Title
Approval of an Ordinance Amending Title 5 of the Olympia Municipal Code Relating to Business Taxes, Licenses and Regulations
Recommended Action
Committee Recommendation:
The Finance Committee recommends moving to approve on second reading, an ordinance amending Title 5 of the Olympia Municipal Code relating to business taxes, licenses and regulations.
City Manager Recommendation:
Move to approve on second reading, an ordinance amending Title 5 of the Olympia Municipal Code relating to business taxes, licenses and regulations.
Report
Issue:
Whether to approve on second reading, an ordinance amending Title 5 of the Olympia Municipal Code relating to business taxes, licenses and regulations.
Staff Contact:
Shawn Ward, Interim Finance Director, 360.753.8465
Presenter(s):
None. Consent calendar item only.
Background and Analysis:
Background and analysis did not change from first to second reading.
In April 2024, the City Council approved a new Tax Review team focused on education and compliance outreach to people engaging in business here. To help in these efforts, we propose administrative updates to Title 3, Title 4 and Title 5. This staff report focuses on Title 5, and there are two other staff reports covering Titles 3 and 4. On November 18, 2024, staff presented these changes to the Finance Committee, who recommended that the City Council approve the changes as proposed.
The City’s business tax code requires those engaging in business in the City of Olympia to comply with licensing and tax obligations. Some of these rules may only be understood by reading several code chapters simultaneously. For example, right now a person wondering if they need a business license won’t find a definition of “engaging in business” in Chapter 5.02, the business license chapter. They must read Chapter 5.04, the B&O tax chapter to find the definition of “engaging in business”. As another example, a locksmith reading the OMC for relevant rules might only look in the chapter titled “Chapter 5.52 LOCKSMITHS”. This chapter doesn’t currently explain that locksmiths must also follow the rules in Chapters 5.04, the B&O tax chapter.
The updates being proposed to Title 5 are administrative in nature. Historical edits have either introduced or failed to eliminate ambiguity across chapters within Title 5. The City wishes to clarify existing licensing and tax requirements and improve compliance through administrative updates that improve language, ensure consistency, and remove ambiguity within the Code.
Climate Analysis:
This agenda item is expected to result in no impact to greenhouse gas emissions.
Equity Analysis:
With the Tax Review program, we aim to ensure more equal access to Olympia’s existing business tax regulations. The code clean-up will improve understanding of the City’s existing licensing and tax obligations by making them clearer and more evident to all.
A second goal of the new program is to improve compliance with the City’s existing license and tax requirements. Many businesses currently comply, and many do not. All taxpayers should meet obligations equitably, and the code clean-up will provide a consistent set of enforcement provisions across business taxes.
Neighborhood/Community Interests (if known):
Members of the community may have an interest in this agenda item as it deals with City requirements for business activity.
Financial Impact:
There is no financial impact associated with this agenda item.
Options:
1. Move to approve on second reading, an ordinance amending Title 5 of the Olympia Municipal Code relating to business taxes, licenses and regulations.
2. Direct staff to modify the ordinance updating OMC Title 5.
3. Take other action.
Attachments:
Ordinance