Business Licenses and Permits

Like many other cities in California, the City of Vallejo recently hired an outside firm to help collect business license fees from delinquent businesses.  The city used Municipal Auditing Services to track down unlicensed businesses and according to the Times-Herald the firm got to keep half of what it collected.

These outside firms can be an asset to help cities get their business license programs back on the right track.  However, in Vallejo the search to uncover unlicensed businesses may have gone too far.  Recently a retired software engineer who lives off social security received a $167 business license bill from the city.  This retiree does not own, nor has ever owned or operated, a business in Vallejo.  After some investigating by the Times-Herald it was discovered that Municipal Auditing Services thought she was operating a business based on a tax form filed when she worked for a bed and breakfast.

Most of the investigative firms hired by local governments to track down unlicensed businesses use tax records to try to determine who’s doing business.  Vallejo city officials believe that this case is an isolated incident.  It will be interesting if any similar stories come out from other cities that are using these types of outside firms.

Amy Lee, Business License Research Analyst, Corporation Service Company

Tags: business license, California