The Payson Town Council thought hard — but then refused to give the vendors at the upcoming classic car show a break on their business license fees.
The split decision represents the latest town toughening on assorted fees, as its budget woes linger.
Backers of the Beeline Cruise-In Classic Car Show said no one told them about the $25 per-vendor charge for a temporary business license before they sent out notices to about 25 businesses that want to operate booths at the show, which normally brings thousands of spectators to Green Valley Park to gawk at meticulously restored classic cars.
Without a waiver, the club that sponsors the car show will have to absorb the $600 to $650 in fees that would otherwise go to local charities, said organizers.
“We were not notified of these new fees in October before we sent out our packets,” said one of the organizers, pleading for a break on the fees this year.
Last year, the council voted to establish a three-day business license fee of $25 for out-of-town businesses who wanted to operate during special events. A regular business license costs $90 annually, but many vendors at weekend special events neither bought businesses licenses nor reported sales to the state or the town. As a result, the town often did not collect even its normal 2 percent sales tax on sales by these temporary vendors.
Moreover, many local businesses that pay the annual business license fee and report their sales complained of competition from out-of-town businesses who didn’t abide by the rules.
The temporary fee did not affect local businesses whose annual fee would cover anything they sold at a special event booth nor charities and service clubs, which often raise money by setting up food booths at special events.
As a result, the town established the $25 fee for a temporary business license, which would also ensure that the temporary businesses reported their sales and paid their share of the sales tax.
The $25 temporary license therefore represents a big reduction from the old rules, which technically required all those temporary vendors to get a regular business license before setting up their booths.
“So we reduce the fees from $90 to $25 and they still want them waived?” asked Payson Mayor Kenny Evans.
“We did that to make sure these vendors take care of the sales tax,” added Councilor John Wilson, a retired Internal Revenue Service auditor.
However, the organizers said that last year they don’t know whether any of the vendors got a business license, since the organizers didn’t know they were supposed to do so.
Last year, the organizers said, the event cleared $12,500, which they donated to local charities — including $1,000 to each of several local food banks.
“We put heads on beds and customers in restaurants, so we ask for your consideration. We promise you we’ll leave the park better than we found it,” said one car show organizer.
“This is not a new fee,” said Town Manager Debra Galbraith. “They should have been paying the higher fees last year. We assumed they were following the law and getting a business license. It appears their vendors were not getting licenses in the past.”
The organizers said they charge each vendor $90 for a booth, but that helps cover the cost of putting on the car show —not the $25 business license fee. “We’ll have to absorb the fee,” thereby reducing the amount given to charity, said the organizer.
Councilman Ed Blair then moved to waive the fee, “given that there was not complete communication.”
That move failed on a 6-1 vote.
Councilor Fred Carpenter then moved to waive half the fee, charging each vendor just $12.50.
That motion failed on a 5-2 vote, with Blair and Carpenter voting to give the vendors a break and Evans, Wilson, Su Connell, Richard Croy and Michael Hughes voting against even a partial waiver.
Evans then asked the town attorney if the council needed another vote to deny the request. “Is the defeat of a motion a positive negative?” asked Evans.
Town Attorney Tim Wright blinked, pondered the question, then said the council could effectively deny the request for a waiver by taking no action.
Which is exactly what the councilors did.