Irate businesses in and out of Salinas may be happy with this latest development in regards to the city's auditing of business licenses. Dear Jon and our Center for Investigative Action have been busy on this topic over the last two months.
Carl emailed me and asks, "Dear Jon, a company produces goods outside Salinas, but sells its goods in Salinas, delivering them by their own truck. Does this company need a business license in Salinas?
The answer may surprise you.
You might think no, but the city says yes. But before you think the city of Salinas is crazy over this rationale, here's what I'm told by the city's Finance Department.
The key to this scenario is the fact that the business sets foot in the City of Salinas to do business. It would be the same as a consultant who consults a business in Salinas. They may not have a physical Salinas address but they do call or set foot in the city to consult a Salinas business. So the city says you have to have a Salinas business license. You may be scratching your head over that viewpoint.
The third party auditor that Salinas has used was going through public records to find these issues and sending letters to these types of entities for back business license fees. The company, Municipal Auditing Services of Fresno, was very aggressive in this and making plenty of businesses mad. They would go back four years seeking license fees - hundreds of dollars in some cases.
So as of Dec. 31st the City of Salinas has ended its contract with Municipal Auditing Services.
Many have claimed this practice by the city to not be business friendly. Others say it's leveling the playing field for dutiful businesses that have been paying their business license fees all along. Time will tell the fallout from this practice by the City of Salinas.