Mountain View resident Mike Lehner said he was baffled as he read the notice sent to his wife Jennifer's health consulting business. He felt like the city was about to revoke their license.
"This was the first we heard about this," he said. "It gave us less than a week's notice, and it said it was the second and final notice, but we never received anything before."
So in late March, Lehner went to City Hall with his wallet, and he found he wasn't alone. A crowd of other frustrated business owners was lining up outside the Finance Department office, angry about the abrupt warnings over $3. City staff seemed to be struggling to control the livid group, he said.
The city did offer an online payment system, but many business owners were miffed that they would be charged a $1.25 convenience fee for using it.
Finance Director Patty Kong agreed it was quite the mess. The last week of March her team had to deal with hundreds of irate business owners, in person and over the phone.
"It was an unfortunate event that this had gone out in this manner," she said. "There were quite a few people who had thought they had paid their licenses already."
The problem, Kong said, was the city's automated software for sending out notices. The system was set up so it didn't send out notices for amounts less than $5 until they were delinquent. For that reason, an initial notice that was supposed to go out in January was never actually sent out, she said.
While the businesses still needed to pay the fee, Kong admitted her department had dropped the ball by not giving ample notice. The final-warning letters were also poorly worded, she said, making it seem like business owners were on the cusp of penalties. In late March, her office sent out thousands of apology letters that tried to clarify the situation.
The new fee being levied on all businesses comes as part of new state legislation intended to increase disability access. Starting in October 2017, all California business license-holders were charged an additional $1, and this fee increased to $4 at the start of 2018.
Kong said all businesses with licenses valid for 2018 are required to pay the new state surcharge, regardless of whether they paid their license fees months earlier.
About 1,600 businesses have paid the new state fee, according to the Finance Department.
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