Chapter 5.04
BUSINESS AND OCCUPATION LICENSES

Sections:

5.04.010    Purpose.

5.04.020    Definitions.

5.04.030    License – Required.

5.04.040    License – Application and classification.

5.04.045    License renewal – Penalties.

5.04.050    Repealed.

5.04.055    Penalty for late application.

5.04.060    License – Application – Approval or denial.

5.04.070    License – Nontransferable – Term.

5.04.080    Separate license for separate location or branch establishment.

5.04.090    Joint licenses.

5.04.100    License – Exceptions.

5.04.110    Special permit for nonprofit enterprises.

5.04.120    Revocation.

5.04.130    Violation – Penalty.

5.04.140    Business owner responsible.

Prior legislation: Ord. 822.

5.04.010 Purpose.

The provisions of this chapter are intended to provide coordination between the City of Ferndale and the Washington State Business Licensing Service (BLS) in the review and issuing of business licenses. Further, this chapter is intended to require that commercial activity that takes place within the City of Ferndale is properly reviewed for compliance with applicable codes, and such review is open and transparent for the purposes of meeting the requirements of Washington State and the United States of America. It shall be deemed an exercise of the authority of the BLS to issue business licenses in coordination with the City of Ferndale’s review and regulation of such licenses. It shall further be the responsibility of the City of Ferndale to approve business licenses with conditions, to deny business licenses, and to regulate, make inspections and impose excises for regulation or revenue in regard to all places and kinds of business, production, commerce, entertainment or exhibition, and upon all occupations, trades and professions and any other lawful activity, as provided in RCW 35A.82.020. The City of Ferndale participates in the Washington State Business Licensing Service (BLS). (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 516.01 § 516.01.010, 1977)

5.04.020 Definitions.

In construing the provisions of this chapter, except when otherwise declared or clearly apparent from the context, the definitions in this section shall be applied. For the purposes of this chapter, “Community Development Director” shall be construed to also include any designee of the Community Development Director.

A.    “Business” and “engaging in business” mean:

1.    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.

2.    This section 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 (A)(1) 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.

3.    Without being all-inclusive, and in the judgment of the City of Ferndale Community Development Director, 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:

a.    Owning, renting, leasing, using, or maintaining an office, place of business, or other commercial establishment in the City.

b.    Soliciting sales.

c.    Making for-profit or commercial repairs or providing maintenance or service to real or tangible personal property, including warranty work and property maintenance.

d.    Providing for-profit or commercial 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.

e.    Commercial installation, construction, or supervision of installation or construction of real or tangible personal property.

f.    Soliciting, negotiating, or approving franchise, license, or other similar agreements.

g.    Collecting current or delinquent accounts.

h.    Commercial pick-up and transport of tangible personal property, solid waste, construction debris, or excavated materials.

i.    Rendering professional or other services performed in the City of Ferndale, such as those provided by commercial pest control services, employment and labor pool services, home nursing care, janitorial services, appraisal services, landscape or architectural services, security system services, surveying, construction, or real estate services, including the listing of homes and managing real property. Professional services such as those included in the fields of finance, accounting, engineering, legal, education, retail, and health care shall also obtain City of Ferndale business licenses.

j.    In general, each business shall be required to obtain a separate business license; individuals working on behalf of the business shall not be required to obtain a separate business license unless otherwise required by law.

k.    Training or recruiting agents, representatives, independent contractors, brokers or others, operating on a job in the City, acting on its behalf, or for customers or potential customers.

l.    In-store stocking or manipulating products or goods, sold to and owned by a customer, regardless of where sale and delivery of the goods took place.

m.    Commercial delivery of goods in vehicles owned, rented, leased, used, or maintained by the person or another acting on its behalf.

4.    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 with government representatives in their official capacity.

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.

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.

5.    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 (A)(4) 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.

B.    “Business license” means the single document designed for public display, issued by the Business Licensing Service, which certifies state agency or local government license approval and which incorporates the endorsements included in the Business Licensing System, which the state or local government requires for any person subject to this chapter.

C.    “Business Licensing Service” or “BLS” means the business registration and licensing services established by this chapter and Chapter 19.02 RCW, and located in and under the administrative control of the Washington State Department of Revenue and the City of Ferndale.

D.    “City business license” means the single document designed for public display issued by the City of Ferndale, for those business or commercial activities that require City review under this chapter, but do not require review by the state of Washington.

E.    “License payer” includes any individual, group of individuals, corporation or association required to have a registration certificate and/or license for business under the provisions of this chapter, or liable for any license fee, or for collection of any license fee, or who is engaged in any business, or who performs any act, for which a license fee is imposed by this chapter.

F.    “Nonprofit organization” means a benevolent, philanthropic, patriotic, eleemosynary, religious, educational, social, recreational, fraternal, or other association, corporation, fund, foundation, civic league, club, or organization having or purporting to have a nonprofit status under provisions of 26 U.S.C. Section 501(c). (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 516.01 § 516.01.020, 1977)

5.04.030 License – Required.

It is unlawful for any person, firm, corporation or association to maintain, conduct or operate any device, vehicle or thing, or otherwise engage in any business, calling, profession, trade, occupation or activity, without first having secured the license to do so. Every person subject to the provisions of this chapter must, before engaging in any business or performing any act for which a license is required, demonstrate that such license has been secured from the BLS. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 516.01 § 516.01.030, 1977)

5.04.040 License – Application and classification.

A.    Application for a City business license is made through the Business Licensing Service. The application must include all information required by the City for all licenses requested, the total fees due for all licenses, and the application handling fee required by RCW 19.02.075. The classifications of business license which may be applied for in this manner include:

1.    Resident general business license for any business license issued to a business not specifically included in subsection (B)(1) of this section, when such business is conducted from an office or location within City limits.

a.    A special classification exists if a resident business activity is of an industrial or manufacturing nature and has gross annual revenues in excess of $500,000.

2.    Home occupation business license for any business conducted within a home or residence.

3.    Nonprofit organization business license for any business qualifying under the definition found in FMC 5.04.020(F), as authorized under FMC 5.04.110.

4.    Nonresident business license for any business conducted within the City from an office or location based outside of the City limits.

5.    If a type of business is not specifically listed in this section or in subsection (B)(1) of this section the license shall be subject to the licensing requirements of this subsection (A).

B.    The following classifications of business licenses must be applied for and obtained directly from the City, without utilizing the Business Licensing Service:

1.    Temporary public space business license for portable food vendors operating from City-owned property and public parks, as administered by FMC 18.72.105. Said temporary license shall be limited to a specific time, place, and duration. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 721 § 1, 1983; Ord. 516.01 § 516.01.040, 1977)

5.04.045 License renewal – Penalties.

The City business license must be renewed on or before the expiration date established by the Business Licensing Service in order for the licensee to continue to conduct business in the City after that date.

A.    Application for renewal of the business licenses identified in FMC 5.04.040(A) is made through the Business Licensing Service, and must include all information required to renew all the licenses involved, the total fees due for all licenses, and the renewal application handling fee required by RCW 19.02.075.

B.    The term of the license, and the respective fee amount, may be prorated as necessary to synchronize the license expiration with the expiration date of the business license account maintained by the Business Licensing Service.

C.    Failure to complete the license renewal on or before the expiration date will incur the late renewal penalty required by RCW 19.02.085 in addition to all other fees due.

D.    Failure to complete the license renewal within 120 days after the expiration date will result in the cancellation of the license and will require the submission of a new application for a license to continue to conduct business in the City.

E.    Application for license renewal of all other licenses issued under the provisions of this chapter, other than those listed in subsection (A) of this section, must be made directly with the City in the manner prescribed by the Finance Director. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020)

5.04.050 License – Application – Fees.

Repealed by Ord. 2141. (Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 721 § 1, 1983; Ord. 516.01 § 516.01.040, 1977)

5.04.055 Penalty for late application.

Any applicant who fails to make application for an original business license prior to engaging in business, and having therefore failed to obtain a license, is subject to enforcement action and a penalty which will be based on such ordinance as adopted by the Ferndale City Council. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997)

5.04.060 License – Application – Approval or denial.

A.    Upon approval of the application, the license shall be issued through the Business Licensing Service.

B.    Upon denial of the application, the City fee paid will be returned to the applicant by the City forthwith, together with both notice that the application has been denied and a copy of the appeal procedures set forth in this section; provided, that no refund will be made where during the pendency of the application the applicant engaged in the business activity for which the license was intended.

C.    The Community Development Director, or any officer of the City designated by them, shall approve, approve with conditions, or deny applications for licenses required under the provisions of this chapter. Each decision to deny, condition, or issue a business license shall be issued in writing and shall contain a statement that the decision constitutes a final administrative determination for the purposes of an appeal.

1.    Any applicant whose license is denied or conditioned or any party of record aggrieved by the issuance of any such license may, within 10 days after the denial, approval with conditions, or approval of such license, appeal to the Hearings Examiner by filing a written notice of appeal, clearly stating the grounds on which the appeal is based, with the Hearings Examiner; and the Hearings Examiner shall set a date for the hearing of such appeal and the Community Development Director, City Administrator, or their designee shall notify the applicant, by mail, of the time and place of hearing.

a.    After the hearing thereon, the Hearings Examiner may direct the issuance of the license applied for, or shall revoke the license issued, or shall sustain the denial of the license, as the Hearings Examiner may deem advisable.

b.    The term “party of record” shall be defined by FMC 14.11.070. Appeal hearings shall be conducted in accordance with the provisions of Chapter 14.11 FMC for administrative appeal.

D.    A business license application shall be deemed automatically abandoned upon the applicant’s failure to provide requested information within 60 days of any City request for such information. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 516.01 § 516.01.050, 1977)

5.04.070 License – Nontransferable – Term.

The business license is personal and nontransferable and is valid until the expiration date established by the Business Licensing Service, or, for those licenses issued by the City, the expiration date established by the City. The license must be renewed on or before the expiration date in order to continue to conduct business in the City after that date. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 516.01 § 516.01.060, 1977)

5.04.080 Separate license for separate location or branch establishment.

A license shall be obtained in the manner prescribed in this chapter for each branch establishment or location of the business engaged in, as if each branch establishment or location were a separate business; provided, that warehouses and distributing plants used in connection with or incidental to a business licensed under the provisions of this chapter shall not be deemed to be separate places of business or branch establishments. And provided further, that individual employees of businesses shall not be required to obtain a separate business license for work performed, unless otherwise required by law. Independent contractors or subcontractors working on behalf of businesses shall obtain their own license. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 516.01 § 516.01.032, 1977)

5.04.090 Joint licenses.

A person engaged in two or more business activities at the same location is not required to obtain separate licenses for conducting each of such business activities. If two or more persons each conduct a business at the same location in the city, each person must obtain a separate license, as provided for in this chapter, for their respective business. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 516.01 § 516.01.034, 1977)

5.04.100 License – Exceptions.

The following, including those activities that are similar in nature and effect to those listed, in the judgement of the Community Development Director, shall be exempt from the requirement to apply for and obtain a business license:

A.    For any mere delivery in the City of any property purchased or acquired in good faith at a person’s regular place of business outside the City where no intent is shown to exist to evade the provisions of this chapter;

B.    In the case of salespeople soliciting orders from manufacturers, wholesalers, jobbers, distributors or retailers, where no act of business is done in the City;

C.    Casual or isolated sales made by persons who are not otherwise engaged in the business of selling the type of property involved. Casual sales shall include garage sales, lawn sales, attic sales, rummage sales, flea market sales, or any other similar casual sale of tangible personal property conducted on an infrequent basis, not to exceed three times per each calendar year and three days per event;

D.    Minors engaged in babysitting, the delivery of newspapers or other similar pursuits;

E.    Any farmer or gardener who sells, delivers or peddles any fruit, vegetables, berries, butter, eggs, fish, milk, poultry, meats, or any farm produce or edibles raised, caught, produced, or manufactured by such person in any place in this state, subject to Health Department regulations for sanitation, permits, and inspections, where applicable;

F.    Any vendor participating in the Ferndale Public Market (or any iteration of an officially sanctioned farmers’ market or public market) shall not be required to obtain a normal business and occupation license, but instead obtain a public market vendor business license, except that any vendor that conducts normal business unrelated to a public market or farmers’ market within the City of Ferndale on other occasions or at other locations shall obtain the normal business and occupation license. If a vendor obtains a normal City of Ferndale business license, the public market vendor license will not be required. Any vendor participating just once in a calendar year in the market shall not be required to obtain a normal business license or the vendor business license;

G.    Any vendor participating in a special event approved by the City, and/or in an event such as a craft fair or similar:

1.    At which multiple vendors may sell their goods or produce, when the event organizer has obtained a business license and, where applicable, a special events permit for the event itself; and

2.    When the average price for an individual product sold does not exceed $250.00;

H.    Businesses possessing an existing business license in the City of Ferndale shall not also be required to obtain a business license for a special event, although individuals associated with that business shall be required to obtain separate business licenses if said event is not organized by the business license holder itself;

I.    The production or manufacture of products within the home, for sale outside of the home, where the average cost of goods sold is less than $250.00 per item, and when such items are sold on an infrequent basis and the gross income derived from the aggregate sale of all goods is less than $5,000 per calendar year.

1.    Within the context of this section, exemption from business license requirements shall not exempt the business from home occupation permits (where applicable), or any other permits required by the City of Ferndale or other agencies;

J.    To the extent set forth in this section, the following persons and businesses shall be exempt from the registration, license and/or license fee requirements as outlined in this chapter:

1.    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 shall be exempt from the general business license requirements in this chapter. The exemption does not apply to regulatory license requirements or activities that require a specialized permit;

K.    Municipal, state, or federal agencies or employees acting on behalf of that agency;

L.    A person employed in the City by a person engaged in business in the City, if the employer is licensed pursuant to this chapter to conduct a business in the City;

M.    A person transacting and carrying on a business exempt from City licensure by virtue of the federal or state Constitution or state law;

N.    Certain nonprofit organizations as identified in FMC 5.04.110; and

O.    Other activities that the City deems are consistent with the provisions of this section and should be exempt. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2044 § 1, 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1717 § 1, 2012; Ord. 1164 § 1, 1997; Ord. 516.01 §§ 516.01.070, 516.01.072, 1977)

5.04.110 Special permit for nonprofit enterprises.

The Community Development Director is authorized to issue a special business license, without payment of any City license fees or other City charges therefor, to any person or organization for the conduct or operation of a nonprofit enterprise or organization as defined in FMC 5.04.020(F), provided the person or organization provides proof of qualifying as such. Provided further, that religious, educational, charitable, and fraternal organizations conducting only their core religious, educational, charitable, or fraternal activities, and no other business activities, are exempt from the business license requirements of this chapter. However, a for-profit organization operating under the sponsorship of a nonprofit organization, and required to hold a separate license under the provisions of this chapter, must pay all applicable license fees and charges. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1164 § 1, 1997; Ord. 516.01 § 516.01.080, 1977)

5.04.120 Revocation.

A.    In accordance with RCW 35A.82.010, the Community Development Director shall be authorized to revoke any business license at any time for cause, subject to the conditions established in subsection (B) of this section.

B.    A business license may be revoked if any of the following has occurred:

1.    The business license was obtained based on false or misleading information which would have prevented the issuance of the business license. Minor flaws in the application, such as scrivener’s errors or unintentional and inconsequential inaccuracies, shall not be construed as false or misleading information.

2.    A documented pattern of illegal activities has occurred associated with the business either on or off premises.

3.    Business activity has occurred on the premises which is outside the scope of what is allowed by the issued business license when such activity is illegal, could not otherwise be permitted by the City, and/or when such activity has caused or is likely to cause impacts to City infrastructure, life safety, or the environment.

4.    The City has determined that the structure(s) or site associated with the business is unsafe for further business operations or occupancy.

5.    Legal but unpermitted activity associated with the business has not ceased or come into compliance within the deadlines specified by the City.

6.    The business is subject to an enforcement action and/or penalty, and compliance/payment deadlines have not been met.

C.    Should a license be revoked, all business operations on the premises shall immediately cease until such time as the business license is reinstated. The Community Development Director shall inform the Business Licensing Service of any business licenses that have been revoked.

D.    The revocation of a license shall constitute a final administrative determination for the purposes of an appeal. The Community Development Director shall issue the determination in writing and shall include appeal rights. Appeals shall follow the processes outlined in FMC 5.04.060 and 14.11.070.

E.    In those cases when a business license is revoked, necessitating cessation of business activities, the business owner shall be entitled to an expedited appeal hearing pursuant to FMC 1.12.060. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017)

5.04.130 Violation – Penalty.

Every person, firm, partnership, corporation, or other business entity that violates the provisions of this chapter shall be subject to enforcement procedures and civil penalties pursuant to Chapter 1.12 FMC. Revocation of a business license and any associated enforcement and penalties are separate from any criminal prosecution that may occur for criminal violations associated with business and other activities on the premises. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017; Ord. 1899 § 1, 2015; Ord. 516.01 § 516.01.090, 1977. Formerly 5.04.120)

5.04.140 Business owner responsible.

It is the business owner’s responsibility to ensure full compliance with the requirements and conditions of the business license and the regulations of the Ferndale Municipal Code. The failure of any parties to comply with these regulations, including the business owner, any employee of the business, any business customers, or any contractors operating within the business, shall be the responsibility of the business owner. (Ord. 2207 § 3 (Att. 1), 2022; Ord. 2141 § 1 (Exh. 1), 2020; Ord. 2075 § 1 (Exh. 1), 2018; Ord. 2033 § 1 (Exh. 1), 2018; Ord. 1992 § 1 (Exh. 1), 2017)