Small businesses question timing of license tax

Small business owners in Carson Valley say an economic downturn is no time to implement a business license tax, as proposed by Douglas County officials.

"A lot of people are struggling to keep their heads above water, and they don't need anything else added on to it," said Paul Ornellas of Gardnerville, who has owned and operated Carson Valley Exterminators for seven years, specializing in the extermination of ants and spiders.

Ornellas is the sole employee of his company. He mostly works in Douglas but also travels to Carson City, Lyon and Washoe counties.

"I already have to pay fees to work in those counties," he said. "I've tried to cut expenses. I've raised prices a little, hardly nothing at all. But it's not the customers' fault the economy is the way it is."

Douglas County is proposing the new tax to make up for an overall shortfall in tax revenue. Currently, businesses in Douglas County can file fictitious names with the county clerk's office, but no license is required.

The proposed ordinance would change that, requiring businesses to pay an annual basic fee of $50, plus additional fees based on the number of employees a business has, ranging from nothing for one to four employees to $1,550 for 1,000 or more employees. There would also be an initial application fee of $25, or $20 if filed online.

County officials have said the proposed tax could generate $600,000 and $800,000 a year.

But small business owners aren't sympathetic.

"The economy is not doing well, and businesses are closing all over the place," said Troy Phillips, owner of Battle Born Wine in Gardnerville. "A new tax would just be another financial strain. And if they implement one, it's subject to change and go up."

A 2002 graduate of Douglas High School, Phillips came back to his hometown about five months ago to open the specialty wine and beer shop.

"We're doing okay," he said. "We're making money, but still paying a lot for startup."

Part of that start up is the expensive nature of selling alcohol.

"There's the liquor license fees, wholesale tax and liquor tariffs," said Phillips. "There's a false illusion of sales. When I sell something, I hold onto that money till I give the government its share each month."

Phillips said it's difficult for a young man in Douglas County to make ends meet.

"It's almost impossible for a kid who grew up here to come back, make a living and afford a house," he said. "Small business is one way to do that, but it looks even harder now."

Monique Haviland, owner of BodyWise Physical Therapy and Fitness in Minden Village, also opposes the tax.

"We already pay so many taxes," she said. "This is a very inappropriate time to ask for this. Why start new taxes when the economy's bad?"

Haviland currently employees about 10 people, but said that's likely to change to 15 as her business expands. She said she would support a license tax if it included protections for new small businesses.

"Every day I see a new business going under on Highway 395," she said. "I would support this if new businesses weren't taxed for the first five years, so they could get on their feet. And, if the government was accountable and showed everyone where the money went at the end of each year."

Some small businesses aren't opposed to the tax.

"Like anybody else, I need more taxes like I need a hole in my head," said Dave Taylor of Gardnerville, who has owned and operated Dave Taylor Appliance since 1985. "I'm not opposed to it; I'm just not happy about it."

Although home-based, Taylor has two employees that help him with the mobile appliance repair service.

"I wish I had more specifics about where exactly the money would go, if it would go to the Sheriff's Office," said Taylor.

The business license tax will be discussed at the Douglas County Commissioners meeting 1 p.m. on March 6 at the Douglas County Administration building, 1616 Eighth St. in Minden. At least two public hearings are required before an ordinance can be ratified.

n Scott Neuffer can be reached at sneuffer@recordcourier.com or 782-5121, ext. 217.