Oscar Cota along with his family, employees and representatives of the Hermiston Chamber of Commerce celebrate with a ribbon-cutting ceremony Oct. 12, 2023. Cota bought Rick’s Car Wash in May. The Hermiston City Council at its meeting July 8, 2024, considers adopting a structure for business license fees.

HERMISTON — Six months after voting to adopt a business license requirement, the Hermiston City Council at its meeting Monday, July 8, will consider what fees businesses operating in Hermiston will have to pay.

On Jan. 22, the council voted to adopt the requirement, but postponed a decision on how much the license would cost individual businesses.

The city then formed a Business License Fee Committee comprising city councilors, Hermiston Chamber of Commerce representatives and local business owners. The committee’s job was to study the issue and make recommendations.

The committee met several times during the spring, and, according to a press release from the city, voted June 10 to recommend the city council adopt the business license fee schedule as originally proposed in January. The city said the fee structure is designed to be straightforward and is modeled after the fee system in Pendleton.

Under the proposal, a business with a permanent location inside the city limits with zero to five employees would pay a base fee of $85 a year.

A similar business with six to 49 employees would pay the base fee plus $15 for every employee over five. A similar-based business with 50 or more employees would pay $1,000 per year.

As an example, a business with nine full-time equivalent employees would pay a base fee of $85, plus $60 for the additional four FTEs, totaling $145.

A business without a permanent location inside city limits with zero to five employees would pay a base fee of $100. A similar business with six to 49 employees would pay the base fee plus $20 per employee over five. A similar business with more than 50 employees would pay $1,200 per year.

According to the press release, the fee would be annual. The city would not prorate fees for short-term businesses. The plan also would require separate licenses for each business entity within a larger organization.

There also would be exemptions to the fee for individuals under 18, certain beauticians and real estate agents, garage sales under specific conditions, special events and nonprofit or government entities.

Pendleton in fiscal year 2022 received $131,000 in business license fees and in fiscal year 2023 received. According to the press release, Hermiston in calendar year 2025 estimates it will gross approximately $100,000 from the fees based on Hermiston’s slightly lower fee schedule compared to Pendleton and initial adjustments businesses may need to make.

Assistant City Manager Mark Morgan noted Pendleton’s fee has been in place for nearly 30 years. As a result, Pendleton businesses have had many years of having to pay the fee on an annual basis. Hermiston expects, however, to see a significant amount of revenue loss in the first year due to businesses not realizing they need to have a license.

Morgan, however, said it is likely that Hermiston’s revenues will eventually match or slightly exceed Pendleton’s due to the larger number of businesses in Hermiston.

The business license fees, if adopted by the council, will take effect on Jan. 1, 2025, with renewals occurring annually. If adopted, the council will still have the authority to amend the program as needed.

Morgan said the revenue from fees is intended to support public safety by funding increased police staffing.