Mayor Bach Reluctantly Vetoes Ordinances
Wednesday, July 09, 2014
COLORADO SPRINGS, Colo.— Mayor Steve Bach announced today that he has reluctantly vetoed City Council’s new ordinances to end most licensing fees for businesses within the City of Colorado Springs.
“I would very much like to support reducing or eliminating business licensing fees as well as City business personal property taxes,” said Mayor Bach. “Our goal is to be the most business-friendly city of our size in the country. However, these ordinances add to our budget deficit and are a piecemeal approach to a larger question. Therefore, I just cannot support them.”
City Council decided yesterday, on a narrow 5-4 split vote on second reading, to enact the new ordinances. The Council’s decision would eliminate fees but still require that businesses obtain and maintain their City licenses. Lost annual revenue from these ordinances in 2015 would be approximately $400,000. The City Clerk’s Office would continue to incur administrative oversight expenses with no license fee revenues to offset the cost.
Mayor Bach pointed out that eliminating the licensing fees while maintaining the licensing requirement would unfairly shift the City’s administrative cost burden from the businesses being licensed to taxpayers. He also questioned why the City would not concurrently eliminate those licenses where fees are waived.
“Once the City Clerk completes her long-planned and announced analysis of policies and practices and presents her findings to City Council and me in September, we need to have a thoughtful, holistic conversation on the best licensing solution,” he said.
The lost $400,000 in licensing fee revenue would be added to the City’s increased cost to water its parks ($1.65M annually) and lost City sales tax due to a retail developer pulling big box retailers just outside of Colorado Springs ($2M annually). Not including the lost licensing fee revenue, the City is already looking at a 2015 budget gap of more than $4.5M before tough funding decisions are made by the Mayor.
City Clerk Sarah Johnson said, “Business licensing fees are one piece of the puzzle that a business will study when choosing a location. It is vitally important to review all elements of business licensing, including whether the license is appropriate, innovative ways to simplify the process, “best practices” from successful cities elsewhere. These details will be included in my comprehensive review to be presented to City Council and Mayor Bach in September.”
City Council approved the new ordinances on June 24 on first reading, and Tuesday, July 8 on second reading, to end City business licensing fees with the exception of liquor, adult-oriented businesses and medical marijuana.
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