After being lax during the pandemic year, Olympia Engineering Program specialist Andrew Curtis said the city is now regulating outdoor dining in downtown businesses.
Curtis spoke at the Parking and Business Improvement Area (PBIA) meeting yesterday, November 2. He discussed the city policy for the private commercial use of the public right-of-way (ROW), sidewalks and alleys for downtown outdoor dining, and the state's tax to collect starting next year.
"During the pandemic, we made a quick pivot to accommodate outdoor dining to keep the businesses going. But now we need to get back to and hopefully clarify the rules for businesses using the public right-of-way," Curtis said.
He said that while the city supports outdoor dining, they cannot lose sight of the sidewalks' purpose or use, which is mobility. They must keep it safe for pedestrians, maintain traffic sightlines, and maintain emergency exits.
"The right-of-way is a public resource that belongs to everyone, not just adjacent businesses," Curtis clarified.
"We also need to follow state laws… and collect the leasehold excise tax on behalf of the state, something the city is required to do," Curtis added.
According to Curtis, the leasehold excise tax is a state tax levy on the permanent private occupation of what is considered public space. Outdoor dining using the right-of-way is leasehold excise taxable.
Because the state requires tax collection for any permanent private occupation of public sidewalks, Curtis said the city developed two permitting pathways.
He said the state considers permanent and is subject to tax any occupation of the right-of-way lasting 30 days and railings anchored into the sidewalks, fences, fixtures, and platform that stay in place.
For permanent fixtures, businesses need:
The city also offers a temporary permitting pathway or arrangement.
Outdoor dining is considered temporary as long as tables and chairs are pulled in once every 29 days. No payment of the leasehold excise tax is needed.
For businesses who opt for temporary use of right-of-way or sidewalk, Curtis listed the following requirements:
Clean Alley Credit
Olympia is implementing a new program called "Clean Alley Credit.” The city wants businesses to adopt and take care of the alleys that do not have use for city services, such as waste pick-up, and are not needed for pedestrian mobility the same way the sidewalks.
"The city would credit them the rent they would typically pay for using the public ROW," Curtis informed the PBIA board members. "The rationale behind this credit is that it costs the city a lot of money to clean… and other city resources to maintain."
However, the city would need to collect the state leasehold excise tax for those with a permanent permit.
6 comments on this item Please log in to comment by clicking here