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HomeMy WebLinkAboutOrd 2333 - Business License / Revenue Generating Regulatory License AmendmentsCity of Tukwila Washington Ordinance No. 2333 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING ORDINANCE NO. 2315, §1 (PART), AS CODIFIED AT VARIOUS LOCATIONS IN TUKWILA MUNICIPAL CODE CHAPTER 5.04, TO ADD "TEMPORARY BUSINESS LICENSE" TO THE DEFINITIONS AND FEE SCHEDULE, TO REVISE APPEAL PROCEDURES AND TO REDEFINE BUSINESSES EXEMPT FROM FEES; AMENDING ORDINANCE NO. 2297, §1 (PART), AS CODIFIED AT TUKWILA MUNICIPAL CODE SECTION 5.62.020, TO CLARIFY THE CITY'S REVENUE GENERATING REGULATORY LICENSE FEE FOR A PERSON OPERATING MULTIPLE BUSINESSES AS SOLE PROPRIETORSHIPS AND FOR BUSINESSES ELIGIBLE FOR A TEMPORARY BUSINESS LICENSE; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. WHEREAS, the current business license ordinance defines nonprofit organizations but does not exempt them from paying the business license fee; and WHEREAS, the City Council desires to exempt qualified nonprofit organizations from both the business license fee and the Revenue Generating Regulatory License fee; and WHEREAS, a temporary business license will provide an alternative license for businesses operating within the City on a very short-term basis; and WHEREAS, changes to the appeal procedures are needed for clarification and efficiency, and revisions are required to clarify application procedures and late fee penalties; and WHEREAS, the City Council desires to apply the Revenue Generating Regulatory License fee only once for a person operating multiple businesses as sole proprietorships within the City, and to revise fee calculation requirements and the penalty period; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, HEREBY ORDAINS AS FOLLOWS: W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 1 of 10 Section 1. TMC Section 5.04.010, "Definitions," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.010, is hereby amended to read as follows: For the purpose of this chapter, the following definitions shall apply: 1. "Business," means any operation performed by any person which involves the manufacturing or processing of materials of any type, the sale of goods, wares or merchandise, the rendition of services or the repair of goods, wares or merchandise to the general public or a portion thereof for any consideration at each established place of business, store, office, shop or yard within the City limits. 2. "Department," means Finance Department. 3. "Director," means the Finance Director or his or her designee. 4. "License or licensee," as used generally in this chapter, means and includes respectively the words "permit" or "permittee" or the holder for any use or period of time of any similar privilege, wherever relevant to any provision of this chapter or other law or ordinance. 5. "Nonprofit organization" includes individual person(s), partnerships, joint ventures, societies, associations, churches, clubs, trustees, trusts or corporations; or any officers, agents, employees, factors or any kind of personal representatives of any thereof, in any capacity, acting either for himself or any other person under either personal appointment or pursuant to law who qualifies under definition of and certification by the Internal Revenue Service as nonprofit. 6. "Person," means any individual, receiver, agent, trustee in bankruptcy, trust, estate, firm, co- partnership, joint venture, company, joint stock company, business trust, corporation, society, or group of individuals acting as a unit, whether mutual, cooperative, fraternal, nonprofit or otherwise. 7. "Person engaged in business" means the owner or one primarily beneficially interested in lawful business for profit and not employees. 8. "Home occupation" means any business conducted in a residence within the corporate city limits of Tukwila, such business being subject to the requirements set forth in TMC 18.06.430. 9. "Temporary business license" means any business conducted within the corporate limits of the City for less than 15 consecutive days in a calendar year. Businesses with a physical location outside the corporate limits of the City that provide professional services on a contractual basis within Tukwila are not eligible for a temporary business license. Section 2. TMC Section 5.04.015, "Business License Required," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.015, is hereby amended to read as follows: W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 2 of 10 No person or persons shall conduct, maintain, operate, or engage in any business within the City without first applying for and obtaining a business license and paying the fee(s) as prescribed herein unless the business is exempt. The exemption is only from the need to pay a fee for issuance of the business license and shall not be construed as relief from compliance with other requirements of the Tukwila Municipal Code. All businesses operating within the City are required to submit a business license application or renewal, as appropriate, regardless of whether a business license fee is due to the City. Section 3. TMC Section 5.04.020, "Application and Fees Required," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.020, is hereby amended to read as follows: A. Any person desiring to establish or conduct any business enterprise or undertaking within the corporate limits of the City shall first apply to the Finance Department for a license to conduct such business. The application shall be upon a form furnished by the Finance Department on which the applicant shall state the company name and address; the nature of the business activity or activities in which he desires to engage; the place where the business will be conducted; the number of employees, whether full or part-time, on the payroll as of January 1, or, if a new business, the number to be employed on the opening date; and other information pertaining to the business as required by the City. B. The application must be accompanied by payment for the amount of the license fee. All fees will be based on the number of employees, whether full or part-time, as follows: 0 to 10 $100.00 11 to 20 $150.00 21 to 50 $300.00 51 to 100 $400.00 101 and up $600.00 Home Occupation (pursuant to TMC 5.04.010) $50.00 Temporary business license (pursuant to TMC 5.04.010) $0.00 Section 4. TMC Section 5.04.040, "Prorating fee," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.040, is hereby amended to read as follows: The license fee set forth in this chapter shall be for the calendar year, and each person engaged in business must pay the full license fee for the current year. Business license fees are non refundable, regardless of whether the business operates for the entire calendar year, or whether the business license is denied, revoked or suspended with cause. W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 3 of 10 Section 5. TMC Section 5.04.050, "Fee for late acquisition or renewal," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.050, is hereby amended to read as follows: A. Monetary Penalty. Failure to pay the business license fee within 30 days after the day on which it is due and payable pursuant to TMC Section 5.04.020 shall render the business subject to a penalty of 5% of the amount of business license fee for the first month of the delinquency and an additional penalty of 5% for each succeeding month of delinquency, but not exceeding a total penalty of 25% of the amount of such business license fee, plus any accounting, legal or administrative expenses incurred by the City. No business license for the current period shall be granted until the delinquent fees, together with penalties, have been paid in full. The Finance Director or his /her designee is authorized, but not obligated, to waive all or any portion of the penalties and interest provided herein in the event the Director or his /her designee determines that the late payment was the result of excusable neglect or extreme hardship. B. Collection. Any business license fee due and unpaid under this chapter, and all penalties thereon, shall constitute a debt to the City and may be collected in court proceedings in the same manner as any other debt in like amount, which remedy shall be in addition to any and all other existing remedies. C. Revocation of License. The Finance Director may revoke any business license issued pursuant to this chapter to any business or other person who is in default in any payment of any business license fee hereunder, or who shall fail to comply with any of the provisions of this chapter. Notice of such revocation shall be mailed to the license holder by the Finance Director, and on and after the date thereof any such business who continues to engage in business shall be deemed to be operating without a license and shall be subject to any and all penalties herein provided. D. There shall be a penalty of not less than $50.00 to reinstate any business license revoked through nonpayment of the business license fee. Section 6. TMC Section 5.04.070, "Change in nature of business," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.070, is hereby amended to read as follows: The license granted in pursuance hereof shall be used to conduct the business or type of business at the designated address for which such license is issued. Any change in the nature of the business, a change in the Unified Business Identifier issued by the Washington State Department of Licensing, a change in the physical location of the business, or a change in ownership of the business shall necessitate a renewed application to the Finance Department. A change in the nature of business or a change in ownership will also require payment of the applicable business license fee. Section 7. TMC Section 5.04.090, "Exemption," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.090, is hereby amended to read as follows: W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 4 of 10 A. Nothing in this chapter shall be construed to require a license for any farmer, gardener, or other person to sell, deliver or peddle any fruits, vegetables, berries, butter, eggs, fish, milk, poultry, meats or any farm produce or edibles raised, caught, produced or manufactured by such person in any place within the State. B. Any business exempt from paying the Revenue Generating Regulatory License fee, in accordance with TMC Section 5.62.040, shall also be exempt from paying the business license fee in TMC Section 5.04.020. Section 8. TMC Section 5.04.110, "Denial Revocation," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.110, is hereby amended to read as follows: A. The Finance Director may deny any business license application pursuant to TMC Section 5.04.105. B. The Finance Director may deny or revoke any license under this chapter where one or more of the following conditions exist: 1. The licensee is in default of any fee, charges or amounts due and payable to the City of Tukwila, as outlined in the Tukwila Municipal Code or City policy. 2. The license was procured by fraud or by a false or misleading representation of fact in the application, or in any report or record required to be filed with the Finance Department, 3. The building, structure, equipment, operation or location of the business for which the license was issued does not comply with the requirements or standards of the Tukwila Municipal Code; 4. The license holder, his or her employee, agent, partner, director, officer or manager has knowingly violated any provisions of any chapter of the Tukwila Municipal Code, or has knowingly permitted, failed to prevent, or has otherwise allowed a violation of any of the provisions of any chapter of the Tukwila Municipal Code to occur on his or her business premises. 5. Conduct of the business would be in violation of any local, state or federal law, rule or regulation prohibiting the conduct of that type of business. C. Upon determination that grounds for denial, suspension or revocation of a license exist, the Finance Director shall send the license holder a Notice of Denial, Suspension or Revocation. Grounds for denial, suspension or revocation include repetition of a violation of any provision of City policies or the Tukwila Municipal Code that has been accompanied by a warning notice of such violation or previous notice of the violation. The Notice of Denial, Suspension or Revocation shall set forth the grounds for and terms of the denial, suspension or revocation and a statement advising that the person may appeal from the Notice of Denial, Suspension or Revocation to the Hearing Officer, provided that the appeal is made in writing and filed with the Finance Director within 10 days from the date of receipt of the Notice of Denial, Suspension or W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 5 of 10 Revocation, and that failure to so appeal shall constitute a waiver of all rights to any additional administrative hearing or determination on the matter. Upon issuance of such Notice, the license is suspended or revoked and is no longer valid and current, unless appealed as provided in this chapter, in which case the effect of the suspension or the revocation is stayed pending the outcome of the appeal. D. Receipt of the Notice of Denial, Suspension or Revocation. The Notice of Denial, Suspension or Revocation shall be served upon the license holder either personally or by mailing a copy of such Notice by certified mail, postage prepaid, return receipt requested to such license holder to his or her last known address as provided in the license application. Alternatively, the Notice may be posted upon the premises where such license holder conducts his or her business, which is the subject of the denied or revoked license. Section 9. TMC Section 5.04.112, "Appeal of Notice of Denial, Suspension or Revocation," Amended. Ordinance No. 2315, §1 (part), as codified at TMC Section 5.04.112, is hereby amended to read as follows: A. Whenever the Finance Director, or his /her designee, determines there is cause for suspending, denying or revoking any license issued or applied for pursuant to this chapter, the Finance Director, or his /her designee, shall notify the person holding the license, by registered mail or hand delivery, of his /her determination. Notice mailed to the address on the license shall be deemed received three business days after mailing. The notice shall specify the grounds for suspension, denial or revocation. B. The licensee or applicant may appeal the decision of the Finance Director, or his /her designee, to suspend, deny or revoke a business license by filing a written appeal to the City Clerk within 10 calendar days of the decision. The appeal must state the grounds for appeal and the basis for why the decision was incorrect. To be accepted the appeal must be accompanied by an appeal fee of $200.00. C. Upon receipt of the notice of appeal, the Finance Director shall set a date for hearing the appeal before the City's Hearing Examiner. Notice of the hearing will be mailed to the licensee or applicant. D. The hearing shall be de novo. The Hearing Examiner may affirm, reverse or modify the Finance Director's, or his /her designee's, decision. E. The decision of the Hearing Examiner shall be final. Any appeal from the administrative hearing shall be to King County Superior Court within 14 calendar days of the Hearing Examiner's decision. Section 10. TMC Section 5.62.020, "Revenue Generating Regulatory License Fee (RGRL)," Amended. Ordinance No. 2297, §1 (part), as codified at TMC Section 5.62.020, is hereby amended to read as follows: A. General. In addition to the business license fee, the highest applicable RGRL in this section shall be paid for the annual license issued under this chapter. W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 6 of 10 1. A business with less than $12,000.00 of average annual gross receipts shall be exempt from any RGRL. 2. For the purposes of this section and in determining the applicable RGRL, the term "employee" means and includes each of the following persons who are not required by the City to have his /her /its own separate City of Tukwila business license: a. Any person who is on the business's payroll, and includes all full -time, part-time, and temporary employees or workers; and b. Self- employed persons, sole proprietors, owners, officers, managers, and partners; and c. Any other person who performs work, services or labor at the business, including an independent contractor who is not required to have a separate City of Tukwila business license. 3. An entity that is entirely exempt from paying the business license fee shall be exempt from any RGRL. 4. An entity with some activities or functions that are exempt from the business license fee and some that are not exempt shall pay an RGRL based on the number of its employees that are involved in the functions or activities that are not exempt. 5. An individual person operating more than one business as sole proprietorships, including leasing of non owner occupied housing, within the corporate limits of the City shall pay only one RGRL fee, at an amount equal to the highest RGRL fee for any one of the multiple businesses, if not otherwise exempt from paying the RGRL fee, pursuant to this chapter. TMC Section 5.62.020.A.5 shall not be applicable if any one of the businesses owned by the sole proprietor has three or more full -time equivalent employees. B. Amount of RGRL. 1. Revenue Generating Regulatory License (RGRL) Fee Method. Except as otherwise provided by this chapter, every person engaging in business within the City shall pay an RGRL based upon the number of employee hours worked in Tukwila during the previous year. Annual employee hours are calculated based on the sum of the 4 quarterly reports submitted to the Washington State Department of Labor and Industries (L &I) for the previous year. It will be the responsibility of the employer to determine the number of hours worked within the City from these reports. Businesses that did not file quarterly reports with the Washington State Department of Labor and Industries shall determine the number of hours worked within the City and demonstrate, if required, to the satisfaction of the Finance Director or his /her designee, that the number of employee hours worked is correct. 2. The annual RGRL fee shall be calculated by multiplying the minimum fee, as defined in subsection (F) of this section, by the number of full- time equivalent W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 7 of 10 employees that worked in Tukwila. The approved fee per full -time employee is $0.028646 (which represents a RGRL multiplier of $0.028646 per employee hour worked), as may be adjusted herein. Employers without a full year history would need to estimate the number of employee hours that will be worked in the current calendar year. 3. If a business has more than one location in Tukwila, the annual business license fee calculation must include a minimum fee for each location and the RGRL for annual employee hours at all locations. C. Alternative FTE Method. A business may choose to calculate its annual RGRL fee by multiplying the minimum fee by the number of its employees. The number of employees shall be based on the sum of the employees in the 4 quarterly reports submitted to the Washington State Department of Labor and Industries (L &I) for the previous year divided by four. It will be the responsibility of the employer to determine the number of employees working within the City from these reports. Businesses that did not file quarterly reports with the Washington State Department of Labor and Industries shall determine the number of employees working in the City and demonstrate, if required, to the satisfaction of the Finance Director or his /her designee, that the number of employees is correct. Employers without a full year history would need to estimate the number of employees that will work in the City for the current calendar year. D. For businesses with employees who work less than 1,920 hours per year (the work hour figure used by the Washington Department of Labor and Industries) the total number of hours worked by all such employees during the 4 quarters of the previous year shall be added together and divided by 1,920 to determine the FTE equivalency. E. It will be the responsibility of the business to determine the total number of FTEs (or equivalency) and demonstrate if required, to the satisfaction of the Finance Director or his /her designee that the calculation is accurate. F. The RGRL fee for a business required to be licensed under this chapter and not located within the City's corporate limits shall be calculated by multiplying the RGRL fee multiplier of $0.028646 per employee hour worked by the number of employee hours worked within the City, but in no event shall the RGRL fee be less than the minimum fee set forth in this chapter. If the number of employee hours worked is not known at the time of renewal, the business shall estimate the maximum number of employee hours they anticipate using in Tukwila during the year. G. Businesses doing business in the City that have no employees physically working within the City shall pay the minimum fee required under this chapter. H. The minimum fee under this chapter shall be $55.00, and may be amended from time to time. I. Payment made by draft or check shall not be deemed a payment of the RGRL fee unless and until the same has been honored in the usual course of business, nor shall acceptance of any such check or draft operate as a quittance or discharge of the W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 8 of 10 fee unless and until the check or draft is honored. Any person who submits a RGRL fee payment by check to the City pursuant to the provisions of this chapter shall be assessed an NSF fee set by the Finance Director if the check is returned unpaid by a bank or other financial institution for insufficient funds in the account or for any other reason. J. Businesses eligible for a temporary business license, pursuant to TMC Section 5.04.010, shall be exempt from payment of an RGRL fee for businesses with fewer than 10 employees. Section 11. TMC Section 5.62.040, "Exemptions," Amended. Ordinance No. 2297, §1 (part), as codified at TMC Section 5.62.040, is hereby amended to read as follows: A. Exemptions. The following entities may claim an exemption from the license fee, but if exempt under this subsection such entities shall still register under this chapter: 1. Certain Organizations Exempt from Federal Income Tax. An organization that files with the city a copy of its current IRS 501(c)(3) exemption certificate issued by the Internal Revenue Service. 2. A governmental entity that engages solely in the exercise of governmental functions. Activities that are not exclusively governmental, such as some of the activities of a hospital or medical clinic, are not exempt under this chapter. 3. A nonprofit business operated exclusively for a religious purpose, upon furnishing proof to the Finance Director of its nonprofit status. For the purposes of this chapter, the activities that are not part of the core religious functions are not exempt. 4. Civic groups, service clubs, and social organizations that are not engaged in any profession, trade, or occupation, but are organized to provide civic, service, or social activities in the City. a. Examples of such organizations include but are not limited to: Soroptomists, Kiwanis, Lions' Rotary, American Legion, children's and adults' athletic leagues and similar types of groups, clubs or organizations. B. A business exempt from obtaining a business license under TMC Section 5.04.090.A shall also be exempt from paying an RGRL fee. Section 12. TMC Section 5.62.050, "Penalties," Amended. Ordinance No. 2297, §1 (part), as codified at TMC Section 5.62.050, is hereby amended to read as follows: A. Monetary Penalty. Failure to pay the RGRL fee within 30 days after the day on which it is due and payable pursuant to TMC Section 5.62.020 shall render the business subject to a penalty of 5% of the amount of RGRL fee for the first month of the delinquency and an additional penalty of 5% for each succeeding month of delinquency, W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 9 of 10 but not exceeding a total penalty of 25% of the amount of such RGRL fee, plus any accounting, legal or administrative expenses incurred by the City. No business license for the current period shall be granted until the delinquent fees, together with penalties, have been paid in full. The Finance Director or his /her designee is authorized, but not obligated, to waive all or any portion of the penalties and interest provided herein in the event the Director or his /her designee determines that the late payment was the result of excusable neglect or extreme hardship. B. Collection. Any RGRL fee due and unpaid under this chapter, and all penalties thereon, shall constitute a debt to the City and may be collected in court proceedings in the same manner as any other debt in like amount, which remedy shall be in addition to any and all other existing remedies. C. Revocation of License. The Finance Director may revoke any business license issued pursuant to this chapter to any business or other person who is in default in any payment of any RGRL fee hereunder, or who shall fail to comply with any of the provisions of this chapter. Notice of such revocation shall be mailed to the license holder by the Finance Director, and on and after the date thereof any such business who continues to engage in business shall be deemed to be operating without a license and shall be subject to any and all penalties herein provided. D. There shall be a penalty of not less than $50.00 to reinstate any business license revoked through nonpayment of the RGRL fee. Section 13. Severability. If any section, subsection, paragraph, sentence, clause or phrase of this ordinance or its application to any person or situation should be held to be invalid or unconstitutional for any reason by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of the remaining portions of this ordinance or its application to any other person or situation. Section 14. Effective Date. This ordinance or a summary thereof shall be published in the official newspaper of the City, and shall take effect and be in full force five days after passage and publication as provided by law. PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a Regular Meeting thereof this %,l day of 2011. ATTEST /AUTHENTICATED: F Christy O'Flgerty, CMC, City ClVrk JimAa6gerton or APPROVED T RM BY: Filed with the City Clerk: Ll Q Passed by the City Council: -)1 Published: Effective Date: zi S�ieTley M. K�ake, City Attorney Ordinance Number: =M W: Word Processing \Ordinances \Business lic -RGRL revisions -2nd submission final 4 -26 -11 SH:bjs Page 10 of 10 City of Tukwila Public Notice of Ordinance Adoption for Ordinances 2332 -2333. On May 2, 2011 the City Council of the City of Tukwila, Washington, adopted the following ordinances the main points of which are summarized by title as follows: Ordinance 2332: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING VARIOUS ORDINANCES AS CODIFIED IN TUKWILA MUNICIPAL CODE TITLE 18, "ZONING CODE," TO MODIFY THE DEFINITION OF DIVERSION FACILITIES; TO EXPAND THE LOCATIONS PERMITTED FOR DIVERSION FACILITIES AND DIVERSION INTERIM SERVICES FACILITIES; PROVIDING FOR SEVERABILITY; AND DECLARING AN EMERGENCY. Ordinance 2333: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, AMENDING ORDINANCE NO. 2315, §1 (PART), AS CODIFIED AT VARIOUS LOCATIONS IN TUKWILA MUNICIPAL CODE CHAPTER 5.04, TO ADD "TEMPORARY BUSINESS LICENSE" TO THE DEFINITIONS AND FEE SCHEDULE, TO REVISE APPEAL PROCEDURES AND TO REDEFINE BUSINESSES EXEMPT FROM FEES; AMENDING ORDINANCE NO. 2297, §1 (PART), AS CODIFIED AT TUKWILA MUNICIPAL CODE SECTION 5.62.020, TO CLARIFY THE CITY'S REVENUE GENERATING REGULATORY LICENSE FEE FOR A PERSON OPERATING MULTIPLE BUSINESSES AS SOLE PROPRIETORSHIPS AND FOR BUSINESSES ELIGIBLE FOR A TEMPORARY BUSINESS LICENSE; PROVIDING FOR SEVERABILITY; AND ESTABLISHING AN EFFECTIVE DATE. The full text of these ordinances will be provided upon request. Christy O'Flaherty, CMC, City Clerk Published Seattle Times: May 5, 2011