HomeMy WebLinkAbout012-25 - Ordinance - Business License ThresholdDocusign Envelope ID: FDF813F9-D841-4336-84A2-FB5182769C9F
ORDINANCE NO. 012-25
AN ORDINANCE OF THE CITY OF PORT ORCHARD, WASHINGTON,
AMENDING PORT ORCHARD MUNICIPAL CODE SECTION 5.12.100,
"LICENSES FOR BUSINESSES LOCATED OUTSIDE CITY LIMITS" TO
INCORPORATE STATE -MANDATED CHANGES TO INCREASE THE
THRESHOLD FOR BUSINESSES; ADOPTING THE MANDATORY
PROVISIONS FROM THE MODEL BUSINESS LICENSE ORDINANCE;
AND ESTABLISHING AN EFFECTIVE DATE OF JANUARY 1, 2026.
WHEREAS, the City of Port Orchard has adopted local regulations establishing
standards and procedures for business licenses, including as currently codified in Chapter
5.12 POMC; and
WHEREAS, in 2017, the state legislature passed EHB 2005 (RCW 35.90), an act
relating to improving the business climate in Washington state by simplifying the
administration of municipal general business licenses and requiring cities to develop a
general business licensing model ordinance; and
WHEREAS, cities, working through the Association of Washington Cities (AWC),
established a model ordinance development committee made up of a representative
sampling of cities that impose a general business license requirement. A city that imposes
a general business license requirement must adopt the mandatory provisions of the
model ordinance by January 1, 2019. The mandatory provisions of the model ordinance
included the following: (1) the definition of "engaging in business within the city"; and (2)
a uniform minimum licensing threshold under which a person would not have to obtain a
city's general business license; and
WHEREAS, the 2018 model included a $2,000 minimum threshold (or occasional
sale) exemption to establish when out-of-town or transient business are required to be
licensed. All business license cities adopted the model by January 1, 2019 (RCW
35.90.080; and
WHEREAS, the City of Port Orchard adopted Ordnance No. 028-18 on September
11, 2018, with an effective date January 1, 2019, which adopted no -fee registrations for
both out -of -city and in -city businesses that did not meet a threshold of $2000; and
WHEREAS, pursuant to Chapter 35.90 RCW, the City of Port Orchard partners with
the Department of Revenue's Business Licensing Services ("BLS") to issue and renew
business licenses; and
WHEREAS, pursuant to RCW 35.90.80-.090, cities that impose a general business
license are required to adopt the mandatory provisions of the state model ordinance; and
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Ordinance No. 012-25
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WHEREAS, an update to the City's municipal code provisions to match the model
ordinance is required for 2026 to increase the threshold to $4000 and include an
automatic periodic increase based on cumulative inflation for every four years thereafter;
and
WHEREAS, current BLS partner cities must adopt the updated language by mid -
October (RCW 35.90.070), and provide notification to BLS in order to maintain its business
licensing program on January 1, 2026; and
WHEREAS, the City of Port Orchard has determined that approval of the updated
model business license threshold is in the best interest of the City, as it is necessary to
ensure continued compliance with state business license requirements; now, therefore,
THE CITY COUNCIL OF THE CITY OF PORT ORCHARD, WASHINGTON, DO ORDAIN AS
FOLLOWS:
SECTION 1. Port Orchard Municipal Code Section 5.12.100 is hereby amended to read as
follows:
5.12.100 Licenses for businesses located outside city limits.
For purposes of the license by this chapter, any person or business whose annual value of products, gross proceeds
of sales, or gross income of the business in the city is equal to or less than $2000 and who does not maintain a place
of business within the city, shall submit a business license registration to the city finance director or designee. The
threshold does not apply to regulatory license requirements or activities that require a specialized permit. Peddlers
and hawkers shall apply for a business license. Businesses whose activities require a permit issued under the
jurisdiction of the Uniform Building Codes shall apply for a business license.
Beginning January 1, 2026, the threshold amount is $4000. The threshold amount will be adjusted every forty-eight
months on January 1, by an amount equal to the increase in the Consumer Price Index ("CPP") for "West Urban, All
Urban Consumers" (CPI -U) for each 12 -month period ending on June 30 as published by the United States
Department of Labor Bureau of Labor Statistics or successor agency. To calculate this adjustment, the current rate
will be multiplied by one plus the cumulative four-year (forty-eight month) CPI increase using each 12 -month
period ending on June 30 of each prior year, and rounded to the nearest $100. However, if any of the annual CPI
increases are more than five (5) percent, a five (5) percent increase will be used in computing the annual basis and if
any of the annual CPI decreased during the forty -eight -month period, a zero (0) percent increase will be used in
computing the annual basis.
SECTION 2. Severability. If any section, sentence, clause or phrase of this Ordinance
should be held to be unconstitutional or unlawful by a court of competent jurisdiction, such
invalidity or unconstitutionality shall not affect the validity or constitutionality of any other
section, sentence, clause or phrase of this Ordinance.
SECTION 3. Publication. This Ordinance shall be published by an approved summary
consisting of the title.
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SECTION 4. Effective Date. This Ordinance shall take effect and be in full force and effect
January 1, 2026.
PASSED by the City Council of the City of Port Orchard, APPROVED by the Mayor and
attested by the Clerk in authentication of such passage this 9th day of September 2025.
Signed by:
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Robert Putaansuu, Mayor
Brandy Wallace, MMC, City Clerk
APPROVED AS TO FORM:
Signed by:
Charlotte A. Archer, City Attorney
PUBLISHED: September 15, 2025
EFFECTIVE DATE: January 1, 2026