“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
August 4, 2026
Consideration of Resolutions:
A) Placing a Ballot Measure on the November
3, 2026, General Municipal Election to
Update/Simplify the Business License Tax
Structure;
B) Providing for the Filing of Rebuttal
Arguments for the City Measure; and
C) Selection of a Ballot Letter Designation for
the City's Ballot Measure
2 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
•
Timeline and Outreach To Date
•
Background & Goals of Business License Tax
Modernization Plan
•
Overview of Selected Tax Model 4
•
Selection of Ballot Letter Designation
•
Next Steps/Final Action
Agenda
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
3 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Timeline & Public Outreach
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Past
Present
Future
October 23,
2025
Met with
Chamber &
BIDs
November 6,
2025
Met with
Finance
Sub
-
committee
March 3,
2026
Phase 1
Ordinance:
City Council
Meeting
March 17,
2026
Second
Reading of
Ordinance
April 23,
2026
Business
License Tax
Forum
–
Community
Meeting
May 12,
2026
Present
Results of Tax
Analysis &
Select
Preferred Tax
Model
July 21, 2026
Present
Polling Results
& Final
Decision
Points for BLT
Measure
July
–
August
2026
Submit Notice
in The Beach
Reporter &
Continued
Outreach &
Mailers
August 4,
2026
Phase 2: Call
Election,
Present
Ordinance &
Documents for
Ballot Measure
November 3,
2026
General
Election
The August 4
th
City Council Meeting
marks the 7
th
public meeting
regarding the BLT Modernization Plan
4 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Why update the City’s Business License Tax (BLT) Code?
•
Current tax structure is complex and inequitable
•
There are nine (9) ways businesses are currently taxed (Gross Receipts, Flat Tax, Per Room/Unit, Per Vehicle, Per SQ FT, Per Employee, and more) •
Applying a gross receipts model ensures fairness across different business types
•
Outdated code from 1971 does not account for new business types •
BLT revenues support the General Fund to pay for public services, maintenance, infrastructure, and other costs that uphold the City’s desirability and attraction to visitors and businesses
•
Polling results support the gross receipts method for all businesses Background
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
5 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Goals of Business License Tax Modernization Plan
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
1) Simplify the Code
2) Clarify the Code
3) Modernize the Code
4) Fair and Equitable Tax Structure
5) Maintain Fiscal Sustainability
6 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Overview of Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Model Structure:
•
Variable gross receipts rate based on business type
•
Small flat
-
rate tax
•
Increases cap to $100,000
•
Model simplifies businesses into five base categories and an exempt category
Outcomes:
•
Easier to administer six (6) categories
•
Low flat rate supports small businesses and micro
-
enterprises
•
More concentration of revenue from particular industries •
Slightly increases revenues for City services
•
Creates a more uniform gross receipts basis for all business types •
Lowers Gross Receipts Tax Rate for General Retail category to help support local brick and mortar businesses based in Manhattan Beach 7 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Flat Rate
6 Simplified Categories
Rate Per Thousand
$100 Flat Rate
Up to $100,000
Gross Receipts
Contractor
$2.80
General Retail
$2.00
Professional
$2.80
Property Rental
$2.80
Services
$2.80
Exempt
Rate Structure
8 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Contractor Definition
•
Persons or firms that are carrying on the
business of a contractor, subcontractor, or
builder, particularly the construction or repair of
any buildings
•
I
ncluding, but not limited to:
1. Contractor
-
Electrical
2. Contractor
-
General
3. Contractor
-
HVAC
4. Contractor
-
Landscape
5. Contractor
-
Masonry
6. Contractor
-
Plumbing
7. Contractor
-
Roofing
8. Contractor
-
Signs
9. Contractor
–
Specialized
9 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
General Retail Definition
•
P
ersons or firms carrying on the business of retail
sales, restaurants, wholesale trade, manufacturing,
service stations, or similar general business activities •
B
usinesses are likely to contribute to City’s tax base in other ways and often have lower profit margins
•
Including, but not limited to:
7. Public Utilities
8. H
otels/Short
-
Term Rentals
9. Service Station
10. Convenience Store
11. Grocery Store
12. Mobile & Sidewalk Vendor
1. Retail Store
2. Restaurant
3. Wholesaler
4. Manufacturer
5. E
vent
S
pace
6. S
ocial & Recreation
C
lubs
10 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Professional Definition
•
P
ersons or firms carrying on businesses that provide services requiring rigorous training through higher education, vocational institutions, certification, licensing, or specialized professional skill •
This category includes advanced services, including businesses in research and development, scientific, technical, and similar fields •
I
ncluding, but not limited to:
8. Research and Development
9. Scientific Services
10. Technical Services
11. Financial Advisory Services
12. Medical Office
13. Dental Office
14. Real Estate Agents and Brokers
1. Doctor’s Office
2. Law Office
3. Consulting Firm
4. Accounting Firm
5. Engineering Firm
6. Architectural Firm
7. Software Development
11 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Property Rental Definition
•
P
ersons or firms carrying on the business of leasing,
renting, or otherwise providing the use of real
property to another individual or entity for
compensation
•
Including, but not limited to:
1. Commercial Leasing
2. Residential Rental (3 or More Units)
3. Parcel Leasing
4. Office Space Rental
12 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Services & Other Definition
•
P
ersons or firms carrying on service
-
based businesses that generally
does not require higher education, formal training, certification, or professional licensing
•
Including, but not limited to:
1. Administration Office
2. Advertising
–
Agency
3. Artist & Designer
4. Automotive
-
Carwashes
-
Detailing
5. Beauty Parlor and Salons
6. Dry Cleaning
7. Security and Patrol
•
Category also serves as the default category for any other business that is not specifically classified under another category
13 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Exempt Definition
•
The tax does not apply to any business that qualifies
for an exemption under Section 6.01.280 of the
Manhattan Beach Municipal Code, including:
1. Those exempt from municipal license taxes by virtue of the Constitution and the laws of this State or the United States
2. Charitable and nonprofit purposes
3. Disabled persons
4. Disabled veterans
5. Interstate commerce
6. Minors
14 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Model 4 Variable Gross Receipts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
Business Type
Number of
Businesses
Estimated Taxable
Gross Receipts
2025 Charges
Model 4
-
Variable
Gross Receipts
Estimated Revenue
Contractor 2,486 $474,705,512 $829,000 $1,008,000
General Retail 784 $1,322,788,156 $1,721,000 $2,203,000 Professional 499 $559,253,940 $1,041,000 $1,337,000
Property Rental 469 $154,479,325 $917,000 $418,000
Services 927 $434,767,820 $881,000 $975,000
Exempt 80 $0 $0 $0
Totals 5,245 $2,947 $5,389,000 $5,941,000
Increased Revenue
$552,000
15 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Analysis of Tax Model 4
$100,000 CAP CURRENT TAX MODEL 4
Maximum Tax (Cap) $12,156 $100,000
Estimated Increased City Revenue $552,000
% of Businesses with Increase 25%
No Change (Exempt) 2%
% of Businesses with Decrease 73%
Flat Tax GR Rate Flat Tax GR Rate Flat Tax GR Rate
$313 0.280% $100 0.200% $100 0.280%
CURRENT MODEL 4 (GENERAL RETAIL) MODEL 4 (ALL OTHER)
Qty. of
Businesses
Under Amt % Gross Receipts
Current
BLT
Payment
Current %
of Gross
Receipts
Revised
BLT
Payment
% of Gross
Receipts
Revised
BLT
Payment
% of Gross
Receipts
2,305 43.9% $100,000 $313 0.31% $100 0.10% $100 0.10%
2,312 44.1% $500,000 $1,457 0.29% $900 0.18% $1,220 0.24% 248 4.7% $1,000,000 $2,857 0.29% $1,900 0.19% $2,620 0.26% 250 4.8% $3,000,000 $8,457 0.28% $5,900 0.20% $8,220 0.27% 41 0.8% $4,500,000 $12,156 0.27% $8,900 0.20% $12,420 0.28% 8 0.2% $5,000,000 $12,156 0.24% $9,900 0.20% $13,820 0.28% 36 0.7% $7,500,000 $12,156 0.16% $14,900 0.20% $20,820 0.28% 7 0.1% $10,000,000 $12,156 0.12% $19,900 0.20% $27,820 0.28% 12 0.2% $15,000,000 $12,156 0.08% $29,900 0.20% $41,820 0.28% 7 0.1% $20,000,000 $12,156 0.06% $39,900 0.20% $55,820 0.28% 4 0.1% $25,000,000 $12,156 0.05% $49,900 0.20% $69,820 0.28% 3 0.1% $30,000,000 $12,156 0.04% $59,900 0.20% $83,820 0.28% 2 0.0% $40,000,000 $12,156 0.03% $79,900 0.20% $100,000 0.25% 2 0.0% $50,000,000 $12,156 0.02% $99,900 0.20% $100,000 0.20% 4 0.1% $75,000,000 $12,156 0.02% $100,000 0.13% $100,000 0.13% 4 0.1% $100,000,000 $12,156 0.01% $100,000 0.10% $100,000 0.10% 5,245 100.0%
16 CITY OF
MANHATTAN BEACH
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Proposed Ballot Measure Language
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
“
City
of
Manhattan
Beach
Business
License
Tax
Update
and
Simplification
Measure
.
Shall
the
measure
to
update/simplify
City
of
Manhattan
Beach’s
business
license
tax,
lower
taxes
for
approximately
73 %
of
businesses
operating
in
Manhattan
Beach,
and
ensure
large
businesses
pay
their
fair
share
for
services
such
as
maintaining
streets,
parks,
playgrounds,
and
9 -
1 -
1 emergency
response
by
applying
rates
up
to
0 .
28 %
of
gross
receipts
(as
described
in
the
ordinance),
lowering
the
minimum
flat
rate,
and
raising
the
cap
for
large
businesses,
generating
$
550
,
000
annually
until
ended
by
voters,
be
adopted?”
YES
NO
17 CITY OF
MANHATTAN BEACH
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•
Pass Through Revenue
º
Ordinance will not recognize Pass
-
Through Revenue
as part of Gross Receipts
º
Ordinance updates definition of Gross Receipts to
exclude “monies received and / or placed in a
segregated account or escrow for the benefit of a
third party and not subject to the taxed party’s control” •
Franchise Agreements with Public Utilities
º
Ordinance will keep the exemption in place for Public
Utilities to only pay the flat tax (and not pay Gross
Receipts basis)
if
there is a Franchise Agreement in
place where Franchise Fees are paid
Special Considerations Included in Ordinance
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
18 CITY OF
MANHATTAN BEACH
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In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
•
Real Estate Agents and Brokers
º
No proposed changes to code
º
Consider exception to allow Brokers to deduct commissions paid to agents from Gross Receipts calculation
º
Evaluate whether to continue current practice of non
-
enforcement
on individual agents or consider applying the tax across all business types to promote equitable treatment
➢
46 Agents/Brokers/Real Estate Professionals are currently licensed
•
Commercial Property
º
Consider exemption to Business License Tax if landlord and tenant are the same owner/entity
Council Policies to be Considered in the Future
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
19 CITY OF
MANHATTAN BEACH
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In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
•
Revenue impacts from Proposed Tax Model 4
➢
$550,000
Annually, if approved by Voters
•
Expenditures related to BLT Modernization Plan
➢
$202,400
in one
-
time costs related to Fiscal Analysis,
Consulting, Polling, and Legal Services
➢
On February 17, 2026, necessary funds were allocated
during FY 2026 Mid
-
Year Budget Update
➢
On March 3, 2026, City Council directed staff to
proceed with Fiscal Analysis
➢
On May 12, 2026, City Council directed staff to proceed with Polling/Consulting services
➢
$17,000
in one
-
time election costs to place ballot
measure
Fiscal Impacts
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
20 CITY OF
MANHATTAN BEACH
“Note: This PowerPoint presentation is intended solely as a visual aid to an oral staff presentation of an agenda report topi c.
In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
•
Los Angeles County Registrar
-
Recorder requires the inclusion of
the Arguments and Rebuttal Form
for all ballot measures
•
Under California law, City Council
may authorize (but does not
require) up to five (5)
Councilmembers to file arguments
for or against the measure
•
Seeking direction if any
Councilmembers would like to file
an argument in accordance with the
attached Form
Arguments For and Against Measure
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
21 CITY OF
MANHATTAN BEACH
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In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
Ballot Letter Designation Options
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION
•
Los Angeles County Registrar
-
Recorder
requires a Ballot Letter Designation Form for
all ballot measures
•
City may select up to three (3) ballot
designation options for Measure
•
Form requires City identify a 1
st
, 2
nd
and 3
rd
choice
•
Options include:
1. BL
–
Business License
2. BLS
–
Business License Simplification
3. MBL
–
Modernize Business License
4. MBT
–
Modernize Business Tax
5. BLT
–
Business License Tax
6. BTM
–
Business Tax Modernization
22 CITY OF
MANHATTAN BEACH
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In the event of any differences between the presentation and the agenda report, the information in the agenda report prevails .”
•
Staff recommends City Council :
º
Adopt Resolution No. 26
-
0087 for Ballot Measure Submission
▪
Requires 4/5 vote from the Governing Body
▪
Resolution includes Exhibit A: Ordinance and ballot
language subject to voter approval
º
Adopt Resolution No. 26
-
0088 for Filing of Rebuttal
Arguments
º
Confirm if City Council will authorize up to five
Councilmembers to file arguments for the measure
º
Select top three (3) Ballot Letter Designations for Ballot Measure
•
Additional outreach to businesses and residents will be provided via mailers, email and website updates at
www.manhattanbeach.gov/BLT
Recommendation
AUGUST 4, 2026
CONSIDER PLACING BALLOT MEASURE ON NOVEMBER 3, 2026, GENERAL MUN
ICIPAL ELECTION