When I had my shepherds, I had a kennel license also- eventhough they lived in the house. It was sheer numbers. A state dog, like a police dog, or one used for breeding didnt have to have one, but the others did- and it was over 20 dogs. The dogs have to be over 4 months old- so it excludes puppies. However- I never let my pups go into foster care for k-9 until 5 months. I just paid it.
However- if I had to do it now, I would use their chip numbers as ID... lol.. make them type 30 numbers of chip numbers into their computers.. ( trying not to laugh- but you get the point...)