District Of Columbia 2023-2024 Regular Session

District Of Columbia Council Bill B25-0284 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1
2	2
3	3
4	4
5	5
6	6
7	7
8	8
9	9
10	10
11	11
12	12	May 2, 2023
13	13
14	14	Nyasha Smith, Secretary
15	15	Council of the District of Columbia
16	16	1350 Pennsylvania Ave, N.W.
17	17	Washington, DC 20004
18	18
19	19	Dear Secretary Smith:
20	20
21	21	Today, along with Councilmembers Trayon White, Zachary Parker, Matthew Frumin, Brooke Pinto,
22	22	Brianne K. Nadeau, and Robert C. White, Jr., I am introducing the “Helping Small Businesses Recover
23	23	and Thrive Amendment Act of 2023”. Please find enclosed a signed copy of the legislation.
24	24
25	25	Many of our small businesses are still recovering from the pandemic, and the District needs to provide
26	26	the necessary support to help them not only make ends meet, but thrive. This is a critical juncture for
27	27	the District’s economic recovery, and small businesses are drivers of growth, innovation, and safe and
28	28	vibrant neighborhoods. But many encounter frustrating bureaucratic red tape and unnecessary fees,
29	29	making their difficult jobs even harder. For example, bars and restaurants are on the hook for alcohol
30	30	licensing fees for employees that have moved on to other jobs, and many small businesses fail to receive
31	31	important notices about critical license renewals. They also regularly encounter widespread public
32	32	confusion about recent changes to the District’s minimum wage laws, and they’re nickeled and dimed by
33	33	transaction fees.
34	34
35	35	The Helping Small Businesses Recover and Thrive Amendment Act of 2023 fosters economic growth and
36	36	makes life easier for small business owners by:
37	37	• Increasing the tax credit available to qualifying businesses for a portion of rent or property taxes
38	38	paid and reducing the taxable value of the commercial property if it is rented or owned by the
39	39	qualifying business. The bill would also allow this real property tax credit to increase year-over-
40	40	year with the annual average Consumer Price Index. Existing law allows for a $5,000 credit to be
41	41	claimed by qualified businesses, and this would raise the credit to $10,000.
42	42	• Prohibiting sales tax from being imposed on service fees at restaurants, ensuring parity between
43	43	service fees and tips. Existing law allows for a tax on service charges in connection with serving
44	44	food or beverages (including alcohol) in cafes, bars, and similar establishments where food or
45	45	drink is served. 2
46	46	• Clarifying that, absent any contrary language, service fees are not considered sales for the
47	47	purposes of calculating rent in a commercial lease agreement. Existing commercial leases may
48	48	be unclear as to whether service fees are considered “sales” for the purposes of calculating rent.
49	49	• Allowing small businesses to receive written notice of license renewals by the Department of
50	50	Licensing and Consumer Protection (“DLCP”) to ensure ample notice of upcoming deadlines.
51	51	Existing law allows DLCP to provide either written or electronic methods of communication about
52	52	license renewals, but DLCP only provides notice through electronic means. This has caused
53	53	numerous small businesses to reach out to my office on the brink of losing their basic business
54	54	license because they missed or didn’t receive an email.
55	55	• Modifying requirements for bar manager licensure, allowing businesses to cover the credential
56	56	on an annual basis or three-year basis. This would allow bars and restaurants to avoid paying for
57	57	a license for a worker who might not otherwise remain with the business for the three-year
58	58	license period. Current law requires payment for the license at the time of the application and is
59	59	tied to the employee, not the business, leaving the business holding the bag if an employee
60	60	leaves before their license expires.
61	61	• Mandating the development and launch of a public awareness campaign to educate District
62	62	residents, visitors, and others who frequent food and drink establishments across the city about
63	63	upcoming changes to the tipped minimum wage. The current status of the tipped minimum
64	64	wage is confusing to consumers, given recent changes to the law.
65	65	• Allowing sexual harassment training to be administered virtually instead of in person for all
66	66	employees, including managers, like many other businesses, companies, and non-profit
67	67	organizations. Current law requires harassment prevention training every two years for all
68	68	employees of restaurant operators with at least one tipped employee, with the law allowing for
69	69	tipped employees and owners and operators of businesses to attend virtually via a real-time
70	70	video stream. However, managers must attend the training in person. The bill makes this
71	71	important training more accessible to industry staff.
72	72	• Prohibiting the charging of swipe fees on the sales tax portion of a credit or debit card
73	73	transaction. Current law allows credit and debit card companies to tack fees onto the entire
74	74	amount of a transaction. The bill would provide some relief to small businesses who accept credit
75	75	or debit cards at payment.
76	76
77	77	Please feel free to reach out to me or my Legislative Director, Antonio Nunes, with any questions or for
78	78	additional information.
79	79
80	80	Sincerely,
81	81
82	82
83	83
84	84	Councilmember Charles Allen, Ward 6
85	85	Chairperson, Committee on Transportation & the Environment
86	86	Vice Chair, Metropolitan Washington Council of Governments
87	87	1
88	88	___________________________ ______________________________ 1
89	89	Councilmember Trayon White, Sr. Councilmember Charles Allen 2
90	90	3
91	91	4
92	92	___________________________ ______________________________ 5
93	93	Councilmember Zachary Parker Councilmember Matthew Frumin 6
94	94	7
95	95	8
96	96	___________________________ ______________________________ 9
97	97	Councilmember Brooke Pinto Councilmember Brianne K. Nadeau 10
98	98	11
99	99	12
100	100	___________________________ 13
101	101	Councilmember Robert C. White, Jr. 14
102	102	15
103	103	16
104	104	17
105	105	A BILL 18
106	106	19
107	107	________ 20
108	108	21
109	109	22
110	110	IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 23
111	111	24
112	112	_________________ 25
113	113	26
114	114	27
115	115	To amend Title II of the Service Improvement and Fiscal Year 2000 Budget Support Act of 1999 28
116	116	to allow managers of a business that employs an employee who receives a tipped wage to 29
117	117	receive sexual harassment training virtually from the Office of Human Rights; to amend 30
118	118	section 25-120 of the District of Columbia Official Code to allow ABCA licensees to pay 31
119	119	for a manager’s license on an annual basis; to amend the Tipped Wage Workers Fairness 32
120	120	Amendment Act of 2018 to require the Mayor to launch a public awareness campaign 33
121	121	regarding the elimination of the tipped minimum wage; to amend An Act To provide for 34
122	122	the payment and collection of wages in the District of Columbia to allow managers of a 35
123	123	business that employs an employee who receives a tipped wage to receive sexual 36
124	124	harassment training virtually; to amend An Act To codify a code of law for the District of 37
125	125	Columbia to provide a presumption in commercial lease agreements, absent any language 38
126	126	to the contrary, that service fees do not constitute sales for the purposes of calculating 39
127	127	rent; to amend Title 47 of the District of Columbia Official Code to increase the tax credit 40
128	128	for a portion of rent or property taxes paid for a qualifying corporation or qualifying 41
129	129	unincorporated business to a $10,000 maximum and to allow an increase year-over-year 42
130	130	with the annual Consumer Price Index, to clarify that additional service charges provided 43
131	131	with the sale of food or drink prepared for immediate consumption are not subject to 44
132	132	sales tax, and to allow businesses to receive notice of license renewals through the mail; 45
133	133	and to prohibit the charging of interchange fees on sales tax as part of credit and debit 46
134	134	card transactions. 47
135	135	48
136	136	2
137	137	BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMB IA, That this 49
138	138	act may be cited as the “Helping Small Businesses Recover and Thrive Amendment Act of 50
139	139	2023”. 51
140	140	Sec. 2. Section 206a(b)(3) of Title II of the Service Improvement and Fiscal Year 2000 52
141	141	Budget Support Act of 1999, effective October 20, 1999 (D.C. Law 13-38; D.C. Official Code § 53
142	142	2-1411.05a(b)(3)), is amended by striking the phrase “attend in-person training” and inserting the 54
143	143	phrase “receive in-person or online training” in its place. 55
144	144	Sec. 3. Section 25-120(c) of the District of Columbia Official Code is amended to read as 56
145	145	follows: 57
146	146	“(c) A manager’s license shall be valid for 3 years or until surrendered, suspended, or 58
147	147	revoked; provided, that the licensee may pay the fee for the manager’s license in full at the time 59
148	148	of application or in part on an annual basis.”. 60
149	149	Sec. 4. The Tipped Wage Workers Fairness Amendment Act of 2018, effective 61
150	150	December 13, 2018 (D.C. Law 22-196; D.C. Official Code passim), is amended by adding a new 62
151	151	section 4a to read as follows: 63
152	152	“Sec. 4a. Public awareness campaign regarding the elimination of the tipped minimum 64
153	153	wage. 65
154	154	“(a) No later than 180 days after October 1, 2024, the Mayor shall launch a campaign to 66
155	155	raise awareness and educate the public about changes to the tipped minimum wage brought about 67
156	156	by the District of Columbia Tip Credit Elimination Act of 2022, effective February 23, 2023 68
157	157	(D.C. Law 24-281; D.C. Official Code § 32-1003). 69
158	158	“(b) The campaign in subsection (a) shall: 70
159	159	3
160	160	“(1) Include the preparation of written and electronic materials that state in plain 71
161	161	language the changes brought about by the District of Columbia Tip Credit Elimination Act of 72
162	162	2022, effective February 23, 2023 (D.C. Law 24-281; D.C. Official Code § 32-1003); 73
163	163	“(2) Ensure that residents, businesses, tourists, and other interested parties are 74
164	164	aware of the changes brought about by the District of Columbia Tip Credit Elimination Act of 75
165	165	2022, effective February 23, 2023 (D.C. Law 24-281; D.C. Official Code § 32-1003), and what 76
166	166	consumers and businesses can expect in terms of implementation and any necessary changes to 77
167	167	existing practices and behaviors; and 78
168	168	“(3) Be conducted in English and any non-English language spoken by a limited 79
169	169	or no-English proficient population that constitutes 3% or 500 individuals, whichever is less, of 80
170	170	the population impacted, or expected to be impacted, of the changes brought about by the 81
171	171	District of Columbia Tip Credit Elimination Act of 2022, effective February 23, 2023 (D.C. Law 82
172	172	24-281; D.C. Official Code § 32-1003).”. 83
173	173	Sec. 5. Section 6a(b) of An Act To provide for the payment and collection of wages in 84
174	174	the District of Columbia, approved August 3, 1956 (70 Stat. 976; D.C. Official Code § 32-85
175	175	1306.01(b)), is amended by striking the phrase “attend in-person” and inserting the phrase 86
176	176	“attend either in-person or online” in its place. 87
177	177	Sec. 6. An Act To establish a code of law for the District of Columbia, approved March 88
178	178	3, 1901 (31 Stat. 1268; D.C. Official Code passim), is amended by adding a new section 505a to 89
179	179	read as follows: 90
180	180	“Sec. 505a. Service fees not included in definition of “sales” for commercial leases. 91
181	181	“(a) Absent any language to the contrary in a lease for a commercial tenancy, service fees 92
182	182	shall not constitute sales for the purposes of calculating percentage or rent for the property 93
183	183	leased. 94
184	184	4
185	185	“(b) If there is any ambiguity in a commercial lease agreement concerning the inclusion 95
186	186	of service fees in calculating percentage or other rent for the property leased, there shall be a 96
187	187	presumption that service fees are not to be included in the calculation.”. 97
188	188	Sec. 7. Title 47 of the District of Columbia Official Code is amended as follows: 98
189	189	(a) Section 47-1807.14 is amended as follows: 99
190	190	(1) A new subsection (b-1) is added to read as follows: 100
191	191	“(b-1) For taxable years beginning after December 31, 2023, a qualified corporation may 101
192	192	claim a credit against the tax imposed by this chapter as follows: 102
193	193	“(1) A tax credit equal to 20% of the total rent paid by the corporation for a 103
194	194	qualified rental retail location during the taxable year, not to exceed $10,000; or 104
195	195	“(2) A tax credit equal to the total Class 2 real property taxes, pursuant to D.C. 105
196	196	Official Code § 47-811, paid by the qualified corporation for a qualified retail owned location 106
197	197	during the taxable year, not to exceed the lesser of the real property tax paid during the taxable 107
198	198	year or $10,000.”. 108
199	199	(2) A new subsection (c-1) is added to read as follows: 109
200	200	“(c-1) The credit claimed under this section in any one taxable year shall be increased as 110
201	201	determined by the Mayor on the basis of the annual Consumer Price Index for the Washington-111
202	202	Baltimore Metropolitan Statistical Area for all-urban consumers published by the Department of 112
203	203	Labor, or any successor index, as of the close of the 12-month period ending on September 30 of 113
204	204	such tax year.”. 114
205	205	(b) Section 47-1808.14 is amended as follows: 115
206	206	(1) A new subsection (b-1) is added to read as follows: 116
207	207	“(b-1) For taxable years beginning after December 31, 2023, a qualified unincorporated 117
208	208	business may claim a credit against the tax imposed by this chapter as follows: 118
209	209	5
210	210	“(1) A tax credit equal to 20% of the total rent paid by the qualified 119
211	211	unincorporated business for a qualified rental retail location during the taxable year, not to 120
212	212	exceed $10,000; or 121
213	213	“(2) A tax credit equal to the total Class 2 real property taxes, pursuant to D.C. 122
214	214	Official Code § 47-811, paid by the qualified unincorporated business for a qualified retail 123
215	215	owned location during the taxable year, not to exceed the lesser of the real property tax paid 124
216	216	during the taxable year or $10,000.”. 125
217	217	(2) A new subsection (c-1) is added to read as follows: 126
218	218	“(c-1) The credit claimed under this section in any one taxable year shall be increased as 127
219	219	determined by the Mayor on the basis of the annual Consumer Price Index for the Washington-128
220	220	Baltimore Metropolitan Statistical Area for all-urban consumers published by the Department of 129
221	221	Labor, or any successor index, as of the close of the 12-month period ending on September 30 of 130
222	222	such tax year.”. 131
223	223	(c) Section 47-2001(n)(2) is amended by adding a new subparagraph (E-i) to read as 132
224	224	follows: 133
225	225	“(E-i) An additional charge for a service provided with the sale of food or 134
226	226	drink prepared for immediate consumption, as defined in subsection (g-1) of this section.”. 135
227	227	(d) Section 47-2851.10 is amended by adding a new subsection (a-1) to read as follows: 136
228	228	“(a-1) The Department shall make the option of notice by first-class mail available to all 137
229	229	licensees of their impending license expirations, renewals, and statements of renewal fees.”. 138
230	230	Sec. 8. Prohibition on charging of interchange fees on sales tax part of credit and debit 139
231	231	card transactions. 140
232	232	(a)(1) The amount of sales tax or fee that is calculated as a percentage of an electronic 141
233	233	payment transaction amount and listed separately on the payment invoice or other demand for 142
234	234	6
235	235	payment shall be excluded from the amount on which an interchange fee is charged for that 143
236	236	electronic payment transaction. 144
237	237	(2) Such taxes include sales and use taxes under § 47-2002(a)(2)-(3). 145
238	238	(b) A payment card network shall either: 146
239	239	(1) Deduct the amount of any tax imposed from the calculation of interchange 147
240	240	fees specific to each form or type of electronic payment transaction at the time of settlement; or 148
241	241	(2) Rebate an amount of interchange fee proportionate to the amount attributable 149
242	242	to the tax or fee. 150
243	243	(c)(1) A deduction or rebate shall occur at the time of settlement when the merchant or 151
244	244	seller is able to capture and transmit tax or fee amounts relevant to the sale at the time of sale as 152
245	245	part of the transaction finalization. 153
246	246	(2) If a merchant or seller is unable to capture and transmit tax or fee amounts 154
247	247	relevant to the sale at the time of sale, then the payment card network shall accept proof of tax or 155
248	248	fee amounts collected on sales subject to an interchange fee upon the submission of sales data by 156
249	249	the merchant or seller and promptly credit the merchant or seller’s settlement account. 157
250	250	(d) A payment card network that violates the provisions of this section is subject to a civil 158
251	251	penalty of no more than one thousand dollars ($1,000) per violation, payable to the Office of Tax 159
252	252	and Revenue, and shall refund the surcharge to each merchant or seller. 160
253	253	(e) For the purposes of this section, the term: 161
254	254	(1) “Credit card” means a card or device, whether known as a credit card or by 162
255	255	any other name, issued under an arrangement pursuant to which a card issuer gives to a 163
256	256	cardholder the privilege of obtaining credit from the card issuer or other person in purchasing or 164
257	257	leasing property or services, obtaining loans, or otherwise. 165
258	258	(2) “Debit card”: 166
259	259	7
260	260	(A) Means any instrument or device, whether known as a debit card or by 167
261	261	any other name, issued with or without a fee by an issuer for the use of the cardholder in 168
262	262	depositing, obtaining, or transferring funds; 169
263	263	(B) Includes a general-use prepaid card, as defined in 15 U.S.C. § 1693l-1; 170
264	264	and 171
265	265	(C) Does not include paper checks. 172
266	266	(3) “Electronic payment transaction” means a transaction which a person uses a 173
267	267	debit card, credit card, or other payment code or device issued or approved through a payment 174
268	268	card network to debit a deposit account or use a line of credit, whether authorization is based on 175
269	269	a signature, personal identification number, or other means. 176
270	270	(4) “Interchange fee” means a fee established, charged, or received by a payment 177
271	271	card network for the purpose of compensating the issuer for its involvement in an electronic 178
272	272	payment transaction. 179
273	273	(5) “Issuer” means a person issuing a credit or debit card, or the issuer’s agent. 180
274	274	(6) “Payment card network” means an entity that: 181
275	275	(A) Directly, or through licensed members, processors, or agents, provides 182
276	276	the proprietary services, infrastructure, and software that routes information and data to conduct 183
277	277	credit card or debit card transaction authorization, clearance, and settlement; and 184
278	278	(B) A merchant or seller uses in order to accept as a form of payment a 185
279	279	brand of credit card, debit card, or other device that may be used to carry out credit or debit 186
280	280	transactions. 187
281	281	(7) “Settlement” means the transfer of funds from a customer’s account to a seller 188
282	282	or merchant upon electronic submission of finalized sales transactions to the payment card 189
283	283	network. 190
284	284	8
285	285	Sec. 9. Fiscal impact statement. 191
286	286	The Council adopts the fiscal impact statement in the committee report as the fiscal 192
287	287	impact statement required by section 4a of the General Legislative Procedures Act of 1975, 193
288	288	approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 194
289	289	Sec. 10. Effective date. 195
290	290	This act shall take effect following approval by the Mayor (or in the event of veto by the 196
291	291	Mayor, action by the Council to override the veto), a 30-day period of congressional review as 197
292	292	provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 198
293	293	24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)), and publication in the District of 199
294	294	Columbia Register. 200