Chapter 5.02 BUSINESS LICENSES*

Unless otherwise exempted by this chapter, every person engaged in business within the corporate limits of Ocean Shores is required to have a city business license. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.020 Exercise of licensing authority.

This chapter is an exercise by the city of its authority to license business activities for the purpose of regulation and revenue pursuant to the provisions of RCW 35A.82.050 and 82.14A.010 et seq. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.030 Definitions.

Where used in this chapter, the following words and terms shall have the meanings as defined in this section, unless, from the context, a more limited or different meaning is clearly defined:

A. “Business” means all activities, occupations, pursuits, or professions located and/or engaged in within the city, with the object of gain, benefit, or advantage to the person engaging in the same, or to any other person or class, directly or indirectly, including home occupations.

B. “City” means the city of Ocean Shores, Washington.

C. “City council” means the city council of Ocean Shores, Washington.

D. “Employee” means any person who performs work, labor, or services for a business and is on the payroll of the business. For the purpose of this chapter, the term “employee” also includes self-employed persons, sole proprietors, owners, managers, partners, and all full-time, part-time and temporary employees or workers which are paid by, employed by, or are in any way compensated by the business, if those persons are not independent contractors.

E. “Engaging in business” means commencing, conducting, or continuing in business, and also the exercise of corporate or franchise powers, as well as liquidating a business when the liquidators thereof hold themselves out to the public as conducting such business.

1. This subsection sets forth examples of activities that constitute engaging in business in the city, and establishes safe harbors for certain of those activities so that a person who meets the criteria may engage in de minimis business activities in the city without having to pay a business license fee. The activities listed in this subsection are illustrative only and are not intended to narrow the definition of “engaging in business” in this subsection. If an activity is not listed, whether it constitutes engaging in business in the city shall be determined by considering all the facts and circumstances and applicable law.

2. Without being all-inclusive, any one of the following activities conducted within the city by a person, or its employee, agent, representative, independent contractor, broker or another acting on its behalf, constitutes engaging in business and requires a person to register and obtain a business license:

a. Owning, renting, leasing, maintaining, or having the right to use, or using tangible personal property, intangible personal property, or real property permanently or temporarily located in the city.

b. Owning, renting, leasing, using, or maintaining an office, place of business, or other establishment in the city.

c. Soliciting sales.

d. Making repairs or providing maintenance or service to real or tangible personal property, including warranty work and property maintenance.

e. Providing technical assistance or service, including quality control, product inspections, warranty work, or similar services on or in connection with tangible personal property sold by the person or on its behalf.

f. Installing, constructing, or supervising installation or construction of real or tangible personal property.

g. Soliciting, negotiating, or approving franchise, license, or other similar agreements.

h. Collecting current or delinquent accounts.

i. Picking up and transporting tangible personal property, solid waste, construction debris, or excavated materials.

j. Providing disinfecting and pest control services, employment and labor pool services, home nursing care, janitorial services, appraising, landscape architectural services, security system services, surveying, and real estate services, including the listing of homes and managing real property.

k. Rendering professional services such as those provided by accountants, architects, attorneys, auctioneers, consultants, engineers, professional athletes, barbers, baseball clubs and other sports organizations, chemists, psychologists, court reporters, dentists, doctors, detectives, laboratory operators, teachers, and veterinarians.

l. Meeting with customers or potential customers, even when no sales or orders are solicited at the meetings.

m. Training or recruiting agents, representatives, independent contractors, brokers or others, domiciled or operating on a job in the city, acting on its behalf, or for customers or potential customers.

n. Investigating, resolving, or otherwise assisting in resolving customer complaints.

o. In-store stocking or manipulating products or goods, sold to and owned by a customer, regardless of where sale and delivery of the goods took place.

p. Delivering goods in vehicles owned, rented, leased, used, or maintained by the person or another acting on its behalf.

3. If a person, or its employee, agent, representative, independent contractor, broker or another acting on the person’s behalf, engages in no other activities in or with the city but the following, it need not register and obtain a business license:

a. Meeting with suppliers of goods and services as a customer.

b. Meeting with government representatives in their official capacity, other than those performing contracting or purchasing functions.

c. Attending meetings, such as board meetings, retreats, seminars, and conferences, or other meetings wherein the person does not provide training in connection with tangible personal property sold by the person or on its behalf. This provision does not apply to any board of directors member or attendee engaging in business such as a member of a board of directors who attends a board meeting.

d. Renting tangible or intangible property as a customer when the property is not used in the city.

e. Attending, but not participating in, a trade show or multiple vendor events. Persons participating at a trade show shall review the city’s trade show or multiple vendor event ordinances.

f. Conducting advertising through the mail.

g. Soliciting sales by phone from a location outside the city.

4. A seller located outside the city merely delivering goods into the city by means of common carrier is not required to register and obtain a business license; provided, that it engages in no other business activities in the city. Such activities do not include those in subsection (E)(3) of this section.

The city expressly intends that engaging in business include any activity sufficient to establish nexus for purposes of applying the license fee under the law and the Constitutions of the United States and the state of Washington. Nexus is presumed to continue as long as the taxpayer benefits from the activity that constituted the original nexus-generating contact or subsequent contacts.

F. “Business license clerk” means the person or his or her designee appointed by the city administrator to act in such capacity.

G. “Person” includes the singular and the plural, and also means and includes any natural person over the age of eighteen years, firm, corporation, association, club, partnership, society, or any group of individuals acting as a unit.

H. “Special sales” includes but is not limited to sidewalk sales, and off-site vending.

I. “Nonprofit community festival” includes but is not limited to any festival or event sponsored by a not-for-profit entity, or a nonprofit corporation, which is open to the entire community.

J. “Business Licensing Service” and “BLS” means the office within the Washington State Department of Revenue providing business licensing services to the city.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.040 Special sales.

This chapter shall apply to all business in the nature of special sales, and it is unlawful for any person, either directly or indirectly, to conduct any such sale except in conformity with the provisions of this chapter unless specifically exempt therefrom. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.050 Notification of exemption or termination of business activities.

A. Every person who has obtained a business license required by this chapter and who thereafter ceases to engage in business within the city shall, prior to the end of the business license year during which business operations have been terminated, notify the business license clerk in writing that the business activities have ceased. Any business for which a license has been issued shall be presumed to continue in operation within the city unless notice of termination of business activities has been given as provided above.

B. Every person who engages in business in the city which is exempt or becomes exempt from the licensing provisions of this chapter under federal, state, or local laws shall notify the business license clerk in writing of the exemption, and the basis thereof.

C. Any business which is exempt from the provisions of this chapter, or which has terminated its business activities in the city, shall not be entitled to a refund of any license fee paid under this chapter if such business has failed to provide written notice to the business license clerk as required by this section.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.060 Agents responsible for obtaining license.

The agents or other representatives of nonresidents who are doing business in the city shall be personally responsible for the compliance with this chapter by their principals and of the businesses they represent. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.070 Separate license for branch establishments.

A license shall be obtained in the manner prescribed in this chapter for each branch establishment or location of the business engaged in, as if each such branch establishment or location were a separate business; provided, that warehouses and distributing plants used in connection with and incidental to a business licensed under the provisions of this chapter are not separate places of business or branch establishments. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.080 Multiple activities—Multiple businesses.

A. A person engaged in two or more business activities at the same location is not required to obtain separate licenses for conducting each of such business activities, but will be issued one license for the location.

B. If two or more persons each conduct their own business at the same location, each such person must obtain their own license for their respective business, as provided in this chapter.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.085 Business changes.

A. If a person wishes to change the location of their business within the city they must notify the Business Licensing Service sufficiently prior to the change to allow the city to review and approve the request. Business may not commence at the new location until approved by the city. A change of location may require submitting a new application as provided in this chapter.

B. In the event of the sale of a business, the new owner must obtain their own business license for the acquired business, as provided in this chapter, prior to engaging in business within the city under the acquired business.

(Ord. 1065 § 1, 2020)

5.02.090 Exemptions from license requirement.

The provisions of this chapter shall not apply to:

A. Any instrumentality of the United States, the state of Washington, or political subdivisions thereof with respect to the exercise of governmental functions.

B. Any farmer or gardener who sells or delivers any fruits, vegetables, berries, eggs, or any farm produce or edibles raised, gathered, caught, produced, or manufactured by such person within the state.

C. Newspaper carriers who are employees of the newspaper they distribute, and postal carriers.

D. Any person who merely delivers within the city any property purchased or acquired in good faith from a person at his/her regular place of business outside the city where that person is not otherwise subject to the licensing provisions of this chapter.

E. Any person, business, enterprise, firm, or corporation which the city is forbidden to tax under state or federal law.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.100 Exemptions for nonprofit community festivals.

A. No license shall be required of any person who operates a business in conjunction with nonprofit community festivals, as approved by the business license clerk; provided, all of the following criteria are met:

1. The business does not operate within the city for more than three consecutive days, or for more than twelve days in a calendar year; and

2. The business is authorized in writing to participate in the community festival by the sponsor of the festival.

B. Any person claiming the exemption set forth in this section shall register with the city, on a form prescribed by the business license clerk, each time she/he engages in business within the city, in order to track the number of days said person does business within the city.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.110 Exemptions—Fee waiver.

The licensing provisions of this chapter shall apply to the following persons and organizations; however, the business license fees shall be waived for:

A. 1. Any nonprofit organization granted a federal tax exemption by the Internal Revenue Service (IRS) under a provision of 26 USC Section 501(c), engaging in business in the city, either regularly or temporarily, when it is without private profit; provided, the organization submits proof of the federal tax exemption.

2. Religious organizations deemed to be tax exempt under 26 USC Section 501(c)(3) without receiving such proof of determination from the IRS are fully exempt from the license requirements of this chapter while performing their core religious service. Should such a religious organization engage in any actual business activities in the city, the organization must obtain a business license for such other business activities, and pay full fees therefor;

B. Any person or business whose gross proceeds of sales or gross income from the business is less than two hundred dollars per month. Such persons shall provide the city with an affidavit at the beginning of each license year, confirming the income for the prior license year;

C. Any person or business whose annual value of products, gross proceeds of sales, or gross income of the business in the city is equal to or less than two thousand dollars and who does not maintain a place of business in the city.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.120 Issuance—Fee collection.

The business license clerk will ensure the collection of all license fees and approve issuance of business licenses in the name of the city to all persons qualified under the provisions of this chapter, and perform the duties set forth in Sections 5.02.130 through 5.02.190. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.130 Enforcement.

The city may promulgate and enforce reasonable rules and regulations as necessary and convenient to the operation and enforcement of this chapter. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.140 Forms.

The business license clerk shall adopt forms and prescribe the information to be given therein as convenient and necessary for processing the application, except for those forms and information that are used by and collected through the Business Licensing Service. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.150 Review and endorsement.

The business license clerk shall submit the information from all applications to appropriate departments for their review and endorsements thereon as to compliance by the applicant with city regulations, including city zoning codes. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.160 Investigations.

The business license clerk may investigate and determine the eligibility of any applicant for a license as prescribed in this chapter. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.170 Compliance with Ocean Shores tax code.

In receiving any business license, the applicant acknowledges that applicant’s business operation must be conducted in accordance with the Ocean Shores tax code, Title 3. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.180 Notification of applicant.

The business license clerk shall notify any applicant within fifteen business days of the acceptance or rejection of his/her application and shall, upon refusal of any license or permit, at the applicant’s request, state in writing the reasons therefor and forward them to the applicant. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.190 Information confidential.

The business license clerk shall keep all financial information furnished or secured under the authority of this chapter in strict confidence. Such information shall not be subject to public inspection and shall be kept so that the contents thereof shall not become known except to the persons charged with the administration of this chapter. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.200 Application required.

Every person required to obtain a license under the provisions of this chapter must submit an application for such license to the Business Licensing Service. No business activities may commence within the city prior to the issuance of an approved license, unless otherwise authorized by the city administrator. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.210 Form.

The license application is made through the Business Licensing Service (BLS) either online or upon a form provided by BLS. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.220 Contents.

The application must include all information required for all licenses requested, including the disclosure of the number of employees at each location within the city of Ocean Shores, which employee count must include any owner, or owners working in the business at each specific location. If the applicant is claiming an exemption or deduction under the terms of this chapter, the application must also include a full disclosure of those facts pertinent to the exemption or deduction. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.230 Fees.

The application must be accompanied by the full amount of the fees chargeable for all licenses requested, including the application handling fee required by RCW 19.02.075. The city’s business license fees are set by resolution of the city council as amended from time to time. The city’s fees for special events are set by resolution of the city council. (Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.240 Duration—License renewal—Procedure.

The license issued under this chapter expires on the date established by the Business Licensing Service and must be renewed on or before that date to continue to engage in business in the city after that date.

A. The applicant for the renewal of a license must submit the application to the Business Licensing Service (BLS) and must include all information required to renew all licenses involved, the total fees to renew all licenses, and the renewal application handling fee required by RCW 19.02.075.

B. The term of the license and respective license fee amount may be prorated as necessary to synchronize the license expiration date with the expiration of the business license account maintained by BLS.

C. Failure to complete the renewal by the expiration date will incur the late renewal penalty required by RCW 19.02.085 in addition to all other fees due.

D. Failure to complete the renewal within one hundred twenty days after expiration will result in the cancellation of the license and will require submitting a new application for license as provided in this chapter in order to continue to engage in business in the city.

E. In addition to other penalties described in this section, the city may impose its own late renewal penalties, payable directly to the city, under the following terms and percentage amounts of the city license fee:

1. Renewal completed after expiration, but within forty-five days after expiration—five percent penalty;

2. Renewal completed forty-five or more days after expiration, but within seventy-five days after expiration—ten percent penalty;

3. Renewal completed seventy-five or more days after expiration, but within one hundred five days after expiration—fifteen percent penalty;

4. Renewal completed one hundred five or more days after expiration, but within one hundred twenty days after expiration—twenty percent penalty;

5. Renewal not completed within one hundred twenty days after expiration results in revocation/cancellation of the license in accordance with Section 5.02.270(A)(14) and subsection (D) of this section.

The penalties imposed by this subsection are in addition to such other remedies provided in this chapter and may be required to be paid before issuance of a new license in the event of license revocation/cancellation due to late filing.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 920 § 1, 2013: Ord. 818 § 1 (part), 2006)

5.02.260 Information required.

Each license issued under the provisions of this chapter must state upon its face the following:

A. The name of the licensee and any other name under which the business is to be conducted;

B. The address of the business so licensed; and

C. The date of expiration thereof.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.270 Denial, suspension or revocation of business license.

A. The city administrator, or designee, may deny a license to any applicant, or may suspend or revoke any license issued under this chapter after it has been issued, or any person’s privilege to do business in the city of Ocean Shores when, after investigation by city staff, any one or more of the following grounds are found to exist:

1. Issuance of the license or permit without authority or power;

2. Issuance under an unauthorized ordinance or under an ordinance illegally adopted;

3. Issuance in violation of an ordinance;

4. The business license was procured by fraud or misrepresentation of facts;

5. When issued through mistake or inadvertence;

6. When the license application contains false or misleading statements, evasions, or suppression and/or omission of material facts;

7. Conviction of a prior offense involving business licensing;

8. Substantial violations of the terms and conditions on which a license or permit is issued;

9. Violation of ordinances or law authorizing or regulating the license or permit, or regulating the business, activity, or thing for which it is issued;

10. Violations of local, state, or federal laws;

11. Wrongful behavior of a substantial character and of a public nature and/or concern in relation to the licensed activity;

12. When reasonably necessary in the interest of protection of the public health, safety, peace, or welfare;

13. When a business becomes an instrument of or a cover for public disorder, crime, or other danger to public safety, peace, health, or welfare.

14. Failure to complete a timely renewal.

B. Before any such license or licensing privilege shall be canceled or revoked, the holder of such license or privilege shall be given ten business days’ notice of a hearing to be held by the city administrator, at which time the applicant must show cause why such license and/or privilege to do business should not be revoked. The notice to be given the applicant shall state the grounds and the reasons for the forfeiture and revocation, and also the date set for the hearing thereon; provided, however, that the city administrator may deny the issuance of a license or immediately revoke the license of any business for any of the grounds set forth herein when any such license has been issued for a period of less than seventy-two hours; any such determination by the city administrator shall be deemed conclusive unless the applicant appeals to the city council within five calendar days of notice of the revocation. Pending any such appeal to the city council, the business license shall remain revoked or denied. A decision on the appeal shall be made by the city council within fifteen business days of the date on which the appeal is filed by the applicant.

C. The decision of the city council to revoke a business license or licensing privilege or to sustain the decision of the city administrator/hearing examiner revoking a license on an appeal shall be supported by written findings of fact in support of the decision. Each decision of the city council to revoke a business license and/or the business licensing privilege shall set forth a minimum period of time for which the business license and/or business licensing privilege is to be revoked. The minimum time period for the duration of the revocation of a business license and/or the business licensing privilege shall be one year, unless the city council determines that extraordinary circumstances exist justifying a shorter period of time, in which case the justification for such decision shall be set forth by the city council in writing. In determining the minimum time of the revocation period, the city council will consider, among other factors:

1. The degree of the business owner’s culpability and the conduct leading to the revocation;

2. The criminal nature of the conduct, if any;

3. The conduct’s effect on the community.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.280 Reinstatement procedures and standards for reviewing an application for reinstatement.

A. Procedures. At any time following the minimum time period for revocation of a business license and/or business licensing privilege set forth by the city council in its decision to revoke a license and/or business licensing privilege, reinstatement of the license and/or licensing privilege may be sought utilizing the following procedure:

1. A written application shall be completed on a form available from the business license clerk.

2. The application, when completed, shall be filed with the business license clerk, with copies to the city administrator and the city attorney.

3. The city council shall set a public hearing date with at least two weeks’ notice to the applicant to consider the application for reinstatement.

4. The public hearing shall be advertised by the city clerk in a newspaper of general circulation in the city of Ocean Shores at least once, and at least ten days prior to the public hearing.

5. At the public hearing, the city council shall receive testimony from the applicant, from city staff, and from interested members of the public.

6. Upon conclusion of the public hearing, the city council shall decide, by motion, whether or not to grant approval of the application. Approval of the application shall require an affirmative vote by a majority of the members of the city council present and voting on the application.

7. All approvals or denials of an application shall be supported by written findings of fact.

8. Reinstatement may also require the submission of a new license application as otherwise provided for by this chapter.

B. Standards for Review. In making its determination on an application for reinstatement of a business license and/or the business licensing privilege, the city council shall consider all relevant factors brought to its attention, including, but not limited to:

1. The time since the revocation action was taken;

2. The degree of the applicant’s culpability, the conduct leading to the revocation, and the criminal nature of the conduct, if applicable;

3. The effect on the community of the conduct leading to the revocation and any lingering effects still experienced by the community;

4. The steps taken by the applicant to reform himself/herself and/or to ensure that if placed in a similar business ownership position she/he would not revert to the same conduct which led to the revocation of his/her license and/or business licensing privilege; and

5. Any additional means by which the applicant can demonstrate to the city council that if allowed a new business license, the prior wrongful conduct would not recur.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)

5.02.290 Illegal operation—Judicial remedy.

A. Any violation of the provisions of this chapter shall be a Class C offense as defined in Title 7.

B. In addition to all other penalties provided in this chapter, whenever a business is being operated without a valid business license, the city may seek to close down said business through any lawful process, including, but not limited to, injunctive measures through any court of competent jurisdiction.

(Ord. 1065 § 1, 2020; Ord. 1030 § 1 (part), 2018: Ord. 818 § 1 (part), 2006)