San Luis Obispo seeking business fee and tax revenue

August 23, 2010

By KAREN VELIE

The city of San Luis Obispo sent out 3,900 letters seeking business license fees from rental property owners today as part of an aggressive campaign to increase license fee revenues.

The letter asks landlords to pay a business application fee of $68 to the city and a yearly tax of 50 cents per thousand. The city says that obtaining business tax and license fees from landlords could increase city revenue by $80,000 a year.

In this case, the city has decided to waive any retroactive fees.

The city has been actively approaching business owners that might be doing business in the city. San Luis Obispo municipal codes provide city officials great discretion in determining which businesses require a license and how tax assessments are determined.

“The Code defines business very broadly in a way that we have concluded in the past includes out of area businesses soliciting customers and making money from them in the city,” said Debbie Malicoat, SLO finance manager. “We also have an apportionment provision that recognizes that an out of area business may derive only a small percentage of its revenue from city business activity and may be subject to taxes in multiple cities.”

If the amount of revenue a business has generated from work conducted in the city limits is difficult to determine, the finance director will do an investigation and determine how much tax a business has to pay in a “reasonable and nondiscriminatory manner,” according to chapter 301 of the municipal code.

“In fixing the business tax to be charged, the finance director shall have the power to base the business tax upon a percentage of gross receipts, operating expenses, floor space, payroll, number of employees, business taxes paid to other cities, or any other measure which will assure that the business tax assessed shall be uniform with the amount of business done in the city of San Luis Obispo, or of businesses of a like nature, so long as the amount assessed does not exceed the business tax set forth in this chapter,” according to the municipal code.


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30 Comments

  1. The Crab says:

    I just would like to know if I must reply to the letter? I live in the home I bought in SLO, and do not rent it out. I have not filed the Home Owner’s Exeption paper, and have thus rec’d the letter stating they believe I must be renting it. As a result, at the end of the letter they direct me to mark “I am not conducting business…” and to sign date and return it.

    When did SLO become a police state, where I have to sign a document that I am not renting my home. AND, what happens if I do not reply. Well, so far, I have ignored two letters, and today I received a “FINAL NOTICE”.

    Again, what happens if I do not reply. Is there a law stating that I must reply? Is their an ordinance that says I must provide a signature stating that I am not renting my home? Are they going to fine me by assuming I am guilty?

    I have considered signing it, but they didn’t even provide a reply envelope with postage prepaid. Which means that I would need a stamp to reply it. It’s been at least 5 years since I’ve used a stamp. What an inconvenience. As a result, I’m refusing to reply.

    Anybody else out there refusing to reply?

    (1) 1 Total Votes - 1 up - 0 down
  2. SLOBIRD says:

    I just followed the link provided by “Crusader” under Callahan Memorial (go to City website. click on Employee Salary and Benefits to verify the following information… We have our own little City of Bell deals going on. According to the City our new manager makes $221,500 annually. The problem with that is that she also receives a $450 mthly car allowance (under IRS mileage of $o.50 a mile that she means uses her car 900 miles a month in SLO and should NEVER use a City vehichle), she got 160 hours a year vacation (other employees have to work 20 yrs to achieve that) PLUS according to Section 2, #B of her contract she can take reasonable time without use of vaction for all her hard work (I thought we paid her well for that), we gave her a $125,000 residential loan at a very low rate and she only has to pay interest, from Dec 09 to July 31, 2010 she got a $2500 monthly rental allowance, ETC ETC ETC,,, Her total annual compensation is $308, 048 without the loan or the added time off (since her husand is down south, no doubt she uses that well)… Real transparency!

    (17) 17 Total Votes - 17 up - 0 down
  3. sinking says:

    They could enforce even more fees that they have on the books . They will get less complaints if they do it gradually. They have latitude in how they apply these rules. For now they are only going to charge landlords $68 which includes outside business license fee of $43. Many of these landlords live in SLO. Why aren’t they requiring landlords to pay the home occupation permit of $129, or the inside city license fee of $131? Maybe later. Other good news – After delaying enforcement, the EPA rules for landlords will take affect next month. If you have a pre 1978 rental house and do your own work, you are supposed to take a $250 class and then pay the EPA $300/year for a license. Fines for non-compliance can go up to $37,000/day. More expenses, more paperwork, more requirements!

    (4) 8 Total Votes - 6 up - 2 down
  4. Saveslocounty says:

    Oh my! How short sighted is this. If I didn’t work downtown I wouldn’t come into SLO at all. Charging people to have a business meeting in town will further kill the restaurant business which is nearly extinct already. Tax them to come into town and then slap them with a huge parking ticket whenever possible. I remember when businesses flourished and the city was supportive of those generating tax revenue for them. Those days are gone.

    (21) 21 Total Votes - 21 up - 0 down
    • Cindy says:

      Speaking of parking tickets. I attended the “Return Annie” rally in front of the County Gov Building today. I found a parking spot up by the court house where the meters only allow 30 minute parking. 30 minutes isn’t very long and of course I wanted the full 30 minutes. I put a quarter in the meter and it gave me 13 minutes! I gave it another quarter and it gave me another 13 minutes for a total of 26 minutes on a 30 minute meter, does that even make any sense? Talk about doing things as unfriendly as possible. No I didn’t give them another freggin quarter for the extra 4 minutes.

      (15) 15 Total Votes - 15 up - 0 down
    • SLOBIRD says:

      If I feed the ducks I’m fined, if a smoke I’m fined, if I shop I’m taxed, if I park I’m taxed, I pay higher water and sewer bills than others in the County, I pay a franchise tax on my utility bills. I guess the City needs my extra dollars to pay corrupt police offices higher salaries than anywhere else in the County (higher than LA oficers who really have a hard job) and now they have a new COMMUNITY PANEL to figure out how to get more from us taxpayers. I want the City to be transparent and tell us how much this funeral Friday is costing our community for a Fire Chief (I know he was a nice guy, as a lot of the employees are) that has already retired once, served our community for less than five years and did not die in the line of duty. He died doing what he loved, we should all be able to do that. As KSBY has a problem to “Stuff the Bus” for our school children, the City is spending thousands on this funeral. Shame on you!

      (15) 19 Total Votes - 17 up - 2 down
      • Cindy says:

        SLOBIRD, I have to reply because I fear that you might get “jumped” for your reply and I want to say that I agree. I also have had enough of the loss of the Dear Fire Chief. You said it well and what is this costing us and why? Wonderful people pass away every day. The Fire Chief has been memorialized in the press and many have given their condolences. We all lose loved ones and he did not die in the line of duty. Too bad we can’t say that about our troops in Iraq who really pass away long before their time.

        (12) 20 Total Votes - 16 up - 4 down
        • Saveslocounty says:

          I read where they are closing many city services which is a lost production at city expense. I wonder why they didn’t move the service to Saturday to avoid the closure, when most of the city employees are off duty.

          (14) 18 Total Votes - 16 up - 2 down
          • SLOBIRD says:

            Because they wouldn’t go on their time! Now we know why they needed the PAC with 300+ City employees. I really find this appalling. I’ve known many City long term employees and never has the City memorialized an employee like this. Those union employees (Public Safety) really can pull the strings.

            (16) 20 Total Votes - 18 up - 2 down
            • PaulJones says:

              SLOBIRD speaks the truth. This is irritating. I agree that it is about the unions. I’ve just about had it with city gov, I in fact have had it. Time for a change, not joking, watch it happen.

              P.S. You have to watch and participate if you want change, WATCH and then PARTICIPATE. Time for change?

              (12) 16 Total Votes - 14 up - 2 down
  5. Crusader says:

    Some people at the city must have a great deal of time on their hands.

    Can them and you’ll save FAR MORE than $80K/year.

    (15) 15 Total Votes - 15 up - 0 down
  6. Professor Whitney says:

    All you people who want a tax free environment for business are forgetting that politicians also respond to everyday constituents who think taxation is a necessary evil to rid ourselves of other unnecessary evils. The business license will probably be passed on to consumers of the business. One of the businesses not now taxed as it should be are property owners who rent their properties to transients, namely students who live in residential housing built for the workforce. So, taxing might just relieve the residential neighborhoods from the blight and noise pollution caused by transients who think they own the public airwaves and public streets. Just as government–even a democratic one– is a necessary evil for an orderly society, so is taxation. And both are meant to reduce the incentives for doing unnecessary harms. So, get real all you tax-free anti-government partiers out there!

    (-9) 17 Total Votes - 4 up - 13 down
    • danika says:

      Speaking of taxes….anyone get the “User tax” letter from the Franchise Tax Board/BOE Division dated 8-18-10? This letter goes on to advise that businesses (and property owners) who gross over $100k a year will have to report their Internet purchase activities when buying items online and not paying State sales tax. They have reason to suspect everyone in this catagory buys CDs, DVDs, etc. from non reciprocating vendors like Amazon, who does not charge Ca state sales tax. You have to register for your “User Tax Account”, pay a deposit, and complete a form quarterly showing what online purchases you have made, the “user tax” that is due, and pay it to the FTB quarterly. Problem? They can request you go back 8 years and pay “user tax” on all your online purchases. They have no proof you have made purchases online, but you have to prove you did not.

      It appears this is relevant to businesses only so far, but you know what is coming next….

      (0) 0 Total Votes - 0 up - 0 down

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