DIRECTOR: means tThe Finance Director of the City, Littleton, CO also known as the City Treasurer, or such other person designated by the Mmunicipality. "Finance Director" shall also include such person's designees. FOOD FOR HOME CONSUMPTION: means fFood for domestic home consumption as defined in 7 USC U.S.C. sec.tion 2012(g)k) (2014), as amended, for purposes of the Federal Food Stamp supplemental nutrition assistance program, or any successor pProgram, as defined in 7 USC U.S.C. sec.tion 2012(ht), as amended, except that "food" does not include carbonated water marketed in containers; chewing gum; seeds and plants to grow food; prepared salads and salad bars; packaged and unpackages cold sandwiches; deli trays; ; and hot and cold beverages served in unsealed containers or cups that are vended by or through machines or non-coin-operated coin-collecting food and snack


devices on behalf of a vendor. and food, snacks or drinks vended by or through machines. GROSS SALES: means tThe total amount received in money, credit, property or other consideration, valued in money, for all sales, leases, or rentals of tangible personal property or services. INTERNET SUBSCRIPTION SERVICE: means services that provide or enable computer access by multiple users to the Internet, but shall not include that portion of packaged or bundled services providing phone or television cable services when the package or bundle includes the sale of Internet Access Services. LICENSE: A City means a Littleton, CO sales and/or use tax license. LODGING SERVICES: The furnishing of rooms or accommodations by any person, to a person who, for consideration, uses, possesses, or has the right to use or possess, any room in a hotel, inn, bed and breakfast, residence, apartment, lodging house, motor hotel, guest house, guest ranch, trailer coach, mobile home, auto camp, or trailer court and park, or similar establishment, for a period of less than thirty (30) days, under any concession, permit, right of access, license to use, or other agreement, or otherwise. MEDICAL SUPPLIES: Drugs dispensed in accordance with a prescription; insulin in all its forms dispensed pursuant to the direction of a licensed physician; glucose useable for treatment of insulin reactions; urine- and blood-testing kits and materials; insulin measuring and injecting devices, including hypodermic syringes and needles; prosthetic devices; wheelchairs and hospital beds; drugs or materials when furnished by a doctor as part of professional services provided to a patient; and corrective eyeglasses, contact lenses, or hearing aids. MOBILE MACHINERY AND SELF-PROPELLED CONSTRUCTION EQUIPMENT: Those vehicles, self-propelled or otherwise, which are not designed primarily for the transportation of persons or cargo over the public highways, and those motor vehicles which may have originally been designed for the transportation of persons or cargo over the public highways, and those motor vehicles which may have originally been designed for the transportation of persons or cargo but which have been redesigned or modified by the mounting thereon of special equipment or machinery, and which may be only incidentally operated or moved over the public highways. This definition includes but is not limited to wheeled vehicles commonly used in the construction, maintenance and repair of roadways, the drilling of wells, and the digging of ditches. NEWSPAPER: A means a publication, printed on newsprint, intended for general circulation, and published regularly at short intervals, containing information and editorials on current events and news of general interest. The term newspaper does not include: magazines, trade publications or journals, credit bulletins, advertising inserts, circulars, directories, maps, racing programs, reprints, newspaper clipping and mailing services or listings, publications that include an updating or revision service, or books or pocket editions of books. PAY TELEVISION: Includes, but is not limited to, cable, microwave or other television service for which a charge is imposed. PERSON: A means any individual, firm, partnership, joint venture, corporation, estate or trust, limited liability corporation, estate or trust, receiver, trustee, assignee, lessee or any person acting in fiduciary or representative capacity, whether appointed by a court or otherwise, or any group or combination acting as a unit. PRESCRIPTION DRUGS FOR ANIMALS: D means drugs dispensed in accordance with any order by a licensed veterinarian, not including drugs available over the counter, specifying the animal for

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which the medicine or drug is offered and directions, if any, to be placed on the label. in writing, dated and signed by a practitioner, or given orally by a practitioner, specifying the animal for which the medicine or drug is offered and directions, if any, to be placed on the label. "Prescription drugs for animals" shall not include drugs that are available for sale over-the-counter. PERSCRIPTION DRUGS FOR HUMANS means a drug which, prior to being dispensed or delivered, is required by the federal Food, Drug, and Cosmetic Act, 21 U.S.C. Sect. 301, et. seq., as amended, and to state at a minimum the symbol “Rx Only,” and is dispensed in accordance with any order in writing, dated and signed by a licensed practitioner of the healing arts, or given orally by a practitioner, not including drugs available over the counter, and immediately reduced to writing by the pharmacist, assistant pharmacist, or pharmacy intern, specifying the name and any required information of the patient for whom the medicine, drug or poison is offered and directions, if any, to be placed on the label.

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4. The total price charged on credit sales including finance charges which are not separately stated. An amount charged as interest on the unpaid balance of the purchase price is not part of the purchase price unless the amount added to the purchase price is included in the principal amount of a promissory note; except the interest carrying charge set out separately from the unpaid balance of the purchase price on the face of the note is not part of the purchase price. An amount charged for insurance on the property sold and separately stated is not part of the purchase price.

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5. Installation, delivery and wheeling-in charges included in the purchase price and not separately stated. 6. Transportation and other charges to effect delivery of tangible personal property to the purchaser. 7. Indirect Federal manufacturers' excise taxes, such as taxes on automobiles, tires and floor stock. 8. The gross purchase price of articles sold after manufacturing or after having been made to order, including the gross value of all the materials used, labor and service performed and the profit thereon. (C) "Price" or "purchase price" shall not include: 1. Any sales or use tax imposed by the State of Colorado or by any political subdivision thereof. 2. The fair market value of property exchanged if such property is to be sold thereafter in the retailers usual course of business. This is not limited to exchanges in Colorado. Out of state trade-ins are an allowable adjustment to the purchase price. 3. Discounts from the original price if such discount and the corresponding decrease in sales tax due is actually passed on to the purchaser. An anticipated discount to be allowed for payment on or before a given date is not an allowable adjustment to the price in reporting gross sales.

PRICE OR PURCHASE PRICE : (A) "Price" or "purchase price" means the price to the consumer, exclusive of any direct tax imposed by the Federal government or by this Chapter, and, in the case of all retail sales involving the exchange of property, also exclusive of the fair market value of the property exchanged at the same time and place of the exchange, if: 1. Such exchanged property is to be sold thereafter in the usual course of the retailer's business, or 2. Such exchanged property is a vehicle and is exchanged for another vehicle and both vehicles are subject to licensing, registration, or certification under the laws of this State. Such vehicles shall include, but not necessarily be limited to: vehicles operating upon public highways, off-highway recreational vehicles, watercraft and aircraft. Any money or other consideration paid over and above the value of the exchanged property is subject to tax. (B) "Price" or "purchase price" includes: 1. The amount of money received or due in cash and credits. 2. Property at fair market value taken in exchange, but not for resale, in the usual course of the retailer's business. 3. Any consideration valued in money, such as trading stamps or coupons, whereby the manufacturer or someone else reimburses the retailer for part of the purchase price, and other medium of exchange.


the aggregate value measured in currency paid or delivered or promised to be paid or delivered in consummation of a sale, without any discount from the price on account of the cost of materials used, labor or service cost, and exclusive of any direct tax imposed by the federal government or by this article, and, in the case of all retail sales involving the exchange of property, also exclusive of the fair market value of the property exchanged at the same time and place of the exchange, if: (1) Such exchanged property is to be sold thereafter in the usual course of the retailer's business, or (2) Such exchanged property is a vehicle and is exchanged for another vehicle and both vehicles are subject to licensing, registration, or certification under the laws of this state, including, but not limited to, vehicles operating upon public highways, off-highway recreation vehicles, watercraft, and aircraft. Any money or other consideration paid over and above the value of the exchanged property is subject to tax. Price or Purchase Price includes: (1) The amount of money received or due in cash and credits. (2) Property at fair market value taken in exchange but not for resale in the usual course of the retailer's business. (3) Any consideration valued in money, whereby the manufacturer or someone else reimburses the retailer for part of the purchase price and other media of exchange. (4) The total price charged on credit sales including finance charges which are not separately stated at the time of sale. An amount charged as interest on the unpaid balance of the purchase price is not part of the purchase price unless the amount added to the purchase price is included in the principal amount of a promissory note; except the interest or carrying charge set out separately from the unpaid balance of the purchase price on the face of the note is not part of the purchase price. An amount charged for insurance on the property sold and separately stated at the time of sale is not part of the purchase price. (5) Installation, applying, remodeling or repairing the property, delivery and wheeling-in charges included in the purchase price and not separately stated. (6) Transportation and other charges to effect delivery of tangible personal property to the purchaser. (7) Indirect federal manufacturers' excise taxes, such as taxes on automobiles, tires and floor stock. (8) The gross purchase price of articles sold after manufacturing or after having been made to order, including the gross value of all the materials used, labor and service performed and the profit thereon. Price or Purchase Price shall not include: (1) Any sales or use tax imposed by the State of Colorado or by any political subdivision thereof. (2) The fair market value of property exchanged if such property is to be sold thereafter in the retailers’ usual course of business. This is not limited to exchanges in Colorado. Out of state trade-ins are an allowable adjustment to the purchase price. (3) Discounts from the original price if such discount and the corresponding decrease in sales tax due is actually passed on to the purchaser, and the seller is not reimbursed for the discount by the manufacturer or someone else. An anticipated discount to be allowed for payment on or before a given date is not an allowable adjustment to the price in reporting gross sales. PRIVATE COMMUNICATIONS SERVICES: T means telecommunications services furnished to a subscriber, which entitles the subscriber to the exclusive or priority use of any communication channel or groups of channels, or to the exclusive or priority use of any interstate intercommunications system for the subscriber's stations. PROSTHETIC DEVICES: Any artificial limb, part, device or appliance for human use which aids or replaces a bodily function; is designed, manufactured, altered or adjusted to fit a particular individual; and is prescribed by a licensed practitioner of the healing arts. Prosthetic devices include but are not limited to prescribed auditory, ophthalmic or ocular, cardiac, dental, orthopedic devices or appliances, oxygen concentrators and oxygen with related accessories.

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PROSTHETIC DEVICES FOR ANIMALS means any artificial limb, part, device or appliance for animal use which replaces a body part or aids or replaces a bodily function; is designed, manufactured, altered or adjusted to fit a particular patient; and is prescribed by a licensed veterinarian. Prosthetic devices include, but are not limited to, prescribed auditory, ophthalmic or ocular, cardiac, dental, or orthopedic devices or appliances, and oxygen concentrators with related accessories. PROSTETIC DEVICES FOR HUMANS means any artificial limb, part, device or appliance for human use which replaces a body part or aids or replaces a bodily function; is designed, manufactured, altered or adjusted to fit a particular patient; and is prescribed by a licensed practitioner of the healing arts. Prosthetic devices include, but are not limited to, prescribed auditory, ophthalmic or ocular, cardiac, dental, or orthopedic devices or appliances, and oxygen concentrators with related accessories. PURCHASE OR SALE: (A) The term "purchase" or "sale" means the acquisition for any consideration by any person of tangible personal property or taxable services that are purchased, leased, rented, sold, used, stored, distributed, or consumed, but excludes a bona fide gift of property or services. These terms include capital leases, installment and credit sales, and property and services acquired by: (1). Transfer, either conditionally or absolutely, of title or possession or both, to or of tangible personal property or taxable services;

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(2). A lease, lease-purchase agreement, rental or grant of a license, including royalty agreements, to use tangible personal property to or taxable services;

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(3). Performance of taxable services; or

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(4). Barter or exchange for other tangible personal property or services including coupons.

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(B) The terms "purchase" and "sale" do not include:

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1. A division of partnership assets among the partners according to their interests in the partnership;

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2. The formation of a corporation by the owners of a business and the transfer of their business assets to the corporation in exchange for all the corporation's outstanding stock, except qualifying shares, in proportion to the assets contributed;

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3. The transfer of assets of shareholders in the formation or dissolution of professional corporations;

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4. The dissolution and the pro rata distribution of the corporation's assets to its stockholders;

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5. A transfer of a partnership interest;

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6. The transfer in a reorganization qualifying under section 368(a)(1) of the "Internal Revenue Code of 1954", as amended;

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7. The formation of a partnership by the transfer of assets to the partnership or transfers to a partnership in exchange for proportionate interests in the partnership;

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8. The repossession of personal property by a chattel mortgage holder or foreclosure by a lienholder;

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9. The transfer of assets from a parent corporation to a subsidiary corporation or corporations which are owned at least eighty percent (80%) by the parent corporation, which transfer is solely in exchange for the stock or securities of the subsidiary corporation;

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10. The transfer of assets from a subsidiary corporation or corporations which are owned at least eighty percent (80%) by the parent corporation to a parent corporation or to another subsidiary which is owned at least eighty percent (80%) by the parent corporation, which transfer is solely in exchange for the stock or securities of the parent corporation or the subsidiary which received the assets;

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11. The transfer of assets between a parent and closely held subsidiary corporations, or between subsidiary corporations closely held by the same parent corporation, or between corporations which are owned by the same shareholders in identical percentage of stock ownership amounts, computed on a share-by-share basis, when a tax imposed by this Chapter was paid by the transferor corporation at the time it acquired such assets, except to the extent that there is an increase in the fair market value of such assets resulting from the manufacturing, fabricating, or physical changing of the assets by the transferor corporation. To such an extent any transfer referred to in this subsection shall constitute a sale. For the purposes of this subsection, a closely held subsidiary corporation is one in which the parent corporation owns stock possessing at least eighty percent (80%) of the total combined voting power of all classes of stock entitled to vote and owns at least eighty percent (80%) of the total number of shares of all other classes of stock.

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The terms "purchase" and "sale" do not include: (1) A division of partnership assets among the partners according to their interests in the partnership; (2) The transfer of assets of shareholders in the formation or dissolution of professional corporations, if no consideration including, but not limited to, the assumption of a liability is paid for the transfer of assets; (3) The dissolution and the pro rata distribution of the corporation's assets to its stockholders, if no consideration including, but not limited to, the assumption of a liability is paid for the transfer of assets; (4) A transfer of a partnership or limited liability company interest; (5) The transfer of assets to a commencing or existing partnership or limited liability company, if no consideration including, but not limited to, the assumption of a liability is paid for the transfer of assets; (6) The repossession of personal property by a chattel mortgage holder or foreclosure by a lienholder; (7) The transfer of assets from a parent company to a subsidiary company or companies which are owned at least eighty percent by the parent company, which transfer is solely in exchange for stock or securities of the subsidiary company; (8) The transfer of assets from a subsidiary company or companies which are owned at least eighty percent by the parent company to a parent company or to another subsidiary which is owned at least eighty percent by the parent company, which transfer is solely in exchange for stock or securities of the parent corporation or the subsidiary which received the assets; (9) The transfer of assets between parent and closely held subsidiary companies, or between subsidiary companies closely held by the same parent company, or between companies which are owned by the same shareholders in identical percentage of stock ownership amounts, computed on a

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share-by-share basis, when a tax imposed by this article was paid by the transferor company at the time it acquired such assets, except to the extent that there is an increase in the fair market value of such assets resulting from the manufacturing, fabricating, or physical changing of the assets by the transferor company. To such an extent any transfer referred to in this paragraph (9) shall constitute a sale. For the purposes of this paragraph (9) , a closely held subsidiary corporation is one in which the parent company owns stock possessing or membership interest at least eighty percent of the total combined voting power of all classes of stock entitled to vote and owns at least eighty percent of the total number of shares of all other classes of stock. RESIDENT means a person who resides or maintains one or more places of business within the City, regardless of whether that person also resides or maintains a place of business outside of the City. : Any person who has his or her business or makes his or her primary residence within the City. RETAIL SALES: A means all sales except wholesale sales. RETAILER OR VENDOR: A means any person selling, leasing or renting or granting a license to use tangible personal property or services at retail. Retailer or vendor shall include but is not limited to, any: (A1) Auctioneer; (B2) Salesperson, representative, peddler or canvasser who makes sales as a direct or indirect agent of, or obtains such property or services sold from, a dealer, distributor, supervisor or employer;; (C3) Charitable organization or governmental entity which makes sales of tangible personal property to the public, notwithstanding the fact that the merchandise sold may have been acquired by gift or donation or that the proceeds are to be used for charitable or governmental purposes.; ; (4) Retailer-Contractor, when acting in the capacity of a seller of building supplies, construction materials, and other tangible personal property. RETAILER-CONTRACTOR means a contractor who is also a retailer of building supplies, construction materials, or other tangible personal property, and purchases, manufactures, or fabricates such property for resale (which may include installation), repair work, time and materials jobs, and/or lump sum contracts. RETURN means the tax that is or should be collected and remitted by a retailer on sales taxed under this Code. : The sales and use tax reporting form used to report sales and use tax. SALES THAT BENEFITS A COLORADO SCHOOL means a sale of a commodity or service from which all proceeds of the sale, less only the actual cost of the commodity or service to a person or entity as described in this Code, are donated to a school or a school-approved student organization. SALES TAX: T means the tax that is or shouldto be collected and remitted by a retailer on sales taxed under this Chapter. SOFTWARE PROGRAM means a sequence of instructions that can be measured, interpreted and executed by an electronic device (e.g. a computer, tablets, smart phones) regardless of the means by which it is accessed or the medium of conveyance. Software program includes: (1) Custom software program, which is a software program prepared to the special order or specifications of a single customer; (2) Pre-written software program, which is a software program prepared for sale or license to multiple users, and not to the special order or specifications of a single customer. Pre-written software is commonly referred to as “canned,” “off-the-shelf (“COTS”),” “mass produced” or “standardized;” (3) Modified software, which means pre-written software that is altered or enhanced by someone other than the purchaser to create a program for a particular user; and (4) The generic


term “software,” “software application,” as well as “updates,” “upgrades,” “patches,” “user exits,” and any items which add or extend functionality to existing software programs. SOFTWARE AS A SERVICE means software that is rented, leased or subscribed to from a provider and used at the consumer’s location, including but not limited to applications, systems or programs. SOFTWARE LICENSE FEE means a fee charged for the right to use, access, or maintain software programs. SOFTWARE MAINTENACNE AGREEMENT means an agreement, typically with a software provider, that may include (1) provisions to maintain the right to use the software; (2) provisions for software upgrades including code updates, version updates, code fix modifications, enhancements, and added or new functional capabilities loaded into existing software, or (3) technical support. STORAGE means any keeping or retention of, or exercise or dominion or control over, or possession of, for any length of time, tangible personal property not while in transit but on a stand still basis for future use when leased, rented or purchased at retail from sources either within or without the City from any person or vendor. STUDENT means any person enrolled in a school. TANGIBLE PERSONAL PROPERTY means personal property that can be one or more of the following: seen, weighed, measured, felt or touched, stored, transported, or exchanged, or that is in any other manner perceptible to the senses. TAX means the use tax due from a consumer or the sales tax due from a retailer or the sum of both due from a retailer who also consumes. TAX DEFICIENCY means any amount of tax, penalty, interest, or other fee that is not reported and/or not paid on or before the date that any return or payment of the tax is required under the terms of this Code. TAXABLE SALES means gross sales less any exemptions and deductions specified in this Code. TAXABLE SERVICES means services subject to tax pursuant to this Code. TAXPAYER means any person obligated to collect and/or pay tax under the terms of this Code. TELECOMMUNICATIONS SERVICE means the service of which the object is the transmission of any two way interactive electronic or electromagnetic communications, including, but not limited to, voice, image, data and any other information; by the use of any means, including, but not limited to, wire, cable, fiber optic cable, microwave, radio wave, Voice over Internet Protocol (VOIP), internet access, remote access to computers and electronic storage equipment, or any combinations of such media, including any form of mobile two way communication. "Telecommunications service" includes, but is not limited to, basic local exchange telephone service, toll telephone service and teletypewriter service; including, but not limited to, residential and business service, directory assistance, cellular mobile telephone or telecommunication service, specialized mobile radio and twoway pagers and paging service, including any form of mobile two-way communication. "Telecommunications service" does not include separately stated nontransmission services which constitute computer processing applications used to act on the information to be transmitted. TELEVISION & ENTERTAINMENT SERVICES means audio or visual content, that can be transmitted electronically by any means, for which a charge is imposed.


TOTAL TAX LIABILITY: T means the total of all tax, penalties and/or interest owed by a taxpayer and shall include sales tax collected in excess of such tax computed on total sales. USE means the exercise, for any length of time by any person within the City of any right, power or dominion over tangible personal property or services when rented, leased or purchased at retail from sources either within or without the City from any person or vendor or used in the performance of a contract in the City whether such tangible personal property is owned or not owned by the taxpayer, or withdrawn from inventory for consumption. USE TAX: T means the tax paid or required to be paid by a consumer for using, storing, distributing or otherwise consuming tangible personal property or taxable services inside the City. WHOLESALE SALES: means Sales to licensedlicensed sales by wholesalers to retailers, jobbers, dealers or wholesalers for resale and does not include a sale by wholesalers to users and consumers not for resale; the latter types of sales shall be deemed to be Retail Sales and shall be subject to the provisions of this chapter.. Sales by wholesalers to consumers are not wholesale sales. Sales by wholesalers to nonlicensed retailers are not wholesale sales. WHOLESALER: A means any person doing an organized wholesale or jobbing business and selling to retailers, jobbers, dealers or other wholesalers, for the purpose of resale and not for storage, use, consumption or distribution. (Ord. 46, Series of 1991)

Section 2: Subsections of section 3-9-3-2(A) of Chapter 9 of Title 3 of the City Code are hereby amended as follows: 3-9-3-2: EXEMPTIONS FROM TAXATION: 7. The sale of prescription drugs for humansdrugs dispensed in accordance with a prescription, prescription drugs for animals, medical supplies, and all sales of corrective prescription eyeglasses and contact lenses. (Ord. 46, Series of 1991) 13. All sales and purchases of meat cattle, sheep, lamb, swine and goats; all sales and purchases, to agricultural producers, of mares and stallions for breeding purposes and all farm closeout sales. (Ord. 46, Series of 1991) 14. All sales and purchases of feed for livestock or poultry, all sales and purchases of seeds and all sales and purchases , to agricultural producers,of orchard trees. (1971 Code, sec. 19.36; amd. Ord. 25, Series of 1972) 23. All sales of custom software programs. 24.”Telecommunications Services” does not include separately stated non-transmission services which constitute computer processing applications used to act on the information to be transmitted’ to their exemption language.

Section 3: Section 3-9-1-10 of Chapter 9 of Title 3 of the City Code is hereby amended as follows: 3-9-1-10: HEARINGS AND PROCEDURE FOR REVIEW: (A) Petition By Aggrieved Taxpayer; Notice; Action Of Treasurer: If any person having made a return, having failed to file a return, having been deemed by the Finance Director to have underpaid the tax due to the City or having been assessed taxes as a result of an audit, and having paid the tax, interest, and penalties (if any) assessed, feels aggrieved by the assessment made upon him by the Finance Director, the taxpayer may apply to the Finance Director by petition in writing


within twentythirty (230) days after the assessment is mailed to the taxpayer for a hearing and a correction of the amount of the tax so assessed and paid, in which petition the taxpayer shall set forth the reasons why such hearing should be granted, and the amount by which such tax, interest, or penalties should be reduced. The Finance Director shall notify the petitioner in writing of the time and place fixed by him for such hearing which shall be held within thirty (30) days after the petition is received by the Finance Director unless continued by mutual consent of the petitioner and the City. After such hearing, the Finance Director shall make such order in the matter as is just and lawful and shall furnish a copy of such order to the petitioner as provided for in subsection (C) of this Section. (B) Hearings To Be Held In City: Every hearing before the Finance Director held pursuant to this Chapter shall be held in the offices of the City. (C) Decisions Of Finance Director To Be In Writing; Notice; When Decisions Final: Every decision of the Finance Director shall be in writing and such decision shall be mailed to the petitioner within ten (10) days of the hearing. All such decisions shall become final upon the date that they are postmarked or personally delivered to the petitioner. An appeal of a final decision of the Finance Director from a hearing held pursuant to this Section shall be commenced within thirty (30) days of such decision, and in accordance with Colorado Rule of Civil Procedure 106. (D) Hearing Officers: 1. If the petitioner so requests in writing received by the Finance Director at least twenty thirty (320) days prior to the date scheduled for hearing, a hearing officer shall be appointed by the Finance Director and shall have all of the powers and duties of the Finance Director as set forth in this Section. All estimated costs of the hearing officer shall be paid as a deposit by the petitioner to the hearing officer at least ten (10) days prior to the date scheduled for hearing, in an amount as determined by the hearing officer. Failure of the petitioner to deposit such funds shall constitute a waiver of the petitioner's option to have a hearing officer preside in the hearing. All costs actually incurred by virtue of the appointment of a hearing officer shall be borne by the petitioner unless he is ultimately successful on the merits of his appeal. If such occurs, the City shall reimburse the petitioner for all costs of the hearing officer.

Section 4: Section 3-9-6-12(C) of Chapter 9 of Title 3 of the City Code is hereby amended as follows: 3-9-6-12: REFUSAL TO MAKE RETURN: (C) Assessment; Petition For Revision Or Modification: The estimate made pursuant to subsection (A) of this Section shall upon the giving of notice as provided in subsection (B) of this Section become an assessment, and such assessment shall be final and due and payable from the taxpayer to the Finance Director twenty thirty (230) days from the date of service of the notice or the date of mailing by registered or certified mail; provided, however, that within such thirtytwenty (230) day period such delinquent taxpayer may petition the Finance Director for a revision or modification of such assessment, and shall within such twenty thirty (230) day period furnish the Finance Director the facts and correct figures showing the correct amount of such taxes. (Ord. 46, Series of 1991)

Section 3: Severability. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such invalidity shall not affect the validity of the remaining sections of this ordinance. The City Council hereby declares that it would have passed this ordinance, including each part, section, subsection, sentence, clause or phrase hereof, irrespective of the fact that one or more parts, sections, subsections, sentences, clauses, or phrases may be declared invalid. Section 4:

Repealer.

All ordinances or resolutions, or parts thereof, in

Ordinance No. 35 Series, 2017 Page 14 of 3 639 640 641 642 643 644 645

conflict with this ordinance are hereby repealed, provided that this repealer shall not repeal the repealer clauses of such ordinance nor revive any ordinance thereby.

646

of the City of Littleton on the 5th day of December, 2017, passed on first reading by a vote of

647

___ FOR and ___ AGAINST; and ordered published by posting at Littleton Center, Bemis

648

Library, the Municipal Courthouse and on the City of Littleton Website.

INTRODUCED AS A BILL at a regularly scheduled meeting of the City Council

649

PUBLIC HEARING on the Ordinance to take place on the 19th day of December

650

2017, in the Council Chamber, Littleton Center, 2255 West Berry Avenue, Littleton, Colorado,

651

at the hour of 6:30 p.m., or as soon thereafter as it may be heard.

652

PASSED on second and final reading, following public hearing, by a vote of

FOR

653

and _____ AGAINST on the 19th day of December, 2017 and ordered published by posting at

654

Littleton Center, Bemis Library, the Municipal Courthouse and on the City of Littleton Website.

655

ATTEST:

656 657 658 659 660 661 662 663 664 665 666 667

__________________________ Wendy Heffner CITY CLERK APPROVED AS TO FORM: _________________________ Lena McClelland ASSISTANT CITY ATTORNEY

______________________________ Debbie Brinkman MAYOR

City of Littleton Tax Matrix

Standard Definitions Tax Matrix

New Standard Definition

Existing Def

Taxable

(1) Agricultural Producer

N

Y

Non‐Taxable Code Reference By Definition or code Y 3‐9‐3‐2(A)13 Code 3‐9‐3‐2(A)14 3‐9‐4‐3(H)

Existing Code Definition

Defined? Taxable

N/A

N

Y

Non‐Taxable Code Reference By Definition or code Y 3‐9‐3‐2(A)13 Code 3‐9‐3‐2(A)14 3‐9‐4‐3(H)

Comment

Code change Source of definition changes needed

The definition clarifies the limitation on the exemption. Detail definition of livestock vs pet. Add reference to Agricultural producers in code. Add for clarity of historic application and modify exemption code to add "agriculture producer" in section 3‐9‐3‐2(A)13 and 3‐9‐3‐ 2(A)14.

Y Add new definition and add language to Exemption

The exemption is limited to agricultural producers this definition spells out an agricultural producer does not include pets or casual sales.

Add definition for clarity of historic application and modify exemptions.

(2) Aircraft

N

Y

3‐9‐3‐1

Code

N/A

N

Y

3‐9‐3‐1

Code

Taxable as TPP

N

Do not add, leave as is

(3) Aircraft Part

N

Y

3‐9‐3‐1

Code

N/A

N

Y

3‐9‐3‐1

Code

Taxable as TPP

N


(4) Aircraft Simulator

N

Y

3‐9‐3‐1

Code

N/A

N

Y

3‐9‐3‐1

Code

Taxable as TPP

N


(5) Aircraft Simulator Part

N

Y

3‐9‐3‐1

Code

N/A

N

Y

3‐9‐3‐1

Code

Taxable as TPP

N


(6) Airline Company (7) Auction (8) AUTOMOTIVE VEHICLE

N N Y

N/A N/A Y

N/A N/A Y

N/A N/A Def/Code

N/A N/A AUTOMOTIVE VEHICLE

N N Y

N/A N/A Y

N/A N/A Y

Change definition.

N N Y

Do not add, leave as is Do not add, leave as is Change Definition for consistency

Y N

N/A

N/A Y

N/A N/A

BUSINESS N/A

Y N

N/A

N/A Y

Y N

Change Definition for consistency Do not add, leave as is

(11) Carrier Access Services

N

Y

3‐9‐3‐1(B)

Def/Code

N/A

N

Y

N/A N/A 3‐9‐3‐1(F) 3‐9‐3‐2(A)1. N/A 3‐9‐3‐2‐17 3‐9‐3‐2‐18 3‐9‐3‐1(B)

N/A N/A Def/Code

(9) BUSINESS (10) Candy

N/A N/A 3‐9‐3‐1(F) 3‐9‐3‐2(A)1 N/A 3‐9‐3‐5

(12) CHARITABLE ORGANIZATION

Y

Y

Y

3‐9‐3‐2(A)19

Def/Code

CHARITABLE ORGANIZATION

Y

Y

Y

3‐9‐3‐2(A)19

Def/Code

(13) “City” or “Town” CITY TREASURER (14) Coins

N Y N

N/A N/A Y

N/A N/A Y

N/A N/A N/A

Def Def N/A

N/A CITY TREASURER N/A

N Y N

N/A N/A Y

N/A N/A Y

N/A N/A N/A

Def Def N/A

Definitions 2NOV2017Final.xlsx Matrix wo def

N/A Code

General definition

Def/Code

Add carrier access service definition ; when Y referencing telecommunications, all charges broken out are taxable. Change to definition which does not change Y interpretation; no other changes General definition Y General definition N City of Littleton does not address coins in the Y code. Not in the definitions or the exemption code. As such it can be assumed as tangible personal property it is taxable. If any coin or currency is exchanged in the open market at the current exchange rate, then the transaction is not subject to sales tax. If coins, however, are commemorative or otherwise, and the coins, although legal tender in the issuing country and also acceptable as legal tender in other countries, are purchased at rates not reflecting actual currency value (as for numismatic or coin collecting purposes or where the previous metal content of the coins determine their value), then the transaction is the sale of tangible personal property and is subject to sales tax.

Add definition for clarity of historic application

Change Definition for consistency Add definition for clarity of historic application Do not add, leave as is Add definition for clarity of historic application

Page 1 of 5 11/20/2017




Existing Def

Taxable


Defined? Taxable

Y

Non‐Taxable Code Reference By Definition or code 3‐9‐3‐1(A) Code

N/A

N

Y

Non‐Taxable Code Reference By Definition or code 3‐9‐3‐1(A) Code

(15) Coin Operated Device

N

(16) Collection Costs (17) Commercial Packaging Materials

N N

N/A Y

N/A Y

N/A 3‐9‐3‐2(B)1

N/A N/A

N/A N/A

N N

N/A Y

N/A Y

N/A 3‐9‐3‐2(B)1

N/A N/A

(18) Commercial Shipping Materials

N

Y

Y

3‐9‐3‐2(B)2

N/A

N/A

N

Y

Y

3‐9‐3‐2(B)2

N/A

(19) Community Organization (20) Construction Equipment

N N

N/A Y

N/A

N/A N/A

N N

N/A Y

N/A

(21) CONSTRUCTION MATERIALS

Y

Y

Y

N/A N/A 3‐9‐4‐4(D),(E ) Code & (H) 3‐9‐4‐4(B) &( C) Def/Code 3‐9‐3‐2(A) 16

CONSTRUCTION MATERIALS

Y

Y

Y

N/A N/A 3‐9‐4‐4(D),(E ) Code & (H) 3‐9‐4‐4(B) &( C) Def/Code 3‐9‐3‐2(A) 16.

(22) CONSUMER (23) Contract Auditor

Y N

N/A N/A

N/A N/A

N/A 3‐9‐6‐1

N/A Code

CONSUMER N/A

Y Y

N/A N/A

N/A N/A

N/A 3‐9‐6‐1

N/A Code

(24) Contractor (25) Cover Charge

N N

N/A Y

N/A

3‐9‐4‐4(B) 3‐9‐3‐1(D)

N/A Def/Code

N/A N/A

Y Y

N/A N/A

N/A

3‐9‐4‐4(B) 3‐9‐3‐1(D)

N/A Def/Code

(26) Data Processing Equipment (27) Digital Product

N N

Y Y

3‐9‐3‐1 3‐9‐3‐1

Code Code

N/A N/A

N N

Y Y

3‐9‐3‐1 3‐9‐3‐1

Code Code

(28) Distribution N/A

N Y

N/A Y

N/A Y

N/A 3‐9‐3‐2(A)7

N/A Def/Code

N/A N DRUGS DISPENSED IN ACCORDANCE WITH A Y PRESCRIPTION

N/A Y

N/A Y

N/A 3‐9‐3‐2(A)7.

N/A Def/Code

(29) Dual Residency (30) Dwelling unit

N N

N/A Y

N/A

N/A 3‐9‐4‐4(B)(C)

N/A Code

N/A N/A

N N

N/A Y

N/A

N/A 3‐9‐4‐4(B)(C)

N/A Code

N/A N Mentioned in the construction permit section Y of the code as a taxable occurrence.

Do not add, leave as is Add definition for clarity of historic application

(31) ENGAGED IN BUSINESS IN THE CITY

Y

N/A

N/A

3‐9‐1‐4(B) 3‐9‐2‐1 3‐9‐4‐3(F)

Def/Code

ENGAGED IN BUSINESS IN THE CITY

Y

N/A

N/A

3‐9‐1‐4(B) 3‐9‐2‐1 3‐9‐4‐3(F)

Def/Code

Change Definition for consistency

EXEMPT COMMERCIAL PACKAGING MATERIALS:

Y

Y

3‐9‐3‐2

Def/Code

EXEMPT COMMERCIAL PACKAGING MATERIALS

Y

Y

3‐9‐3‐2

Def/Code

(32) Factory Built Housing (33) FARM CLOSEOUT SALE: (34) Farm Equipment

N Y N

N/A N Y

N/A Y Y

N/A N/A 3‐9‐3‐2(A)13 Def/Code 3‐9‐3‐2(A)2 and Code 3

N/A FARM CLOSEOUT SALE N/A

N Y N

N/A

N/A

Y

Y

N/A N/A 3‐9‐3‐2(A)13 Def/Code 3‐9‐3‐2(A)2 and Code 3

(35) Farm Operation

N

Y

3‐9‐3‐2 (A) 14

N/A

N

Y

Licensing definition Y Tax Requirements Exemption of components used in manufacturing The new definitions is split into two which Y align better with the code. There are a few items specifically listed that are not in the current definitions (pallets, banding material N General definition Y Code notes Farm Implements only and parts N and accessories for those implements. Definition is broader in scope and appears to exempt additional items. Do not add definition. General definition (see (1) Agricultural Y Producer)


Code

3‐9‐3‐2 (A) 14

Code

Comment


City of Littleton does not address coin Y operated devices in the code. Not in the definitions or the exemption code. As such it can me assumed as tangible personal property purchased through coin operated devices are taxable. N Replace the Exempt Commercial Packaging Y definition. Replace the Exempt Commercial Packaging Y definition. N New definition. Term used in code 4 times. Y Already taxable per 3‐9‐4‐4. Generally taxable; exempt if for a Y Government; exempt if purchased with a building permit. (14 ref.) General definition Y Code already indicates the City may, if it N desires, contract and agree with any other body or bodies for the collection of the amount of the tax levied by this Chapter by the other body. N Taxed as part of taxability of food/beverage Y Taxable as TPP Taxable as TPP ‐ not in code specifically but taxable as internet subscription service.

Definition will be replaced with two new definitions ‐ see 59 and 60 definition.


Do not add, leave as is Add new definition and remove Exempt Commercial Packaging definition Add new definition and remove Exempt Commercial Packaging definition Do not add, leave as is Add definition for clarity of historic application Change Definition for consistency



N Y


N Y

Do not add, leave as is Remove current definition and replace with new definition 59 and 60.

Remove current definition and replace with 17 and 18 definitions.

Do not add, leave as is Change Definition for consistency Do not add, leave as is


Page 2 of 5 11/20/2017




Existing Def

Taxable

(36) FINANCE DIRECTOR (37) Food For Home Consumption

Y Y

N/A Y

(38) Garage Sales

N

Y

(39) GROSS SALES (40) Internet Access Services

Y N

N/A

(41) Internet Subscription Service

N

Y

(42) LICENSE (43) Linen Services LODGING SERVICES (44) Machinery

Y N Y N

N/A N/A Y Y

N/A N/A

(45) Manufactured Home (46) Manufacturing

N N

N/A Y

N/A

(47) Medical Marijuana N/A

N Y

N/A

N/A Y

(48) MOBILE MACHINERY AND SELF‐ PROPELLED CONSTRUCTION EQUIPMENT:

Y

Y

(49) Modular Home (50) Motor Fuel

N N

N/A N

(51) NEWSPAPER (52) Online Garage Sales PAY TELEVISION

Y N Y

(53) Parent (54) PERSON (55) Photovoltaic System


Non‐Taxable Code Reference By Definition or code N/A N/A N/A Y 3‐9‐3‐5 Def/Code

N/A Y


Defined? Taxable

FINANCE DIRECTOR FOOD

Y Y

N/A Y

Non‐Taxable Code Reference By Definition or code N/A N/A N/A Y 3‐9‐3‐5 Def/Code

3‐9‐3‐1 (A)

Code

N/A

N

Y

N/A N/A

N/A N/A

GROSS SALES N/A

Y N

N/A

N/A

N/A

N/A

N

Y

N/A N/A 3‐9‐3‐1(I) 3‐9‐1‐2 3‐9‐3‐2(C) 3‐9‐4‐4(D)(E)(H)

N/A N/A Def/Code Def/Code

LICENSE N/A LODGING SERVICES N/A

Y N Y N

N/A N/A Y Y

N/A N/A

N/A 3‐9‐3‐2(B)(C) 3‐9‐4‐3(F)(G)

N/A Code

N/A N/A

N N

N/A Y

N/A

3-20-29

N/A Def/Code

N/A MEDICAL SUPPLIES

N/A Y

N/A

N/A Y

3‐9‐3‐2(A)7

N/A Y

Comment


General definition Minimal wording changes which will not change the application but clarify. We do not exempt Garage Sales in the code and there is not a reason for adoption of the definition Valuation definition There is no mention of Internet access services in the code, which would require the definition. Non‐taxable per ITFA

Y Y

Change Definition for consistency Change Definition for consistency

N


Y N


3‐9‐3‐1 (A)

Code

N/A N/A

N/A N/A

N/A

N/A

Historical application has been digital Y downloads of subscriptions are taxable, as are digital versions of media that is generally available as tangible personal property such as magazines, books, trade journals etc.


N/A N/A 3‐9‐3‐1(I) 3‐9‐1‐2 3‐9‐3‐2(C) 3‐9‐4‐4(D)(E)(H)

N/A N/A Def/Code Def/Code

General definition

Change Definition for consistency Do not add, leave as is Do not add, leave as is Do not add, leave as is

N/A 3‐9‐3‐2(B)(C) 3‐9‐4‐3(F)(G)

N/A Code

N The city does not have a manufacturing N machinery exemption. The term Manufacturing is in the code a few times as it relates to component parts in the manufacturing process being exempt and the utilities used in manufacture exemption.

Do not add, leave as is Do not add, leave as is

3-20-29

N/A Def/Code

Covered in title20 Not in new std defs; prosthetic devices are listed in medical supplies definition and are listed in a new definition.

N N


N


N N


3‐9‐3‐2(A)7

3‐9‐4‐4 (D) (E ) Def/Code and (H)

MOBILE MACHINERY AND SELF‐PROPELLED Y CONSTRUCTION EQUIPMENT

Y

N/A Y

N/A 3‐9‐3‐2(A)6

N/A Code

N/A N/A

N/A N

N/A N

N/A Y

N/A 3‐9‐3‐2(A)6

N/A Code

N N/A Y

Y N/A

3‐9‐3‐1 (G) N/A 3‐9‐1‐2

Def/Code N/A Def/Code

NEWSPAPER N/A PAY TELEVISION

Y N Y

N N/A Y

Y N/A

3‐9‐3‐1 (G) N/A 3‐9‐1‐2

Def/Code Def/Code Def/Code

N

N/A

N/A

3‐9‐3‐2‐22

Code

Noted in Exemptions section

N

N/A

N/A

3‐9‐3‐2‐22

Code

Y N

N/A N/A

N/A N/A

N/A N/A

N/A N/A

PERSON N/A

Y N

N/A N/A

N/A N/A

N/A N/A

N/A N/A

No changes at this time. Taxable as TPP no exemption.; noted in Exemptions on Utilities in manufacturing and the Manufacturing definition. Noted in 3‐9‐4‐ 47 related to mobile machinery taxable for construction jobs.

3‐9‐4‐4 (D) (E ) Def/Code and (H)

Code does not reference Motor fuel specifically but fuel in general. 6. Sales of fuel used for the operation of internal combustion engines. (1971 Code, sec. 19.36)

Y N N N

Y N Not in new std defs; replaced with Television Y & Entertainment Services Not in definitions, but definition is included in N Exemptions General definition Y Not in code no reason to include. N

Change Definition for consistency Do not add, leave as is Delete this definition and add Television and Entertainment Services. Do not add, leave as is Change Definition for consistency Do not add, leave as is

Page 3 of 5 11/20/2017




Existing Def

Taxable

(56) Precious Metal Bullion (57) Prepress Preparation Material (58) Preprinted Newspaper Supplements

N N N

N/A N/A N/A

(59) PRESCRIPTION DRUGS FOR ANIMALS

Y

(60) Prescription Drugs for Humans (61) PRICE OR PURCHASE PRICE

N Y

N/A

(62)PRIVATE COMMUNICATIONS SERVICES

Y

Y

(63) Prosthetic Devices for Animals

Y

(64) Prosthetic Devices for Humans

Y

(65) PURCHASE OR SALE (66) Rail Carrier (67) Rail Carrier Part (68) Recreation Services (69) Renewable Energy (70) RESIDENT

Y N N N N Y

N/A N/A N/A N/A N/A N/A

(71) RETAIL SALES

Y

Y

(72) RETAILER OR VENDOR

Y

Y

(73) Retailer‐Contractor

N

N/A

N/A

(74) RETURN

Y

N/A

(75) Sale that Benefits a Colorado School

N

(76) SALES TAX (77) School

Y N

(78) Security System Services (79) Soft Drink (80) Software Program

N N N


Non‐Taxable Code Reference By Definition or code N/A N/A N/A N/A N/A N/A N/A N/A N/A


Defined? Taxable

N/A N/A N/A

N N N

Y

3‐9‐3‐2(A)7

PRESCRIPTION DRUGS FOR ANIMALS

Y

Y N/A

3‐9‐3‐2(A)7 Code 3‐9‐1‐4(B) Def/Code 3‐9‐3‐ 1(A)(G)(H)(I) 3‐9‐3‐13 3‐9‐3‐4 3‐9‐4‐4€(G)(H)

N/A PRICE OR PURCHASE PRICE

N Y

N N/A

3‐9‐3‐1(B)

Code

PRIVATE COMMUNICATIONS SERVICES

Y

Y

Y

3‐9‐3‐2(A)7

Code

PROSTHETIC DEVICES

Y

Y

3‐9‐3‐2(A)7

Code

PROSTHETIC DEVICES

Y


3‐9‐2‐1(A) N/A N/A N/A N/A 3‐9‐3‐1(F) 3‐9‐3‐2(5)a 3‐9‐3‐1(A)(C) 3‐9‐4‐3 3‐9‐4‐3(A) 3‐9‐4‐4 (C) Numerous references in code

Def/Code N/A N/A N/A N/A Def/Code

PURCHASE OR SALE N/A N/A N/A N/A RESIDENT

Y N N N N Y


Def/Code

RETAIL SALES

Y

Y

Code

RETAILER OR VENDOR:

Y

Y

N/A

Code

N/A

N

N/A

N/A

N/A

N/A

N/A

RETURN

Y

N/A

Y

3‐9‐3‐2‐22

Code


N

N/A N/A

N/A N/A

N/A 3‐9‐3‐2‐22

N/A N/A

SALES TAX Noted in Exemptions section

Y N

N/A N/A Y

N/A N/A Y

N/A N/A N/A

N/A N/A N/A

N/A N/A N/A

N N N

Def/Code

N/A N/A N/A

Non‐Taxable Code Reference By Definition or code N/A N/A N/A N/A N/A N/A N/A N/A N/A

Def/Code

Comment


Not in code no reason to include. Not in code no reason to include. Not in code, no reason to include. The definition of newspaper covers the supplements sufficiently. Wording change, no change in application.

N N N

Do not add, leave as is Do not add, leave as is Do not add, leave as is

Y


Y

3‐9‐3‐2(A)7

Y N/A

3‐9‐3‐2(A)7 Code 3‐9‐1‐4(B) Def/Code 3‐9‐3‐ 1(A)(G)(H)(I) 3‐9‐3‐13 3‐9‐3‐4 3‐9‐4‐4€(G)(H)

Medical supplies definition remains. Valuation; sales tax. Definition is essentially the same.

Y Y

Add definition for clarity of historic application Change Definition for consistency

3‐9‐3‐1(B)

Code

Included in TPP

Y


Y

3‐9‐3‐2(A)7

Code

Y

3‐9‐3‐2(A)7

Code


3‐9‐2‐1(A) N/A N/A N/A N/A 3‐9‐3‐1(F) 3‐9‐3‐2(5)a 3‐9‐3‐1(A)(C) 3‐9‐4‐3 3‐9‐4‐3(A) 3‐9‐4‐4© Numerous references in code

Def/Code N/A N/A N/A N/A Def/Code

Removed current definition and split into Y Prosthetic devices for animals and prosthetic devices for humans. Removed current definition and split into Y Prosthetic Devices for Animals and Prosthetic Devices for Humans. Change definition. Y N N N N Change definition. Y

Change Definition for consistency Do not add, leave as is Do not add, leave as is Do not add, leave as is Do not add, leave as is Change Definition for consistency

Def/Code

Minor changes

Y


Code

Similar to current definition

Y

Modify current definition; however, leave "retailer or vendor" as there are many references in the code to both these terms.

N/A

Code

N/A

N/A

N/A

Y

3‐9‐3‐2‐22

Code

This should be defined for clarity in Y contractors. Suggest add General definition Y Update definition. Not in definitions, but definition is included in Y Exemptions

N/A N/A

N/A N/A

N/A 3‐9‐3‐2‐22

N/A N/A

N/A N/A Y

N/A N/A N/A

N/A N/A N/A

N/A N/A N/A

General definition Y Not in definitions, but definition is included in N Exemptions N N Not specifically in code but historically all Y software other than custom software is taxable.




Change Definition for consistency Change Exemption section to include "to a person or entity…" Does not change the definition meaning. Change Definition for consistency Do not add, leave as is Do not add, leave as is Do not add, leave as is Add definition for clarity of historic application and add exemption for custom software

Page 4 of 5 11/20/2017




Existing Def

Taxable

Non‐Taxable Code Reference By Definition or code N/A N/A

(81) Software as a Service

N

Y

(82) Software License Fee

N

Y

N/A

(83) Software Maintenance Agreement

N

Y

(84) Solar Thermal Systems (85) Sound System Services (86) Special Fuel (87) Special Sales Event (88) Storage

N N N N N

N/A N/A N/A N/A N/A

(89) Student

N

(90) TANGIBLE PERSONAL PROPERTY


Defined? Taxable

N/A

N

Y

N/A

N/A

N

Y

N/A

N/A

N/A

N/A

N/A

N

Y

N/A

N/A

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N N N N N

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

N/A

N/A

3‐9‐3‐2‐22

Code


N/A

N/A

3‐9‐3‐2‐22

Code

Minor changes

Y


Y

Y

Y

3‐9‐3‐2(A)

Code

TANGIBLE PERSONAL PROPERTY

Y

Y

Y

3‐9‐3‐2(A)

Code

Change definition.

Y


(91) TAX (92) TAX DEFICIENCY

Y Y

N/A N/A

N/A N/A

N/A N/A

N/A N/A

TAX TAX DEFICIENCY

Y Y

N/A N/A

N/A N/A

N/A N/A

N/A N/A

Y Y

Change Definition for consistency Change Definition for consistency

(93) TAXABLE SALES

Y

Y

N/A

N/A

TAXABLE SALES

Y

Y

N/A

N/A

Y


(94) TAXABLE SERVICES

Y

Y

N/A

N/A

TAXABLE SERVICES

Y

Y

N/A

N/A

Y


(95) TAXPAYER

Y

N/A

N/A

N/A

`

TAXPAYER

Y

N/A

N/A

N/A

N/A

Y


(96) TELECOMMUNICATIONS SERVICE

Y

Y

N

3‐9‐3‐1(B)

Code

TELECOMMUNICATIONS SERVICE

Y

Y

N

3‐9‐3‐1(B)

Code

General definition General definition Update definition. General definition Minor Change General definition Minor Change General definition Minor Change Change definition.

Y


(97) Television & Entertainment Services

N

Y

N

3‐9‐3‐1(H)

Def/Code

N/A

Y

Y

N

3‐9‐3‐1(H)

Def/Code

New definition. Replaces Pay Television Y definition. Taxation of satellite TV exempted by federal law

(98) Therapeutic Device

N

N/A

N/A

N/A

N/A

N/A

N

N/A

N/A

N/A

N/A

(99) Toll Free Telecommunications Service

N

N/A

N/A

N/A

N/A

N/A

N

N/A

N/A

N/A

N/A

(100) TOTAL TAX LIABILITY (101) Transient / Temporary Sale (102) Transient / Temporary Vendor (103) Use

Y N N N

N/A N/A N/A N/A

N/A N/A N/A N/A

N/A N/A N/A N/A

N/A N/A N/A N/A

TOTAL TAX LIABILITY N/A N/A N/A

Y N N N

N/A N/A N/A N/A

N/A N/A N/A N/A

N/A N/A N/A N/A

N/A N/A N/A N/A

N Not mentioned in Code; If adopted it may affectively expand the exemption. Not mentioned in Code, no recommendation N to add. General definition Y N N Not currently defined. In code many times. Y Definition would probably not impact code interpretation. No issues in the past related to lack of definition. Could include in code.

(104) USE TAX (105) WHOLESALE SALES (106) WHOLESALER

Y Y Y

N/A N N/A

N/A Y N/A

N/A 3‐9‐3‐2(B)2(c) N/A

N/A Def/Code N/A

USE TAX WHOLESALE SALES WHOLESALER

Y Y Y

N/A N N/A

N/A Y N/A

N/A N/A 3‐9‐3‐2(B)2( c) Def/Code N/A N/A


Non‐Taxable Code Reference By Definition or code N/A N/A

Comment


Not specifically in code but historically all SAS Y is taxable. Not specifically in code but historically is Y taxable. Not specifically in code but historically is Y taxable. N N N General definition N General definition Y Update definition. Not currently defined. In code several times but with different meanings (storage, use, consumption vs. storage of information). Definition would not impact code interpretation. No issues in the past related to lack of definition.

General definition Change is additional clarification of term. General definition Change is additional clarification of term.

Y Y Y

Add definition for clarity of historic application Add definition for clarity of historic application Add definition for clarity of historic application Do not add, leave as is Do not add, leave as is Do not add, leave as is Do not add, leave as is Add definition for clarity of historic application

Insert new definition. Change verbiage in code. (H) On the purchase price paid or charged for pay, cable or subscription (including microwave) television services sold, purchased, leased, rented, furnished or used. (Ord. 39, Series of 1980) Do not add, leave as is Do not add, leave as is Change Definition for consistency Do not add, leave as is Do not add, leave as is Add definition for clarity of historic application

Change Definition for consistency Change Definition for consistency Change Definition for consistency

Page 5 of 5 11/20/2017

City of Littleton


Staff Communication File #: Ordinance 36-2017, Version: 1 Agenda Date: 12/05/2017 Subject: An ordinance on first reading amending Ordinance No. 21 Series of 2016 known as the Annual Appropriation Bill for all municipal purposes for the fiscal year beginning January 1, 2017 and ending December 31, 2017. Presented By:


POLICY QUESTION: Does city council support an amendment to the 2017 annual appropriation? BACKGROUND: The following funds are recommended to be increased: General Fund - $2,287,904 The General Fund increase is proposed to increase as follows: Transfer to Capital Projects Fund - $1,937,904. The city had a TABOR excess in 2016 of $1,937,904. A ballot question was approved by voters on November 7, 2017 allowing the city to retain the 2016 excess for specific capital improvements. This transfer moves the excess TABOR funds from the General Fund to the Capital Projects Fund to be spent on the two specific capital projects: 1) Pavement improvement initiative - residential streets and 2) Bowles Avenue and Federal Boulevard intersection safety upgrades. The 2016 ending fund balance in the General Fund has already been reduced by this amount in 2016 with an audit accrual adjustment. The net effect to the 2018 estimated ending fund balance is $0.

Transfer to Property and Liability Fund - $350,000. Historically, there has not been a dedicated funding source for the Property and Liability Fund. With the increase in claims, additional monies need to be transferred to the fund to cover claim costs and maintain adequate reserves. This transfer was included in the 2017 estimates for the 2018 budget and discussed with council during the 2018 budget sessions in September.

Geneva Village - $43,425 Repairs were required at Geneva Village to prevent potential future sewer backups and to bring the sewer system up to current standards and code. The project cost was $43,425. These expenditures were included in the 2017 estimates for the 2018 budget in estimating ending available cash. With these expenditures, the estimated ending cash balance in 2018 will be $95,495. The recommended reserve is $98,000. Employee Insurance - $200,000 Worker’s Compensation is included in the Employee Insurance Fund. Worker’s Compensation claims vary from year to year. The city is self-funded for Worker’s Compensation claims with a self-insured retention limit of $500,000 per occurrence. Expenditures are trending higher as compared to the budget. An additional $200,000 City of Littleton

Page 1 of 2


powered by Legistar™

File #: Ordinance 36-2017, Version: 1 $500,000 per occurrence. Expenditures are trending higher as compared to the budget. An additional $200,000 in appropriation is estimated to be needed for 2017. Staff will continue to monitor claims through the end of the year and in 2018, and adjust funding in future years as needed. With this additional appropriation, the 2018 estimated ending fund balance will be $995,455. Property and Liability - $200,000 Property and liability claims vary from year to year. Expenditures are trending higher as compared to the budget. An additional $200,000 in appropriation is estimated to be needed for 2017. These additional expenditures are partially offset by increased reimbursements from insurance related to claims. To provide adequate funding and reserves in this fund, a transfer from the General Fund of $350,000 is requested.. The 2018 estimated ending fund balance will be $350,397 in this fund. STAFF ANALYSIS: Amending the annual appropriation bill is a typical process that the city conducts every year. FISCAL IMPACTS: The 2017 budget appropriation is recommended to increase by $2,731,329. STAFF RECOMMENDATION: Staff recommends approval of the ordinance on first reading amending the 2017 budget. PROPOSED MOTION: I move to approve amending on first reading Ordinance No. 21 Series of 2016 known as the Annual Appropriation Bill for all municipal purposes for the fiscal year beginning January 1, 2017 and ending December 31, 2017, and schedule the second reading and public hearing on December 19, 2017.

City of Littleton

Page 2 of 2


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49

CITY OF LITTLETON, COLORADO ORDINANCE NO. 36 Series, 2017 INTRODUCED BY COUNCILMEMBERS: AN ORDINANCE OF THE CITY OF LITTLETON, COLORADO, AMENDING ORDINANCE NO. 21 SERIES OF 2016 KNOWN AS THE “ANNUAL APPROPRIATION BILL” FOR ALL MUNICIPAL PURPOSES OF THE CITY OF LITTLETON, COUNTIES OF ARAPAHOE, JEFFERSON AND DOUGLAS, STATE OF COLORADO, FOR THE FISCAL YEAR BEGINNING JANUARY 1, 2017 AND ENDING DECEMBER 31, 2017. WHEREAS, Ordinance No. 21, Series of 2016 established the annual appropriation for municipal purposes for the City of Littleton, Colorado, and WHEREAS, Ordinance No. 18, Series of 2017 amended the annual appropriation for municipal purposes for the City of Littleton, Colorado; and WHEREAS, appropriations have theretofore been made for the expenditures of monies pursuant to said budget; and WHEREAS, the necessity of receiving and expending additional monies from the various funds could not have been reasonably anticipated during the time of adoption of the budget and appropriation of funds in accordance therewith;

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, THAT: Section 1: The budget of the City of Littleton for the fiscal year beginning January 1, 2017, and ending December 31, 2017, is hereby amended by additions to the following funds: FUND General Geneva Village Employee Insurance Property and Liability Total

EXPENDITURE $ 2,287,904 $ 43,425 $ 200,000 $ 200,000 $ 2,731,329

Section 2: The provisions of the annual appropriations Ordinance No. 21, Series of 2016, are hereby amended with the total of all fund expenditures amended to $90,366,249.

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Section 3: Severability. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such invalidity shall not affect the validity of the remaining sections of this ordinance. The City Council hereby declares that it would have passed this ordinance, including each part, section, subsection, sentence, clause or phrase hereof, irrespective of the fact that one or more parts, sections, subsections, sentences, clauses or phrases may be declared invalid. Section 4: Repealer. All ordinances or resolutions, or parts thereof, in conflict with this ordinance are hereby repealed, provided that this repealer shall not repeal the repealer clauses of such ordinance nor revive any ordinance thereby.

INTRODUCED AS A BILL at a regularly scheduled meeting of the City Council

15

of the City of Littleton on the 5th day of December, 2017, passed on first reading by a vote of ___

16

FOR and ___ AGAINST; and ordered published by posting at Littleton Center, Bemis Library,

17

the Municipal Courthouse and on the City of Littleton Website.

18

PUBLIC HEARING on the Ordinance to take place on the 19th day of December,

19

2017, in the Council Chambers, Littleton Center, 2255 West Berry Avenue, Littleton, Colorado,

20


21


FOR

22


23


24

ATTEST:

25 26 27 28 29 30 31 32 33



City of Littleton


Staff Communication File #: Ordinance 39-2017, Version: 1 Agenda Date: 12/05/2017 Subject: An ordinance on first reading amending the 2017 Emergency Medical Transportation Enterprise Budget. Presented By:


POLICY QUESTION: Does city council support an amendment to the 2017 Emergency Medical Transportation Enterprise Fund budget? BACKGROUND: The city provides emergency medical services that are funded from fees for medical transports. An Emergency Medical Transportation Enterprise Fund was established to account for the revenues and expenditures related to emergency medical transports. During the 2018 budget preparation, it was determined that it is necessary to reallocate approximately $350,000 in personnel expenses in 2017 from the General Fund to the Emergency Medical Transportation Enterprise Fund due to the addition of peak hour medic units. This reallocation was included in the 2017 estimates for the 2018 budget. This change in allocation may have an impact on the sustainability of this fund over the next five years. Staff will continue to monitor revenues and expenditures related to emergency medical services. STAFF ANALYSIS: Amending the annual budget is a typical process that the city conducts every year. FISCAL IMPACTS: The Emergency Medical Transportation Enterprise Fund 2017 budget is recommended to increase by $350,000. It is estimated that the 2018 ending cash balance in this fund will be $676,863. STAFF RECOMMENDATION: Staff recommends approval of the ordinance on first reading amending the 2017 Emergency Medical Transportation Enterprise Fund budget. PROPOSED MOTION: I move to approve the amendment to the Emergency Medical Transportation Enterprise Fund 2017 budget on first reading and schedule a second reading and public hearing on December 19, 2017.

City of Littleton

Page 1 of 1


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47

CITY OF LITTLETON, COLORADO ORDINANCE NO. 39 Series, 2017 INTRODUCED BY COUNCILMEMBERS: AN ORDINANCE AMENDING THE 2017 EMERGENCY MEDICAL TRANSPORTATION ENTERPRISE BUDGET

WHEREAS, the city council established the City of Littleton Emergency Medical Transportation Enterprise (the “Enterprise”) by Ordinance No. 15, Series of 2000; and WHEREAS, the city council, as the governing board of the Enterprise, has the authority to establish the budget for the Enterprise; and WHEREAS, Ordinance No. 32, Series of 2016, established the 2017 budget for the Emergency Medical Transportation Enterprise; and WHEREAS, the necessity of receiving and expending additional monies from the Enterprise could not have been reasonably anticipated during the time of adoption of the budget and appropriation of funds in accordance therewith;

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, THAT: Section 1: The budgeted expenditures for the Emergency Medical Transportation Enterprise for the period January 1, 2017, to December 31, 2017, are hereby amended to $4,327,110. Section 3: Severability. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such invalidity shall not affect the validity of the remaining sections of this ordinance. The City Council hereby declares that it would have passed this ordinance, including each part, section, subsection, sentence, clause or phrase hereof, irrespective of the fact that one or more parts, sections, subsections, sentences, clauses or phrases may be declared invalid. Section 4: Repealer. All ordinances or resolutions, or parts thereof, in conflict with this ordinance are hereby repealed, provided that this repealer shall not repeal the repealer clauses of such ordinance nor revive any ordinance thereby.

INTRODUCED AS A BILL at a regularly scheduled meeting of the City Council of the City of Littleton on the 5th day of December, 2017, passed on first reading by a vote of ___

Ordinance 39 Page 2 of 2 1


2


3


4


5


6


FOR

7


8


9

ATTEST:

10 11 12 13 14 15 16 17 18



City of Littleton


Staff Communication File #: Ordinance 37-2017, Version: 1 Agenda Date: 12/05/2017 Subject: An ordinance on first reading adopting and entering into the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust and taking other actions in connection therewith Presented By:

Julie Lanier, Acting HR Director

POLICY QUESTION: Does city council support entering into the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust and taking other actions in connection therewith? BACKGROUND: On May 3, 2017, Governor Hickenlooper signed SB 17-214 which allows an employer to participate in a voluntary firefighter cancer benefits program, as a multiple employer health trust to provide benefits to firefighters by paying contributions into the established trust. SB 17-214 requires the trust to provide benefits to each firefighter based on the cancer diagnosis and award level. The bill gives local governments the option to join the trust. Should they choose to do so, workers' compensation expenses for these local governments may decrease. The precise impact to local governments will vary across jurisdictions and will depend on a number of factors, including whether or not they join the trust and the number of compensable cancer benefit claims they receive from firefighters. Under this new statute, a firefighter must have at least five years of continuous, full time employment and be diagnosed with cancer within ten years of ceasing employment as a firefighter ( SB 17-214 covers part-time and volunteer firefighters, but the City of Littleton only employs full time firefighters). The purpose of this statute is to provide supplemental income and reimbursement for out-of-pocket costs not otherwise paid for by insurance coverage to firefighters who contract covered cancers and to reduce the cost of Workers’ Compensation insurance for employers of firefighters. This is not a replacement for Workers’ Compensation coverage or any other kind of medical insurance. This revised statue does not eliminate or curtail the obligation of an employer of firefighters to participate in the state Workers’ Compensation system, nor does it eliminate or curtail the right of a firefighter to pursue benefits under the state Workers’ Compensation system. Rather, it provides a practical alternative for firefighters to deal with the costs and burdens of covered cancers without being forced to rely in recovering compensation under the rebuttable presumption created by House Bill 07-1008 (Chapter 187, Section 1 (3) and (4), SB 17-214). House Bill 07-1008, enacted in 2007, established a rebuttable presumption in the State Workers’ Compensation system that certain types of cancer, when contracted by firefighters, are occupational diseases caused by City of Littleton

Page 1 of 3


File #: Ordinance 37-2017, Version: 1 system that certain types of cancer, when contracted by firefighters, are occupational diseases caused by employment as a firefighter. Nine years of experience has shown that the rebuttable presumption established by House Bill 07-1008 has produced no demonstrable benefit to firefighters but has led to significantly greater costs to employers of firefighters (Chapter 187, Section 1 (1) and (2), SB 17-214). Pursuant to Chapter 187, 29-5-403- Required benefits - conditions of receiving benefits, the trust shall provide coverage to individuals diagnosed with cancer, based on the award level of the cancer at the time of diagnosis, after the employer becomes a participant. Award levels will be established by the trust based on the category and stage of the cancer as follows: a) Award level zero, $100 up to $2,000; b) Award level one, $4,000, which shall be paid in addition to the amounts paid for an award level two or higher diagnosis; c) Award level two, $5,000; d) Award level three, $15,000; e) Award level four, $22,500; f) Award level five, $28,125; g) Award level six, $37,500; h) Award level seven, $75,625; i) Award level eight, $84,375; j) Award level nine, $168,750; k) Award level ten, $225,000.

STAFF ANALYSIS: The City of Littleton operates under the 2007 presumption of cancer legislation, in which it is up to the city to prove that the employee or former employee’s cancer is not a direct result of their employment and the associated risks. For example, if an employee makes a cancer claim he does not receive an immediate Workers Compensation payout until an invasive investigation is completed. The city and Workers Compensation attorneys spend time researching prior exposures and investigating prior employment, family history and medical records in order to make a determination. Therefore, the city ends up paying for outside legal costs and expert medical examinations. This is the case whether the employee is active or retired. Over the last 10 years since the presumption passed in 2007, the city has had seven cancer claims. The average claim cost is $64,779, resulting in an average cost per year of $45,345. The Colorado Firefighter Heart and Cancer Benefits Trust is a multiple employer health trust to provide benefits to eligible firefighters by paying City of Littleton

Page 2 of 3


File #: Ordinance 37-2017, Version: 1 contributions into an established trust. An employer participating in the trust will be exempt from the presumptive eligibility mandate for Workers Compensation for firefighters with certain types of cancers. No investigation into the cause of cancer will be needed upon confirmation of eligibility. In order for a firefighter to be eligible for the trust they must be a full time firefighter for five years. While it would not make sense for a firefighter to file a Workers Compensation claim, by law they still maintain the right to do so. The burden of evidence is on the firefighter to prove that the cancer was jobrelated. The Cancer Trust would offset Workers Compensation costs in the event a claim was filed. The Trust provides for limited liability for former employees and is capped at 10 years (currently employees who are retired up to 30 years are eligible to make a claim). The added benefits of the Trust are faster payouts for firefighters. Payments will start within 10 days of confirmation to the Trust of a diagnosed cancer versus two or more years. There will be no more invasive investigations. The five covered cancers are brain, skin, digestive, hematological, or genitourinary OPTIONS/ALTERNATIVES: Do not join the Colorado Firefighter Heart and Cancer Benefits Trust and continue to operate under the 2007 presumption of cancer legislation. FISCAL IMPACTS: $265 per firefighter (120 EE) = $31,800 annually. STAFF RECOMMENDATION: Staff recommends approval of the Trust Agreement for SB 17-214. Funds for the city to join the trust were included and approved in the 2018 budget. PROPOSED MOTION: I move to approve an ordinance on first reading adopting and entering into the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust and to schedule a second reading and public hearing for December 19, 2017.

City of Littleton

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CITY OF LITTLETON, COLORADO ORDINANCE NO. 37 Series, 2017 INTRODUCED BY COUNCILMEMBERS: AN ORDINANCE OF THE CITY OF LITTLETON, COLORADO, ADOPTING AND ENTERING INTO THE TRUST AGREEMENT FOR THE COLORADO FIREFIGHTER HEART AND CANCER BENEFITS TRUST AND TAKING OTHER ACTIONS IN CONNECTION THEREWITH WHEREAS, under state law, specifically, Part 3 of Article 5 of Title 29, Colorado Revised Statutes (C.R.S.), an employer as defined therein is required to maintain certain firefighter heart and circulatory malfunction benefits in accordance with and subject to the requirements and limitations of said Part 3; and WHEREAS, under state law, specifically, Part 4 of Article 5 of Title 29, Colorado Revised Statutes (C.R.S.), an employer as defined therein may participate in the voluntary firefighter cancer benefits program to provide certain cancer benefits in accordance with and subject to the requirements and limitations of said Part 4; and WHEREAS, in order to provide such benefits, an employer, which includes The City of Littleton is authorized to participate in a multiple employer health trust; and WHEREAS, the city council of the City of Littleton has authority under Article XIV, Section 18(2)(a) of the Colorado Constitution, and Sections 10-3-903.5, 29-1-201, et seq., 29-5-302, and 29-5-402, C.R.S., as amended, to participate with other employers in a multiple employer health trust for the provision of such benefits and for related claims handling, risk management, and other functions and services related to such benefits; and WHEREAS, the city council has reviewed the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust, a copy of which is attached hereto as Exhibit A, by and through which the Members (as defined therein) desire to establish a trust (the “Trust”) and provide a benefit plan that provides firefighter heart and circulatory malfunction benefits and a benefit plan that provides cancer benefits consistent with the provisions of Part 3 and Part 4 of Article 5 of Title 29, C.R.S., as specified in the Colorado Firefighter Heart and Circulatory Malfunction Benefits Plan and Colorado Firefighter Cancer Benefits Plan (collectively, the “Plan”); and WHEREAS, the Members intend that the Trust, together with the Plan, shall constitute an irrevocable trust exempt from taxation under Internal Revenue Code Section 115; and WHEREAS, the city council finds that membership and participation in the Trust and Plan would be in the best interests of the City of Littleton its employees and its

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taxpayers; and WHEREAS, the city council by this enactment desires to adopt and enter into the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust, and to take other actions in connection therewith. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LITTLETON, COLORADO, THAT: Section 1: Approves the Trust Agreement for the Colorado Firefighter Heart and Cancer Benefits Trust (the “Trust Agreement”). Section 2: Authorizes and directs the mayor to execute the Trust Agreement on behalf of the City of Littleton. Section 3: Directs that staff transmit to the Colorado Firefighter Heart and Cancer Benefits Trust (the “Trust”), McGriff, Seibels & Williams Inc., PO Box 1539, Portland, OR 97207-1539, executed and attested copies of this ordinance and such Trust Agreement. Section 4: Designates Julie Lanier, Acting HR Director as its initial Member Representative to the Trust and designates Melissa Saghy, HR Generalist II as its initial Alternate Representative to the Trust, at the mailing address of 2255 W. Berry Avenue, Littleton, CO 80120. Section 5: Understands that, with the adoption of this Ordinance and subject to the terms of the Trust Agreement, The City of Littleton becomes a Member of the Trust, with its participation to commence effective as of the date determined in accordance with the Trust Agreement. Section 6: Severability. If any part, section, subsection, sentence, clause or phrase of this ordinance is for any reason held to be invalid, such invalidity shall not affect the validity of the remaining sections of this ordinance. The City Council hereby declares that it would have passed this ordinance, including each part, section, subsection, sentence, clause or phrase hereof, irrespective of the fact that one or more parts, sections, subsections, sentences, clauses or phrases may be declared invalid. Section 7: Repealer. All ordinances or resolutions, or parts thereof, in conflict with this ordinance are hereby repealed, provided that this repealer shall not repeal the repealer clauses of such ordinance nor revive any ordinance thereby.

INTRODUCED AS A BILL at a regularly scheduled meeting of the City Council of the City of Littleton on the 5th day of December, 2017, passed on first reading by a vote of ___

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FOR

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ATTEST:

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TRUST AGREEMENT FOR COLORADO FIREFIGHTER HEART AND CANCER BENEFITS TRUST

November 24, 2014 Amended October 22, 2015 Amended May 17, 2017

TABLE OF CONTENTS ARTICLE 1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17

ADMINISTRATOR .................................................................................................................................................... 2 AUTHORIZED INVESTMENT .................................................................................................................................... 2 BENEFICIARY ......................................................................................................................................................... 2 CODE ..................................................................................................................................................................... 2 CUSTODIAN ............................................................................................................................................................ 2 FISCAL YEAR ......................................................................................................................................................... 2 INVESTMENT COMMITTEE ...................................................................................................................................... 2 INVESTMENT FUND ................................................................................................................................................ 2 INVESTMENT MANAGER......................................................................................................................................... 2 MEMBERS OR MEMBER .......................................................................................................................................... 2 MEMBER REPRESENTATIVE ................................................................................................................................... 3 PARTICIPANT.......................................................................................................................................................... 3 PLAN ...................................................................................................................................................................... 3 TRUST .................................................................................................................................................................... 3 TRUST COMMITTEE ................................................................................................................................................ 3 TRUST FUND .......................................................................................................................................................... 3 TRUSTEE ................................................................................................................................................................ 3

ARTICLE II 2.1 2.2 2.3

DUTIES OF TRUST COMMITTEE ....................................................................................................... 7

DUTIES. .................................................................................................................................................................. 7 Receipt of Contributions........................................................................................................................................ 7 Management of Funds. .......................................................................................................................................... 7 Payments. .............................................................................................................................................................. 7 Appointment of Administrator. .............................................................................................................................. 7 Appointments of Investment Committee. ............................................................................................................... 7

ARTICLE V 5.1 (a)

TRUSTEES AND SUCCESSOR TRUSTEES ........................................................................................ 3

TRUSTEES. ............................................................................................................................................................. 3 SUCCESSOR TRUSTEES. .......................................................................................................................................... 4 COMPENSATION. .................................................................................................................................................... 5 CHAIR AND OFFICERS; SUB-COMMITTEES. ............................................................................................................ 5 MEETINGS. ............................................................................................................................................................. 5 PROXY. .................................................................................................................................................................. 5 NO DELEGATES. ..................................................................................................................................................... 5 QUORUM AND VOTING. .......................................................................................................................................... 5 ACTION WITHOUT A MEETING................................................................................................................................ 6 CONFLICTS OF INTEREST. ....................................................................................................................................... 6 OFFICE LOCATION AND MEETING PLACE. .............................................................................................................. 6 AGENT FOR SERVICE OF LEGAL PROCESS. ............................................................................................................. 6 RULES AND REGULATIONS. .................................................................................................................................... 7

ARTICLE IV 4.1 (a) (b) (c) (d) (e)

ESTABLISHMENT OF THE TRUST..................................................................................................... 3

TRUST ESTABLISHED. ............................................................................................................................................ 3 LIMIT OF INTEREST – IMPOSSIBILITY OF DIVERSION. ............................................................................................. 3 TRUST COMMITTEE’S ACCEPTANCE. ...................................................................................................................... 3

ARTICLE III 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13

DEFINITIONS ........................................................................................................................................... 2

INVESTMENT OF TRUST ASSETS ...................................................................................................... 8

GENERAL INVESTMENT POWER/INVESTMENT FUNDS. ........................................................................................... 8 Authority of Investment Committee. ...................................................................................................................... 8

(b) (c) 5.2 (a) (b) (c) (d) (e) 5.3 (a) 5.4

Investment Funds................................................................................................................................................... 8 Funding Policy. ..................................................................................................................................................... 8 INVESTMENT MANAGERS. ...................................................................................................................................... 8 Appointment. ......................................................................................................................................................... 8 Contractual Arrangement...................................................................................................................................... 9 Trust Committee’s Duties. ..................................................................................................................................... 9 Failure to Direct.................................................................................................................................................... 9 Termination of Appointment. ................................................................................................................................. 9 MANNER AND EFFECT OF DIRECTIONS. .................................................................................................................. 9 Delegation of Authority to Custodian.................................................................................................................... 9 AUTHORIZATION OF DESIGNEE(S). ....................................................................................................................... 10

ARTICLE VI 6.1 6.2 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) (p)

POWERS OF TRUST COMMITTEE................................................................................................... 10

GENERAL AUTHORITY. ........................................................................................................................................ 10 SPECIFIC POWERS. ............................................................................................................................................... 10 Purchase of Property. ......................................................................................................................................... 10 Disposition of Property. ...................................................................................................................................... 10 Retention of Cash. ............................................................................................................................................... 10 Exercise of Owner’s Rights. ................................................................................................................................ 10 Registration of Investments. ................................................................................................................................ 11 Borrowing. .......................................................................................................................................................... 11 Purchase of Contracts. ........................................................................................................................................ 11 Execution of Instruments. .................................................................................................................................... 11 Settlement of Claims and Debts........................................................................................................................... 11 Establish Rules and Policies. .............................................................................................................................. 11 Trustee Insurance. ............................................................................................................................................... 11 Risk Management. ............................................................................................................................................... 11 Delegation. .......................................................................................................................................................... 12 Employment of Agents, Advisers and Counsel. ................................................................................................... 12 Appointment of Custodian. .................................................................................................................................. 12 Power to do any Necessary Act. .......................................................................................................................... 12

ARTICLE VII CONTRIBUTIONS TO THE TRUST FUND ....................................................................................... 12 7.1 7.2 7.3 7.4 7.5 7.6

MEMBER CONTRIBUTIONS. ................................................................................................................................... 12 CONTRIBUTION RATE STRUCTURE. ....................................................................................................................... 12 FAILURE TO MAKE CONTRIBUTIONS. .................................................................................................................... 13 TABOR COMPLIANCE. ........................................................................................................................................ 13 STATE FUNDING. .................................................................................................................................................. 13 REPORTS. ............................................................................................................................................................. 14

ARTICLE VIII PARTICIPATION AND WITHDRAWAL OF MEMBERS ............................................................... 14 8.1 8.2 8.3 8.4 8.5 8.6

PARTICIPATION IN TRUSTBY MEMBERS. .............................................................................................................. 14 WITHDRAWAL BY MEMBER. ................................................................................................................................ 14 SUCCESSORS AND ASSIGNS................................................................................................................................... 15 POWERS OF THE MEMBERS. .................................................................................................................................. 15 MEETINGS OF THE MEMBERS. ............................................................................................................................... 15 MEMBER OBLIGATIONS. ....................................................................................................................................... 16

ARTICLE IX 9.1 (a) (b) (c) (d) (e) 9.2

ADMINISTRATION ............................................................................................................................... 16

ACCOUNTING. ...................................................................................................................................................... 16 Books and Records. ............................................................................................................................................. 16 Accounting........................................................................................................................................................... 16 Release. ............................................................................................................................................................... 16 Valuations. .......................................................................................................................................................... 17 Reliance on Administrator................................................................................................................................... 17 EXPENSES. ........................................................................................................................................................... 17

ARTICLE X 10.1 (a) (b) 10.2 10.3

AMENDMENT OF TRUST. ...................................................................................................................................... 17 Right to Amend. ................................................................................................................................................... 18 Exclusive Benefit. ................................................................................................................................................ 18 TERMINATION OF PLAN. ....................................................................................................................................... 18 FINAL ACCOUNTING. ............................................................................................................................................ 18

ARTICLE XI 11.1 11.2 11.3 11.4 11.5 11.6 11.7 11.8 11.9 11.10 11.11 11.12

AMENDMENT OF TRUST; TERMINATION OF PLAN ............................................................. 17

MISCELLANEOUS ................................................................................................................................ 18

NONALIENATION OF BENEFITS. ............................................................................................................................ 18 BENEFIT. .............................................................................................................................................................. 19 EFFECT OF PLAN. ................................................................................................................................................. 19 DISPUTE RESOLUTION. ......................................................................................................................................... 19 ENTIRE AGREEMENT. ........................................................................................................................................... 20 APPROVAL OF THE MEMBERS. ............................................................................................................................. 20 LIABILITY FOR PREDECESSOR OR SUCCESSOR...................................................................................................... 20 LIABILITY FOR ACTS OF OTHERS. ........................................................................................................................ 20 GOVERNMENTAL IMMUNITY. ............................................................................................................................... 20 CONTROLLING LAW. ............................................................................................................................................ 20 EFFECTIVE DATE.................................................................................................................................................. 20 EXECUTION IN COUNTERPARTS. ........................................................................................................................... 20

TRUST AGREEMENT THIS TRUST AGREEMENT (this “Agreement”) is entered by and between the undersigned Colorado governmental entities (who, together with and any other Colorado governmental entities that becomes a participating Member under this Trust, are collectively the “Members”) and the undersigned trustees constituting the “Trust Committee” for the Trust, as defined herein (the “Trust Committee”).

WITNESSETH: WHEREAS, the Members are exempt from federal income tax under the Internal Revenue Code of 1986, as amended, as a state or territory of the United States, or any political subdivision, municipality or agency thereof, or an agency of such political subdivision or municipality (including any corporation owned or controlled by any state or territory of the United States or by any political subdivision, municipality, or agency); and WHEREAS, the Members desire by and through this Agreement to provide a benefit plan that provides heart and circulatory malfunction benefits consistent with the provisions of Part 3 of Article 5 of Title 29, Colorado Revised Statutes (C.R.S.), as specified in the Colorado Firefighter Heart and Circulatory Malfunction Benefits Plan and cancer benefits consistent with the provisions of Part 4 of Article 5 of Title 29, C.R.S., as specified in the Colorado Firefighter Cancer Benefits Plan (collectively, the “Plan”); and WHEREAS, the Members desire for the Trust to accept funds that shall from time to time be paid over to the Trust Committee in accordance with the terms of this Agreement, together with the earnings and profits thereon, if any, and to hold the funds in trust (the “Trust”) and to make disbursements from the Trust in accordance with the provisions of this Agreement and the Plan; and WHEREAS, the Members desire to appoint the Trust Committee as a trustee to hold and administer the assets of the Plan in accordance with this Agreement; and WHEREAS, the Trust Committee has agreed to serve as trustee of the trust established under this Agreement; and WHEREAS, the Members intend that the Trust hereby established, together with the Plan, shall constitute an irrevocable trust exempt from taxation under Internal Revenue Code Section 115; and WHEREAS, the Members intend that the Trust hereby established, together with the Plan, shall constitute a multiple employer health trust for the purpose of Part 3 and Part 4 of Article 5 of Title 29, C.R.S.; NOW, THEREFORE, the Members and the Trust Committee hereby mutually covenant and agree as follows: 1

ARTICLE I DEFINITIONS The following words and phrases, when used herein with an initial capital letter, shall have the meanings set forth below unless a different meaning plainly is required by the context. Any reference to a section number shall refer to a section of this Agreement unless otherwise specified. 1.1

Administrator means the person, committee or entity appointed by the Trust Committee to serve as plan administrator of the Plan. The Administrator shall be retained by the Trust Committee and shall administer the Plan pursuant to an administrative services agreement entered into between the Administrator and the Trust Committee.

1.2

Authorized Investment means and is limited to those investments that are defined as permissible for investment of public funds in Section 24-75-601 et seq. C.R.S., as in effect from time to time.

1.3

Beneficiary means any person designated under the terms of the Plan to receive benefits payable upon the death of a Participant.

1.4

Code means the Internal Revenue Code of 1986, as amended.

1.5

Custodian means Wells Fargo Bank, N.A., which shall serve as custodian for the Trust Fund. To the extent any assets are held by any custodian other than Wells Fargo Bank, N.A., such party shall also be considered a Custodian for the Trust.

1.6

Fiscal Year means the accounting year of the Trust, which shall commence on July 1 and end on June 30 of each year, except that the first year shall commence on the Effective Date and shall end on the immediately following June 30. (As Amended, Ballot 2015-1, eff. 11/24/2014)

1.7

Investment Committee means the person, committee or entity appointed in accordance with the terms of the Trust to make and effect investment decisions under the Plan and Trust. Unless the Trust Committee appoints an Investment Committee, the Trust Committee shall be deemed to be the Investment Committee.

1.8

Investment Fund means any of the separate funds established by the Investment Committee for the investment of Plan assets.

1.9

Investment Manager means any person, corporation or other organization or association appointed by the Trust Committee pursuant to the terms of Section 4.3 to manage, acquire or dispose of the assets of an Investment Fund.

1.10

Members or Member means those governmental employers listed on Exhibit A and any other governmental employer that becomes a participating Member under this Trust pursuant to Article VIII, below. 2

1.11

Member Representative means that person who has been designated in writing by a Member as its representative to the Trust.

1.12

Participant means an employee or former employee of the Member.

1.13

Plan means the Colorado Firefighter Heart and Circulatory Benefits Plan and the Colorado Firefighter Cancer Benefits Plan set forth in Part 3 and Part 4 of Article 5 of Title 29, Colorado Revised Statutes, and in the Plan Summaries of Benefits as such Plan may be amended from time to time.

1.14

Trust means the trust established by this Agreement.

1.15

Trust Committee means the Trust Committee appointed pursuant to Section 3.1 of this Trust Agreement, acting as a group or body.

1.16

Trust Fund means the total amount of cash and other property held in the Trust under this Agreement.

1.17

Trustee means the Trust Committee members and their successors as provided by this Agreement.

ARTICLE II ESTABLISHMENT OF THE TRUST 2.1

Trust Established. The Members hereby establish with the Trust Committee, as a funding medium for the Plan, a Trust consisting of the Trust Fund and such earnings, profits, increments, additions and appreciation thereto and thereon as may accrue from time to time.

2.2

Limit of Interest - Impossibility of Diversion. It shall be impossible at any time for any part of the Trust to be used for or diverted to purposes other than for the exclusive benefit of the Participants and Beneficiaries covered under the Plan, except that the payment of taxes and administration expenses may be made from Trust funds as hereinafter provided. Funds of the Trust may not be transferred to any other account or fund of a Member.

2.3

Trust Committee’s Acceptance. The Trust Committee accepts the Trust hereby created and agrees to perform the duties hereby required of the Trust Committee.

ARTICLE III TRUSTEES AND SUCCESSOR TRUSTEES 3.1 Trustees. The Trust shall be administered by the Trust Committee. The Trust Committee shall be comprised of nine (9) individual Trustees; provided, however, that the Trust Committee shall be deemed duly constituted and may commence operations of the Trust upon seating of and execution of this Agreement by four (4) initial Trustees. Each Trustee must be a Participant and 3

current employee of a Member, except as provided below. Trustees shall be appointed by the Board of Directors of the Colorado State Fire Chiefs (“CSFC Board”) from among the following: (a) One Trustee who is a Member Representative from a fire district or fire authority serving an area having less than thirty thousand (30,000) in population; (b) One Trustee who is a Member Representative from a fire district or fire authority serving an area having more than thirty thousand (30,000) in population; (c) One Trustee who is a Member Representative from a municipality having less than thirty thousand (30,000) in population; (d) One Trustee who is a Member Representative from a municipality having more than thirty thousand (30,000) in population; (e) One Trustee who is a Participant and officer of the Colorado Professional Firefighters Association (“CPFF”), who is designated for appointment by CPFF; and (f) Four Trustees who are Member Representatives from four other Members of any size or type, who are elected or appointed officials or employees of the Member and are not firefighters eligible for participation in the Plan, and at least two of whom are persons holding full-time positions in risk management or human resources for their appointing Member. Nominations for Trustees from the Members and CPFF shall be made by elected governing body of the Member (i.e., district board of directors, city council, CPFF Board of Directors) and be submitted to the CSFC Board at such time as the CSFC Board may provide. Terms of the Trustees shall be two-year, overlapping terms or until their successors have been appointed, except that in the initial appointment of Trustees, four of them shall serve an initial term of no more than two years and five of them shall serve an initial term of no more than one year so as to establish the staggering of terms. The term shall begin on a January 1, and end at midnight on a December 31, except that the initial Trustees’ terms shall begin upon the formation of the Trust. A vacancy shall occur on the Trust Committee when a Trustee (1) submits a written resignation to the Trust Committee; (2) dies; (3) ceases to be a Participant; (4) ceases to be a Member Representative, except in the case of the CPFF Trustee to whom such requirement (4) does not apply; (5) fails to attend three consecutive regular meetings of the Trust Committee without the Committee having entered upon the record its proceedings an approval for an additional absence or absences, except that such additional absence or absences shall be excused for temporary mental or physical disability or illness; or (6) is convicted of a felony. Any vacancy on the Trust Committee shall be filled by appointment by the CSFC Board for the unexpired portion of the term. Upon appointment and written acceptance thereof, a successor Trustee shall have all the title, rights, powers and privileges and duties conferred or imposed upon the initial or predecessor Trustee. 3.2

Successor Trustees. No successor Trustee need examine the accounts, records and acts 4

of any previous Trustee of any allocation of the Trust assets, nor shall such successor Trustee be responsible for any act or omission to act on the part of any previous Trustee. All Trustees and their successors from time to time acting under this Agreement shall have all the rights, powers and duties of the initial Trustees named in this Agreement, unless this Agreement is amended to provide otherwise. Compensation. The Trustees shall receive no compensation for their services rendered 3.3 under this Agreement other than any compensation as an employee of a particular Member. The Trust Committee may adopt policies to reimburse Trustees for actual meeting expenses and attendance at the Trust Committee meetings and other properly incurred expenses on Trust matters. 3.4 Chair and Officers; Sub-Committees. The officers of the Trust Committee shall be the chair, vice chair and secretary. The officers shall be appointed by the Trust Committee from among its members. Appointment of officers shall occur at the first meeting of the Trustee Committee each year. The Trust Committee may establish sub-committees necessary or appropriate to the exercise of its powers. Meetings. The Trust Committee shall determine the time and place of its regular 3.5 meetings. Special meetings of the Trust Committee may be called by the chair or by four (4) Trustees. The Trustees shall be provided with at least ten (10) days prior written notice designating the time, place and agenda of a regular meeting and three (3) days prior written notice designating the time, place and agenda of any special meeting. The manner of giving notice of meetings may include, without limitation, service by electronic mail to the Trustee’s email address. Regular and special meetings of the Trust Committee may be held by telephone or electronic (internet-based) conference call. Any meeting at which all Trustees are present in person, or concerning which all Trustees have waived notice in writing, shall be a valid meeting without the requirement to provide any notice. 3.6 Proxy. Any Trustee may duly authorize in writing another Trustee to cast a vote on one (1) or more specific matters to be voted on at a meeting, on behalf of such Trustee. Any such written authorization must specify the matter or matters and be given for a specific meeting and may not carry over to subsequent meetings. No Delegates. A Trustee and/or the Trustee’s Member Representative may not appoint a 3.7 delegate to serve in his or her place. 3.8

Quorum and Voting. (a)

To constitute a quorum at any regular or special meeting of the Trust Committee and for any action to be valid at such meeting, there must be present in person or by proxy at least five (5) of the nine (9) Trustees.

(b)

Valid actions at meetings at which a quorum is present require the affirmative vote of a simple majority of those Trustees present and voting, except where an absolute majority is expressly required. Each Trustee shall cast his or her vote on 5

each matter upon which action is taken, except where abstention from voting is required because of conflict of interest. (c)

To approve the following items, an absolute majority vote (as defined below) is required: (1)

Annual budget;

(2) and

Incurring any debt other than liabilities in the ordinary course of business;

(3)

Settling any litigation involving the Plan or Trust.

An absolute majority vote is the affirmative vote of at least five (5) Trustees. Action without a Meeting. Any action that may be taken at a meeting of the Trust 3.9 Committee may be taken without a meeting upon the written consent of a sufficient number of the Trustees otherwise required to approve such action at a meeting and shall be effective on the date of the last consent, unless two (2) or more Trustees object to taking the action without a meeting. A copy of such written consent, signed by the Trustees, shall be provided within ten (10) days of the effective date of the consent to each Trustee. Consent may be signified by a signature of the Trustee on a written consent or by an electronic means, such as an affirmative email response to a request for confirmation of favorable action on a matter, approval of a specific resolution, etc. 3.10 Conflicts of Interest. Trustees should avoid the appearance of impropriety. A Trustee shall exercise care that the Trustee’s independent judgment in the discharge of Trust Committee responsibilities is not impaired as a result of conflicts between the interests of the Trust and the Trustee’s own financial interests or personal interests, or the financial interests or personal interests of the members of the Trustee’s family or associates. A Trustee shall not vote or decide upon any matter relating solely to himself or herself or vote in any case in which his or her individual right or claim to any benefit under the Plan is particularly involved or in which he or she otherwise has a conflict of interest. In the event that a Trustee believes that he or she has a conflict of interest, the Trustee shall disclose the conflict to the Trust Committee and shall refrain from participating in the matter to which the conflict relates. The minutes of the meeting where the disclosure is made shall reflect the disclosure and the fact of the Trustee having abstained from participation in the matter. A Trustee shall not use confidential information acquired in the course of the performance of Trust Committee responsibilities to further that Trustee’s own financial interests or personal interests, or the financial interests or personal interests of the members of the Trustee’s family or associates. 3.11 Office Location and Meeting Place. All meetings of the Trust Committee shall be held at a place designated at least annually by the Trust Committee, or the chair, if the Trust Committee is unable to reach an agreement regarding a meeting location. The Trust shall have its principal office at 433 S. Allison Parkway, Lakewood, CO 80226.

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3.12 Agent for Service of Legal Process. The designated agent for service of legal process shall be Samuel J. Light, Light Kelly, P.C. 101 University Blvd., Suite 210, Denver, Colorado 80206, or any successor agent as the Trust Committee shall designate. 3.13 Rules and Regulations. The Trust Committee shall have the power at any regular or special meeting to adopt bylaws, rules, regulations and policies for the administration of the Trust, and for the conduct of the affairs of the Trust Committee. Any bylaws, rules, regulations and policies of the Trust Committee shall be consistent with the written provisions of the Trust Agreement, and shall be binding upon all persons dealing with the Trust and upon any and all persons claiming any benefits under the Plan.

ARTICLE IV DUTIES OF TRUST COMMITTEE 4.1

Duties. It shall be the duty of the Trust Committee: (a)

Receipt of Contributions. To receive any contributions paid to it under this Agreement in cash or in other property acceptable to the Trust Committee. The Trust Committee shall not be responsible for the calculation or collection of any contribution required to be paid by the Member to the Trust under the Plan, but shall be responsible only for property actually received by it pursuant to this Agreement.

(b)

Management of Funds. To hold, invest, reinvest, manage and administer (except as otherwise provided herein) all contributions so received, together with the income therefrom and any other increment thereon, for the benefit of Participants and their Beneficiaries in accordance with the terms of this Agreement.

(c)

Payments. To direct payments under the Plan; provided, however, that the Trust Committee may rely upon the directions received from the Administrator, and the Administrator hereby indemnifies the Trust Committee from any loss, claim, damage or liability, including legal expenses, that may arise in connection with the Trust Committee’s acting upon such direction.

(d)

Appointment of Administrator. To appoint such person, committee or entity as the Trust Committee shall determine to serve as Administrator of the Plan, and to contract with the Administrator for provision of its services. The Trust Committee shall have the power to terminate the appointment of the Administrator upon written notice with or without cause.

(e)

Appointment of Investment Committee. To appoint as the Investment Committee such person, committee or entity as the Trust Committee shall determine to make and effect investment decisions under the Plan and Trust; provided, however, that the Trust Committee may appoint itself as the Investment Committee. 7

ARTICLE V INVESTMENT OF TRUST ASSETS 5.1

5.2

General Investment Power/Investment Funds. (a)

Authority of Investment Committee. Except as provided in Sections 5.2 and 5.3, the Investment Committee shall have all authority and responsibility for the management, disposition and investment of the Trust Fund, and the Trust Committee shall comply with directions of the Investment Committee. The Investment Committee shall not issue any directions that are in violation of the terms of the Plan or this Agreement.

(b)

Investment Funds. The Trust may be divided into one or more separate Investment Funds, the number, makeup and description of which shall be determined from time to time by the Investment Committee. The Trust Committee shall implement, terminate, value, transfer to and from and allocate the gains, losses and expenses among the Investment Funds in accordance with the proper directions of the Investment Committee, the Administrator, or their delegates, and, to the extent applicable under the terms of this Agreement, the directions of Investment Managers.

(c)

Funding Policy. The Trust Committee shall have responsibility for selecting or establishing and carrying out a funding policy and method, consistent with the objectives of the Plan. The Trust Committee shall be responsible for the proper diversification of the Trust Fund, for the prudence of any investment of Trust assets consistent with State law, for compliance with statutory limitations on the amount of investment in securities, and for assuring that any such investments meet the requirements of State law.

Investment Managers. (a)

Appointment. The Investment Committee may, but shall not be required to, appoint one or more Investment Managers to manage the assets of all or any one or more of the Investment Funds. Each such Investment Manager shall be either (i) registered as an investment adviser under the Investment Advisers Act of 1940; (ii) a bank, as defined in such Act; or (iii) an insurance company qualified to perform the services of Investment Manager under the laws of more than one state. The Investment Committee shall obtain from any Investment Manager so appointed by it a written statement acknowledging (i) that such Investment Manager is or on the effective date of its appointment will become a fiduciary with respect to the Trust assets under its management; (ii) certifying that such Investment Manager has the power to manage, acquire or dispose of Trust assets in the manner contemplated by the contract or other written instrument by which its appointment is or will be effected; and (iii) certifying that it is either an

8

investment adviser, a bank or an insurance company which is qualified to be appointed as an Investment Manager under this Agreement.

5.3

(b)

Contractual Arrangement. The Investment Committee shall enter into a written contract or agreement with each such Investment Manager in connection with its appointment as such, and such contract shall be subject to such terms and conditions and shall grant to the Investment Manager such authority and responsibilities in the management of the applicable Investment Fund assets as the Investment Committee deems appropriate under the circumstances. Without limiting the generality of the foregoing, such contract may establish investment objectives for the assets of the Investment Fund(s) under the management of the Investment Manager and may limit the types of assets that may be acquired or held by such Investment Fund(s).

(c)

Trust Committee’s Duties. With respect to each Investment Fund the management of which has been delegated to an Investment Manager, the Trust Committee shall follow and carry out the instructions of the appointed Investment Manager with respect to the acquisition, disposition and reinvestment of assets of such Investment Fund, including instructions relating to the exercise of all ownership rights in such assets.

(d)

Failure to Direct. In the event that an appointed Investment Manager shall fail to direct the Trust Committee with respect to investment of all or any portion of the cash held in an Investment Fund under its management, the Trust Committee shall invest such cash only when and as directed by the Investment Committee.

(e)

Termination of Appointment. The Investment Committee shall have the power to terminate the appointment of an Investment Manager upon written notice with or without cause. Upon the termination of the appointment of an Investment Manager, the Investment Committee shall (i) appoint a successor Investment Manager with respect to the Investment Fund(s) formerly under the management of the terminated Investment Manager, (ii) direct the Trust Committee to merge or combine such Investment Fund(s) with other Investment Fund(s) or Trust assets, or (iii) direct the Trust Committee to invest the assets of such Investment Fund as the Investment Committee deems appropriate in accordance with the existing funding policy.

Manner and Effect of Directions. (a)

Delegation of Authority to Custodian. The Custodian is delegated the authority and responsibility for receiving and carrying out the directions of the Trust Committee, the Administrator, the Investment Committee, any Investment Manager or their designees. With respect to any assets held by a party other than Trust Committee, the Trust Committee is authorized and directed to delegate to the Custodian the authority and responsibility for receiving and carrying out the directions of the Investment Committee, any Investment Manager or their 9

designees. The Trust Committee is authorized and directed to enter into such agreements with another Custodian as are deemed necessary or appropriate to effect such delegation. 5.4

Authorization of Designee(s). The Administrator and the Investment Committee may each appoint one or more designees to act on their behalf. If a designee (or designees) is appointed, the appropriate committee shall furnish the Trust Committee with written documentation of the appointment and a specimen signature of each designee. The Trust Committee shall be entitled to rely upon such documentation until the Trust Committee is otherwise notified in writing.

ARTICLE VI POWERS OF TRUST COMMITTEE 6.1

General Authority. In accordance with the directions of the Investment Committee and any Investment Managers as provided in Article V, the Trust Committee shall receive, hold, manage, convert, sell, exchange, invest, reinvest, disburse and otherwise deal with the assets of the Trust, including contributions to the Trust and the income and profits therefrom, without distinction between principal and income and in the manner and for the uses and purposes set forth in the Plan and as hereinafter provided.

6.2

Specific Powers. In the management of the Trust, the Trust Committee shall have the following powers in addition to the powers customarily vested in trustees by law and in no way in derogation thereof; provided, all such powers shall be exercised only upon and in accordance with the directions of the Investment Committee and, to the extent applicable, any duly appointed Investment Managers: (a)

Purchase of Property. With any cash at any time held by it, to purchase or subscribe for any authorized investment (as defined in Section 6.3) and to retain the same in trust.

(b)

Disposition of Property. To sell, exchange, transfer or otherwise dispose of any property at any time held by it.

(c)

Retention of Cash. To hold cash without interest in administrative accounts for contribution and distribution processing in such amounts as may be reasonable and necessary for the proper operation of the Plan and the Trust.

(d)

Exercise of Owner’s Rights. The Members acknowledge and agree that the Trust Committee shall have the right or power to vote proxies appurtenant to securities that it holds. The Members acknowledge and agree that the Trust Committee shall have the power to make any review of, or consider the propriety of, holding or selling any assets held in the Trust Fund in response to any tender offer, conversion privilege, rights offering, merger, exchange, public offering and/or any proxy action for any of such assets.

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(e)

Registration of Investments. To cause any stock, bond, other security or other property held as part of the Trust to be registered in its own name or in the name of one or more of its nominees; provided, the books and records of the Trust Committee shall at all times show that all such investments are part of the Trust.

(f)

Borrowing. To the extent permitted by State law and at the direction of the Investment Committee, to borrow or raise money for the purposes of the Trust in such amounts, and upon such terms and conditions, as determined by the Investment Committee; and, for any sum so borrowed, to issue its promissory note as Trust Committee and to secure the repayment thereof by pledging all or any part of the Trust Fund to the extent permitted by State law; and no person lending money to the Trust Committee shall be bound to see to the application of the money lent or to inquire into the validity, expediency or propriety of any such borrowing.

(g)

Purchase of Contracts. To apply for, purchase, hold, transfer, surrender and exercise all incidents of ownership of any insurance, re-insurance, excess or stop loss insurance or annuity contract that the Trust Committee determines or the Investment Committee directs it to purchase or that is necessary or appropriate to carrying out the purposes of the Plan. The Trust Committee shall endeavor to obtain stop loss insurance to provide coverage for payment of benefits under the Plan above specified per claim and aggregate limits, provided such stop loss coverage can be obtained at a reasonable cost as determined by the Trust Committee.

(h)

Execution of Instruments. To make, execute, acknowledge and deliver any and all documents of transfer and conveyance and any and all other instruments, which may be necessary or appropriate to carry out the powers herein granted.

(i)

Settlement of Claims and Debts. To settle, compromise or submit to arbitration any claims, debts or damages due or owing to or from the Trust, to commence or defend suits or legal or administrative proceedings and to represent the Trust in all suits and legal and administrative proceedings.

(j)

Establish Rules and Polices. To establish, to the extent consistent with this Agreement and the Plan, rules and policies necessary or appropriate to the administration of the Trust or the carrying out of the powers herein granted.

(k)

Trustee Insurance. To purchase on behalf of the Trust Committee and the Investment Committee, trustees’ errors and omissions insurance or similar coverage in such amounts as are recommended by a licensed insurance broker for benefit plans and a trust of similar size and purpose.

(l)

Risk Management. procedures.

To establish reasonable risk management policies and

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6.3

(m)

Delegation. To delegate in writing fiduciary responsibilities or ministerial powers and duties to such officers, agents, representatives and independent contractors as determined desirable, provide such delegation does not conflict with the provisions of this Agreement or the Plan.

(n)

Employment of Agents, Advisers and Counsel. To employ suitable agents, actuaries, auditors, accountants, investment advisers, brokers and counsel, and to pay their reasonable expenses and compensation.

(o)

Appointment of Custodian. The Trust Committee shall designate a custodian to hold Trust assets. The Trust Committee may change the custodian upon an affirmative vote of five (5) Trustees.

(p)

Statutory Provisions. To exercise powers and carry out obligations provided for in Part 3 and Part 4 of Article 5 of Title 29, C.R.S., in matters relating to the administration of the Plan and Trust, upon such terms and conditions as it may deem in the best interest of the Trust.

(q)

Power to do any Necessary Act. To do all acts which it may deem necessary or proper and to exercise any and all powers under the Plan and this Agreement upon such terms and conditions as it may deem in the best interests of the Trust.

Authorized Investments. (a)

General Definition. “Authorized investment” as used in this Article VI shall mean and be limited to those investments that are defined as permissible for investment of public funds in Section 24-75-601 et seq. C.R.S., as in effect from time to time.

(b)

Responsibility for Compliance. The responsibility for determining whether any investment of Trust assets complies with the terms of this Agreement and applicable law shall lie solely with the Trust Committee.

ARTICLE VII CONTRIBUTIONS TO THE TRUST FUND 7.1 Member Contributions. Subject to the limitations of this Agreement, each Member shall pay or cause to be paid contributions to the Trust at such times and in the amounts determined by the Trust Committee as are necessary to ensure funding of the Trust is sufficient, that operation of the Trust is not hazardous to the public or Participants or which the Trust Committee otherwise deems beneficial to protect the financial condition of the Trust. The Trust Committee shall establish Member contributions consistent with this Agreement, the Plan and any guidelines consistent with this Agreement and the Plan as established by the Trust Committee from time-to-time.

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7.2. Contributions on Annual Basis; Rate Structure. The contribution rate structure for Member contributions shall provide for contributions to be made on an annual basis. Contributions shall be sufficient to fund the projected benefits and applicable expenses for the Participants receiving benefits under the Plan. 7.3

Failure to Make Contributions. (a)

If any Member fails to make its Member contribution to the Trust within thirty (30) business days after the date on which they are due, such contributions shall bear interest from the date due at the rate of return for the three (3) month LIBOR rate set on the date when such contribution was first due plus one percent (1%), compounded monthly.

(b)

Any other Member may, with the consent of the Administrator, make the contribution on behalf of the delinquent Member and, such amount shall become a debt of the delinquent Member to the contributing Member.

(c)

The Trust Committee has the right, upon an affirmative vote of five (5) Trustees, with any Trustees from a Member in default excluded from the vote, should the delinquent Member not cure the delinquency within thirty (30) calendar days after the Administrator provides written notice to the Member of its delinquency, to terminate: (1)

such Member’s participation in the Plan and Trust at the end of an additional thirty (30) calendar day notice period or the end of the Plan year of the Member’s delinquency, if earlier, if such delinquency is not cured, and

(2)

upon such termination, no claims submitted by Participants of the delinquent Member for benefits subsequent to the date of the termination, shall be paid by the Trust.

(d)

The Trust Committee also has the right, upon an affirmative vote of five (5) Trustees, with any Trustees from the Member in default excluded from the vote, to notify the Participants of such delinquent Member that such Member’s participation in the Plan and Trust has been or will be terminated.

(e)

Nothing herein, however, shall relieve the delinquent Member of its responsibility for benefits payable to its Participants.

7.4 TABOR Compliance. This Agreement does not create a multiple fiscal year direct or indirect debt or other financial obligation. All financial obligations of a Member under this Agreement are contingent upon appropriation, budgeting, and availability of specific funds to discharge such obligations. No Member’s contribution for any Fiscal Year shall exceed the annual contribution billed for such Fiscal Year unless additional funds for payment thereof have been appropriated by the Member. 13

7.5 State Funding. For benefits required under Section 29-5-302, C.R.S., no Member shall be required without its consent to make a contribution for a Fiscal Year in excess of the amount of state funding paid or payable to the Member under Section 29-5-302(11), C.R.S. for that Fiscal Year. There is reserved to the Members and to the Trust the right set forth in Section 295-302(12) C.R.S., providing that if, at any time, the state funding provided for the benefit required by Section 29-5-302, C.R.S. is insufficient to cover the cost of the benefit, then the requirements of Section 29-5-302, C.R.S. to maintain the benefit shall become optional pursuant to Section 29-1-304.5. C.R.S. The Trust Committee may establish guidelines consistent with this Agreement governing any exercise of the right under said Section 29-5-302(12), C.R.S. 7.6 Reports. The Trust Committee shall provide reports needed for purposes of administration of this Agreement and the Plan.

ARTICLE VIII PARTICIPATION, WITHDRAWAL AND OBLIGATIONS OF MEMBERS 8.1 Participation in Trust by Members. The initial participating Members in the Trust are as set forth on Exhibit A. Additional Members may participate in the Trust subject to the approval of the Trust Committee, which participation shall be effective as of the beginning of the next Fiscal Year or such other date as determined by the Trust Committee. Participation in the Trust is limited to those employers who are governmental entities participating for purposes of Part 3 of Article 5 of Title 29, C.R.S or for purposes of Part 4 of Article 5 of Title 29, C.R.S., and a Member may participate in the Trust for either or both such purposes. The Trust Committee reserves the right to require a new participating Member at the time of joining the Trust to contribute to the reserves of the Trust or to make such other appropriate financial contribution as determined by the Trust Committee. The Trust Committee may reject requested participation by any additional Member for any reason. To participate in the Trust, a Member must properly adopt and enter into this Trust Agreement, which shall be evidenced by providing to the Trust Committee (i) a certified copy of the resolution or ordinance of the governing body of the Member approving and entering into this Trust Agreement, and (ii) a signed counterpart original of this Trust Agreement duly executed by presiding officer of the governing body or other authorized officer of the Member. 8.2 Withdrawal by Member. A Member may withdraw from participation in the entire Trust on the following terms and conditions: (a)

Except as provided in this section, any Member which intends to withdraw from participation in the Trust must give at least ninety (90) days advance written notice to the Trust Committee. Upon a Member’s withdrawal from the Trust, any Trustees who are employees of such Member shall no longer serve as Trustees.

(b)

Upon withdrawal, the Member shall be deemed to have withdrawn from participation in the entire Trust. Upon the effective date of withdrawal, the Member’s Participants shall cease to participate in the Plan, provided, that if required by law, a Participant’s benefits may be extended pursuant to, if and to the 14

extent applicable, the terms and provisions of the Plan, including those Participants who have filed a claim for or are receiving benefits under the terms of the Plan prior to the effective date of the Member’s withdrawal, in which case benefits shall continue subject to the withdrawing Member’s payment of required contributions. (c)

Upon withdrawal, the Trust Committee also has the right to notify the Participants of such withdrawing Member that such Member’s participation in the Plan and Trust has ceased or will cease.

(d)

In the event of a Member’s withdrawal pursuant to this section, such withdrawing Member shall have no right to any of the assets, income or reserves of the Trust at any time, nor shall such Member have any right to a refund or rebate of any of its contributions to the Trust.

Successors and Assigns. Upon approval of the Trust Committee, a participating 8.3 Member may transfer or assign its participation in the Trust to any successor in interest, whether by merger, consolidation, reorganization, restructuring, transfer of employees, or dissolution, creation or consolidation of Member entities or governing boards or otherwise. 8.4 Powers of Members. In addition to powers herein vested in the Members, the Members shall have the power to:

8.5

(a)

Amend the Trust Agreement by a two-thirds (2/3) vote of the Members present at a meeting. Written notice of any proposed amendment shall be provided to each Member at least forty-five (45) days in advance of any vote on the amendment.

(b)

Terminate the Plan and disburse its assets by a two-thirds (2/3) vote of all Members, pursuant to such notice and in keeping with such procedure as shall be shall be established by the Trust Committee. In the case of such a vote, termination of the Plan shall be pursuant to provisions of Article X.

Meetings of the Members. Meetings of the Members shall be held as follows: (a)

Members shall meet at least once annually at a time and place to be set by the Trust Committee, with notice mailed to each Member at least thirty (30) days in advance.

(b)

Special meetings of the Members may be called by the Trust Committee upon its own motion and shall be called by the Trust Committee upon written request of thirty (30) percent of the Members, with notice mailed to each Member at least thirty (30) days in advance.

(c)

The chair of the Trust Committee shall preside at the meetings; the vice chair shall preside in the absence of the chair.

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(d)

Thirty percent (30%) percent of the Members shall constitute a quorum to conduct business.

(e)

Except for action to terminate the Plan, proxy voting shall be allowed, pursuant to such procedures as the Trust Committee may determine. Each Member shall be entitled to one vote on each issue, to be cast by its Member Representative.

8.6 Member Obligations. In addition to the other provisions, hereof, each Member shall have the obligation to: (a)

Pay all contributions or other payments to the Trust at such times and in such amounts as shall be established by the Trust Committee. Any delinquent payments shall be paid with interest pursuant to a policy established by the Trust Committee and uniformly applied.

(b)

Designate in writing a Member Representative and one or more alternates for the Members' meetings. The Representative and any alternate shall be an employee of the Member, except as provided in Section 3.1, and may be changed from time to time. Any alternate may exercise all the powers of the Representative during a Member meeting in the absence of the Member Representative.

(c)

Allow the Trust Committee and Administrator and their agents reasonable access to records of the Member as required for the administration of Plan and Trust.

(d)

Cooperate fully with the Trust Committee and Administrator and their agents in matters relating to the administration of the Plan and Trust and the administration and coordination of benefits under the Plan.

(e)

Allow the Trust Committee to make decisions regarding, and to designate attorneys to represent the Member in, the investigation, settlement and litigation of any claim within the scope of benefits furnished through the Plan.

(f)

Comply with the benefits administration, claims handling and related policies established by the Trust Committee.

ARTICLE IX ADMINISTRATION 9.1

Accounting. (a)

Books and Records. The Administrator generally shall be responsible for keeping accurate and detailed records of all investments, receipts and disbursements and other transactions hereunder, including such specific records as shall be required by law and such additional records as may be agreed upon in writing between the Administrator and the Trust Committee. The Trust shall account separately for contributions made for heart and circulatory malfunction 16

benefits pursuant to Part 3 of Article 5 of Title 29, C.R.S., and contributions made for benefits for cancer benefits pursuant to Part 4 of Article 5 of Title 29, C.R.S., but separate audits or financial statements are not required. All books and records relating thereto shall be open to inspection and audit at all reasonable times by any person or persons designated by the Administrator, the Member, or the Investment Committee. The Trust Committee shall promptly provide copies of such books or records to any persons designated by the Administrator.

9.2

(b)

Accounting. Following the close of each Plan year of the Plan, or more frequently as the Trust Committee and the Administrator may agree, the Trust Committee, with the assistance of the Administrator, shall cause to be prepared a written statement setting forth all investments, receipts, disbursements and other transactions effected during such year or during the period beginning as of the close of the last preceding year. Except as may be required by statute or by regulations published by State or federal government agencies with respect to reporting and disclosure, as may be required pursuant to the terms of the Plan or this Agreement or as reasonably may be requested by a majority of the Members or the Investment Committee, no person shall have the right to demand or to be entitled to any further or different accounting by the Trust Committee.

(c)

Release. Except with regard to claims of breach of fiduciary duty, upon the expiration of 90 days from the date of presentation to the Members of such annual or other statement, the Trust Committee shall forever be released and discharged from any liability or accountability to anyone as respects the propriety of its acts or transactions shown in such account, except with respect to any acts or transactions as to which, within such 90-day period, a Member whose interest is affected by such act or transaction shall file with the Trust Committee its written disapproval. In the event such a disapproval is filed, and unless the matter is compromised by agreement of the Trust Committee, the Trust Committee shall file its statement covering the period from the date of the last annual statement to which no objection was made in any court of competent jurisdiction for audit or adjudication. The applicable statutes of limitation shall be available to the Trust Committee in the event of a claim of breach of fiduciary duty.

(d)

Valuations. The Trust Committee shall designate a party to be responsible for valuations of assets of the Trust for which prices are not readily available on a nationally recognized securities exchange.

(e)

Reliance on Administrator. The Trust Committee shall be entitled to rely on the Administrator and any Custodian, other than Trust Committee, for the maintenance and provision of all records specified in this Section.

Expenses. The expenses incurred by the Trust Committee in the performance of its duties hereunder, including fees for legal and other services rendered and all other proper charges and disbursements of the Trust Committee, including taxes of any and all kinds whatsoever, that may be levied or assessed under existing or future laws upon or in 17

respect of the Trust or any money, property or security forming a part of the Trust Fund, shall be paid by the Trust Committee from the Trust Fund, and the same shall constitute a charge upon the Trust Fund. To the extent the Member pays any expenses that are properly payable from the Trust Fund, the Trust Committee shall reimburse the Member that has made payment from the Trust Fund if requested to do so by the Member.

ARTICLE X AMENDMENT OF TRUST; TERMINATION OF PLAN 10.1

10.2

Amendment of Trust. (a)

Right to Amend. The Members may amend this Agreement at any time or from time to time by the affirmative vote of two-thirds (2/3) of all Members, and any such amendment by its terms may be retroactive. An amendment shall require compliance with the terms of Section 8.4(a). An adopted amendment shall become effective upon the date specified in the ballot approved by the Members, without necessity of further written consent or signatures by the Members. Upon adoption of any amendment, the Trust Committee shall cause a current copy of this Agreement to be sent to each Member.

(b)

Exclusive Benefit. Notwithstanding the foregoing, no amendment shall be made which would authorize or permit any assets of the Trust Fund, other than such assets as are required to pay taxes and administration expenses, to be used for or diverted to purposes other than the exclusive benefit of Participants or Beneficiaries.

Termination of Plan. The Trust shall continue for such time as may be necessary to accomplish the purposes for which it was created and shall terminate only upon the complete distribution of the Trust. The Trust may be terminated as of any date (and shall in fact terminate upon the complete distribution of the funds of this Trust on such date or thereafter) by unanimous vote of the Trust Committee and approval by a two-thirds (2/3) vote of all Members. Upon termination of the Trust, provided that the Trust Committee has not received instructions to the contrary, the Trust Committee shall liquidate the Trust and, after paying the reasonable expenses of the Trust, including expenses involved in the termination, distribute the balance thereof according to the written directions of each Member for the provision of benefits similar to those provided under the Plan for the benefit of each such Member’s Participants and Beneficiaries covered thereunder; provided, however, that the Trust Committee shall not be required to make any distribution until the Trust Committee is reasonably satisfied that adequate provision has been made for the payment of all taxes, if any, which may be due and owing by the Plan and the Trust; and provided, further, that in no event shall any distribution be made by the Trust Committee until the Trust Committee is reasonably satisfied that the distribution will not be contrary to the applicable provisions of the Plan dealing with termination of the Plan and the Trust.

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10.3

Final Accounting. At such time as the Trust is terminated, the Trust Committee shall render a final accounting of the affairs of the Trust to each participating Member, and thereafter there shall be no claim or action against the Trust Committee or any Trustee, and they shall have no further responsibilities or duties and shall be discharged.

ARTICLE XI MISCELLANEOUS 11.1

Nonalienation of Benefits. Neither the benefits payable from the Trust Fund nor any interest in any of the assets of the Trust Fund shall be subject in any manner to the claim of any creditor of a Participant, or Beneficiary or to any legal process by any creditor of such Participant, or Beneficiary; and neither a Participant nor any Beneficiary shall have any right to alienate, commute, anticipate or assign any right to benefits payable from or any interest in the Trust, except as provided in the Plan.

11.2

Benefit. Except as otherwise provided in the Plan and this Agreement, no part of the Trust hereunder shall be used for or diverted to any purpose other than for the benefit of Participants and Beneficiaries or the payment of expenses as herein provided.

11.3

Effect of Plan. The Trust Committee is not a party to the Plan, and in no event shall the terms of the Plan, either expressly or by implication, be deemed to impose upon the Trust Committee any power or responsibility other than as set forth in this Agreement. In the event of any conflict between the provisions of the Plan and this Agreement, this Agreement shall be deemed to be incorporated into and be a part of the Plan, and the terms of this Agreement shall control over any inconsistent terms of the Plan not contrary to State law.

11.4

Dispute Resolution. (a)

Disputes arising in relation to benefits under the Plan shall be resolved in accordance with the procedures established in the Plan.

(b)

The parties to this Agreement (each, a “party”) are mutually committed to collaborative problem solving for resolving issues that may arise among or between them concerning this Agreement. In the event of a dispute, the complaining party may notify the other party of the dispute in writing and each party to the dispute will each appoint a representative to negotiate in good faith to resolve the dispute. These negotiations between representatives of the parties shall continue until the earliest of: (a) the time the dispute has been resolved; (b) the designated representatives have concluded that continued negotiation does not appear likely to resolve the dispute; or (c) thirty (30) days from the date of written notice of the dispute. If the dispute is not resolved through direct negotiations, the parties may, with the consent of all parties, attempt to settle any dispute arising out of or related to this Agreement through mediation. Unless otherwise agreed by the parties, mediation shall proceed as follows: The parties may agree on a mediator. If they are unable to agree on a mediator within thirty (30) days of the 19

agreement to mediate, the parties shall contact an agreed upon dispute resolution organization or service and shall use its selection process to select a mediator. Each party shall bear its own costs of the mediation and the parties shall share the costs of the mediator. The mediation shall be scheduled within sixty (60) days of the agreement to mediate. If the direct negotiation process is unsuccessful and the parties do not consent to mediation or the agreed-upon mediation process does not successfully resolve the dispute within ninety (90) days of the agreement to mediate, the parties shall be entitled to pursue any other remedy allowed by law or this Agreement. However, no party shall pursue such a remedy without first exhausting the direct negotiation process. 11.5

Entire Agreement. This Agreement constitutes the entire Agreement between the parties hereto with regard to the subject matter hereof, and there are no other agreements or understandings between the parties relating to the subject matter hereof other than those set forth or provided for herein.

11.6

Approval of the Members. The Members shall have the right, on behalf of all individuals at any time having any interest in the Trust, to approve any action taken or omitted by the Trust Committee.

11.7

Liability for Predecessor or Successor. No successor Trustee hereunder in any way shall be liable or responsible for any actions or omissions of any prior Trustee in the administration of the Trust or the Trust Fund prior to the date such successor Trustee assumes its obligations hereunder, nor shall any prior Trustee in any way be liable or responsible for any actions or omissions of any successor Trustee.

11.8

Liability for Acts of Others. No Trustee shall be liable for the acts or omissions of a Member, the Custodian, the Administrator, the Investment Committee or any Investment Manager except with respect to any acts or omissions of any such party in which the Trustee participates knowingly or which the Trustee knowingly undertakes to conceal, and which the Trustee knows constitutes a breach of fiduciary responsibility of such party.

11.9

Governmental Immunity. It is specifically understood and agreed that nothing contained in this Agreement shall be construed as an express or implied waiver by the Trust, the Trust Committee, the individual Trustees, or the Members of governmental immunity or of the sovereign immunity of the State of Colorado or its instrumentalities or any provision of the Colorado Governmental Immunity Act, Section 24-10-101 et seq., C.R.S.

11.10 Controlling Law. This Agreement shall be construed according to the laws of the State of Colorado. 11.11 Effective Date. This Agreement shall be effective on and after November 24, 2014. Any amendment to this Agreement shall become effective upon the date specified in the ballot approved by the Members to adopt such amendment. 20

11.12 Execution in Counterpart. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the Member has caused this Agreement to be signed by its duly authorized officers or representatives as of the day set forth its signature.

MEMBER

Sign: By: Title:

Attest:

Sign: By: Title:

Date of Member Adoption of Agreement:

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