Chapter 5.04
BUSINESS LICENSES GENERALLY

Sections:

5.04.010    Purpose.

5.04.020    Definitions.

5.04.030    Business license required.

5.04.040    License – Expiration date.

5.04.050    License – Application – Contents – Issuance.

5.04.060    Separate licenses required – Nontransferable.

5.04.070    License – Fee provisions.

5.04.080    Persons exempt from payment – Business license.

5.04.090    License to be procured when – Delinquency charge.

5.04.100    Collection of licenses authorized by city.

5.04.110    Recordkeeping – City authority.

5.04.120    Responsibility of nonresidents.

5.04.130    Denial – Suspension – Revocation of license.

5.04.140    Appeal procedure.

5.04.150    Violations – Penalties.

5.04.160    Disclaimer of city liability.

5.04.010 Purpose.

The provisions of this chapter are an exercise of the city’s power to license for revenue and of the city’s police power. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 1, 1981)

5.04.020 Definitions.

In construing the provisions of this chapter, except when otherwise declared or clearly apparent from the context, the following definitions apply:

A. “Business” includes all services and activities engaged in with the object of gain, benefit or advantage to the licensee or to another person or class, directly or indirectly, whether part-time or full-time, except those businesses subject to the city’s utilities tax.

B. Engage/Engaging in Business.

1. The term “engaging in business activities” means commencing, conducting, or continuing in business, exercising corporate or franchise powers, and liquidating a business when the liquidators thereof hold themselves out to the public as conducting such business.

2. The city expressly intends that “engaging in business” includes 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.

C. “Person,” used interchangeably in this chapter, means any individual, receiver, assignee, trustee in bankruptcy, trust, estate, firm, co-partnership, joint venture, club, company, joint stock company, business trust, corporation, association, society or any group of individuals acting as a unit, whether mutual, cooperative, fraternal, nonprofit, or otherwise.

D. “Premises” means all lands, structures and places, and the location at which the business activity occurs, and which location is owned, leased, rented or occupied by the person or persons engaging in the business activity, and/or their agents, managers or employees. “Premises” of a business includes any offices, warehouses, storage rooms or other facilities upon or at which any part of the activity of the business occurs.

E. “Threshold exemption” is an exemption from the requirement to obtain a business license that is available to persons who do not maintain a place of business within the city and whose annual value of products, gross proceeds of sales or gross income from engaging in business within the city does not exceed $2,000. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 2, 1981)

5.04.030 Business license required.

A. Unless determined by the city to be exempt under SMC 5.04.080, it is unlawful for any person to conduct, operate, engage in or practice any business in the city without having first obtained a business license to do business in the city of Sequim. If an activity is not listed, whether it constitutes engaging in business in the city will be determined by the city after considering all the facts, circumstances, and applicable law.

B. Without being all-inclusive, 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. The activities listed in this section are illustrative only and are not intended to narrow the definition of “engaging in business” as defined in this chapter.

1. Rendering professional services such as those provided by accountants, architects, attorneys, auctioneers, consultants, engineers, professional athletes, barbers, baseball clubs and other sports organizations, chemists, psychologists, court reporters, dentists, doctors, detectives, laboratory operators, teachers, veterinarians.

2. All other businesses, including individually owned and operated part-time, home-owned, or domestic.

3. Mobile home parks, trailer courts and campgrounds.

4. Commercial rentals of premises exceeding 3,000 square feet. All premises rented from the person acting as lessor or landlord are deemed within the business activity of renting and the gross floor area of such rentals is totaled in determining applicability under this chapter.

5. Rentals of five or more residential dwelling units. All premises rented from the person acting as lessor or landlord are deemed within the business activity of renting and all dwelling units of such rentals are totaled in determining applicability under this chapter.

6. Businesses located outside the corporate limits of the city and making retail sales and sales and deliveries within the city on a continuing basis whose annual value of products, gross proceeds of sale or gross income from business conducted within the city exceeds the amount of the threshold exemption.

7. Businesses located outside the corporate limits of the city engaged in the sale of services within the corporate limits of the city on a continuing basis whose annual value of products, gross proceeds of sale or gross income from business conducted within the city exceeds the amount of the threshold exemption.

C. Businesses operated at one location comprised of a combination of business activities under one ownership are required to have only one license. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 2005-029 § 2; Ord. 429 §§ 3 – 6, 1981. Formerly 5.04.030, 5.04.040, 5.04.050, 5.04.060)

5.04.040 License – Expiration date.

Unless otherwise provided by this chapter, all licenses expire on the date established by the Master License Service. Business license renewals must be accomplished each year through the Master License Service. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 7, 1981. Formerly 5.04.070)

5.04.050 License – Application – Contents – Issuance.

A. Application for license is accomplished by filing an application and paying all applicable fees through the Washington State Master Licensing Service (MLS).

B. Businesses must have an approved city of Sequim business license prior to starting business in the city unless they have been determined to be exempt from the requirement. See SMC 5.04.080. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 8, 1981. Formerly 5.04.080)

5.04.060 Separate licenses required – Nontransferable.

City business licenses are personal and nontransferable. In cases where business is transacted at two or more separate places by one person within the city, a separate license is required for each place in which business is transacted with the public. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 9, 1981. Formerly 5.04.090)

5.04.070 License – Fee provisions.

The license fee and the tax levied in this chapter are in addition to any license fee or tax imposed or levied under any law or any other city ordinance, except as otherwise expressly provided in this chapter. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 11, 1981. Formerly 5.04.080)

5.04.080 Persons exempt from payment – Business license.

Any person paying a business and occupation tax or license fee under the terms of other city of Sequim ordinances or as listed below is exempt from the payment of any license or tax under this chapter.

A. Additionally, if a person, or its employee, agent, representative, independent contractor, broker or another acting on the person’s behalf, engages only in the following activities in or with the city but the following, it need not register and obtain a business license:

1. Meeting with suppliers of goods and services as a customer.

2. Meeting with government representatives in their official capacity, other than those performing contracting or purchasing functions.

3. 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.

4. Renting tangible or intangible property as a customer when the property is not used in the city.

5. Attending, but not participating in, a “trade show” or “multiple vendor events.”

6. Conducting advertising through the mail.

7. Soliciting sales by phone from a location outside the city.

8. 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 if it engages in no other business activities in the city;

B. All businesses operated not-for-profit are exempt from paying a business license fee upon application and satisfactory proof to the city of said not-for-profit status but may be required to file a nonprofit business license application;

C. Any special events licensed under another ordinance of the city;

D. Any instrumentality of the United States, the state of Washington, or political subdivision thereof;

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;

F. Tax-exempt nonprofit organizations recognized by the state of Washington and the United States government;

G. Nonprofit organizations, clubs, or corporations maintained for organized sports, charity, public school-related activities, or municipal-related activities, including police or fire department reserve organizations;

H. Peddling or delivering newspapers;

I. Minors doing business or operating a business where no other person is employed by the minor, such as babysitting, lawn mowing, car washing, and similar activities;

J. Casual or isolated sales or services made by persons who are not engaged in the ongoing business of selling the type of property involved. “Casual or isolated” is defined as not more than four such sales made during any tax year. Examples include garage sales, yard sales, rummage sales, bake sales, and occasional parties for the sale or distribution of goods.

K. Threshold Exemption. Any person or business:

1. Whose annual value of products, gross proceeds of sales, or gross income from business conducted within the city is equal to or less than $2,000; and

2. Who does not maintain a place of business within the city;

is 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. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 494 § 1, 1986; Ord. 429 § 12, 1981. Formerly 5.04.090)

5.04.090 License to be procured when – Delinquency charge.

In addition to the required annual license, the MLS program may assess and collect a delinquency charge as established by the Master Licensing Services and the Sequim city council. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 2005-029 § 2; Ord. 450 § 2, 1983; Ord. 429 § 13, 1981. Formerly 5.04.100)

5.04.100 Collection of licenses authorized by city.

The licenses required under this chapter and all penalties thereon constitute a debt to the city. Such penalties may be collected by court proceeding in the same manner as any other debt in like amount, in addition to all other existing remedies, and also includes the city’s right to judgment for its costs and reasonable attorney’s fees. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 14, 1981. Formerly 5.04.110)

5.04.110 Recordkeeping – City authority.

The city clerk, or designee, will keep full and accurate records pursuant to retention guidelines. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 15, 1981. Formerly 5.04.120)

5.04.120 Responsibility of nonresidents.

The agents or other representatives of nonresidents who are doing business in the city are personally responsible for the compliance with this chapter of their principals and the businesses they represent. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 18, 1981. Formerly 5.04.130)

5.04.130 Denial – Suspension – Revocation of license.

A. A business license may be denied, suspended, or revoked if any one of the following apply:

1. Fraud, misrepresentation or false statement in the application for license;

2. Any violation of this chapter;

3. The licensee/applicant, or licensee’s/applicant’s employees or agents, have been convicted of a crime or suffered civil judgment or consent decree that bears a direct relationship to the conduct of the business;

4. Conducting the business in an unlawful manner, or in such a manner as to constitute a breach of the peace or to constitute a menace to the public health, safety, or general welfare;

5. The licensee/applicant has failed to comply with any of the provisions of this title, or other applicable state, federal or local law;

6. The licensee/applicant, or licensee’s/applicant’s employees or agents, have engaged in, allowed, or acquiesced in unlawful drug-related or other criminal activity on the business premises;

7. The licensee/applicant, or licensee’s/applicant’s employees or agents, have violated any law or ordinance relating to the regulation of the business licensed pursuant to this chapter, or any health or safety ordinance.

B. The city will provide written notice of the reasons for denial, suspension, or revocation of a license. The notice will be mailed, postage prepaid, to the last known address of applicant or licensee, as applicable. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 20, 1981. Formerly 5.04.140)

5.04.140 Appeal procedure.

A. Appeals for a denial, suspension, or revocation of a license may be made to the city council by filing a written notice of appeal with the city clerk within 20 calendar days from the date of the city’s decision. Appeals must contain all the following:

1. A brief statement setting forth each appellant(s)’ legal interest in the business involved in the denial, suspension, or revocation;

2. A brief statement, in concise language, of the specific order or action protested, together with any material facts claimed to support appellant(s)’ contentions;

3. A brief statement, in concise language, of the relief sought, and the reasons why it is claimed the protested action or decision should be reversed, modified, or otherwise set aside;

4. The signatures and official mailing addresses of all persons named as appellants;

5. Each appellant’s verification (by declaration under penalty of perjury) as to the truth of the matters stated in the appeal.

B. The city clerk will schedule a hearing before the city council to consider the appeal as soon as practicable. Only those matters or issues specifically raised by the appellant(s) in the written notice of appeal will be considered in the hearing. Public testimony will not be considered during the hearing; city staff and appellant(s), including appellant(s)’ agents, may offer relevant evidence and testimony regarding the decision.

C. Notice of the hearing will be provided to the appellant(s) via certified mail at least 10 calendar days before the hearing date.

D. The city council may delay its decision or continue the hearing until the next regular city council meeting as it deems necessary.

E. Enforcement of any suspension or revocation of any business license will be stayed during the pendency of a properly and timely filed appeal.

F. Failure of any aggrieved party to file an appeal in accordance with the provisions of this chapter constitutes a waiver of the right to an appeal and adjudication of the decision.

G. The city council may delegate its authority to hear such denials, suspensions, or revocations to a hearing examiner. (Ord. 2018-011 § 1 (Exh. A))

5.04.150 Violations – Penalties.

A. It is a violation for any person to fail to comply with any provision of this chapter, any other business license regulation, or any terms and conditions of a city business license. Unless a specific penalty is expressly provided for a particular violation, violations of this chapter constitute (1) a civil infraction and/or civil penalty of $250.00 for each offense, or (2) a misdemeanor, punishable by a fine not exceeding $1,000, or imprisonment in jail for any term not exceeding 90 days, or both.

B. In determining which penalty will be used to enforce violations of this chapter, if the offense is of a serious nature, it poses a risk to public safety, the violator has not made good faith efforts to achieve compliance, or there are limited other avenues for effective enforcement, the investigating officer may refer a violation for charging as a misdemeanor.

C. Any person who engages in or carries on any business subject to a tax under this chapter without having the business license so to do will be deemed guilty of a separate violation for each day during which the business is engaged in or carried on; and any person who fails or refuses to pay the license fee or tax or any part thereof on or before the due date will be deemed to be operating without license so to do.

D. Additional Relief. The city may seek legal or equitable relief to enjoin any acts or practices or abate any condition that constitutes or will constitute a violation of the applicable provisions of this chapter when penalties provided here are inadequate to effect compliance. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A); Ord. 429 § 17, 1981. Formerly 5.04.180)

5.04.160 Disclaimer of city liability.

Issuance of any license pursuant to this chapter does not create any duty by the city of Sequim to indemnify a licensee or any city duty to third parties for any wrongful acts against the public by any licensee or their agents, officers or employees, or to guarantee the quality of goods, services, or expertise of a licensee. Nothing in this chapter may be construed to shift responsibility from the licensee to the city of Sequim for proper training, conduct or equipment of self or agents, even if specific regulations require standards of training, conduct or inspection. (Ord. 2018-011 § 1 (Exh. A); Ord. 2015-014 § 1 (Exh. A))