Many residents are interested in earning money through small businesses that provide services, sell crafts and other homemade goods or operate on the Internet. Surprisingly though, a lot of home-based business owners aren’t aware that a business license is most likely required for their new venture.
We look this week at when exactly a business license is required in Fairfield.
The rule of thumb is that all businesses in the city of Fairfield must obtain a city business license. Businesses subject to this requirement include contractors based in other cities who are doing jobs in Fairfield, Internet-based businesses, vendors, property owners with more than four residential units or commercial spaces and real estate management companies.
There are exceptions – insurance brokers and banks are exempted by state law and most vendors at local farmers markets and festivals are covered by the event organizers’ “participation agreements” with the city. Mobile vendors (food trucks, door-to-door sales, etc.) must also obtain a vendors’ permit from the Fairfield Police Department.
Some small-business owners may not have been aware that a business license is necessary for their activities. Over the past year, the city’s business license software provider, HDL, has been auditing businesses in Fairfield to ensure that all active, operating businesses have a license. HDL has been sending letters to potential business owners – people who receive the letters should follow the instructions in the letter and contact HDL directly with questions or concerns.
Obtaining a Fairfield business license is straightforward. The forms are available on the city’s website at www.fairfield.ca.gov/civica/filebank/blobdload.asp?BlobID=8615. The forms are also available at the department offices located on the second floor of City Hall (1000 Webster St.) and typically can be completed in less than 15 minutes.
If the business is a home-based business, the operator also must obtain a “home occupation permit.” Internet-based businesses and businesses with a commercial post office box are considered home-based businesses for Fairfield residents. In general, home-based businesses are permitted if they do not change the fundamental residential character, do not involve more than eight customer visits per day and do not require the use of heavy equipment or the storage of dangerous materials.
Home-based businesses that involve a vehicle modified to provide service, such a tow truck, are not allowed to park the vehicle at the residence. Vehicle sales and repair are not permitted home-based businesses. A typical home-based business permit and business license averages $115.
New business license applications must be brought to the Community Development Department counter on the second floor of City Hall at 1000 Webster St., which is open from 8 a.m. to noon and 1 to 5:30 p.m. during business days. One key question is whether the proposed business is permitted by the zoning or the Municipal Code. Before signing any lease or purchasing a property, the city recommends you contact planning division staff to confirm that the use would be permitted at that location. If the business is permitted by zoning in the location selected, the planner on duty will approve the application and receive the fees.
In addition to the city business license, business operators who want to sell retail goods must obtain a sellers’ permit from the state Board of Equalization. Those individuals who do not want to use their Social Security number as an identification number for federal tax purposes must obtain a federal tax identification number from the IRS. Finally, contractors who wish to undertake jobs valued at more than $500 must have a state contractors’ license.
One question staff often receives from the public is about fictitious business names. The fictitious business name statement is filed at the County Clerk’s Office at 675 Texas St. downtown, with a notice published in the local paper. This enables you to “register” your business name; many banks require a fictitious business name be filed in order to open banking accounts in the business name.
Fairfield issues thousands of business licenses each year. There are nearly 5,000 valid business licenses issued by the city of Fairfield, with more 3,600 located in city limits and the remainder out-of-town businesses doing work locally. Business licenses include everything from Anheuser-Busch to local Internet consultants to out-of-town contractors doing a single job in the city.
The city has adopted a process to revoke business licenses for those activities that are illegal or violate city ordinance. In general, however, a business license may be renewed annually for as long as the operator wishes to retain the license. Fairfield business licenses are issued for the calendar year. Renewal notices are typically sent out in mid-December and are due by Jan. 31 of the new year. After the first renewal, business licenses may be renewed online or via mail.
Any questions about whether a business is permitted in the city should be addressed to the city planner on duty at 428-7461. Questions about the issuing of business licenses, including renewals can be directed to the business license desk at 428-7509.
Economic Notes is an update from Fairfield City Hall written by Brian Miller and Karl Dumas of the Fairfield Planning and Development Department. Reach them at 428-7461 or email at [email protected] or [email protected]