BERLIN – A decision to increase the town’s business license fee was delayed so officials can explore the possibility of basing the annual fee on location.
The Berlin Town Council on Monday voted unanimously to table a decision regarding the town’s business license fee, which has been proposed to double, following comments by Councilman Dean Burrell, who has served on the council since 1994. Burrell suggested the town charge businesses different license fee amounts based on their location in Berlin.
“In my opinion, the fees should be different for a business in that Main Street corridor as it relates to a business over on Branch Street or over on Old Ocean City Boulevard,” Burrell said.
Ivy Wells, the town’s economic and community development director, said that during budget development the idea of increasing the town’s business fee had been recommended. The fee, which is currently $75, has not been changed since it was first implemented in 2009. The proposal included in the fiscal year 2024 budget is to double it this year. Mayor Zack Tyndall said fees were meant to cover the town’s costs associated with a service.
“The town’s costs since 2009 have changed,” he said. “The recommendation to increase the fees was made through the budgeting process.”
Burrell asked what costs the business license fee covered. Wells said she worked with business owners, as did the planning department and the finance department.
“Each one of those departments that touches has salary costs and other costs associated,” Tyndall said.
The mayor added that the town’s business license fee, even if doubled, was still low compared to other places.
Burrell asked if the town could create a special fee area. He essentially believes businesses in the Main Street area should have a higher license fee than those elsewhere.
“Based on what has been described, I think that a business on Flower Street, a business on Bay Street, does not receive the same level of services as a business downtown,” he said.
Burrell said he felt downtown businesses benefitted more by Wells’ time, for example, than a business on Flower Street did.
Wells noted that when considering downtown events, those were typically sponsored by downtown businesses.
“I understand that,” Burrell said, “but my reference is the equitable delivery of town services as it relates to businesses throughout the town. I’m under the impression that Main Street, they receive greater service.”
Town attorney David Gaskill said the fee was meant to cover the cost of generating the license. He said that wouldn’t cost any more no matter where the business was located.
Councilman Jay Knerr said other jurisdictions charged business license fees based on the type of business or the square footage of the business.
“You pay different rates,” he said.
Wells said she and the town’s finance director had tried to categorize town businesses last year and hadn’t been successful because there were so many unique businesses in Berlin.
Councilwoman Shaneka Nichols said the categorization process as suggested by Burrell would simply be location.
Town Administrator Mary Bohlen said town staff could contact state officials to see if there were any problems with a location-based fee.
“Let us explore it and find out what the possibilities are,” she said, adding that changes would need to be made soon, prior to the next business license billing cycle.
The council voted unanimously to table the fee decision while staff research the issue.
“We’ll put this on our next agenda,” Tyndall said.