Yorkton Council took a look at the City’s Business License Bylaw at its regular meeting Monday.
The review came from a resolution made at the Aug. 22, meeting directing “Administration to review the Business License Bylaw in regards to the business licenses to out-of-town businesses when their products or services are in direct competition to an established business located within the City of Yorkton; and provide a report back to Council,” detailed material circulated to Council at Monday’s meeting.
The report was asked for in response to concerns from Council, and from local automotive dealers “over out-of-town automotive dealers holding special event sales within the City.” The major concern is that out-of-town dealers do not pay sufficient fees to the City, thus giving them an unfair advantage vs. in-town dealers.
Administration contacted other cities to compare licensing practices and fees, explained Michael Eger Director of Planning, Building & Development with the City at Monday’s meeting. He said cities share a number of common concerns including;
• A significant portion of businesses will avoid licensing due to cost and perceived hassle.
• Businesses often view Business Licenses as an extra, hidden tax.
• Increased fees should coincide with increased revenues, but increased non-compliance typically reduces number of licensed businesses which in turn offsets potential revenue gains.
• Non-compliance strains enforcement resources, which are already limited - Ultimately, better enforcement mechanisms are needed.
• It is difficult to determine what costs are borne by the municipality to administer a business license, which makes it difficult to arrive at a reasonable and fair fee structure.
• Local businesses often express concerns that out-of-town businesses should be charged higher rates so as to offset perceived advantages
In regards to out-of-town auto dealers, Eger noted they pay $100 for a Transient Trader license, which is valid for up to one week. He added, for a recent car sales event at the Gallagher Centre, the business was charged a $100 fee for a Transient Trader license and $300 per day for partial use of the parking lot. Other businesses have rented the Ag Pavilion, which ranges from $1025 per day to $5,381.25 per week. While the parking lot rental fees are lower, the fees for one week’s rental of the Ag Pavilion are roughly equivalent to the annual taxes charged to a small car dealership.
In terms of business license fees, Eger said the City has limited ability to raise fees. The Cities Act states that license fees must not exceed the cost to the City of administering and enforcing the license activity.
“Additionally, the City cannot legally prohibit or artificially restrict non-resident business,” he said.
Furthermore Eger said a full review of options would take time.
“Because of legislative constraints surrounding licensing fees, a more thorough internal cost analysis will be required before fees can be adjusted. Additionally, other issues are present with the current Bylaw and it is likely that a full review and update are required to efficiently and fairly administer the City’s business license system. Due to decreases in staffing levels, this review will fall under the duties of the Director of Planning, Building & Development, and other projects, such as the Yorkton Regional Planning District – District Plan and the City of Yorkton Zoning Bylaw and Sign Bylaw have been identified as higher priority items. As such, the full Business License Bylaw review would be deferred until a later date,” he said.
Council did move to file the report, but not before directing Administration to bring another report to Council looking at additional options regarding increases fees faced by out-of-town businesses doing business in Yorkton.
