Second 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          .    prohibits a municipality from transmitting information about certain businesses;
             16          .    provides a repeal date; and
             17          .    makes technical corrections.
             18      Money Appropriated in this Bill:
             19          None
             20      Other Special Clauses:
             21          None
             22      Utah Code Sections Affected:
             23      AMENDS:
             24           10-1-203 , as last amended by Laws of Utah 2012, Chapter 289
             25           63I-1-210 , as renumbered and amended by Laws of Utah 2008, Chapter 382


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


             88      agreement as defined in Subsection 10-1-303 (6) with an energy supplier that is in effect on July
             89      1, 1997, may continue to collect that fee as provided in Subsection 10-1-310 (2).
             90          (d) (i) Subject to the requirements of Subsection (3)(d)(ii), a franchise agreement as
             91      defined in Subsection 10-1-303 (6) between a municipality and an energy supplier may contain
             92      a provision that:
             93          (A) requires the energy supplier by agreement to pay a contractual franchise fee that is
             94      otherwise prohibited under Part 3, Municipal Energy Sales and Use Tax Act; and
             95          (B) imposes the contractual franchise fee on or after the day on which Part 3,
             96      Municipal Energy Sales and Use Tax is:
             97          (I) repealed, invalidated, or the maximum allowable rate provided in Section 10-1-305
             98      is reduced; and
             99          (II) is not superseded by a law imposing a substantially equivalent tax.
             100          (ii) A municipality may not charge a contractual franchise fee under the provisions
             101      permitted by Subsection (3)(b)(i) unless the municipality charges an equal contractual franchise
             102      fee or a tax on all energy suppliers.
             103          (4) (a) Subject to Subsection (4)(b), beginning July 1, 2004, the legislative body of a
             104      municipality may raise revenue by levying and providing for the collection of a municipal
             105      telecommunications license tax as provided in Part 4, Municipal Telecommunications License
             106      Tax Act.
             107          (b) A municipality may not levy or collect a telecommunications tax or fee on a
             108      telecommunications provider except as provided in Part 4, Municipal Telecommunications
             109      License Tax Act.
             110          (5) (a) (i) The legislative body of a municipality may by ordinance raise revenue by
             111      levying and collecting a license fee or tax on:
             112          (A) a parking service business in an amount that is less than or equal to:
             113          (I) $1 per vehicle that parks at the parking service business; or
             114          (II) 2% of the gross receipts of the parking service business;
             115          (B) a public assembly or other related facility in an amount that is less than or equal to
             116      $5 per ticket purchased from the public assembly or other related facility; and
             117          (C) subject to the limitations of Subsections (5)(c) and (d):
             118          (I) a business that causes disproportionate costs of municipal services; or


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


             150          (A) the costs that constitute disproportionate costs; and
             151          (B) the amounts that are reasonably related to the costs of the municipal services
             152      provided by the municipality.
             153          (ii) The amount of a fee under Subsection (5)(a)(i)(C)(I) shall be reasonably related to
             154      the costs of the municipal services provided by the municipality.
             155          (d) (i) Before the legislative body of a municipality imposes a license fee on a
             156      purchaser from a business for which it provides an enhanced level of municipal services under
             157      Subsection (5)(a)(i)(C)(II), the legislative body of the municipality shall adopt an ordinance
             158      defining for purposes of the fee under Subsection (5)(a)(i)(C)(II):
             159          (A) the level of municipal services that constitutes the basic level of municipal services
             160      in the municipality; and
             161          (B) the amounts that are reasonably related to the costs of providing an enhanced level
             162      of municipal services in the municipality.
             163          (ii) The amount of a fee under Subsection (5)(a)(i)(C)(II) shall be reasonably related to
             164      the costs of providing an enhanced level of the municipal services.
             165          (6) All license fees and taxes shall be uniform in respect to the class upon which they
             166      are imposed.
             167          (7) The municipality:
             168          (a) shall transmit the information from each approved business license application to
             169      the county assessor within 60 days following the approval of the application[.]; and
             170          (b) may not transmit to the county or other government entity any information
             171      regarding a business that is not required to be licensed.
             172          (8) If challenged in court, an ordinance enacted by a municipality before January 1,
             173      1994, imposing a business license fee on rental dwellings under this section shall be upheld
             174      unless the business license fee is found to impose an unreasonable burden on the fee payer.
             175          Section 2. Section 63I-1-210 is amended to read:
             176           63I-1-210. Repeal dates, Title 10.
             177          Subsections 10-2-203 (1)(a)(ii), (b), (c), (d), (e), (f), (g), and (2)(b) are repealed July 1,
             178      2016.


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