Mayor Brian Ebersole

Tacoma, Washington Is Business Friendly

Tacoma Mayor Brian Ebersole believes that one way to ensure that business is stable and continues to grow in his city is to anticipate the needs and concerns of the business community and respond to them. To this end, the City of Tacoma surveyed its business community to determine which factors influenced decisions to move into, stay in or leave Tacoma. Tacoma's business community answered by citing two major factors: taxes and regulations.

The Mayor and other city leaders then responded by repealing 13 licenses and refining or completely eliminating numerous other duplicative or unclear tax regulations.

City Survey Probes Business Community

Last year, a City of Tacoma "total quality" team began mapping out a strategy to enhance the business environment. The quality team conducted two focus groups of business owners and a series of one-on-one interviews with business stakeholders to help craft an extensive telephone survey.

In September, independent research-ers randomly telephoned more than 400 Tacoma business owners, operators and chief executive officers to gather opinions about city services, taxes and regulations.

The business people pointed to business taxes, the crime rate and local government regulations as chief factors in decisions to locate or remain in Tacoma.

Among the survey's key findings:

Overall satisfaction with city services rated an average of 3.65 on a 5-point scale with 5 at the top.

Businesses consider crime and the business and occupation (B&O) tax rate as the two discouraging factors for companies looking to locate or remain in Tacoma.

Half the businesses surveyed in Tacoma believe the current business environment, including taxes and regulations, causes companies to be reluctant to locate or remain in Tacoma, with taxes the most significant factor..

The two factors that would most encourage businesses to expand or relocate in Tacoma are: lower B&O taxes (64 percent said this was "very important") and one office for all city permits and information about business services (60 percent said this was "very important").

Tacoma businesses claim that, of all local taxes, they would benefit most from a change in the B&O tax structure _ although the survey did not ask whether business owners meant the local or state B&O tax.

The three most important services to conducting current business for Tacoma companies are public safety, utility services and rates, and street and sidewalk repair and maintenance. Least important are public transportation and social services.

The overall quality of life and opportunities for cultural experiences are considered two of the strongest factors encouraging businesses to locate or remain in Tacoma.

The results will help a team of city employees redesign the way local government serves existing and prospective businesses, according to Randy Lewis, government relations officer. "We confirmed a lot of things we have long suspected were true," Lewis said. "Now we have the statistically valid results to guide us as we try to make things better for business in Tacoma."

60 License, Tax Changes Streamline Business Paperwork

Mayor Ebersole and the Tacoma City Council took the survey findings to heart, and in February unanimously approved a package of more than 60 changes to the City's tax and license ordinances.

The changes included repealing 13 regulatory licenses for barbershops, retail stores selling drugs, golf courses, sale of distressed merchandise, tatoo parlors, mobile home parks and photography solicitors.

Other tax ordinance revisions included reducing the reporting frequency for some telephone and cellular services, and exempting persons with small home service businesses from regulatory and business licenses, as well as the city business and occupation tax.

The recent regulatory reforms met three major goals - they eliminated duplication, cleared up confusion and wiped ineffective laws off the books.

Most importantly, the repeals and revisions took some of the paperwork out of owning a business for approximately 400 Tacoma entrepreneurs.

"The City Council is pleased with these changes and hopes that the review of city tax ordinances will continue to remove onerous reporting requirements and reduce taxes for businesses," said Mayor Ebersole.

Heating Up The Business Barometer

Last year, based on citizen feedback, the Tacoma City Council set new strategic priorities. Developing the local economy and improving government performance made the final cut, ranking second and fourth on the Council's list of priorities. The City's business climate total quality team continues to look for more ways to break down barriers to investment and cultivate Tacoma's business environment. One of the team's top changes is to review the City's business and occupation tax structure. The latest tax and license changes can be best portrayed as a step along a longer path to easing reporting requirements and simplifying taxes for businesses. The ultimate goal is to allow business owners to spend more of their time tending their stores instead of filling out bureaucratic paperwork and spend more of their money reinvesting in their business instead of paying for licenses and taxes.

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The United States Conference of Mayors

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