Carolina Beach Council Discusses New Business Registration Ordinance

Carolina Beach Council Discusses New Business Registration Ordinance Featured

By / Local News / Wednesday, 29 April 2015 04:00

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CAROLINA BEACH - The Carolina Beach Town Council discussed implementing a new "Business Registration" ordinance at their Tuesday April 28th, meeting. Last year the Republican controlled North Carolina General Assembly adopted legislation amending State General Statute 160A-194, that allow municipalities to license and regulate businesses, but changed the law so they can no longer do so using a "Privilege License Tax" after July 1st, 2015.
According to Town Manager Michael Cramer, the Town can still require businesses to register and it's necessary for a number of purposes including ensuring compliance with zoning regulations, minimum building and fire code standards and exercise of general police powers.
According to Cramer, "This proposal will create a requirement for brick and mortar businesses to register with the Town and lay out fees and penalties for the new regulation."
Cramer explained, "The NC General Assembly made fiscal year 2014-15 the last year for local governments to track business activity using a privilege license. The privilege license was a tax on almost anyone doing business in the community with only a few state licensed businesses being excluded. As the privilege license comes to an end on June 30, local governments will be faced to find a new method for tracking business activity."
He explained, "According to the School of Government local governments still have the authority to require brick and mortar businesses to register with the Town, however we can no longer require anyone doing business to register. For instance, contractors who come to the island to do work but do not have a physical location here would have been required to have a privilege license but are not and can not be required to fill out a business registration To add even more clarity the NC General Assembly is currently moving a bill forward that will specific authority for Business Registration even though there is still a broad authority under the current statutes. Beer/Wine and Municipal Taxi Taxes are still specifically regulated by NC § 105-113.77. Those taxes should continue to be identified and charged outside of the business registration in accordance with the state enabling authority."
During the meeting Mayor Dan Wilcox questioned the meaning of "physical location" saying, "Is that a commercial physical location you are actually doing business out of. How does that take into account home business, people that do business on the island that work out in the field. People that come across the bridge to the island and do business. We are not able to capture those other businesses?"
Senior Planner Jeremy Hardison explained, "If you are claiming your location of your business and that address in is a town, then that's where you would have to register your business with."
Wilcox explained, "So basically our citizens are paying and the people coming across the bridge to make to money on our citizens aren't paying?"
Hardison said, "Yes. If it's an outside contractor coming in to do work they wouldn't need a business registration to do work in the Town."
He said the registration only applies to business locations within town limits.
Wilcox said he's a contractor and often does office type work at home, but it's not a business location. There are no signs or indicators of a business. It's his residence.
He said his work is primarily out in the field building and remodeling homes.
In that case, Hardison said if a person doesn't voluntarily put down a location in Carolina Beach, there is no need to register or pay a fee.
Town Manager Michael Cramer said the proposal is tied to zoning regulations for brick and mortar locations. He said they estimate 364 locations will likely fall under the requirement.
He said there is a competing bill currently proposed in the legislature this session that would eliminate the business registration option.
Councilman Gary Doetsch asked, "Until this bill either passes or goes away" in the State Legislature, "wouldn't we be wise just to hold back on doing this and wait and see what happens with this bill?"
Hardison agreed saying they should wait to see what authority the state will give municipalities with regards to business registration fees.
Cramer said current state law allows for a business registration fee, but the most recent proposed bill might eliminate that.
Cramer and the Council are currently working through numerous meetings to plan for the upcoming 2015-2016 fiscal year. He explained, "What do we lose when we lose the privilege license process? It's not so much the dollars, although we do lose dollars, but we also lose that data and the process that we have used to trigger other activity and other government regulation as we go on."
He explained, "We can ask for information. If there is no fee, are we going to get it and how useful is it going to be?"
Wilcox said, "If there is no penalty you can't put any teeth in it."
Cramer said, "I'm expecting they will also rule on whether or not we are allowed to have a penalty for not providing the information. If a business doesn't provide the information and say ok the Town's can't charge for the registration process, then do we have the ability to penalize them for not providing the information; not registration" whether there is a fee or not.
Cramer said there are two competing bills in the legislature and the two elected leaders will likely get together and compromise. He said the plan was to get the new registration ordinance in place to begin July 1st to take the place of privilege licenses, but with the uncertainty of the pending State legislation and requirements, they will come back after the legislature makes a final decision. He recommended not including it in the budget process.
The current budget estimated $40,000 in revenue from the Privilege Licenses. They anticipate 364 businesses paying $20.00 per year would generate $7,280 of revenue.


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