Star Valley decided to keep a $50 business license fee and also devise an economic development plan to kick-start local businesses at a meeting last week.
Council members worried that eliminating the existing fee would make it easy for someone to set up shop, sell whatever they wanted and perhaps undercut established businesses.
“I think what we are doing is opening the town up to become the largest park-and-swap in northern Arizona and I don’t want to be a part of that,” said Mayor Bill Rappaport.
Councilor George Binney last month suggested the town do away with the fee. Conceding the fee is minimal, Binney, a small-business owner, said he was outraged by the idea of imposing that fee on the very businesses whose sales taxes support the town.
“It is absolutely ridiculous the extortion that goes on in this country,” he said.
“I think if we are going to prove that we are business-friendly, that we don’t do away with the business license, we do away with the cost.”
But the majority of the council disagreed. While all said they support local businesses, most felt eliminating the license fee would actually hurt businesses.
“It protects us from Joe Blow coming in and selling something on the corner and then leaving town,” said Councilor Barbara Hartwell.
Binney said people already do that. Eliminating the fee, but not the license, would still require business owners to register with town hall and collect sales tax, he said.
Councilor Vern Leis said that removal of the fee would encourage unwanted businesses in the area.
“I think that by doing this it actually tells businesses that have been here that we are being unfriendly to them by not supporting them and opening the doors to every Tom, Dick and Harry that wants to come in and do business with no control or identification over them,” he said.
Leis suggested the town find another way to help local businesses — from taking out small ads in the Roundup to creating a business program.
Councilor Paty Henderson agreed that the town needed to support business owners. Right now, owners pay $50 a year for the license and don’t see any benefit from it, she said.
Councilor Gary Coon said the fee helps cover paperwork costs, staff time and monitoring businesses for compliance.
“I feel eliminating the business license fee would send the wrong message by diminishing the significance of the license,” he said. “It also protects business from uncontrolled vendors. I believe the cost of service is fair and should not be changed.
Hartwell said she was against eliminating the fee, but supported local businesses.
“I definitely believe we should charge, it makes us professional, it gives a professional atmosphere to the businesses and it protects the businesses that are here.”
Rappaport said he initially supported Binney’s plan, but after talking with local business owners, he realized eliminating the fee could open the town up to unwanted business ventures.
“What is there to stop someone from setting up a card table and hurting the business behind them?” he said.
Resident Gary Rolf agreed, saying a business license fee is similar to earnest money — faith that someone is not going to take out a license as a souvenir, but because they want to run a reputable business.
Rappaport said now that the town has paved most of the roads, bought a water company and is working on a sewer plan, it is time the council focus on an economic development plan.
Rappaport said he was working on something that would justify the $50 fee the town collects that also helps businesses.
Town Manager Tim Grier said ideas include adding a business listing to the town Web site, developing a business brochure and possibly investing in advertisement.
“We have been overwhelmed with becoming a town and getting things going,” he said. “I have always wanted to do an economic development program.”