Belmont Shore business considers class-action lawsuit over city fees charged in spite of COVID-19 closures

A Belmont Shore business is mulling whether to sue the city over business license fees that it collected, despite health orders that prevented the business from opening most of this year.

Elison Rd., a clothing boutique on Second Street, filed a claim for damages against the city of Long Beach in June asking for lost profits and refunds in business license fees after the mandatory closures of non-essential businesses from COVID-19 from mid-March to mid-May.

The Long Beach City Attorney’s office rejected the claim on July 31, according to Howard Russell, the deputy city attorney, but the office had no other comment.

Christian Petronelli, the attorney who filed the claim for Elison Rd., noted that while the loss of profits for businesses in Long Beach is a broad estimate, the amount of money businesses paid to operate in the city is more easily proveable.

“It’s more about the fact that businesses paid good money for a 12-month business license,” and should be refunded, Petronelli said.

The claim was also filed on behalf of other non-essential businesses as a precursor to a potential class-action lawsuit. Other local business owners can contact his practice if they want to get involved, he said. Petronelli said he’s waiting to file suit until he knows how the rest of the year is going to pan out for local businesses.

Tattoo shop owners, who had been among the non-essential businesses still not allowed to reopen, recently filed suit against the state for the right to reopen.

Retail shops can now reopen, but under strict requirements limiting the number of customers in the store and other safety measures.

The city, meanwhile, is still trying to figure out what to do about business license fees. In a Oct. 9 memo from Long Beach’s financial director, John Gross, city staff have been “looking at whether the services paid for by business fees are actually being provided by the City” and are looking at other relief options to present to the City Council in November.

For now, the city is extending the deferral of late payment penalties until the end of November so businesses can pay their bills from the city’s health and fire departments.

“Businesses able to make payments are encouraged to do so (and many have), which helps avoid a later cost for those businesses,” the memo said. “However, for those businesses suffering major cash flow issues, the deferral of license taxes and fees will be of help.”

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Valerie Osier is a breaking news and crime reporter for the Long Beach Post. She’s a Riverside native who found her love for journalism while at community college. She graduated from the Cal State Long Beach journalism program in 2017 and covered the Palos Verdes Peninsula for the Daily Breeze prior to coming to the Post. She lives in Long Beach with her husband and two cats.
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