ORD NO. 2018-35 AMENDING BIMC 5.04 BUSINESS LICENSE CODEORDINANCE NO. 2018-35
AN ORDINANCE of the City of Bainbridge Island, Washington, relating to
business licenses and amending Chapter 5.04 of the Bainbridge Island Municipal
Code (BIMC) to adopt mandatory provisions required under Chapter 35.90 RCW.
WHEREAS, Engrossed House Bill (EHB) 2005 was passed by the Washington State
Legislature with an effective date of July 23, 2017; and
WHEREAS, EHB 2005 is intended to simplify the administration of municipal general
business licenses for the applicants and improve the business climate; and
WHEREAS, the sections of EHB 2005 related to business licenses were codified as
Chapter 35.90 RCW; and
WHEREAS, RCW 35.90.080 directed the Association of Washington Cities (AWC) to
develop a model ordinance on general business license requirements by July 1, 2018; and
WHEREAS, RCW 35.90.080 and RCW 35.90.090 require all cities that impose a
general business license requirement to adopt certain mandatory provisions of AWC's model
ordinance by January 1, 2019; and
WHEREAS, the City of Bainbridge Island, through Chapter 5.04 BIMC, imposes a
general business license requirement on certain businesses; and
WHEREAS, the City of Bainbridge Island administers its business licensing through
Washington State's Business Licensing Service; and
WHEREAS, due to the requirements of RCW 35.90.070, the City must adopt the
mandatory provisions of AWC's model ordinance by October 17, 2018, in order for them to be
in effect on January 1, 2019.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF BAINBRIDGE
ISLAND, WASHINGTON, DOES ORDAIN AS FOLLOWS:
Section 1. Section 5.04.020 of the Bainbridge Island Municipal Code is hereby amended
to read as follows:
5.04.020 Definitions and presumption.
A. This chapter incorporates by reference all definitions set forth in Chapter 82.04 RCW,
hereafter amended, except where a conflicting definition is stated in this chapter.
B. "Director" means the director of finance and administrative services for the city.
C. "Business Licensing Service" or "BLS" is the office within the Washington State
Department of Revenue providing business licensing services to the city.
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D. engaging in business is defined as follows:
wMin the city or using either a business telephene number- or- biisiness address withi
eity shall be presumed to be engagedd in business within the eity.
1. The term "engaging in business" means 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 ublic as conducting such business.
2. This section sets forth examples of activities that constitute_ engaging in.
business in the cily 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 p4y 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 (1). 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, any one of the following activities conducted
within the city by a person, or its employee, agent, representative, inde endent
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, entin leasing, easing, maintaining, or having the right to use, or
using, tangible personal property, intangible personal property, or real
proper l2ennanently or temporarily located in the city.
b. Owninp, renting, leasing, usin or maintaining,an office lace of
business or other establishment in the cijy.
c. Soliciting sales.
d Making repairs or providing_ maintenance or service to real or tangible
personal property, including warranly work and property maintenance.
e Providing 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,
f Installing, constructing, or supervising installation or construction of,
real or tangible personal Rroperty,
g. Soliciting, negotiating, or gpproving approvingfranchise license or other similar
agreements.
h. Collecting current or delinquent accounts.
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i. Picking up and transporting tangible personalrrooperty, solid waste,
construction debris or excavated materials.
i. Providing disinfecting and gest control services, employment and labor
pool services, home nursing care, janitorial services, appraising,_landscape
architectural services, security system services, surveying, and real estate
services including the listing of homes and managing real property_
k. Rendering professional services such as those provided by accountants
architects, attorneys, auctioneers, consultants, engineers, professional
athletes, barbers, baseball clubs and other sports organizations, chemists,
consultants, psycholoizists, court reporters, dentists doctors detectives
laboratory operators. teachers veterinarians.
1. Meeting with customers or potential customers, even when no sales or
orders are solicited at the meetin s.
m. Training or recruiting agents, re resentatives independent contractors
brokers or others, domiciled or operating on a job in the city, acting on its
behalf, or for customers or potential customers.
n. Investigating, resolving, or otherwise assistinginresolving customer
complaints.
o. In-store stockingor mgWpulatingproducts or goods, sold to and owned
by a customer, regardless of where sale and delivery of the goods took
place.
R. Delivering 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,
other than those performing contracting or purchasing functions.
c. Attending meetings, such as board meetings, retreats, seminars, and
conferences, or other meetings wherein the person does not provide
training in connection with tangiblepersonal�roperty sold by the person
or on its behalf. This provision does not apply to any board of director
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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 when the property
is not used in the city.
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..
a. 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 (44.
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.
Section 2. Section 5.04.090 of the Bainbridge Island Municipal Code is hereby amended
to read as follows:
5.04.090 Payment of license fees.
A. There shall be a license fee imposed for the privilege of doing business as set by
resolution of the city council.
B. Payment of the fee imposed by this chapter shall be due on or before the
commencement of business and for renewal of the license on or before the expiration date
of the license.
C. On or before the due date, every person required to pay a license fee or a tax as set
forth by this chapter shall file a license renewal with the Business Licensing Service, or,
for taxes, a written return with the city upon such form and including such information as
the director shall require, together with the payment of the amount of the tax.
A Nonprofit activities carried on by religious, charitable, educational, benevolent,
fraternal, or social organizations which have been determined by the Internal Revenue
Service of the United States to be exempt from the payment of income tax shall be
exempt from the license fee.
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E. 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 shall be exemt
from the license fee.
Section 3. In accordance with RCW 35.90.070, this ordinance shall take effect and be in
force on January 1, 2019.
PASSED by the City Council this 25th day of September, 2018.
APPROVED by the Mayor this 25th day of September, 2018.
Kol Medina, Mayor
ATTEST/AUTHENTICATE:
FILED WITH THE CITY CLERK September 7, 2018
PASSED BY THE CITY COUNCIL September 25, 2018
PUBLISHED: September 28, 2018
EFFECTIVE DATE: January 1, 2019
ORDINANCE NO: 2018-35
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