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FIN 2017-08-08 Item 2D - Ordinance/Resolution - Business License Fee Schedule
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FIN 2017-08-08 Item 2D - Ordinance/Resolution - Business License Fee Schedule
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1/14/2021 12:13:08 PM
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8/4/2017 8:41:23 AM
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Council Committees
Committees Date (mm/dd/yy)
8/8/2017
Committee Name
Finance 2017-2020
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Agenda Packet
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City f Tukwila <br />Allan Ekberg, Mayor <br />TO: Finance Committee <br />FROM: Peggy McCarthy, Finance Director <br />BY: Vicky Carlsen, Deputy Finance Director <br />CC: Mayor Ekberg <br />DATE: July 12, 2017 <br />SUBJECT: Streamlining Business License Fee Calculation <br />(Page 4 of Ordinance (shaded text) updated after Finance Com.) <br />(Update to this memo following the 7124117 C.O.W shown underlined <br />ISSUE <br />Due to recent State legislation, the City will be required to partner with the State of Washington <br />Department of Revenue Business License Services (BLS) for business license processing within <br />the next few years. In order to ensure a smooth transition to the BLS system, it is important that <br />the City's business license fee structure is better streamlined and easy to understand. The current <br />method of using FTE (full-time equivalent) hours to calculate the business license fee is confusing <br />and time consuming to applicants, resulting in significant staff time to correct calculation errors, <br />The Administration recommends that the City change its structure to be on a per -employee basis <br />in order to reduce confusion and better streamline the City's processes. <br />BACKGROUND <br />The State of Washington recently passed EHB, 2005 requiring cities that issue business licenses <br />partner with BLS and use its online system to obtain new or renewal business licenses. This bill <br />was created to help simplify the process of licensing for businesses who apply for licenses from <br />multiple jurisdictions. This bill requires cities to move to the State BLS system within the next five <br />years.' The State would collect payment and process all applications and renewals for most <br />jurisdictions. The City would be notified of pending applications and complete a formal review <br />process prior to the State issuing the license. <br />The City's current fee structure requires a calculation of employee hours times a multiplier <br />($0.034896) to arrive at the total license fee. The minimum fee for one full-time equivalent <br />employee is currently $67, which is a combination of a $12 business license fee, plus a $55 <br />revenue generating regulatory license (RG L) fee. This complex calculation method causes <br />frustration and confusion from business owners, and results in significant errors in the application <br />process. Much of the confusion stems from how part time employees are calculated due to the <br />multiplier described above. It appears that many employers cannot easily obtain information on <br />the number of hours worked per employee. <br />I This timeline may be funding dependent and the legislation is written so that if funding is not available to <br />the Department of Revenue the timeline may slip accordingly. <br />23 <br />
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