Guadalupe vote

Guadalupe City Council members discuss their response to a Santa Barbara County grand jury report which recommends the city disincorporate. The council voted 5-0 to remain a city.

A vote to give Guadalupe city staff approval to hire an auditor to enforce a new tax was delayed during the last City Council meeting, as only three board members were present. On Tuesday, the Guadalupe City Council will reconsider the issue. 

The tax -- Measure W2014 -- passed in November by a margin of 81 to 18 percent, takes the business license fees the city has charged in the past and now collects them as a gross receipts tax.

"Since the gross receipts tax varies by size of business, an auditing process is needed to make sure all businesses pay their required tax," City Administrator Andrew Carter wrote in a staff report. "This is particularly important during the first year of the new tax in order to set appropriate expectations within the community. It's also important as a matter of fairness and equity."

Business licenses previously cost $60 to $120 per year based on the type of business. Now, all businesses must pay a business license tax of 50 cents per $1,000 of gross receipts with a minimum of $100 per year for home-occupation businesses and those without a fixed place of business within city limits and a minimum of $200 per year for regular storefront businesses.

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The gross receipts tax minimums are locked for out-of-town businesses at $100 unless they grossed receipts of more than $200,000 and for in-town businesses if they grossed more than $400,000.

One councilwoman, Virginia Ponce, said she feared the tax could cause Guadalupe businesses to consider leaving city limits. Finance Director Annette Munoz said she has received calls from confused citizens and that she has tried to graciously explain the ordinance.

The new tax will generate approximately $150,000 in annual revenue for the city. Though the tax is already an official law, the council decided to wait to vote on the audit until all members, including Mayor John Lizalde, were present to vote together.

The meeting will begin at 6 p.m. at City Hall in the council chambers at 918 Obispo St. in Guadalupe.

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