PORT ANGELES — After two years of planning and discussion, the Port Angeles City Council voted that businesses must obtain a business license to operate within the city.
The general business licenses will not be required for short-term rentals or bed and breakfasts, which have their own unique licensing requirements.
The logistics and paperwork are still being worked through, Assistant City Manager Calvin Goings said. The licenses won’t be required until sometime in late spring or early next summer.
“The important point for business owners is nothing new or different needs to be done now,” Goings said.
Once implemented, the annual licenses will be free for nonprofits or for businesses making less than $25,000 in gross revenue. Businesses making more than $25,000 will have to pay $190 a year.
The licenses could bring the city between $150,000 and $200,000 a year, Goings said, based on a conservative estimate.
Deputy Mayor Navarra Carr said the licenses are not being implemented just to bring the city revenue.
“It’s to recognize the fact that, for a long time, only some businesses have had to pay for the services we were providing,” she said.
The business license requirement will replace city code that outlined 15 specialty licenses, ranging in cost from $25 to $100, for businesses activities such as horse taxis, hotels and motels, tattooing, religious solicitations and more.
“Now, everyone is going to have to pay their fair share,” Carr said.
The city plans to use any revenue it receives for the benefit of the business community, Goings said.
To ensure that the money will only be used for its intended purposes, Goings said once the money comes in, an amendment will be added to the budget “that will show exactly where the new funds are coming from and what specifically they will be used for.”
The city’s priorities will be to support the downtown resource officer position; convert the half-time code enforcement officer into a full-time position; hire a new half-time public records assistant; hire a new half-time business districts and neighborhoods advocate; and hire a new half-time citywide homelessness navigator, in that order.
Positions like the downtown resource officer and code enforcement officer “directly serve our business community,” Carr said. “We are doing something that is in our city’s best interest.”
In addition to collecting money to provide more resources, Goings said the requirement will provide the city with an inventory of businesses operating within city limits.
However, due to security concerns raised by the business community, available information will be limited. The business licenses will be submitted to and held by the state Department of Revenue (DOR), and Goings said any employees with access to the data must sign a confidentiality agreement.
The city still will have access to general data like the number and type of businesses in the city, Goings said.
Processing these licenses will cost the city an estimate of just over $95 per application, Goings said. Since businesses that make less than $25,000 and nonprofits will get the licenses for free, the city will essentially absorb those costs.
“I would infer that the city greatly appreciates micro-small businesses and wants to encourage the growth of micro-small businesses,” Goings said. “By having no license fee, it is doing all that it can to encourage the growth of those very small businesses.”
Obtaining a city license will be simple for the business owners, Goings said, as it will be obtained through a DOR Secure Access Washington (SAW) account.
Washington requires all eligible businesses to have a separate state business license, so Goings said all city businesses should already have a DOR SAW account. Getting a city business license will only take about 45 seconds of extra time, he said.
Separate business licenses will need to be acquired for each business that is individually registered with the DOR, Goings said.
There are currently no plans for enforcement of the license requirement, Goings said.
“We fully believe all of the businesses in the city will in good faith participate in this requirement,” he said.
As part of the process of developing the business license requirement, city staff reached out to seven different groups that represent the city’s business community.
During public comment on Tuesday, Marc Abshire, director of the Port Angeles Chamber of Commerce and a Clallam Economic Development Council board member, said the city did a “fantastic job” communication with businesses about this issue. He said he appreciated the fee schedule that they decided on.
Port Angeles will join a long list of Washington cities that require city business licenses; now, only 49 cities do not require one, Goings said.
Sequim charges $56 to obtain a city business license while Port Townsend charges $30 for businesses that make less than $20,000 in gross income and $75 for businesses that make over that amount.
Forks is one of the 49 cities that does not have a city business license requirement.
If parts of the code aren’t working, Mayor Kate Dexter said the council can “fiddle with things as we go.”
Five city council members passed the code change. Carr voted against it, and council member Lindsey Schromen-Wawrin had an excused absence.
More information about the licensing process will be shared in the future, Goings said.
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Reporter Emma Maple can be reached by email at emma.maple@peninsuladailynews.com.
