RESOLUTION NO. _____________

BOARD OF SUPERVISORS, COUNTY OF SAN MATEO, STATE OF CALIFORNIA

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RESOLUTION IN SUPPORT OF AB 451 (YEE), LOCAL SALES TAX: JET FUEL: PLACE OF SALE

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RESOLVED, by the Board of Supervisors of the County of San Mateo, State of California, that

WHEREAS, In 1998, AB 66 (Baca) was enacted to establish that, as it relates to jet fuel, the consummation of a sale for businesses with multiple locations (or no permanent location) is at the location where the jet fuel is delivered, the “wingtip”; and

WHEREAS, AB 66 (Baca) also provided a special exception for the City and County of San Francisco requiring that jet fuel sales tax revenues generated at San Francisco International Airport, which is located in San Mateo County, would be shared equally between San Francisco and San Mateo County; and

WHEREAS, the exception created in AB 66 (Baca) and a change in Board of Equalization regulations changing the applicability of sales taxes to “buying companies” allowed United Airlines, in 2002, to create a separate, single buying company subsidiary to purchase and resell all jet fuel in California; and

WHEREAS, United Airlines negotiated with the City of Oakland to locate its buying company in the City of Oakland in exchange for a rebate in sales taxes that United Airlines would have otherwise been required to pay to jurisdictions in which its airplanes refuel; and

WHEREAS, AB 451 would clarify that allocation of local sales tax on jet fuel with only one place of business in California is to be based on the point of delivery of the fuel into the aircraft; and

WHEREAS, San Mateo County’s current Legislative Program as approved by the Board of Supervisors to pursue efforts to ensure that San Mateo County receives jet fuel sales tax revenues in a manner that is consistent with the 'point of sale' principle; and

WHEREAS, AB 451 would preserve the jet fuel sales tax split between San Mateo County and San Francisco as codified in AB 66;

NOW, THEREFORE, IT IS HEREBY DETERMINED AND ORDERED that the Board of Supervisors by adoption of this resolution does hereby support AB 451.

IT IS FURTHER DETERMINED AND ORDERED that the Board of Supervisors by adoption of this resolution notes that AB 451 does not meet the County’s Legislative Program objective of ensuring that San Mateo County receives jet fuel sales tax revenues in a manner that is consistent with the 'point of sale' principle.

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