'Not business friendly' - post #5

Here we go, again ... another act by Toledo City Council that falls into the 'not business friendly' category.

The latest is proposed legislation to add a new chapter 721 to the Toledo Municipal Code, entitled "Convenience Stores," with the purpose of placing onerous and costly requirements upon this particular type of business through the guise of 'licensing' them.

We had a lively discussion about this during the Eye on Toledo show last night and you can listen to the reaction here.

So what exactly is this all about? Well, that depends upon whom you ask. Some will say it's to provide a safer environment for employees and customers of such stores. Others will say it's a way to relieve the police of their duty to enforce laws by requiring store owners to assume that responsibility. Some will say that it's a way for the city to generate additional yearly income. Others will say it's a way to remove 'problem businesses.' Whatever one says about the law, no one is saying that it's business-friendly or that it will lead to growth of the city.

And the 'not business friendly' aspect starts immediately with the cost and the anticipated application process. It's a $250 fee every year, but there is some discussion of making the initial cost only $100 because it will be for only a portion of the year.

The anticipated process is this: Get packet from office on 20th floor and fill it out; take tax compliance form to Taxation Department and get sign off; take zoning form to 16th floor to get sign off; take inspection form to different office on 16th floor and get proof of an occupancy permit; go to another office on the 17th floor and obtain, at additional cost, a criminal history background check; return to 20th floor with all completed documents and turn in application and fee.

Isn't that ridiculous? Whatever happened to the concept of a one-stop shop?

And in the application - you have to give your life story. Well, not exactly, but almost. You have to list the name and address of the applicant, which seems logical. But if the owner is more than one person or any entity or firm, you have to list the full name of all parties interested and their addresses. If it's a partnership, corporation or LLC, you have to provide a complete list of the officers or members with the name and addresses of the officers, the state in which the entity is organized and the names and addresses of people designated as managers. Oh - and also the name of the owner of the property and whether any involved parties have been 'engaged in the operation of a convenience store' and, if so, when where and how long in each place.

Then there is the nice little provision that if the application is complete and the applicant 'qualifies to engage in such business,' the Department of Finance may grant the application and issue the license. Note the 'may'? After going through all this stuff, and qualifying, you are not assured of getting your license. The 'rejection of application' portion of the law says applications can be rejected if a person fails to qualify or if the premises don't comply with all applicable laws.

So, if your application is complete and you 'qualify,' why wouldn't the language say that the license shall be granted, instead of 'may' be granted?

Now, if you'd like to sell your business, the new owner needs to go through the same process and get a license in their own name which, in effect, restricts your ability to sell to whom you want since the city can decide not to issue a license to your buyer.

Of course, there's also a section about revoking a license for 'disorderly or immoral conduct therein.' Guess the government is now going to be responsible for determining if you're behaving in a 'moral' way ... and who gets to determine that definition???? Well, it doesn't say.

Then there are the conditions. Every convenience store will now be required to have and maintain a surveillance camera system. But the law doesn't stop there - they even detail the operation of such a system, including signage, inspections and the stipulation that it operate 24 hours per day without interruption. Failure to meet these requirements means you're subject to administrative fines and/or criminal charges, with fines beginning at $200 per day accumulating for each day of non-compliance.

As if this isn't bad enough, the law specifies not just the needs such a system must meet, but what kind of system you install. The licensee must ensure that the camera system contains a full roll of film and is working properly. It must record and produce 'color, retrievable, enlargeable and reproducible photographic images ... of sufficient clarity to be used for suspect identification in investigations or criminal proceedings.'

They even specify the tapes used in such a system:

"A. Each business shall maintain a supply of 32 videotapes. 31 tapes shall be numbered 1 through 31 and used on the corresponding day of the month. In the event licenses (stet) or the Toledo Police Department needs to take one of these tapes as evidence, the extra tape will be used as a replacement.

B. Videotapes shall be used a maximum of 12 times. One per month for a period of one year.

C. Under no circumstances should a videotape be reused for a period of more than one time per month."

Further, the vendor has to "maintain all equipment, assure accuracy of time keeping, and log tape reuse and schedule immediate repair if necessary." (emphasis added)

Guess you're going to have to keep a log of your tapes and which ones you use - and you'll have to incur the cost of replacing all of them each year, regardless of need.

Haven't these people ever heard of digital???? In fact, a caller to the show last night said that most security companies don't even use tapes anymore and most expect them to be completely obsolete within two years. And this is why it's ridiculous for the law to specific such conditions in light of how rapidly technology changes and how better systems are quickly available. But, to create a law that allows for such innovations would require council members to be cognizant of continuing changes in a business owner's resources - and they're not. This legislation clearly demonstrates that fact.

Here's an interesting question: Do you think anyone bothered to ask how much it was going to cost for business owners to comply with these provisions, outside the costs of the application itself? Our local government complains of unfunded mandates pushed upon them all the time - you'd think they'd be at least curious about the financial impact of their own laws. But, then again, this is Toledo.

But that's not the end of the expectations. Most businesses police their own property in terms of litter and debris. This law requires owners to also inspect and remove litter and debris from all adjacent streets, sidewalks and alleys adjoining their premise AND within 100 feet of their lot lines.

The obvious assumption for this requirement is that such owners are responsible for people who litter and should be required to clean up everyone else's property - rather than to expect the other property owners (including the city) to be responsible for their own clean up. You know, with all the new fees and enforcements the city's pushing on its residents, you'd think they'd find a ready supply of violations and ticketable offenses at such convenient stores. After all - it seems less costly to have a cop hang out and write tickets for littering than it would be to institute the aerial enforcement for speeding that they've included in the 2008 budget. Talk about a return on investment!

But again, the fallacy is that this law makes the owner of a business liable for the illegal activity of customers who patronize the business - something no business owner should have to be responsible for.

And there's more!

The licensee is directly and vicariously responsible for any violations on their premises and parking areas by any employee or independent contractor working under their supervision or management. They will be required to pay all delinquent court judgments arising out of their business and business operations. They have to make sure that any area of their property that is not regularly monitored is not accessible to customers or the public. They can't have vending or coin-operated machines available when they're not open.

The law says "all solid waste and recyclable materials shall be stored in refuse containers made of metal or approved plastic." Does this means they're being forced to recycle? I think a legal argument could be made for that point based upon the current wording.

But the most troublesome aspect of this law, for me, is the requirement that such owners are to act as de facto law enforcement officers and can lose their new license if they don't prevent people from committing certain crimes on their property. This is the topic of my Eye On Toledo column in this weekend's edition of the Toledo Free Press.

After detailing all these conditions, it's clear to see that this is not business friendly. It's a new law designed to placate certain neighborhoods who don't like convenience stores. In fact, in response to public demand, City Council recently denied a special use permit for one such store. However, the store sued and the judge found in favor of the store, calling stories of criminal activity 'anecdotal' and ruling:

"In this case, a review of the entire record in no way supports the decision of city council. The opponents of the [permit] expressed many unsubstantiated concerns regarding the carryout, and most of these were in regard to the sale of alcohol."

City Council had to grant the permit - and you would think that they'd learn a lesson from this experience. But no - this law is the result, and it took them a year to come up with something this bad!

The problem is that such a law is never going to stop people from doing illegal things - only a police presence to deter such actions and swift enforcement when they do occur will solve that particular problem.

But it's so much easier to pass feel-good legislation that gives the appearance of doing something about a problem, while perpetuating false expectations that the problem is now solved.

In the meantime, business owners - those individuals who invest their own funds to start a business and provide much-needed jobs in this city - will bear the burden and will react accordingly. This sends a terrible message to the vast number of convenience stores, as defined by the law, who are and have been good business members of our community.

And this false solution to what is, in reality, a lack of police staff and enforcement, will not go unnoticed by other businesses in the city, who will rightly be concerned that, if council gets away with this, they may expand such laws to others. And that doesn't even touch on the impact it can have on those considering establishing a business here.

It's not business friendly and is certainly not the way to go about building a community of growth and opportunity.