City officials are reviving a controversial business license fee discussion, with plans to adopt a new fee structure as soon as May.
Medford City Council considered increasing fees for some and reducing them for others during its study session Thursday. The fee has drawn fire from out-of-town entrepreneurs who must pay the fee to conduct business in Medford.
"Currently we have 6,700 issued licenses," said Alison Chan, finance director for the city. She said of those, 4,900 are inside the city and 1,800 are outside. The fee, $81 per business, generates $550,000 annually for Medford. She asked if the council wanted to eliminate the license requirement for out-of-town businesses who do work inside the city.
City Manager Mike Dyal said eliminating such fees could encourage Medford businesses to move out of town.
The council asked Chan to come back with two proposals: one would bump commercial license fees up to $100 and drop home occupational fees to $50 and secondary licenses for independent contractors (such as beauticians) to $50. Chan said such a change would result in an estimated loss of $125,000 annually. The council requested a second scenario, beyond a $100 commercial fee, that would maintain the $550,000 annual income.
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"I'd like to add a per-employee charge to make up for some of the hit," he said.
In December, the council considered a new fee structure for commercial business license fees that ranged from $100 for 1 to 10 employees to a $1,000 cap for more than 50 employees. The fee would have replaced the current $81 basic fee, and would have generated about $150,000 monthly. Following strong opposition from the Chamber of Medford/Jackson County, the council set aside the increase.
Then the finance department began stiffer enforcement of payment for those outside of the city who do business within the city. The department received public criticism after it began enforcing the license requirement for self-employed small-business owners, such as freelance photographers, outside of Medford.
Even the Legislature weighed in with House Bill 2541 at the request of the Oregon Association of Realtors, which would exempt real-estate agents and brokers from paying business license fees in communities where they do not have a physical office. Rep. Sal Esquivel, R-Medford, a Medford real estate agent, says he will seek to extend the exclusion to other state-licensed practitioners as well.
The city recently put a halt on enforcing the fee on out-of-town businesses, Chan said Thursday.
Councilman Bob Strosser, himself a Medford real estate agent, said he did not want the city to be going after out-of-towners so aggressively.
Chan said the city attorney's office has also recently redefined what qualifies as a business. Having a business lunch in the city does not count as "doing business," but delivering a product and taking money does, she said.
The last change to the business license fee was when it was bumped from $77 to $81 in 2005.
No date has been set for a public hearing on the license fee change.
Reach reporter Meg Landers at 776-4481 or e-mail mlanders@mailtribune.com.
