HomeMy WebLinkAbout20200527_SB 1441_PrePaidWireless_Support
27 May 2020
The Honorable Mike McGuire
Senator, 2nd District
State Capitol, Room 5061
Sacramento, CA 95814
RE: SB 1441 (McGuire) Local Pre-Paid Mobile Telephone Services Collection Act
NOTICE OF SUPPORT
Dear Senator McGuire:
The City of San Luis Obispo is pleased to support your bill, SB 1441, which would repeal the sunset and
make permanent the point of sale collection mechanism for Utility Users Taxes (UUTs) imposed on prepaid
wireless services. By making point of collection permanent, this bill will protect an important revenue stream
for local governments at a time when revenues are critically needed.
Prepaid wireless services are offered on a “pay-as-you-go” basis with no requirement contracts, term or
volume commitments, early termination penalties, overage charges, or credit checks. These important
factors make prepaid services available to those consumers to whom the security and convenience of
mobile telephone service might not be available. This business model offers reliable service and affordable
pricing.
In 2014, the Legislature approved AB 1717 (Perea) to create a statewide system for the retail point of sale
collection of state and local taxes and fees on prepaid wireless services. The California Department of Tax
and Fee Administration (CDTFA) collects and distributes revenues resulting from AB 1717 to participating
local governments. Currently, 101 cities and 3 counties have implemented voter-approved ordinances to
allow them to impose this tax, which has generated over $26 million in revenue.
As the City of San Luis Obispo grapples with how to maintain core services in the wake of the COVID-19
pandemic it is imperative that we continue to have the ability to collect this vital funding stream. For these
reasons, we are pleased to support this bill and thank you for your leadership on this important issue.
Sincerely,
Heidi Harmon
Mayor
cc: Danielle Bradley, Legislative Aide
San Luis Obispo City Council
State Senator Bill Monning, fax (916) 651 – 4917
State Assembly Member Jordan Cunningham, fax (916) 319-2135
Dave Mullinax, League of California Cities, dmullinax@cacities.org
Meg Desmond, League of California Cities, mdesmond@cacities.org