Senate sidetracks admin bill regarding business license fees
Concerned with having the government set business license fees through a rule making process, the Senate agreed to “table” for now, until an appropriate time next year, an administration bill which seeks to, among other things, delete provisions of the statute which set business license fees.
The Senate’s decision was made during the second reading of the proposed legislation late last week after a Senate Economic Development Committee hearing where Commerce Department director Keniseli Lafaele testified.
According to the proposal, the DOC director would have the authority to set fees for business licenses through a rule making process, following public hearings.
However, some senators were concerned with this provision of the bill and asked Lafaele for an explanation as to why the administration is proposing to delete all business license fees currently set by law.
Lafaele explained this statute has been in place for some 40 years and having fees set by a rule making process will make it easy for the government to adjust the fees when needed in accordance with economic conditions, instead of having any future changes sent to the Fono for approval when the need arises.
He said the rule making process will require public hearings to explain any proposed hike and provide an opportunity for the community to comment. He said such a hearing can also be done specifically for the Fono — to gather input from lawmakers.
Lafaele noted current regulation requires a public hearing when there are 25 people who petition for one, but the administration plans to hold public hearings no matter if there are any requests made.
Sen. Nua Saoluaga said he remains concerned with the promise of public hearings through the rule making process, adding that other ASG departments and entities end up raising fees without calling in the community to hear their input.
A good example, said Nua, is the golf course where fees are hiked with no public input at all. He said this will be the same problem if business fees are set by rule making.
Nua said the current process is safe and secure for the private sector as well as the community because the fees are set by law and everyone knows the fee rates year-round.
Lafaele responded the rule making process for business licenses would be different, in that public hearings will be called even if no one requests such hearings.
Nua wasn’t satisfied and fired off more questions, like how the public hearings are going to be conducted, where they will be held, and when.
Lafaele said these questions can be addressed by adopting rules to administer these proposed changes in the bill. However, if the Senate wants specific details, they can amend the bill.
Nua was not convinced with the explanation, saying the community is currently well protected with the fees set by law, and not in the way this bill is being presented to the Senate.
Sen. Magalei Logovi’i said he has concerns with the use of the word “may” because this would be a loophole in the law, thereby avoiding the holding of any public hearings, while the current law using “shall” is enforcement to ensure that public hearings are conducted.
Magalei said he agrees with the concerns raised by Nua over the rule making process to set fees, which is something that requires additional time for the Senate to fully review. His comments were echoed by other senators.
Last Friday, the House approved in third and final reading its version of the bill, after amendments were made following a committee hearing early last week.
The biggest change made by the House is to restore current language that the administration is trying to delete and that is, the statute setting different business license fees, including license fees for fundraising events like bingo, visiting foreign entertainment groups, and specific businesses — e.g. hotel operations.
The House bill is expected to be introduced in the Senate today. It’s unclear what action the Senate will take on the House’s version.