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8.C. - Page3 About 75% of the business license revenue is generated by businesses that fall into the "general business" category. The current tax rates for this category are $37 per business plus $24 for each full-time employee and $12 for each part-time employee. If the proposed increase is approved by the voters these rates would increase, over a three year period, to $59 per business plus $38 for each full-time employee and $19 for each part-time employee. It is staff's recommendation that the maximum tax, along with all other taxes in the Business License ordinance, increase at the same recommended rate. A proposed increase in the Business License Tax, assuming the Council does not attach any restrictions upon the use of these revenues, would constitute a general tax measure and require a simple majority of the voters to pass. If the City Council directs staff to proceed with pursuing an increase to the Business License Tax rate, the measure would also be proposed through a ballot question. As was the case for the recommended TOT ballot question, Council members Bain and Seybert, as an ad hoc subcommittee of the Finance Committee, reviewed and provided input into the recommended ballot question language for the Business License Tax measure (allowing some discretion for staff to revise for consistency and legal compliance): "To preserve funding for general city services including libraries, parks, street repair, and public safety, shall an ordinance be approved increasing, over three years, the annual "general business"base tax by �22 and the annual per-employee tax by�7- �14, with commensurate increases in other business sectors, annually ad�usted thereafter based on the Consumer Price Index, with proceeds placed in the City's General Fund which is sub�ect to the City's annual independent financial audit?" Com m u n ity O utreach On November 15, 2010 the Council Finance Committee directed staff to bring the same Business License Tax increase measure that was submitted to the voters in November, 2009, to the Council for consideration along with an increase in the TOT rate from 10% to 12% (that measure did not pass). The committee also directed staff to initiate a public outreach process to inform key stakeholders of the effect of these two proposed tax increases. Staff has made presentations to the Redwood City — San Mateo County Chamber of Commerce's Economic Development Committee, Housing and Transportation Committee, and Government Relations Committee. Once the Council takes action on these two possible tax increases the Chamber will survey its members and then ask its Board of Directors to take a position on these measures.