Daly City moves to enforce 5% utility‑users tax on streaming video services, estimates $750K–$1M in revenue

Daly City Council voted June 8 to accept a staff report and pursue enforcement of the city's existing 5% utility users tax (UUT) as it applies to video programming services delivered over internet protocols (streaming).

Assistant City Manager Tim Nevin summarized the legal backdrop and fiscal opportunity, citing a recent California Court of Appeals decision (Disney v. Santa Barbara) that upheld application of local UUT rules to streaming services. Nevin told council staff estimates potential annual revenue of $750,000 to $1 million if providers begin remitting the tax.

"This is not a new tax; it is our existing tax," Nevin said. "We're implementing the video programming provision in our ordinance to reflect the market shift from cable to streaming services."

Council members asked procedural and equity questions: Dr. Rod and others asked how the tax would be collected and whether residents could be double taxed if they subscribe to both cable and streaming. Nevin replied the tax is collected from providers; if households subscribe to multiple providers the city could collect UUT on each service provider at the statutory rate (current Daly City rate is 5%). He noted staff will pursue prospective enforcement, notify known providers, and consider consultant support for compliance and audit.

Council also asked about vote thresholds and the local rate; staff confirmed the existing UUT rate is 5% and that changing the rate would require voter approval. Several council members framed the move as a way to shore up general‑fund revenue for city services.

The resolution to accept the report and begin enforcement actions was adopted by council at the meeting by roll call vote of the five members present.

What happens next: staff will issue notices of compliance to known streaming providers, consider audit and compliance support, and report revenues to the council. Enforcement will be prospective consistent with staff's recommendation.

Vote note: Council adopted the staff recommendation to accept and receive the UUT report; staff projected the revenue estimate contingent on provider compliance and collection.