Tempe City Council is scheduled to hear about the development of a general business license program designed to help the city support its local business community through collecting more comprehensive data on companies in the city.
Staff will deliver this presentation during council’s April 3 work study session, which will take place at 4 p.m. in the city council chambers at Tempe City Hall, 31 E. Fifth St. The meeting may also be watched on Cox Cable Channel 11 and at www.tempe.gov/tempe11.
Tempe Financial Services Director Lauren Calder wrote in a city memo the presentation’s purpose is to provide council with the proposed concept of a general business license and to get feedback.
Calder’s memo stated the proposed program would create “deeper Tempe business demographics, broader information sharing and enhanced communication and support to the Tempe business community.”
“The city of Tempe currently faces challenges in comprehensively supporting its local business community due to limitations in business data,” Calder wrote.
Tempe mainly relies on transaction privilege tax license data from the Arizona Department of Revenue, which is subject to confidentiality rules that restrict access to a limited number of city employees.
As it stands, Tempe manages regulatory licenses for about 1,300 businesses, but this total leaves about 30,000 businesses within the city unaccounted for in city records, according to Calder.
This makes it difficult for the city to conduct effective outreach and support initiatives, and it impedes Tempe’s ability to understand and address local businesses’ needs.
The proposed business license program aims to “bridge this information gap by establishing a more complete database of local Tempe businesses,” according to city reports.
A city-specific license would aid in this initiative by enabling officials to gather and track currently unavailable business information, such as sober living sites, minority and disadvantaged business ownership, number of employees and revenue groupings.
“The data collected will enhance communication and support by creating a complete database of Tempe businesses,” Calder wrote.
This database would enable the city to communicate updates, promote city services and programs, and develop an interactive geographic information system.
Calder also noted the program has the potential to generate city revenue through annual fees that could then be reinvested into Tempe supporting local businesses and evolving existing programs such as the Business, Retention and Expansion program.
Program details
Calder explained in the memo that the city is considering a model that requires companies with a permanent location in Tempe to obtain a business license.
Tempe’s license would require businesses not required to obtain a sales tax license to obtain it, including professional services and contractors with job sites in Tempe and other governmental and nonprofit entities.
“Exemptions are being considered for businesses with existing regulatory licenses, temporary businesses, special event vendors and other businesses like casual activities, childcare, independent contractor/sale representative, educational lessons or tutoring services,” Calder wrote.
Tempe is considering enforcement through letters sent to unlicensed businesses and a 50% penalty if the license is not renewed 30 days after expiring or operating without a license.
Tempe’s proposed fee structure for this program would charge businesses $25 annually, which, according to Calder, is in alignment with fees charged by other Valley cities.
Calder stated in the report that after further development, the target implementation date would be Aug. 1, which includes a five-month grace period before mandatory renewal in January 2027.
Council is expected to hold the first public hearing on the proposed plan on May 22, and the second a final hearing will be held on June 5, where council will vote on approving the general business license program.
Please send your comments to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines. Reporter Caroline Yu can be reached at cyu@iniusa.org
Meet Caroline Caroline Yu joined Independent Newsmedia, Inc., USA, in 2020 as a summer intern covering Scottsdale. As an intern, she continued her coverage of Scottsdale, Paradise Valley and Tempe. After graduating in 2022, Caroline became a full-time reporter for Scottsdale and Paradise Valley. She is currently reporting for the Tempe market.
Community: She is a supporter of the environment and tries to get involved with related community events.
Education: Arizona State University with a BA in Journalism and Mass Communications, with a minor in French.
Random Fact: She used to be a ballet dancer for 10 years.
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