Government Code § 53084.5

53084.5.

(a) On or after January 1, 2016, a local agency shall not enter into any form of agreement that would result, directly or indirectly, in the payment, transfer, diversion, or rebate of any tax revenue resulting from the imposition of a sales and use tax under the Bradley-Burns Uniform Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code) to any person for any purpose when both of the following apply:

(1) The agreement results in a reduction in the amount of revenue under the Bradley-Burns Uniform Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency.

(2) The retailer continues to maintain a physical presence within the territorial jurisdiction of that other local agency.

(b) (1) A local agency entering into an agreement that results in a reduction of the amount of revenue under the Bradley-Burns Uniform Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency shall post the proposed agreement on its internet website for at least 30 days prior to ratification or approval of that agreement by its governing body.

(2) A local agency entering into an agreement that results in a reduction of the amount of revenue under the Bradley-Burns Uniform Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency shall notify the other local agency by certified mail addressed to the attention of the chief executive of that other local agency at least 60 days prior to ratification or approval of that agreement by its governing body.

(3) A local agency shall post any agreement on its internet website it has entered into that results in a reduction of the amount of revenue under the Bradley-Burns Uniform Local Sales and Use Tax Law that, in the absence of the agreement, would be received by another local agency, including any agreements entered into prior to January 1, 2016, that are still in effect on and after that date.

(c) (1) A local agency shall not enter into any form of agreement that would result, directly or indirectly, in the payment, transfer, diversion, or rebate of any tax revenue resulting from the imposition of a sales and use tax under the Bradley-Burns Uniform Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code) imposed on the sale or purchase of a digital product that is transferred electronically or accessed remotely.

(2) A payment, transfer, diversion, or rebate of any tax revenue pursuant to an agreement described in paragraph (1) may be subject to redistribution by the California Department of Tax and Fee Administration pursuant to Section 7209 of the Revenue and Taxation Code.

(d) For the purposes of this section:

(1) “Accessed remotely” has the same meaning as defined in Section 6016.2 of the Revenue and Taxation Code.

(2) “Digital product” has the same meaning as defined in Section 6016.1 of the Revenue and Taxation Code.

(3) “Local agency” means a chartered or general law city, a chartered or general law county, or a city and county, of this state.

(4) “Person” has the same meaning as defined in Section 6005 of the Revenue and Taxation Code.

(5) “Physical presence” means the lease or ownership of any real property for the purpose of carrying on business operations.

(6) “Purchase” has the same meaning as defined in Section 6010 of the Revenue and Taxation Code.

(7) “Retailer” has the same meaning as defined in Section 6015 of the Revenue and Taxation Code.

(8) “Sale” has the same meaning as defined in Section 6006 of the Revenue and Taxation Code.

(9) “Transferred electronically” has the same meaning as defined in Section 6016.2 of the Revenue and Taxation Code.

(e) Except as provided in subdivision (c), this section shall not apply to any agreement by a local agency to pay or rebate any use tax revenue resulting from the imposition of a use tax under the Bradley-Burns Uniform Local Sales and Use Tax Law relating to a use tax direct payment permit issued under Section 7051.3 of the Revenue and Taxation Code.

(f) This section shall not be interpreted to limit the ability of a local agency to contract with or otherwise enter into an agreement pursuant to subdivision (b) of Section 7056 of the Revenue and Taxation Code.

(g) This section shall not apply to any mutual tax revenue sharing agreement between local agencies to pay, transfer, or divert tax revenues that would be received by a local agency resulting from the imposition of a sales and use tax under the Bradley-Burns Uniform Local Sales and Use Tax Law to another local agency, and where the agreement would not result, directly or indirectly, in the payment, transfer, diversion, or rebate of those tax revenues to a retailer.

(h) The amendments to this section by the act adding this subdivision shall become operative immediately upon enactment.