HomeMy WebLinkAbout07 BUSINESS LICENSE DOCUMENTATION POLICYAgenda Item
AGENDA REPORT
Finance Director
MEETING DATE: DECEMBER 17, 2013
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
VIA: JEFFREY C. PARKER, CITY MANAGER
FROM: CHUCK ROBINSON, DEPUTY CITY MANAGER 0
SUBJECT: BUSINESS LICENSE DOCUMENTATION POLICY
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At the City Council's December 3, 2013 meeting, the City Council authorized a
modification to the Tustin Municipal code exempting real estate agents from business
license requirements (Ordinance No. 1439). In addition, Councilmember Nielsen
requested staff to research and bring back options regarding modifications to the
business license documentation policy when applying for a business license.
The current business license tax is calculated according to gross receipts. At the time in
which businesses apply for a business license, they must provide information related to
gross receipts. Several options are available to applicants to suffice this request. Owners
may submit tax return information with personal information redacted, financial
statements indicating gross receipts, and /or some other form of back up relative to gross
receipts.
The aforementioned requested information has been viewed as somewhat invasive to the
business owner. There are several options available to the City Council to address the
concern of how much information is required to obtain a business license. The following
options presented for City Council discussion do not require a proposition 218 vote.
ALTERNATIVE ADMINISTRATIVE OPTIONS:
1. The City may require back up information such as financial statements or the page of
the tax return that reflects gross receipts with any personal information redacted
(current practice);
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2. Applicants may option out of providing any back up financial information and pay a flat
fee of $100 for the annual business license (the current average business license is
$60);
3. The City shall request applicants to provide gross receipts information but will not
require any formal documentation.
RECOMMENDATION:
City Council discretion.
FISCAL IMPACT:
The adoption of an alternative policy may result in a reduction in business license
revenue if no audit checks are conducted to ensure proper documentation is submitted.
However, a more streamlined business license program may increase the number of
applicants.
CORRELATION TO THE STRATEGIC PLAN:
The review of the Business License program correlates to the Strategic Plan Goal C
Financial Strength, 2. Explore opportunities for new or increased revenues, b. Evaluate
the City's business license program to ensure fairness and equity for all businesses.