Riverside trustees last month gave the go-ahead for waiving a number of fees as incentives to anyone looking to open a new sales tax-generating business in the village in 2021.
The fee waivers were proposed by Village Manager Jessica Frances as part of a continuing response to the COVID-19 pandemic, which has impacted many local businesses.
Earlier this year, the village board approved waiving liquor license and outdoor dining license fees to help restaurants and bars hit hard in 2020 and part of 2021 by pandemic restrictions.
In addition to those fees, Frances proposed several other business fee waivers in 2021 to incentivize businesses to open in Riverside.
“While it’s not a significant dollar amount [in terms of revenue for the village], I think it would be very significant to those new businesses,” Frances told village trustees at their June 17 regular business meeting.
Among the fees waived for new businesses will be the $100 business license fee and $100 fire inspection fee. The village would also waive the $120 bi-annual health inspection fees.
The village would continue to offer waiving fees for a new liquor license ($1,800) or outdoor café license ($25) for any business wanting those amenities.
At most, a single business could see $2,265 in business-related startup fees waived in 2021, while the waiver for a non-food/alcohol business would be $440.
In order for the village to recover the cost for a food/drink business getting all of the proposed waivers, the business would have to generate either $56,625 or $75,500, depending on whether or not the business was located in one of the three officially designated Harlem Avenue business districts, which impose an additional tax on retail sales.
A non-food/drink business would have to generate either $11,000 or $14,667 in sales for the village to recover the cost of the fee waivers.
According to Frances, in 2019 before the pandemic, the total revenue of a Riverside restaurant ranged from $87,300 to about $1.8 million, based on that year’s tax returns.
In addition to the state sales tax, Riverside collects a 1-percent non-home rule sales tax and a 1-percent places-for-eating tax.
“Having any new business come into Riverside, it enhances the amenities to our residents while also it enhances [equalized assessed value of property], because you have what was once a vacant storefront is now being energized by a new business,” Frances said.
Village trustees will have to vote to officially adopt the policy to waive fees via a resolution that likely will appear on their July 15 board meeting agenda. The village manager suggested making any fee waivers retroactive to July 1, because there were some pending business license applications.
“We have individuals reviewing options within the village, so I’d like to afford them the opportunity of these waivers,” Frances said.
The fee waivers would be offered to new sales-tax generating businesses only, and is intended as a one-year perk. Business licenses are renewed on a calendar year basis, while liquor licenses expire annually on April 30, so that fee waiver would carry over into the first part of 2022.