The council set Ordinance 25C‑22, which updates Chapter 5.01 of the Mercer Island Municipal Code governing business licenses, for second reading on Sept. 16. Finance Director Matt Moore said the primary change raises the minimum threshold exemption for out‑of‑city businesses from $2,000 to $4,000 and adds an automatic adjustment every four years tied to the Producer Price Index‑Urban, with rounding to the nearest $100 and floors/ceilings to simplify administration.

Why it matters: The updates align local code with a 2024 Association of Washington Cities model ordinance and state business licensing service procedures. The city participates in the Washington State Department of Revenue Business Licensing Service, which administers business licenses for Mercer Island; state rules require cities to adopt certain standardized language and provide 75 days’ notice to the Department of Revenue for code changes that affect business licensing.

Moore said staff also used the update to modernize administrative references (for example, naming the finance director as the business licensing authority rather than the city clerk), clarify that all businesses must comply regardless of location, and propose that appeals be made to the hearing examiner rather than to council. The ordinance must be adopted by mid‑October to meet the state’s notice requirement and take effect Jan. 1, 2026. Council approved scheduling the second reading at the Sept. 16 meeting.

Next steps: Staff will return with the final ordinance at second reading and implementation steps, and will coordinate with the Department of Revenue to meet the state’s notice timeline.