Chapter 5.02
BUSINESS LICENSES
Sections:
5.02.010 License – Application – Fee.
5.02.030 Person subject to tax.
5.02.040 Business located outside city limits.
5.02.050 Agents responsible for obtaining license.
5.02.100 Failure to pay – Penalty.
5.02.110 Review of exempt organization business.
5.02.120 Right to refuse to issue license.
5.02.130 Revocation of license.
5.02.140 Reinstatement procedures and standards for reviewing an application for reinstatement.
5.02.010 License – Application – Fee.
A. It shall be unlawful for any person to engage in business in the city for which a license is hereafter required or a license fee provided without first procuring a one-time license and/or paying such fee (as applicable). All such licenses shall be effective for as long as the business continues to do business in the state of Washington.
B. Any person engaging in business upon their commencement and application for business license shall pay their business license fee.
C. The one-time business license fee shall not be prorated.
D. Payment of the license fee, if applicable, shall be a condition precedent to engaging in business within the city limits.
E. The license fees to be paid shall be based upon the basic fee as set forth in RIMC 5.02.080 unless another section of this chapter shall provide a license fee based upon some other means of determination of such license fee, in which case the basic fee as set forth in RIMC 5.02.080 may not apply or may be in addition to other fees. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.020 Definitions.
In construing the provisions of this chapter, except when otherwise declared, apparent or clearly appearing from the context of the passage or section, the following definitions shall be applied:
A. “Business” means all activities, occupations, trades, pursuits or professions located and/or engaged in within the city, with the object of gain, benefit or advantage to the taxpayer, or to another person or class of persons, directly or indirectly. Each business location shall be deemed a separate business.
B. “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 definition 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 B 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.
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 as further set forth in this chapter.
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, 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 or 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 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 (B)(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.
C. “Issuing official” means the city clerk/treasurer.
D. “Person” means any individual, firm, partnership, company, corporation, association, receiver, assignee, trustee in bankruptcy, trust, estate, joint venture, club, joint stock company, business trust, society or any group of individuals acting as a unit, whether mutual, cooperative, fraternal, nonprofit or otherwise.
E. “Taxpayer” means any person who engages in business or who is required to have a business license hereunder, or who performs any act for which a license fee or tax is imposed by this chapter.
F. “Year” means the calendar year from January 1st to and including the succeeding December 31st. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.030 Person subject to tax.
Unless otherwise exempt, there is 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 within the city limits. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.040 Business located outside city limits.
Unless otherwise exempt, this chapter covers and applies to any business located outside the city engaging in business inside the city limits. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.050 Agents responsible for obtaining license.
The agents or other representatives of any person or entity engaging in business in this city shall be personally responsible for the compliance of their principals and of the businesses they represent with this chapter. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.060 Duties of licensee.
Every applicant/licensee under this chapter shall:
A. Ascertain and at all time comply with all laws and regulations applicable to such licensed business.
B. Be personally responsible for the business engaged in on the business premises.
C. Avoid all illegal practices or conditions on the business premises which do or may harmfully affect the public health, safety or welfare, including the taking of such corrective or preventative actions as are reasonably available (i.e., supervision, prohibiting lawbreakers and troublemakers from the business premises, reporting criminal activity to the police) and requested in writing by the city clerk/treasurer or his/her designee. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.070 Exemptions.
A. Except as otherwise provided herein, the provisions of this chapter shall not apply to the following:
1. Any delivery person, firm, company or corporation delivering in the city any property purchased or acquired outside of the city, where such delivery service business offices are located outside of the city and where there is no intent by such person, firm, company or corporation to evade the provisions of this chapter.
2. Any fraternal or social corporation or organization whose purpose is charitable and nonprofit.
3. Any religious organization or church, or other religious assemblage.
4. Any person who is by the laws of the United States of America or the state of Washington exempt from such tax.
5. Any municipality or political subdivision of the United States or of the state of Washington.
6. Any charitable fundraising organization.
7. Any farmer, gardener or other person who shall sell, deliver or peddle any fruits, vegetables, berries, eggs, or any farm produce or edibles raised, gathered, produced, or manufactured by such person in this state as provided by RCW 36.71.090 as now exists or as may be hereafter amended.
8. 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 $2,000 and who does not maintain a place of business within the city. The exemption does not apply to regulatory license requirements or activities that require a specialized permit.
B. The provisions of this section shall not authorize exempt organizations to engage in business or activities subject to the requirements of any other ordinance of the city relating to taxes, fees or licenses to be purchased or paid for carrying on that particular activity. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.080 Basic license fee.
Unless it is otherwise provided by provision in a section providing for the licensing of a special, named, enumerated or specific business or activity, the one-time basic license fee for engaging in business shall be $2.00. This license fee is a basic fee for engaging in business within the city limits. Any other section of this chapter or any ordinance of the city requiring a license or tax for conducting a specific and named activity shall be in addition to this basic license fee. There shall be no set off or credit given for this basic license fee unless such ordinance or section of ordinance so allows. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.090 Street vendors.
Any person selling any commodity or merchandise from any vehicle, trailer, stand or temporary structure or place physically located in the city shall, in addition to the basic license fee, pay an annual license fee established by resolution of the city council from time to time. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.100 Failure to pay – Penalty.
There is established a penalty to be added to each business license for failure to pay such business license within 45 days after the due date. The due date shall be prior to engaging in business for any new business beginning operation. Such penalty shall be 20 percent of the basic license fee. Failure to pay such fee and penalty is grounds for denial of the application and/or imposition of penalties as provided in RIMC 5.02.160. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.110 Review of exempt organization business.
A. All persons who claim exemption from the basic license fee or requirements pursuant to RIMC 5.02.070 are required to apply to the issuing official for an application to engage in business activity within the city limits. This requirement specifically includes all charitable and fundraising organizations and activities. There shall not be a licensing fee for carrying on such activity by an exempt person, except as specified in other ordinances or sections of ordinances of the city or as required by the state or any of its political subdivisions.
B. Prior to engaging in business, including fundraising activities, such exempt organization or person shall make application for a business license to the city through the issuing official. Such application shall be on a similar form or the same form as for all other business organizations specifying the same information as required thereon.
C. If the issuing official deems it in the best interest and welfare of the city to have such licenses reviewed by the city council, he/she shall not issue such license without referring it to the city council for review. Such matter shall be brought on at the next regularly scheduled city council meeting for review and either accepted or denied by the city council. Such review by the city council shall be binding upon all parties, subject to the right of appeal to the superior court of Douglas County, having jurisdiction over these matters. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.120 Right to refuse to issue license.
A. The issuing official may, if he/she deems it best for the welfare of the citizens and inhabitants of the city, refuse to issue a license to any person, stating in writing the reasons for such denial, and the person so refused shall not engage in business for which a license as herein required has been refused.
B. Any denial of license may be based upon the failure to pay a penalty pursuant to RIMC 5.02.100 or any one or more of the applicable grounds for revocation as set forth in RIMC 5.02.130.
C. Upon refusal to grant a license, the aggrieved party shall have the right to appeal the decision of the city council. Such appeal shall be received, in written form, by the city clerk/treasurer within 10 days of the date of the issuance of the written refusal to license. The city council must then review the application and the reasons for the refusal to license within 30 days from the date of the receipt of the notice of appeal.
D. Upon a hearing of the facts, the city council shall then have the right to either uphold the refusal or accept the application for license upon payment of the basic license fee and any other tax or license imposed upon such business. The council shall make a written decision within 30 days of the date of its review at a city council meeting.
E. The decision of the council shall be final. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.130 Revocation of license.
A. The city council may revoke any license issued under this chapter after it has been issued, or any person’s privilege to engage in business in the city, when after investigation by city staff, any one or more of the following grounds are found to exist:
1. Illegal issuance of the license or permit.
2. Issuance of the license or permit without authority or power.
3. Issuance under an unauthorized ordinance or under an ordinance illegally adopted.
4. Issuance in violation of an ordinance.
5. When the business license was procured by fraud or false representation of facts.
6. When issued through mistake or inadvertence.
7. When the license application contains false or misleading statements, evasions or suppression of material facts.
B. Other grounds for revocation in addition to those stated in the previous subsection are:
1. Substantial violations of the terms and conditions on which a license or permit is issued.
2. Violation of ordinances or law authorizing or regulating the license or permit, or regulating the business, activity or thing for which it is issued.
3. Conviction of infractions of or offenses under such an ordinance or law.
4. Wrongful behavior of a substantial character and of a public concern in relation to the licensed activity.
5. When reasonably necessary in the interest of protection of the public health, safety, peace or welfare.
6. When a business becomes an instrument of or a cover for public disorder, crime, or other danger to public safety, morals or health.
C. Before any such license or licensing privilege shall be cancelled or revoked, the holder of such license or privilege shall be given two weeks’ notice of a hearing to be held by the city council, at which time the applicant must show cause why such license and/or privilege to engage in business should not be revoked. The notice to be given the applicant must state the grounds and the reasons for the forfeiture and revocation and also the date set for the hearing thereon; provided, however, the issuing official may deny the issuance of a license or immediately revoke the license of any business for any of the grounds set forth, when any such license has been issued for a period of less than 72 hours; any such determination by the issuing official shall be deemed conclusive unless the applicant appeals to the city council within 10 calendar days of notice of the revocation. Pending any such appeal to the city council, the business license shall remain revoked or denied.
D. The decision of the city council to revoke a business license or licensing privilege, or to sustain the decision of the issuing official 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 during which reinstatement of a business license and/or business licensing privilege shall not be considered, the city council will consider among other factors:
1. The degree of the person’s culpability and the conduct leading to the revocation; and
2. The criminal nature of the conduct, if any; and
3. The conduct’s effect on the community; and
4. The licensee’s acceptance of the responsibility for their actions or conversely their failure to accept responsibility or admit their wrongdoing.
E. The decision of the city council shall be final. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.140 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 procedures:
1. A written application shall be completed on a form available from the city clerk.
2. The application, when completed, shall be filed with the city clerk.
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 Rock Island at least once and at least five days prior to the public hearing.
5. At the public hearing the city council shall receive testimony from the applicant, city staff and 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.
7. All approvals or denials of an application shall be supported by written findings of fact.
B. Standards for Review. In making their 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 their attention, which shall include:
1. The time since the revocation action was taken; and
2. The degree of applicant’s culpability and the conduct leading to the revocation and the criminal nature of the conduct, if applicable; and
3. The effect on the community of the conduct leading to the revocation of the licensing privilege and any lingering effects still experienced by the community; and
4. The steps taken by the applicant to reform him/herself or insure that if placed in a similar business ownership position, he/she would not revert to the prior 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 council that if allowed a new business license, the prior wrongful conduct would not reoccur.
C. Final Decision. The decision of the city council shall be final. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.150 Appeal.
Any person with standing aggrieved by a final decision of the city council may file an appeal with the Douglas County superior court within 30 days of the issuance of the written decision by the city council. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).
5.02.160 Violation – Penalty.
Any person, firm, corporation or association violating the terms of this chapter shall be guilty of a civil infraction and shall be punished by a fine not to exceed $500.00. (Ord. 22-209 § 1; Ord. 18-177 § 1; Ord. 98-023 § 2).