ORDINANCE No. 176872

*Amend the Code to allow the City Council to establish charges for city vehicles taken home by City employees. (Ordinance; amend Code Section 5.60.110).

The City of Portland ordains:

SECTION 1. The Council finds:

1.  City employees are authorized, with appropriate approval, to drive City vehicles to and from their place of residence.

2.  The City has established (City Code 5.60.110) that employees shall pay a charge for the use of the vehicles driven to and from their residence.

3.  Actual rental charges were originally set in City Code Section 5.60.110. Due to changes in the Internal Revenue Code in 1984, the City Code was amended to reference “IRS guidelines” to avoid the need for periodic City Code amendments when the rates established by the IRS changed.

4.  A recent opinion of the City Attorney’s Office suggests the broad reference to IRS guidelines, previously thought to reference only the minimum amount to charge employees, should actually be interpreted to include the entire IRS guidelines.

5.  Applying all IRS guidelines, many vehicles are exempt from the tax requirement to charge a minimum amount for use to and from the residence of employees.

6.  Because the City Code broadly mentions IRS guidelines, the opinion of the City Attorney’s Office suggests the City cannot establish a charge for the use of vehicles exempted from IRS tax requirements.

7.  Removal of the IRS reference in the City Code will allow continuation of the current policy of allowing the City to establish charges for City vehicles driven by employees to and from their residences.

NOW, THEREFORE, the Council directs:

a. The City Code 5.60.110 is amended as follows:

A.  Employees authorized to drive City vehicles to and from their place of residence shall pay to the City a rental charge for each accounting period of use. The rental charge shall be based upon Internal Revenue Service guidelines.

If there is more than one City employee commuting in the same vehicle, the charge to the passenger will be equal to that of the driver. It shall be the responsibility of bureaus to report to the Accounting Division vehicles used as commuting vehicles.

Payroll deductions for rental charges shall be made from the employee’s second payroll check of the month. Submission of the Personal Use of City Vehicle form is required upon vehicle assignment, cancellation, or when reduction is requested by Friday of the payroll submission week.

B.  Credit will be given when total consecutive working days of nonuse exceed working days.

C.  Requests for authorization to drive City vehicles to and from work must be approved by the employee’s bureau manager and the employee’s Commissioner In Charge.

Section 2. The Council declares that an emergency exists because unintended interpretation of the current language could remove City Council authority to make decisions concerning charges for employee use of vehicles, and deprive the City of revenue; therefore, this ordinance shall be in force and effect from and after its passage by Council.

Passed by the Council  AUG 28 2002        GARY BLACKMER

             Auditor of the City of Portland

Mayor Vera Katz          By /S/ Terry Reisz

Rodger Johnson

August 1, 2002            Deputy

BACKING SHEET INFORMATION

AGENDA NO. 1076-2002

ORDINANCE/RESOLUTION/COUNCIL DOCUMENT NO. 176872