Business licenses in city may go away
Council vote still needed
After paying a $35 business license fee for the past two years, local businesses likely will get a break in 2020.
Although a vote is still needed to make it official, a majority of Prescott City Council members were clear Tuesday afternoon that the business license program that went into effect Jan. 1, 2017 should go away.
“This is just another layer (of bureaucracy) and an unnecessary license,” City Councilman Steve Blair said after hearing a report on the license from Budget and Finance Director Mark Woodfill.
Most of his fellow council members voiced similar views as well during the study-session discussion on Tuesday, Sept. 10.
Woodfill led off the discussion by reporting that the license had been in effect for two consecutive years, with 4,998 licenses issued.
The total included: 2,157 “brick-and-mortar” businesses inside city limits; 889 home-based businesses inside city limits; 109 commercial properties; 736 special events; 511 contractors; and 596 businesses located outside city limits.
This week’s review of the license program occurred after questions had come up among council members about whether the business license was doing what it was intended to do, and whether it was needed any longer.
Woodfill pointed out that one of the main reasons for the license — the identification and regulation of sober living homes in the city — no longer existed, because the Arizona State Legislature had moved the regulation of sober living homes to the state Department of Health Services.
“Effective July 1, 2019, the city is prohibited from licensing,” Woodfill’s report stated.
Back in 2016 when the council approved the business-license program, getting a handle on the number of sober-living homes in Prescott was among the goals.
Mayor Pro Tem Billie Orr noted this week that when she was running for a seat on the council in 2015, she asked how many sober-living homes were located in Prescott, and was told, “We don’t have a clue.”
Orr added: “I think we’ve come a long way since then.”
While the city estimated that as many as 200 sober living homes were operating in Prescott a few years back, Orr said the number is now down to 27.
The reduction has been attributed to a number of reasons, including the stringent regulations that the city imposed on sober living homes in 2017, which the state later duplicated, as well as stricter enforcement of claim rules by insurance companies.
Still, Woodfill said the business license had “served a significant purpose for the sober living homes.”
Councilman Phil Goode, who participated in Tuesday’s meeting via teleconferencing, voiced his opposition to continuing the business-license program.
“I feel this is just another layer of tax — even if it is not significant — on businesses,” Goode said.
He added that the city had promised the business community some benefits from the license, such as a directory of businesses available in Prescott.
Although an online directory is available, Goode said the business descriptions were vague – resulting in “kind of a breach of contract” by the city.
Woodfill noted that the business directory uses the descriptions provided by the businesses themselves. He added that a survey of the use of the online directory had shown minimal use by the public.
City Manager Michael Lamar said the city’s evaluation of the business license program was “a good example of an acknowledgment that there was a benefit to this, and the benefit has now waned.”
Based on the council’s direction, Woodfill said after the meeting that his department would work with the city’s legal department on proposed ordinance changes to do away with the business license. The proposed changes are expected to go to the council for official action in the coming months.
While council members were adamant about elimination of the business license, they appeared to want to keep the registration program for vacation rentals, as well as tracking and inspection of businesses for life/safety purposes.
Follow Cindy Barks on Twitter @Cindy_Barks. Reach her at 928-445-3333, ext. 2034, or email@example.com.