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Minutes - San Leandro City Council Meeting - September 18, 1995 Page - 8 - NEW BUSINESS (continued) D. Matter of Public Meeting to Provide Information to the Public on the Proposed Change in the Method of Computation of the Business License Fee and DFSI (public meeting to provide information, as required by State law) . No Action Required. - Letter Regarding Change in Business License Fee Computation from James A. Begier, Treasurer; Ben A. Begier Co. , Inc. ; dated September 7, 1995. John Jermanis, Finance Director, presented the staff report. He said this is a continuation of the public input process started in July with Chamber of Commerce-sponsored business forums. He said the 1995-96 budget proposes changing the Business License rate from "per employee" to "gross revenue. " He said San Leandro is the only city in Alameda County with a per employee basis. He said the recommended changes will increase revenue by $400,000, while allowing a decrease in DFSI rates to provide increased economic development incentives. He described the notification process to businesses, comments received, and said the proposal was adjusted accordingly. He said San Leandro's rate still will be the lowest in Alameda County, and the overall rate structure will still remain low. He noted a letter received from Begier Buick, objecting to auto dealer rates, and said he will continue discussions with them. He said the phase-in of the new rates will be five years. The Meeting was then opened to the public. James Begier, Begier Buick, 1915 East 14th Street, said the new rate structure is burdensome on car dealers and will impact their fleet programs. He said his fee will be 10 times more than anyone else is paying. He believes the basis of $40 million is fair. The proposed fee will ruin fleet business that brings in millions of dollars and sales tax revenue. He said he would like to meet with Mr. Jermanis and come back in October with modified rates. Martin Babinec, TriNet Employer Group, Inc. , 101 Callan Avenue, said some businesses might be adversely impacted by going from number of employees to gross receipts. He said TriNet's revenue is based on servicing employees around California, providing payroll , workers' compensation, benefit, and other services. Therefore, sales are based on total payroll dollars, which reflects a high top line of total revenue, but which actually has a thin margin of less than 3%. He said his company is unfairly penalized by this proposal . Last year he paid $1,400; under the current proposal , he will pay $22,000, and within five years, $100,000. He recommended building in flexibility to address unusual business structures. Darlene Evans, 361 Bristol Boulevard, said Business License fees affect people who have duplexes and 24-unit apartments. She said people must go outside San Leandro to find employment, education, or rehabilitation services.