Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, May 11, 1995 TAG: 9505110120
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: DAN CASEY STAFF WRITER
DATELINE: LENGTH: Long
The cost of creativity may be going up.
Citing a local law that has been only spottily enforced until recently, the city of Roanoke wants hundreds of artists, crafts makers and food vendors to cough up $50 for setting up a booth at this year's Roanoke Festival in the Park.
Organizers of the 26-year-old festival were notified of the "itinerant merchant license fee" by the commissioner of revenue's office last month.
In one form or another, the fee has existed in Roanoke for 40 years, but it's never been applied to Festival In the Park vendors before, said Wendi Schultz, executive director of the private, not-for-profit event.
The commissioner's office has asked for a list of vendors at the festival, a request Schultz turned down. Instead, she's referred the matter to lawyers at Woods, Rogers & Hazlegrove, who are wrangling with the city over it.
"I'm unwilling to be put in a position where I'm going to be collecting taxes for the city," Schultz said.
Commissioner of Revenue Marsha Compton Fielder said she's doing the job she was elected to do. Vendors at other local events such as the Railway Festival and the Henry Street Festival began paying the license fee last year. The fee was also charged to merchants who sold items at the Chili Cook-off last weekend, she said.
"I'm between a rock and a hard place," she said. "I'm charged with enforcing a license code that other people have been paying under. If I don't, I'm not doing my duty. If I do, I'm the bad guy."
She'll cease the effort when the law is changed or City Council in some other way exempts Festival in the Park - but not before, she said.
If enforced, the itinerant merchants license fee would affect roughly 370 vendors expected to display and sell artworks, crafts and food during Festival in the Park, Schultz said.
If all of the vendors paid up, the city could expect at least $18,500 in revenue from the two-weekend extravaganza - about the same amount it has collected in itinerant merchant fees in all of the past 15 months.
Schultz said her concerns are fourfold:
Because the festival kicks off in less than three weeks, she believes it's too late to tell vendors they must pay the fee. Fielder said her office notified Schultz early in April about the tax.
Schultz also questioned why the city has begun charging the fees now, although the law has been on the books for years. Fielder, who took office last year, said she believes her office was rebuffed in attempts to collect the fees years ago, and the matter was subsequently shelved.
There also is an apparent conflict in the code, which allows some crafts vendors at the City Market to set up by paying a $6 per week "street and other sellers" license fee, Schultz said. But Fielder said that fee applies only to "totally mobile" vendors, such as people who walk around and sell balloons during parades.
Finally, Schultz fears the $50 fee could deter many vendors, particularly amateur artists who use the festival as a low-cost venue to showcase their work to thousands of people. It's greater than the rental rate many of them pay the festival for the smallest display spaces.
Fielder said it's a question of fairness. Established local merchants pay a business, professional and occupational license tax and a variety of other taxes. Festival in the Park vendors get off scot-free, except for sales taxes they remit to the state, she said.
"I'm a big supporter of the festival, but the city has to look out for its permanent businesses also," she said.
Some vendors don't see it that way.
"I think it's ludicrous," said Anthony Gilbert, an amateur photographer who plans to exhibit less than 10 nature and outdoors photographs at the festival this year. He's paying the festival $30 in rent for a 4-foot-wide space along a fence.
Add to that his costs for pricey photographic supplies, matting and framing, plus setting up the booth, and the festival can already be downright expensive, Gilbert said. This year's event will be his third.
"I may not sell anything. I probably lose money because of what it costs to prepare for the show," Gilbert said. "If they enforce [the $50 fee], I probably wouldn't even participate."
Higher-grossing vendors in the festival's two-day art show don't like it either, said artist Eric Fitzpatrick, who is gearing up for his 19th straight festival in the park.
Fitzpatrick already pays the BPOL tax to Roanoke.
"I would think that that would put you in great shape for anything you want to do," he said.
The city has little to do with the festival, but taxpayers foot the bill for tens of thousands of dollars in services to it each year.
Under a contract with festival organizers that expires this year, the city has agreed to put up to $45,000 in goods and services into the event. Most of that is in providing electricians, grounds crews and other laborers, said Bill Clark, the city's public works director.
Schultz noted that the festival pays for its own security and trash pickup. Citing a study by a Roanoke College associate professor of economics, she said that direct and indirect spending as a result of the festival totals $4.5 million.
The festival also pays admissions taxes and meals tax on drinks and snacks it sells, she said.
Virginia Beach doesn't charge the itinerant merchant fee to vendors in its annual Boardwalk Art Festival, the closest equivalent that city has to Festival in the Park.
Instead, the not-for-profit foundation that runs the art festival assesses a gross receipts tax on vendors who don't already hold a Virginia Beach BPOL, said Phil Kellam, who works for the commissioner of the revenue in that city. It works out to a penny on each $5 of merchandise they sell, he said. That's the same as retail businesses in both Virginia Beach and Roanoke pay in BPOL taxes.
At that rate, a vendor would have to sell $25,000 in merchandise to owe $50 in BPOL taxes.
by CNB