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Chamber slams $200 home business fee
Mayor says decrease would have been unfair to storefronts

Simon Whitehouse
Northern News Services
Published Friday, June 29, 2012

The Yellowknife Chamber of Commerce is coming out against a $50 hike to home-based business licence fees this week that will now require small start-up companies to pay an annual fee of $200.

Chamber president Larry Jacquard said the chamber was "strongly" against the increase and that he was in contact with Mayor Gord Van Tighem and senior administrative officer Bob Long through e-mail, asking why the increase was allowed.

"We're against increasing a home-based licence and very much in favour of lowering it," said Jacquard. He said $50 would be a more reasonable figure and the development permit fee should also be eliminated. The increased fee is double what home-based businesses had to pay in 2010. The fee went up that year for the first time since 1990 to $150 from $100, and rose another $50 the year after that. The $200 annual fee is the same that's being charged to a wide variety of other businesses in the city.

"It makes no sense that a little home-based business is paying the same amount for a licence as a large grocery store or a retailer or an architect," he said.

For people entering home-based business practices "every cent counts" and with the costs of permitting, the expenses add up, said Jacquard.

"Also, if the home-based business doesn't have clients coming to the home, there should be no need for additional permitting," he said.

City councillor Paul Falvo introduced an amendment to the fees and charges bylaw at Monday's council meeting that would have reduced the home-based business fee to $100 but it was rejected by other councillors. Only Coun. David Wind supported the amendment, while the six others supported the increase.

"Putting this fee and licensing requirements on home-based businesses is a disincentive," said Falvo. "Home-based businesses are good for a number of reasons. Some are intended to always remain home-based businesses, so they are small businesses that help families that help the city. They help our residents provide services that people need and sometimes they are also an incubator for businesses. Even some downtown businesses started out as a home-based business. That is further reason why we should be supporting them."

Wind said while $50 might not be a "make-or-break" figure, costs add up and the city should do more to support economic development. A reduction would have been "a strong statement" to the business community, he added.

"We do very little in the city for economic development," Wind said. "I thought a $50 reduction was at least an opportunity to make a token gesture to encourage economic development in the city."

Others at council thought the increase made sense, however. Mayor Gord Van Tighem pointed out that as a former president of the chamber, increases to home-based businesses were often encouraged.

"At that time, some approved the idea of increased charges to home-based business so that people would be encouraged to go into a storefront and support people who are putting money into commercial development and having to pay the bills," he said.

Van Tighem said money is primarily going into clerical work by city staff to review the homes looking for business licences.

Coun. Mark Heyck said he might have considered keeping the fee at $150 but not lowering it.

"I could have supported something that said hold the line, as opposed to decreasing it," he said, noting it wouldn't be fair to drop home-based business licensing fees and not commercial fees.

"The last time these fees came up they put both home-based businesses and commercial on par with each other."

Coun. Bob Brooks who is a past executive director for the NWT Chamber of Commerce, was "absolutely for" the increase and said the $200 was a reasonable figure. Had he supported the $50 decrease, it would have meant council having to find other rates to increase in order to meet budget requirements.

"In the past there has been the philosophy that businesses that are established and put in infrastructure and staffing and all things that make a business, are not in the same footing as a home-based business who only operate out of their house," he said.

"While we want to make the rates low enough to encourage home-based businesses to get established, you look at the rate structure, I think it is fair."

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