Chapter 5.04 BUSINESS LICENSES

The provisions of this chapter shall be deemed an exercise of the power of the city to license for revenue. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 1, 1951).

5.04.015 Engaging in business.

(1) The term “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.

(2) This section 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 section are illustrative only and are not intended to narrow the definition of “engaging in business” in subsection (1) of this section. 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.

(3) 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.

(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, 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.

(4) 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.

(5) 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 (4) 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. (Ord. 3178 § 1 (Exh. A), 2018).

5.04.018 Business license threshold.

(1) Threshold Exemption. To the extent set forth in this section, the following persons and businesses shall be exempt from the license fee requirements as outlined in this chapter:

(a) 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 $12,000 shall be exempt from the general business license fee requirements in this chapter and shall therefore be subject to an effective license fee of $0.00. All other requirements and provisions of this chapter shall apply, including the requirement to obtain and renew the general business license and/or any otherwise required license. The fee exemption does not apply to regulatory license requirements or activities that require a specialized permit. (Ord. 3198 § 1, 2019; Ord. 3178 § 1 (Exh. A), 2018).

5.04.020 Definitions.

In construing the provisions of this chapter, except when otherwise declared apparent or clearly from the context a different meaning is intended, the following definitions shall be applied:

“Business” shall mean and include all activities, occupations, trades, pursuits or professions located and/or engaged in, within the city, with the object of gain, benefit, profit or advantage to the person or business owner, or to another person or class, directly or indirectly, regardless of where their permanent location of business is located. Each business location shall be deemed a separate business.

“Business Licensing Service” or “BLS” means the office within the Washington State Department of Revenue administering the Puyallup city general business licensing process.

“City clerk” means the Puyallup city clerk or his or her designee.

“Director” means the city manager, or any officer, agent, or employee of the city designated to act on the city manager’s behalf.

“Employee” means any person employed at any business enterprise that performs any part of their duties within the city, except casual laborers not employed in the usual course of business. A sole proprietor is not an “employee.” All officers, agents, dealers, franchisees, etc., of a corporation or business trust, and all but one partner of a partnership (except limited partners), are “employees” within this definition.

“Nonprofit” means any charitable organization that has been exempted from the payment of taxes to the federal government under Section 501(c)(3) of the Internal Revenue Code.

“Person” means any individual, firm, partnership, company, corporation, association, receiver, consignee, trustee in bankruptcy, trust, estate, joint venture, club, joint stock company, business trust, society, or any group of individuals acting as a unit.

“Person or business owner” includes any person who engages in business or who is required to have a business license hereunder, or who is liable for the collection of any license fee hereunder, or who performs any act for which a license fee is imposed by this chapter.

“Year” means January 1st to December 31st, or other 12-month period as may be applicable. (Ord. 3178 § 1 (Exh. A), 2018; Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 2, 1951).

5.04.030 Persons subject to fees.

There is hereby levied upon and shall be collected from every person engaging in business in the city an annual license fee for the privilege of engaging in business activities and to identify and register businesses that are active in the city, except those engaged in business activities on premises owned by the Western Washington Fair Association and authorized to conduct business by the Western Washington Fair Association. Such license fee shall be measured by using the estimated number of employees, if it is a new business at the time a business license is sought, or the number of employees as reported in the Washington State Unemployment Insurance Report for the quarter ended immediately prior to when the annual license renewal is due, payable as follows:

(1) Every sole proprietor and every person employing less than 25 employees: $75.00 per year;

(2) Every person employing at least 25 and less than 100 employees: $300.00 per year;

(3) For every person employing 100 or more employees: $500.00 per year;

(4) The Western Washington Fair Association business license fee shall be negotiated annually directly with the city, such negotiations to be concluded by July 1st of each year, and shall reflect cost of the city for the Western Washington Fair Association doing business in the city together with all of those businesses that are conducted on premises owned by the Western Washington Fair Association and approved for operating such businesses by the Western Washington Fair Association. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 2291 § 1, 1991; Ord. 1878 § 1, 1981; Ord. 1536 § 1, 1969; Ord. 1171 § 3, 1951).

5.04.040 Businesses located outside city.

As to businesses located outside the city and furnishing or performing services within the city, the license fee herein shall be measured by the number of employees of such business to perform any part of their duties within the city. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 4, 1951).

5.04.050 Exemptions from all licensing requirements of this chapter.

The business license requirements of this chapter shall not apply to the following:

(1) Any instrumentality of the United States, state of Washington, or any political subdivision thereof, with respect to the exercise of governmental functions;

(2) Temporary stands and temporary fair parking exempted under PMC 5.32.285;

(3) Persons engaged in irregular, casual activities such as lemonade stands, babysitting, delivery of newspapers, casual lawn mowing, casual car washing, and other similar activities;

(4) Brokers, designated brokers and managing brokers as defined in RCW 18.85.011. (Ord. 3178 § 1 (Exh. A), 2018; Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1820 § 1, 1980; Ord. 1610 § 1, 1973; Ord. 1186 § 1, 1952; Ord. 1171 § 5, 1951).

5.04.052 Exemptions from payment of fees under this chapter.

The requirement to pay license fees as set forth in this chapter shall not apply to the following, provided all other provisions of this chapter, including without limitation the requirement to obtain and maintain a current business license, shall apply to all businesses covered by this chapter:

(1) Nonprofit organizations, including but not limited to religious, civic, charitable, benevolent, nonprofit, cultural or youth organizations, as defined in PMC 5.04.020;

(2) The activities regulated under PMC 5.32.135 (bill poster, bill or sample distributor) and special events permitted under Chapter 5.34 PMC including contests, circuses, shows, carnivals, auctions, etc.;

(3) Any farmer or gardener who sells, delivers or peddles any fruit, 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 in this state;

(4) All persons engaged in parking vehicles with a lot capacity of not more than 15 cars;

(5) Family day care homes for children and mini day care homes for children as the same are defined under PMC 20.15.005;

(6) Persons engaged in commerce using an internet website, hobbyists, and crafters who engage in sales that do not involve home visits;

(7) Businesses meeting all of the following criteria:

(a) Having no employees performing work other than delivery within the city;

(b) Having no sales people soliciting sales within the city;

(d) Having no offices, warehouses or other physical location(s) within the city;

(e) Having no inventory located within the city. (Ord. 3178 § 1 (Exh. A), 2018; Ord. 3164 § 1, 2018).

5.04.060 Requirements for issuance of license.

No person shall engage in any business or activity in the city for which a license is required or a license fee is imposed by this chapter without first having obtained and being the holder of a valid and subsisting license, to be known as a “business license,” issued under the provisions of this chapter, as hereinafter provided, and without paying the license fee imposed by this chapter, which license fee shall accompany the application for the license. Such license shall expire on the date established by the Business Licensing Service, and must be renewed on or before that expiration date to continue business in the city. The application for a license shall be made to the Business Licensing Service, which application shall set forth the name of the applicant, place of business, the nature of the business and the amount of the license fee prescribed by this chapter. Every license granted under this chapter shall be posted in a conspicuous place in the place of business of the licensee for which it was issued. Any license issued under and by virtue of the provisions of this chapter shall be personal and nontransferable. In case business is transacted at two or more separate places by one person or business owner, a separate license for each place at which business is transacted with the public shall be required. If two or more business owners conduct separate businesses at the same location, each such business must obtain its own business license.

If payment is made by draft or check, the fee shall not be deemed paid unless the check or draft is honored in the usual course of business, nor shall acceptance of any such check or draft be an acquittance or discharge of the fee unless and until said check or draft is honored.

The city authorizes the Business Licensing Service to mail forms for applications and renewals for licenses, or otherwise provide notifications, but failure of the person or business owner to receive any such forms or notifications shall not excuse the person or business owner from making timely application for and securing or renewing the license required and payment of the license fee.

If any person or business owner required by the terms and provisions of this chapter to pay a license fee for any period fails or refuses to do so, that person shall not be granted a city license for the current period until such delinquent license fee, together with penalties, has been paid in full. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 6, 1951).

5.04.062 Investigations and background checks.

(1) Any application for licenses may be investigated by such departments or officers of the city as the director may determine.

(2) All applicants for a license may be subject to a criminal background check, and the results of such check may be sufficient grounds for denial of a license. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005).

5.04.065 Nonconforming uses.

There exists a need to identify and register businesses which are active in the city in order to protect the public health, safety and welfare of the community. The issuance of a business license by the city does not constitute either approval of a business or the use of any particular parcel in the city for a business purpose. By issuing a business license, the city shall not be precluded from taking enforcement action against any use which is not authorized in the zone in which it is occurring, and does not vest the licensee with any rights to continue a nonconforming use. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005).

5.04.067 Inspections – Right of entry.

The director or an authorized representative of the development services department, fire department or police department is authorized to make inspections of any licensed premises during normal hours of operation of said business and take action as may be required to enforce the provisions of the Puyallup Municipal Code. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005).

5.04.070 Renewal of license and payment of fees.

All business licenses shall be renewed on or before the expiration date established by the Business Licensing Service if the business is to be continued. The term of the license and respective fee due may be prorated in order to synchronize the expiration date with that established for the business by the Business Licensing Service. Application for renewal shall be made to the Business Licensing Service and must include all information required and all fees due including any other license fees and the handling fee authorized under RCW 19.02.075, and any delinquency fee authorized under RCW 19.02.085 when applicable. A license that remains unrenewed after 120 days is automatically terminated, and the business would need to submit a new application to resume doing business in Puyallup. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 2761 § 1, 2003; Ord. 2019 § 1, 1984; Ord. 1186, 1952; Ord. 1171 § 7, 1951).

5.04.071 Marijuana producer, processor, and retailer.

The city shall not issue a city business license to a person who will operate as a marijuana processor, marijuana producer, or marijuana retailer, as such terms are defined in PMC 20.15.005. (Ord. 3164 § 1, 2018; Ord. 3080 § 2, 2014).

5.04.080 Over or underpayment of fees.

The initial license application fee shall be nonrefundable. If, upon investigation of any application and/or receipts, the director finds that the fee paid on any license or license renewal is more than the amount required of the applicant, the director shall return the overpaid amount. If the director finds that the fee paid is less than required, the director shall mail a statement to the applicant showing the balance due, who shall within seven days pay the amount shown thereon. (Ord. 3178 § 1 (Exh. A), 2018; Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 8, 1951).

5.04.090 Failure to make application.

Repealed by Ord. 3164. (Ord. 2834 § 1, 2005; Ord. 1171 § 9, 1951).

5.04.095 Grounds for disqualification of licenses.

Pursuant to the provisions of this chapter, no license shall be issued to the following persons:

(1) Any minor under 18 years of age.

(2) Any person who, if licensed, is likely to present a danger to the public health, safety, or welfare by reason of any of the following:

(a) The applicant or his or her employees or agents have been convicted of a crime which relates directly to the specific occupation, trade, vocation, or business for which the license is sought; provided, the time elapsed between the violation and the date of license application is less than three years for a felony conviction, or less than one year for a misdemeanor conviction.

(b) The applicant has had a similar license revoked or suspended pursuant to the provisions of PMC 5.04.100.

(c) The director has reasonable grounds to believe the applicant to be dishonest or to desire such license to enable the applicant to practice some illegal act or some act injurious to the public health or safety.

(3) Any person who is not qualified under any specific provision of this chapter for any particular license for which application is made. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005).

5.04.097 Application for license – Approval or denial – Appeal.

The director shall have authority to make administrative decisions, including approval, conditioning, suspension, revocation, or denial of licenses required hereunder. The applicant, licensee or person or entity who is subject to the administrative decision may, within 10 days after issuance of the administrative decision, appeal said decision by filing a written notice of appeal, clearly stating the grounds that the appeal is based on, with the city clerk. The appeal shall occur before the hearing examiner of the city, which appeal shall be governed by Chapter 2.54 PMC. (Ord. 3164 § 1, 2018; Ord. 3123 § 1, 2016; Ord. 2834 § 1, 2005).

5.04.100 Suspension or revocation – Appeal.

(1) The director shall have the power and authority to suspend or revoke any registration or license issued under the provisions of this chapter. The director shall notify such licensee in writing by certified mail of the suspension or revocation of its license and the grounds therefor. Any license issued under this chapter may be suspended or revoked based on one or more of the following grounds:

(a) The registration was procured by fraud or false representation of fact.

(b) The licensee has failed to comply with any provisions of this chapter.

(d) The licensee is in default in any payment of any license fee or tax under this title.

(e) The licensee or employee has been convicted of a crime involving the business.

(f) Licensee’s continued conduct of the business for which the license was issued will result in a danger to the public health, safety, or welfare by reason of any of the following:

(i) The licensee, licensee’s employees or agents have been convicted of a crime which bears a direct relationship to the conduct of the business under the license issued pursuant to this chapter.

(ii) The licensee, or licensee’s agents or employees, have, in the conduct of the business, violated any law or ordinance relating to public health or safety.

(iii) The conduct of the business for which the license was issued has resulted in the creation of a public nuisance as defined in the PMC or in state law.

(2) Any licensee may, within 10 calendar days from the date that the suspension or revocation notice was mailed to the licensee, appeal such suspension or revocation by filing a written notice of appeal (“petition”) setting forth the grounds therefor with the city clerk. A copy of the petition must be provided by the licensee to the director and the city attorney on or before the date the petition is filed with the city clerk. The hearing shall be conducted in accordance with the procedures for hearing contested cases set out in Chapter 2.54 PMC. The hearing examiner shall set a date for hearing said appeal and notify the licensee by mail of the time and place of the hearing. After the hearing thereon the hearing examiner shall, after appropriate findings of fact and conclusions of law, affirm, modify, or overrule the suspension or revocation and reinstate the license, and may impose any terms upon the continuance of the registration.

No suspension or revocation of a license issued shall take effect until 10 calendar days after the mailing of the notice thereof by the director and, if appeal is taken as herein prescribed, the suspension or revocation shall be stayed pending final action by the hearing examiner. All licenses which are suspended or revoked shall be surrendered to the city on the effective date of such suspension or revocation.

The decision of the hearing examiner shall be final. The licensee and/or the director may seek review of the decision by the superior court of Washington in and for Pierce County within 21 days from the date of the decision. If review is sought as herein prescribed, the suspension or revocation shall be stayed pending final action by the superior court.

Upon revocation of any license as provided in this section, no portion of the license fee shall be returned to the licensee. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 10, 1951).

5.04.110 Authority of director.

The director shall have the power, and it shall be the director’s duty, from time to time, to adopt, publish and enforce rules and regulations not inconsistent with this chapter or with the law for the purpose of carrying out the provisions hereof, and it is unlawful to violate or fail to comply with any such rules or regulations. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 2232 § 1, 1990; Ord. 1171 § 11, 1951).

5.04.120 Mailing of notices.

Any notice required by this chapter to be mailed to any person or business owner shall be sent by ordinary mail, addressed to the last known mailing address of the person or business owner as shown in the records, or to such address as is able to be ascertained by reasonable effort. Failure of the person or business owner to receive any such mailed notice shall not release the person or business owner from any fees or any penalties thereon, nor shall such failure operate to extend any time limit set by the provisions of this chapter. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 12, 1951).

5.04.130 Disclaimer of city liability.

The city of Puyallup expressly finds and requires that responsibility for compliance with the provisions of this chapter rests with license applicants and their agents and that no action, inaction, or omission of the city or any of its agents or employees shall serve to assume or shift responsibility for compliance with the provisions of this chapter to any other party, including the city. Furthermore, issuance of a license pursuant to this chapter does not constitute the creation of a duty by the city to indemnify the licensee for any wrongful acts against the public, or to guarantee the quality of goods, services or expertise of a licensee. The issuance of a license does not shift responsibility from the licensee to the city for proper training, conduct or equipment of the licensee or their agents, employees or representatives, even if specific regulations require standards of training, conduct or inspection. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 13, 1951).

5.04.140 License fee additional to others.

The license fee herein levied shall be additional to any license fee imposed or levied under the law of any other chapter of the city except as herein otherwise expressly provided. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 14, 1951).

5.04.150 Fee constitutes debt.

Any license fee due and unpaid under this chapter, and all penalties thereon, shall constitute a debt to the city and may be collected by court proceedings in the same manner as any other debt in like amount, which remedy shall be in addition to all other existing remedies. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 15, 1951).

5.04.155 Assignment of licenses.

The business license is personal and may not be assigned or transferred. A change in ownership of a business requires the new owner to apply for a license as provided in this chapter. If an existing business owner changes ownership structure, such as a sole proprietor forming a corporation or limited liability company, and wishes to conduct the same business under the new business structure, a new business license application must be submitted under the new business structure, as provided in this chapter. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005).

5.04.160 Penalties – Violations.

(1) Violations. It shall be unlawful for any person to violate any of the provisions of this chapter and such person shall be subject to the penalties detailed below. Additionally, the license of the business in which a violation occurs may be revoked for such violation, whether the owner knew of or encouraged the violation.

(2) Monetary Penalties.

(a) Penalties. Every person who operates a business without first obtaining a license issued pursuant to this chapter shall be assessed by the director an additional monetary penalty in the amount of $250.00. This penalty shall be in addition to the required license fee remitted through the Business Licensing Service.

(b) Collection. Any license fee due and unpaid and delinquent under this chapter shall constitute a debt to the city. The city may, pursuant to Chapter 19.16 RCW, use a collection agency to collect unpaid fees or taxes owed or assessed, or it may seek collection by court proceedings, which remedies shall be in addition to all other remedies.

(3) Criminal Penalties for Repeat Violations. A second or repeat violation of any provision of this chapter shall constitute a misdemeanor punishable by a fine of a sum not exceeding $1,000 or by imprisonment not exceeding 90 days or by both such fine and imprisonment. Each separate day or portion thereof during which any violation of any provision of this chapter continues shall constitute a separate violation and upon conviction thereof shall be punished as provided in this section. (Ord. 3164 § 1, 2018; Ord. 2834 § 1, 2005; Ord. 1171 § 16, 1951).