Adopting the 2022 Model Business License Ordinance

When the General Assembly passed Act 176, the SC Business License Tax Standardization Act, it created new standardization requirements for the cities and towns that administer this tax. It created action items that they need to undertake by January 1, 2022, even if they have made business license changes in recent years. 

The law requires that these taxing jurisdictions now all use a single due date — April 30 — and a standard license year period of May 1 to April 30. Other licensing practices must be standardized as well, including the method of calculating a business’s gross income, the setting of rate classes, as well as acceptance of a standard license application and acceptance of payments from a statewide online payment center. 

The Municipal Association of SC has created a seven-step process that cities and towns can use as a guide to comply with the law. Some critical early steps include converting to the standard license year, reviewing data and rebalancing rates to prevent a revenue windfall. 

Repeal and replace 

Once cities and towns complete the previous steps, they will have laid the necessary groundwork to tackle Step 5 in the process: repeal the existing business license ordinance and replace it with the revised model business license ordinance created by the Municipal Association to address the new law’s requirements. Because of the law’s complexities, the Association strongly encourages municipalities to repeal their existing ordinances, rather than altering and correcting those ordinances. Adoption of business license ordinances that comply with Act 176 must take place by January 1, 2022. 

The new model ordinance includes the current standard business license class schedule required by law, which cities and towns must update at the end of every odd-numbered year. It also contains a comprehensive definition of a business’ gross income as required by Act 176. 

Here are some other business license issues covered by the model ordinance: 

• Applicability to businesses lacking an established location in the municipality 
• Requirements for display or carrying of a license
• Inspections 
• Audits 
• Assessments 
• Penalties for nonpayment 
• Denials, suspensions and revocation of licenses
• Violations 

Resources 

Cities and towns can obtain the model ordinance and the standard class schedule by contacting their business license standardization liaison at the Association. The City Quick Connect podcast has a new episode featuring the Association’s Manager for Collections Programs Caitlin Cothran and General Counsel Eric Shytle discussing the purpose and importance of the model ordinance.

Sunshine Week Begins March 14

Sunshine Week runs from March 14 – 20 and is a celebration of governmental transparency and access to public information, which is often highlighted by newspapers and news stations serving the state’s cities and towns. Be it a city council meeting or a meeting of any public body covered by the SC Freedom of Information Act, Sunshine Week focuses on the importance of transparency and the value of open government. 

As COVID-19 continues to impact the number of attendees at meetings, or moves the audience into a virtual attendance capacity, the importance of transparency and access cannot be understated.

The March 2021 edition of Uptown featured an article on cities’ use of virtual meetings as a way of keeping transparency a priority during the pandemic, including in the Town of Mount Pleasant. In it, Town Administrator Eric DeMoura said that “maintaining transparency throughout this pandemic was of utmost importance as critical decisions were made at a rapid pace and there was some business such as project approvals that needed to proceed … Transparency and access are most important during times of crisis and uncertainty.” 

Although transparency and FOIA compliance are critically important in any context for governmental bodies and their meetings, digital meeting options, can create the potential to be more open than ever before, and give residents an opportunity to tune in from home to see their government at work, making decisions that affect their daily lives. 

An important aspect of open and transparent government is making sure that governing bodies follow the law when moving from an open forum into executive session. During executive session, a governmental body will generally move from the meeting space to another secured location to talk about issues that need to remain confidential, like human resource discussions, contractual negotiations, or criminal misconduct matters. Parameters for executive session are spelled out in SC Code Section 30-4-70. 

The need for executive session should only arise in matters that truly need to remain confidential, as required by FOIA. The law makes public information available when possible and creates requirements for cities to follow in terms of agendas, minutes, and other meeting information. 

In South Carolina, the SC Press Association promotes FOIA and the governmental transparency that is the focus of Sunshine Week. By promoting the public’s right to know, the SC Press Association helps to ensure the people have access to information and the government is held to the highest standards. For an overall look at FOIA specifics, see the SC Press Association’s Public Official's Guide to Compliance With South Carolina's Freedom of Information Act.