Morgantown moves to align business licensing and B&O tax with state law, narrows license requirement

MORGANTOWN, W.Va. — The Morgantown City Council on Tuesday approved the first reading of an ordinance to align the city’s business licensing and business-and-occupation (B&O) tax provisions with changes in the 2025 West Virginia legislative session (House Bill 2451).

City Attorney (presentation) explained the ordinance implements three elements required by the state law: an exemption from municipal business licensing for persons who operate as sole proprietors or independent contractors who have no physical location in the city and who earned less than $2,500 in the prior calendar year; a corresponding exemption from the city’s business-and-occupation tax for businesses with total annual revenue under $2,500; and related conforming code updates.

The ordinance ties the licensing exemption to the prior calendar year’s revenue: applicants claiming the exemption must show that in the prior calendar year they had under $2,500 in gross revenue and meet the other two criteria. The B&O tax exemption applies during the fiscal year for operators who do not exceed $2,500 in total revenue for that fiscal year; if a business exceeds the threshold, it must pay the tax due for that period.

Council members discussed marketplace implications for vendors (for example, farmers or other agricultural producers) and the downtown market; the city attorney noted some vendors may already qualify for existing agricultural exemptions and that whether a temporary vendor falls under the “physical location” element depends on the business structure and revenue. The council approved the first reading and may act on second reading after the required notice period; staff asked council to adopt changes in June so they could take effect on a fiscal-year basis July 1.

Council recorded the vote as 7-0 to advance the ordinance.