The town of Garland has raised its privilege license fee for electronic gaming operations by $300 per terminal, from $200 to $500 for each machine in a sweepstakes establishment.
That move, along with another to bring fees in line with state requirements, was made during a special meeting of the Garland Board of Commissioners Thursday. Town clerk Pam Cashwell said she had done research, with the assistance of city of Clinton staff, into privilege license fees and brought the matter to Garland commissioners.
The issue has come up during a couple recent Garland meetings, with various ways of increasing revenue being discussed. Every person, firm or corporation engaging in a business activity, trade, service or profession is subject to a privilege license fee by local government. Over the last couple years, license fees for electronic gaming have become one of the highest assessed by some local governments as the state gives discretion to municipal boards as to how and what they will charge.
“On some, it is not up to the municipality to decide. We have, per my review, not been compliant with some of the fees. If we’re going to do something, I want to be within the line of the law,” said Cashwell. Among those that needed modification, barbershops and beauty salons were to be billed $2.50 per operator, where Garland was charging $15. The town also nixed a $5 charter fee.
The town has not been charging at all in other areas. “There are some accounts we don’t bill for privilege licenses that we can bill,” Cashwell noted. “Even if there is no building (in Garland), if they bill for a service, we can charge for that.”
Cashwell offered a standard schedule of privilege license fees and regulations, saying that direction from the board was needed to send renewal notices out as soon as possible. The fees are due June 30 and Cashwell said letters had already been drafted in anticipation of possible board approval. The letters began going out Friday.
The privilege license tax year covers the period from July 1 to June 30 of each year. The tax year for beer and wine sales is May 1 to April 30. Persons entering business after Jan. 31 of the tax year may secure the license for the remainder of the year for one-half of the tax required. There is no pro-ration of beer and wine license.
The board approved the slate of license fees encompassing every type of business, with the majority of the fees falling in the range of $10 to $50 a year. There are just a handful that are more than $100 each year, including electronic gaming.
Cashwell asked whether the board wanted to modify its current fee of $200 per gaming terminal. She said Roseboro charges $750 per machine and Clinton assesses a fee of $1,000 per machine. She explained that a sticker with a corresponding number is assigned upon payment for each terminal. That sticker, a tax stamp, is not transferable, she noted. It allows the town to check to ensure all machines are accounted for and being taxed, if necessary.
“Right now, we’re pretty much going on their word,” Cashwell said.
“So we would have the right to check on them anytime we see fit?” asked Commissioner Ralph Smith.
“Yes,” said Cashwell. “We would also have the ability to go into establishments and make sure they’re selling what they’re licensed to sell.”
Commissioner Denise Toler said she felt a $1,000 per machine fee was “too high for this town.”
“I don’t think you can go less than $750,” said Commissioner Matthew Register. Toler said she thought $500 was a better number. Smith agreed.
“I don’t think we need to run them off,” said Smith. “We need the business. You have to give them incentive to come here. I think if I have the option of Roseboro or Garland at $750, I would choose Roseboro because there’s more population there.”
Register said increased revenue was a positive, but attracting sweepstakes establishments to town was not the best way to do that.
“I know we need the business, but I’ll tell you what we don’t need. We don’t need every building with poker machines in it,” said Register. “I don’t want to live in that kind of town.”
Toler and Commissioner Haywood Johnson said they did not believe that would happen. Currently, there are two known establishments in Garland that are currently subject to the license tax per terminal, including one that has 16 terminals and another that has around 30, according to town officials.
“That is still an increase of $300,” Smith noted.
The board voted unanimously to adopt the change, as well as to revise the payment cycle for privilege license fees to bring them all in line with each other on the July 1- June 30 timeline, with the exception of beer and wine sales. Cashwell noted that some are out of sequence, including those that pay the electronic gaming fees.
The board voted to increase the rate to $500 effective July 1, 2012. They will prorate on a monthly basis for businesses whose privilege licenses are currently scheduled to expire in February 2013 and bring them in line with others in Garland.
Chris Berendt can be reached at 910-592-8137 ext. 121 or via email at sicrime@heartlandpublications.com.
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