First Substitute H.B. 258

Representative Jacob L. Anderegg proposes the following substitute bill:

1 MUNICIPAL BUSINESS LICENSING AMENDMENTS
2 2014 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Jacob L. Anderegg
5 Senate Sponsor: ____________
6
7 LONG TITLE
8 General Description:
9 This bill amends provisions related to the authority of a municipality to license a
10 business.
11 Highlighted Provisions:
12 This bill:
13 . amends provisions authorizing a municipality to license a business;
14 . prohibits a municipality from requiring a license for certain businesses;
15 . authorizes a municipality to require certain businesses that are exempt from
16 licensure to register with the municipality;
17 . prohibits a municipality from transmitting information about certain businesses; and
18 . makes technical corrections.
19 Money Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 None
23 Utah Code Sections Affected:
24 AMENDS:
25 10-1-203 , as last amended by Laws of Utah 2012, Chapter 289

26
27 Be it enacted by the Legislature of the state of Utah:
28 Section 1. Section 10-1-203 is amended to read:
29 10-1-203. License fees and taxes -- Application information to be transmitted to
30 the county assessor.
31 (1) As used in this section:
32 (a) (i) "Business" means any enterprise carried on for the purpose of gain or economic
33 profit, except that the acts of employees rendering services to employers are not included in
34 this definition.
35 (ii) "Business" does not include a nonprofit corporation as defined in Section
36 16-6a-102 .
37 (b) (i) "Commercial breeder" means a person who for a fee or other consideration:
38 (A) maintains in a kennel at any time six or more dogs for breeding or six or more cats
39 for breeding and sells, leases, trades, barters, auctions, or provides to another person the
40 offspring of those dogs or cats; or
41 (B) buys, sells, leases, trades, barters, or provides to another person a dog or cat at
42 wholesale for resale to another.
43 (ii) "Commercial breeder" does not include:
44 (A) an animal shelter as defined in Section 11-46-102 ; or
45 (B) a person with five or fewer unsterilized dogs over six months old or five or fewer
46 unsterilized cats over six months old.
47 (c) "Kennel" means a facility where a commercial breeder keeps, houses, and maintains
48 dogs or cats.
49 (d) "Mechanic business" means a business that constructs, repairs, adjusts, inspects, or
50 overhauls a motor vehicle or off-highway vehicle.
51 (e) "Motor vehicle" means a self-propelled vehicle intended primarily for use and
52 operation on the highways.
53 (f) "Off-highway vehicle" is as defined in Section 41-22-2 .
54 (g) "Residence" means a person's principal place of abode within Utah.
55 [(b)] (h) "Telecommunications provider" is as defined in Section 10-1-402 .
56 [(c)] (i) "Telecommunications tax or fee" is as defined in Section 10-1-402 .

57 (2) (a) Except as provided in Subsections (2)(b) and (3) through (5), the legislative
58 body of a municipality may license for the purpose of regulation [and revenue] any business
59 within the limits of the municipality and may regulate that business by ordinance.
60 (b) A municipality may not require a license for a business if the business:
61 (i) is primarily conducted at the residence of the owner of the business;
62 (ii) receives customers at the business owner's residence only to the extent that:
63 (A) the number of customer motor vehicles present at any one time does not
64 significantly disrupt the flow of traffic; and
65 (B) the number of customers present at any one time in the residence or on the
66 residence property does not significantly interrupt an owner's enjoyment and use of the owner's
67 property that is immediately adjacent to the residence where the business is conducted;
68 (iii) does not employ employees or contract with independent contractors who work in
69 the business owner's residence;
70 (iv) does not involve a hazardous occupation as defined in Section 34-23-103 ; and
71 (v) is not a kennel or mechanic business.
72 (c) (i) A municipality may require a business that is exempt from licensure under
73 Subsection (2)(b) to register with the municipality.
74 (ii) Notwithstanding Subsection (2)(c)(i), a municipality may not impose a registration
75 fee or penalty for failure to register.
76 (3) (a) The legislative body of a municipality may raise revenue by levying and
77 collecting a municipal energy sales or use tax as provided in Part 3, Municipal Energy Sales
78 and Use Tax Act, except a municipality may not levy or collect a franchise tax or fee on an
79 energy supplier other than the municipal energy sales and use tax provided in Part 3, Municipal
80 Energy Sales and Use Tax Act.
81 (b) (i) Subsection (3)(a) does not affect the validity of a franchise agreement as defined
82 in Subsection 10-1-303 (6), that is in effect on July 1, 1997, or a future franchise.
83 (ii) A franchise agreement as defined in Subsection 10-1-303 (6) in effect on January 1,
84 1997, or a future franchise shall remain in full force and effect.
85 (c) A municipality that collects a contractual franchise fee pursuant to a franchise
86 agreement as defined in Subsection 10-1-303 (6) with an energy supplier that is in effect on July
87 1, 1997, may continue to collect that fee as provided in Subsection 10-1-310 (2).

88 (d) (i) Subject to the requirements of Subsection (3)(d)(ii), a franchise agreement as
89 defined in Subsection 10-1-303 (6) between a municipality and an energy supplier may contain
90 a provision that:
91 (A) requires the energy supplier by agreement to pay a contractual franchise fee that is
92 otherwise prohibited under Part 3, Municipal Energy Sales and Use Tax Act; and
93 (B) imposes the contractual franchise fee on or after the day on which Part 3,
94 Municipal Energy Sales and Use Tax is:
95 (I) repealed, invalidated, or the maximum allowable rate provided in Section 10-1-305
96 is reduced; and
97 (II) is not superseded by a law imposing a substantially equivalent tax.
98 (ii) A municipality may not charge a contractual franchise fee under the provisions
99 permitted by Subsection (3)(b)(i) unless the municipality charges an equal contractual franchise
100 fee or a tax on all energy suppliers.
101 (4) (a) Subject to Subsection (4)(b), beginning July 1, 2004, the legislative body of a
102 municipality may raise revenue by levying and providing for the collection of a municipal
103 telecommunications license tax as provided in Part 4, Municipal Telecommunications License
104 Tax Act.
105 (b) A municipality may not levy or collect a telecommunications tax or fee on a
106 telecommunications provider except as provided in Part 4, Municipal Telecommunications
107 License Tax Act.
108 (5) (a) (i) The legislative body of a municipality may by ordinance raise revenue by
109 levying and collecting a license fee or tax on:
110 (A) a parking service business in an amount that is less than or equal to:
111 (I) $1 per vehicle that parks at the parking service business; or
112 (II) 2% of the gross receipts of the parking service business;
113 (B) a public assembly or other related facility in an amount that is less than or equal to
114 $5 per ticket purchased from the public assembly or other related facility; and
115 (C) subject to the limitations of Subsections (5)(c) and (d):
116 (I) a business that causes disproportionate costs of municipal services; or
117 (II) a purchaser from a business for which the municipality provides an enhanced level
118 of municipal services.

119 (ii) Nothing in this Subsection (5)(a) may be construed to authorize a municipality to
120 levy or collect a license fee or tax on a public assembly or other related facility owned and
121 operated by another political subdivision other than a community development and renewal
122 agency without the written consent of the other political subdivision.
123 (b) As used in this Subsection (5):
124 (i) "Municipal services" includes:
125 (A) public utilities; and
126 (B) services for:
127 (I) police;
128 (II) fire;
129 (III) storm water runoff;
130 (IV) traffic control;
131 (V) parking;
132 (VI) transportation;
133 (VII) beautification; or
134 (VIII) snow removal.
135 (ii) "Parking service business" means a business:
136 (A) that primarily provides off-street parking services for a public facility that is
137 wholly or partially funded by public money;
138 (B) that provides parking for one or more vehicles; and
139 (C) that charges a fee for parking.
140 (iii) "Public assembly or other related facility" means an assembly facility that:
141 (A) is wholly or partially funded by public money;
142 (B) is operated by a business; and
143 (C) requires a person attending an event at the assembly facility to purchase a ticket.
144 (c) (i) Before the legislative body of a municipality imposes a license fee on a business
145 that causes disproportionate costs of municipal services under Subsection (5)(a)(i)(C)(I), the
146 legislative body of the municipality shall adopt an ordinance defining for purposes of the tax
147 under Subsection (5)(a)(i)(C)(I):
148 (A) the costs that constitute disproportionate costs; and
149 (B) the amounts that are reasonably related to the costs of the municipal services

150 provided by the municipality.
151 (ii) The amount of a fee under Subsection (5)(a)(i)(C)(I) shall be reasonably related to
152 the costs of the municipal services provided by the municipality.
153 (d) (i) Before the legislative body of a municipality imposes a license fee on a
154 purchaser from a business for which it provides an enhanced level of municipal services under
155 Subsection (5)(a)(i)(C)(II), the legislative body of the municipality shall adopt an ordinance
156 defining for purposes of the fee under Subsection (5)(a)(i)(C)(II):
157 (A) the level of municipal services that constitutes the basic level of municipal services
158 in the municipality; and
159 (B) the amounts that are reasonably related to the costs of providing an enhanced level
160 of municipal services in the municipality.
161 (ii) The amount of a fee under Subsection (5)(a)(i)(C)(II) shall be reasonably related to
162 the costs of providing an enhanced level of the municipal services.
163 (6) All license fees and taxes shall be uniform in respect to the class upon which they
164 are imposed.
165 (7) The municipality:
166 (a) shall transmit the information from each approved business license application to
167 the county assessor within 60 days following the approval of the application[.]; and
168 (b) may not transmit to the county or other government entity any information
169 regarding a business that is not required to be licensed, including information that is obtained
170 through a registration described in Subsection (2)(c)(i).
171 (8) If challenged in court, an ordinance enacted by a municipality before January 1,
172 1994, imposing a business license fee on rental dwellings under this section shall be upheld
173 unless the business license fee is found to impose an unreasonable burden on the fee payer.