Finance Committee Agenda and Packet 2011 08 22

Home Browse Search

PAGE TWO SUBJECT: DISCUSSION/DIRECTION CONSOLIDATION OF SALES/USE TAX LICENSING AND BUSINESS REGISTRATION DATE: AUGUST 22, 2011 The current business registration process requires little maintenance, resources or overview. The output is neither sophisticatednor comprehensive. However, there are concerns about whether a business is operating legitimately, those typically occur after a sales tax license has been issued andthe business is in operation. Such concerns often happen as a result of routine PD patrols and/or complaints by other property/business owners. Over 10 years ago, the City used a formal business LICENSE process. This required compliance and review of operations to determine the appropriateness and safety of a business proposing operation at a specific location within the City. The cost for the license was $15. The compliance review included evaluating whether the business was located in the appropriate zoning (prior to issuance of a sales tax license), adhered to City codes, (such as wastewater), signage, occupancy limits, etc. Staff used an Access database at that time to compile the data. The license application also required the applicant to provide other information including emergency contact information, names and phone numbers of landlords, burglar and fire alarms.In 2002, the Council approved the Sales/Use Tax ordinance and increased the cost of a sales tax license to $25 and the business “license” became a no fee business “registration”. City staff is not recommending returning to the business license format at this time as the City’s IT infrastructure does not allow for an integrated system that could coordinate the sales/use tax license with the business licensing component. Staff does believe, however, with the appropriate software, the business license concept has merit and should be pursued. However, in recognition of limited resources and other priorities such implementation does not merit further consideration at this time. FISCAL IMPACT: There is a potential decrease in fee revenue of $12,375 by eliminating one of the two $25 license fees currently paid by in-City retailers (based on current number of sale/use tax licenses and business registrations). However, actual results are unknown, revenue may increase or decrease. RECOMMENDATION: Either maintain the current fee at $25 each for the sales/use tax license and business registration or have one fee which will require minor Code changes to implement. ïð