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City of Tukwila <br />Allan Ekberg, Mayor <br />INFORMATIONAL MEMORANDUM <br />TO: Finance Committee <br />FROM: Peggy McCarthy, Director of Finance <br />BY: Vicky Carlsen, Deputy Finance Director <br />CC: Mayor Ekberg <br />DATE: October 2, 2018 <br />SUBJECT: Amend Title 5 Business Licenses and Regulations and adoption of <br />legislative required language and minimum threshold <br />ISSUE <br />In order to be compliant with Business Licenses Services (BLS), the city is required to adopt the <br />new model licensing ordinance that includes a minimum threshold to require a business be <br />licensed. <br />BACKGROUND <br />Engrossed House Bill 2005 passed unanimously in 2017. The bill, now codified as Chapter <br />35.90 RCW, requires any city with a general business license, to partner with a combined <br />licensing service. It has specific deadlines. If the City does not complete partnership with BLS or <br />another service, it may no longer issue business licenses after December 2022. The legislation <br />also includes a provision requiring cities, working with Association of Washington Cities, to <br />develop and implement a model licensing ordinance that includes a minimum income threshold <br />to require a business be licensed. The ordinance should be adopted by cities with business <br />licenses by January 1, 2019. <br />DISCUSSION <br />The city has agreed in principle to partner with BLS as part of the 2018-19 plan required by the <br />legislation. To proceed, Tukwila Municipal Code Title 5 needs to be amended with the model <br />licensing language and minimum threshold. <br />Summary of changes to the ordinance include: <br />• Added language to define the effective date/period for new language/process. <br />• Added required language from model ordinance defining "engaging in business". <br />• Added required language regarding $2,000 per year threshold for businesses that do not <br />have a location in the city. <br />• Combined language where duplicate. <br />• Added text to definition of employee "or reports from a location within the City's corporate <br />limits." <br />• Simplified language "an entity subject to exemption... need not pay a business license fee." <br />RECOMMENDATION <br />The Council is being asked to approve the ordinance, and consider this item at the October 8, <br />2018 Committee of the Whole meeting and subsequent October 15, 2018 Regular Meeting. <br />ATTACHMENTS <br />Draft ordinance 123 <br />