The multitude of challenges that the new mayor of America’s second largest city will face starting tomorrow constitutes a laundry list of items. None needs greater focus than revamping the Office of Finance and the business licensing process. If Los Angeles ever wants to regain its business friendly status, this is where he needs to start.
There are many tools the City of Los Angeles has found to antagonize current and prospective businesses, but the licensing process and the people who oversee it are at the top -- largely because Los Angeles has been in such need of revenue they have attacked businesses like a mortal enemy. Here are some of the many ways they do it:
1. It starts with the rates. I actually have not had my business in Los Angeles for 24 years and doubt I would move back. For the honor of being a business in Los Angeles I would pay more than five times as much as I do to West Hollywood. This is not like moving states for lower taxes. For many businesses it is moving blocks when the opportunities occur to avoid the oppressive and complicated tax system. But it is more than money.
2. Because of the confusing tax structure, sometimes businesses find they have been either charged the wrong rate or they can take advantage of a rate that is advantageous to a favored group, like the entertainment industry. When that occurs the City does not return your money; it gets applied against future license fees. They make it even harder. The credit is not shown on your statement -- you have to call the Office of Finance, contact the person with whom you previously worked and get the credit applied against the current year’s fees. Heaven knows what happens if that person retires or gets kidnapped by aliens. It is a uniquely anti-taxpayer system not employed by any other tax collection agency of which I have become aware.