Tax loophole creation being proposed by two Oshkosh Common Councilors
Coming before tomorrow night's meeting of the Oshkosh Common Council will be a proposed amendment to a city ordinance - sponsored by councilors Paul Esslinger and Dennis McHugh - which, according to this article in the Oshkosh Northwestern, would exempt business tenants from the city licensing law that pulls restaurant and liquor licenses for delinquent taxes on the building if the building is owned by someone else.
On the surface this seems like a good idea. After all, why punish the business owner for the bad deeds of the landlord? But the issue cuts deeper than just that, and that is what must be considered.
The ordinance as it stands right now gives the city some teeth in its tax collection efforts. It may not be perfect and may not always achieve the optimum results, but it is better than the alternative. At least with the ordinance as it exists today, delinquent landlords know that if a tenant loses their liquor license because of that delinquency, their tenant is likely going to have a very strong case against them in a court of law for lost business.
Second, if word of a commercial landlord's delinquency and its subsequent problems gets around to other potential tenants, that may cause the landlord some difficulty in being able to rent out their commercial space in the future. That, too, may be an incentive for paying their fair share to the city when due. You take that away, and there is little to no incentive that I can see for a delinquent taxpayer to pay up. And if he or she doesn't pay for a long enough period of time, the property will eventually be foreclosed on and that could very well put those innocent business tenants out of business anyway - or at least put them in a position where they're looking for new commercial space.
Third, by amending the ordinance, and depending on how it's written, it could set up a scenario where it is applied in different ways in different situations.
In summary, I think changing the ordinance is a bad idea. Certainly, any business owner can get caught in the wheels of a landlord's tax delinquency. But in the case of Cranky Pat's Pizza, for example, they should have chosen their landlord a little more carefully. They knew before they even opened last year that their landlord, Ben Ganther, is infamous for not paying taxes in full on his 100 N. Main property. They took a gamble, came up short, and now want the city to do something to help them retain their liquor license, despite Ganther's delinquency.
Bottom line: While I feel for most innocent business caught in the crosshairs of City Hall and the tax collection department, the city council should leave the ordinance stand as-is, and not only hold the landlord responsible for his or her taxes, but also withhold the liquor license for that property until the taxes are paid in full. If the business tenant loses business or is forced to close as a result of that action, they need to pursue their deadbeat landlord for their losses. And the city should once and for all, stop doing business with business owners who don't pay their taxes when owed.
On the surface this seems like a good idea. After all, why punish the business owner for the bad deeds of the landlord? But the issue cuts deeper than just that, and that is what must be considered.
The ordinance as it stands right now gives the city some teeth in its tax collection efforts. It may not be perfect and may not always achieve the optimum results, but it is better than the alternative. At least with the ordinance as it exists today, delinquent landlords know that if a tenant loses their liquor license because of that delinquency, their tenant is likely going to have a very strong case against them in a court of law for lost business.
Second, if word of a commercial landlord's delinquency and its subsequent problems gets around to other potential tenants, that may cause the landlord some difficulty in being able to rent out their commercial space in the future. That, too, may be an incentive for paying their fair share to the city when due. You take that away, and there is little to no incentive that I can see for a delinquent taxpayer to pay up. And if he or she doesn't pay for a long enough period of time, the property will eventually be foreclosed on and that could very well put those innocent business tenants out of business anyway - or at least put them in a position where they're looking for new commercial space.
Third, by amending the ordinance, and depending on how it's written, it could set up a scenario where it is applied in different ways in different situations.
In summary, I think changing the ordinance is a bad idea. Certainly, any business owner can get caught in the wheels of a landlord's tax delinquency. But in the case of Cranky Pat's Pizza, for example, they should have chosen their landlord a little more carefully. They knew before they even opened last year that their landlord, Ben Ganther, is infamous for not paying taxes in full on his 100 N. Main property. They took a gamble, came up short, and now want the city to do something to help them retain their liquor license, despite Ganther's delinquency.
Bottom line: While I feel for most innocent business caught in the crosshairs of City Hall and the tax collection department, the city council should leave the ordinance stand as-is, and not only hold the landlord responsible for his or her taxes, but also withhold the liquor license for that property until the taxes are paid in full. If the business tenant loses business or is forced to close as a result of that action, they need to pursue their deadbeat landlord for their losses. And the city should once and for all, stop doing business with business owners who don't pay their taxes when owed.
posted by Cheryl Hentz at 10:41 PM
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