BERLIN – Berlin officials agreed to waive business license fees for contractors hired by the town.
On Monday, the Berlin Town Council voted 4-1, with Councilman Dean Burrell opposed, to, refrain from charging business license fees to companies working directly for the town.
“There would not be any sense in charging them the license fee because they would simply pass that cost back to the town,” Town Administrator Mary Bohlen said.
Last month, the council updated the code to give the town the ability to charge business license fees to any businesses that operated in town, not just those with physical locations in Berlin. Bohlen told the council this week that as a follow-up to that ordinance, she was asking the council to waive those fees for contractors who worked for the town.
“This was an oversight on my part,” she said.
Bohlen said that the town hired contractors throughout the year and under the new ordinance, those companies would have to pay the business license fee to do work in Berlin. Because the fee is typically passed on to the customer, Bohlen said the companies would charge the town for the cost. As a result she said she was asking the council to waive that fee when companies were hired directly by the town.
“This would provide us with the ability to waive the fee in those cases, for outside contractors hired for town projects,” she said. “However, if those contractors do work for other customers within the town, they would need to pay the fee.”
Burrell said he wasn’t comfortable with the idea.
“If the cost is going to be passed on to the public, it needs to be handled the same way for the town,” he said.
Bohlen said what was proposed was similar to the way the town would handle a building permit, as it would not charge itself. She added that if the contractor did work for anyone else in Berlin, they would then have to pay the business license fee.
“The town is not issuing them a free license to work here,” said David Gaskill, the town’s attorney.
The council voted 4-1, with Burrell opposed, to approve waiving the fee. When Councilman Steve Green asked how the fee in general was being received, Planning Director Dave Engelhart said numerous contractors had already paid. Engelhart said his office had emailed contractors alerting them of the need for a business license prior to the July 1 effective date.
“They’re used to it,” Engelhart said. “We got a lot of them. Our regular home improvement guys that we see all the time, same thing. We didn’t have a complaint from anybody. For the region, it’s common.”