RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF EAST PALO ALTO
APPROVING THE BUSINESS DISCOVERY PROGRAM RELATED TO BUSINESS
LICENSES
WHEREAS, Title 5 – Business Licenses and Regulations of the City of East Palo Alto’s Municipal Code defines and requires the City to collect a business license tax; and WHEREAS, on June 2, 2022 the City of East Palo Alto contracted with HdL Companies to provide business discovery services for businesses in the City who are not in compliance with Title 5.
NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF EAST PALO ALTO HEREBY approves the following Business Discovery Program Related to Business Licenses:
1. Communicate with noncompliant businesses. HdL will send out communication to non-compliant business through all available means. As these businesses are not yet in the City’s system, not all forms of communication are available. At a minimum, all business will receive a monthly letter in a form substantially similar to Exhibit 1. Further, City staff will use social media platforms to notify the public about the amnesty period and in particular that rental properties are subject to the City’s Business License Tax.
Information will also be posted on the City website. This process is designed to provide a path forward allowing the business to become compliant and current on all fees.
2. Amnesty and Education Phase (90 Days). If the business becomes compliant within the first 90 days of HdL’s communication campaign (90-day education-amnesty period), the underlying tax itself will still be due but the late penalties and interest will be waived.
During this 90-day amnesty and education phase, businesses must pay all owed business taxes to become compliant. All eligible penalties would be waived for businesses that become compliant during this phase. For those businesses that remain noncompliant after the 90-day education-amnesty period, the penalties would snap back and must be paid in order to bring the business into compliance.
The 90-day phase serves two critical public purposes: 1. providing a period within which to educate taxpayers of the City’s compliance efforts; 2. improving collection by providing more time for taxpayers to come into compliance.
3. Enforcement-Collection Phase. Eventually, once the 90-day education-amnesty expires, the City will need to proceed with its enforcement and collection efforts.
HdL will consult staff to determine an appropriate strategy to bring businesses into compliance. This could include site visits to certain businesses. Such in-person visits would be specifically for business where the owner or operator is onsite. HdL has additional outreach that may occur for rental properties where the owner may not be in state.
During this phase, staff will exercise its discretion to avail itself of all remedies available to the City, including, administrative citations, real property liens, civil collection actions, and criminal enforcement, and any other means provided for under applicable law. Staff understand the import of these additional compliance methods, but also understand the importance of equity under the tax code. Before these additional compliance actions would occur, staff would return to the Council with an update on the status and number of non-compliant business and a more specific enforcement plan.
PASSED AND ADOPTED this 7th day of January 2023, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
SIGNED:
Lisa Gauthier, Mayor
ATTEST: APPROVED AS TO FORM:
James Colin, City Clerk John D. Lê, City Attorney
Exhibit 1
CITY OF EAST PALO ALTO
COMPLIANCE DIVISION 8839
N CEDAR AVE #212
FRESNO, CA 93720
(951) 877-3316
HdL Companies
1111 E 2nd St
East Palo Alto, CA
February 02, 2023 Account No. :xxxxxx
Re: City of East Palo Alto Business Tax
Dear Business Owner:
The HdL Companies has been retained by the City of East Palo Alto to assist businesses and property owners in becoming compliant with the City’s Municipal Code as it relates to Business Taxes. All information obtained during the review will remain strictly confidential and be used for the City’s administration of Business Taxes.
It has come to our attention that you are conducting business in the City of East Palo Alto and the City would like to welcome you to the business community. However, our records indicate that your business may not be in compliance with the City’s Business Tax requirements. Please be advised, the City Council of East Palo Alto has approved an amnesty program for the business community. The amnesty waives all penalties and interest until xx/xx/xxxx. Please complete the following steps to take advantage of the Amnesty Program:
• If you do not hold a valid business license in the City of East Palo Alto, please complete the attached application and mail to the return address listed in the top left corner of this letter. You may also submit your application by:
Email at [email protected] | Fax: (909) 348-0465. • If you currently have a valid Business Tax Certificate in the City of East Palo Alto, please contact the Compliance Division at [email protected] and include the account number listed above.
• If your business is no longer in business, or you feel as if this message has been received in error, please call into our offices to discuss at (951) 877-3316. We would be happy to assist you with any and all questions.
Sincerely,
City of East Palo Alto
Compliance Division