Getting past the red tape

13Dec - by The Chung Report - 0 - In Uncategorized


Getting past the red tape

Rules are important. They keep us safe, prevent crime and more. But what happens when too many rules become overbearing limitations to our city’s ambitions?

BREAKING DOWN BARRIERS TO BUSINESS

Rules are important. They keep us safe, prevent crime and ensure we all have some opportunity to advance in American society.

But what happens when rules overstep the line between keeping us safe and becoming overbearing limitations to our city’s ambitions? Where is that line — and what happens when navigating these rules correctly could mean the difference between creating a thriving small business and closing up shop?

We talked with two small business owners who work in downtown entertainment to find out how city rules have held them back, and to learn how better city communication and fewer regulations could lead to more vibrant nightlife, a more inclusive music scene and better relationships between small businesses and city departments.

BIG HURDLES FOR SMALL BUSINESS

We all want a diverse range of entertainment in our city — especially downtown. Things like cocktail bars, music venues and clubs are all essential to any city core.

But Steve Peters, who founded Vorshay’s Cocktail Lounge with his wife, Natalie, says he was convinced Wichita was dead set against him by the time he opened the bar in September — six months later than planned.

Moving back to Wichita from Dallas, Steve and Natalie saw an opportunity to bring a higher-end cocktail lounge to downtown Wichita by borrowing from cocktail bars they enjoyed in Dallas. But Wichita’s strict alcohol laws made this far more difficult than they predicted.

"Dallas is obviously a different city. It’s huge, especially compared to Wichita," Steve Peters says. "But the mentality is different, too. … When you go and you talk to people, they’re very helpful, and they point you in the right direction."

Peters says he had a difficult time getting information on business regulations from the city, leaving him, in many cases, to guess his way forward.

The permitting process took weeks, he says. In Dallas, where Peters worked as a commercial construction superintendent and oversaw the construction of many bars and restaurants, it often took just one day.

"There were several times in the process where I was convinced … that the City of Wichita just doesn’t want small business," Peters says. "It’s like they do everything they can to try and deter you or wear you down enough to where you just give up and don’t put your business in."

It’s like they do everything they can to try and deter you or wear you down enough to where you just give up and don’t put your business in.Steve Peters

Peters says the difficulty was especially overbearing when it came to getting a liquor license. When he called the state to request a liquor license, he says the person on the other end started laughing.

"I was like, ‘That’s not good,’" Peters says. "She goes, ‘You’re going to hate the City of Wichita as much as I do by the time this process is over. … In Johnson County, you’ll have your liquor license within a couple weeks. It’s not a big deal. But you’re literally going to wait months.’"

Peters says he thought she was exaggerating.

But in Wichita, you have to wait for a certificate of occupancy in order to get a zoning letter sent to the State of Kansas and start the process of getting a liquor license. That means the business has to be turnkey ready before the liquor license process even begins.

"She was 100 percent right," he says. "I was a cop for nine years. I’ve been back and forth to Iraq and Afghanistan since 2007 [training Iraqi police forces and contracting for the U.S. State Department]. And opening this bar was a more terrifying process than any of that stuff."

Wichita City Manager Robert Layton says the city tries to keep city rules to a minimum, keeping only the ones that ensure citizen safety. He says many of the more restrictive alcohol laws have been requested by citizens over the years to address crime, noise and other neighborhood safety issues.

"We are trying to minimize the red tape involved in licensing and permitting, and are hoping to adopt a more ‘red carpet’ approach," Layton says in an email. "The city does strive to create a local environment where businesses can start and grow, and the city offers a number of tools and resources to assist with business growth in Wichita."

The Chung Report reached out to many of the departments Layton mentioned as being available for new businesses, including the Wichita Office of Economic Development. No one we contacted agreed to speak with us on this topic, and many of the people we spoke with said they don’t actually work with small business owners at all.

CONSEQUENCES FOR RESTRICTIONS

When entrepreneurs take the leap to start a business, they’re putting their time, money and resources on the line. A months-long delay in profitability could be the difference between succeeding and failing. Peters says Vorshay’s was lucky to get through.

Not having a liquor license meant Peters couldn’t train his employees or purchase any liquor at the lower, wholesale price, delaying his opening while extending his time paying rent without earning revenue.

"We needed liquor bottles in there months ago," Peters says. "That’s our deal. We’re selling craft cocktails, so we need to perfect some of those recipes. … We would’ve liked to set up our point of sale system, but we couldn’t do that because we had no idea what our liquor cost was because we couldn’t buy liquor."

Besides time and money, restrictions can also have deeper effects that can go on to impact the city’s culture and overall vibe.

Adam Hartke, co-owner of Barleycorn’s, The Cotillion and Wave, says city alcohol laws have likely set back Wichita’s music scene by limiting the places people under 21 can perform or even see local musicians.

"Barleycorn’s has turned away probably hundreds, if not more, young people," he says.

City laws require a drinking establishment to sell at a 30 percent food-to-alcohol ratio to allow all ages to enter. While The Cotillion and Wave meet that requirement, Barleycorn’s doesn’t, meaning it can only offer shows for those 21 and older.

Barleycorn’s has turned away probably hundreds, if not more, young people.Adam Hartke

"That’s hard when you’re operating a venue that has shows that appeal to numerous audiences," Hartke says. "And that sends a strange message to the youth of our city saying that, ‘Hey, we know you’re interested in music, and this is one of your favorite bands, but you can’t go see them because they serve alcohol.’ It’s kind of painting music in a strange picture, you know?"

The law essentially limits the Wichita venues at which bands with members under 21 can perform.

Of course, these rules aren’t without reason. Old Town has been known to have some bad actors that have abused alcohol laws to serve minors, and Wichita itself was under strict alcohol laws for longer than most cities, just coming back to serving alcohol by the drink in 1986.

But Hartke argues we’re in a different time now, and laws need to reflect that.

"It’s a time where we can really sit back and look at what we’re doing and choose a path forward that is going to be beneficial to everybody," he says. "[These rules] will prevent more good things than they will bad things."

While city laws seem to have an outsized affect on Wichita’s drinking establishments, the lack of city communication and guidance goes well beyond to impact anyone hoping to get the information they need to start a business.

"I understand [Wichita] wants companies like Cargill, they want Spirit, they want stuff like that, … but I think what they really need to do is concentrate on small business," Peters says. "And the people who are on a shoestring budget, and they’re super broke, but they want to be an entrepreneur. … They can’t be regulated to death."

At best, city regulations protect the public from isolated instances of crime and unsafe or unfair business practices. At worst, these regulations prevent the growth of our city and limit the dreams of our citizens.

FINDING SOLUTIONS

Without a lot of city help, small business owners are left to turn to other resources. Fortunately, there are plenty, starting with NetWork Kansas, a statewide nonprofit that pools resources for entrepreneurs and small business owners.

"Our most common questions at the early stage tend to focus on regulatory requirements," says John Gendron, director of referral center operations at NetWork Kansas. "For those who contact us, we help to streamline the process and get them to the specific individual within the appropriate department. So we help to ease the frustration in that process."

To get in contact with NetWork Kansas, you can visit their website, download the app (also available on Google Play) or simply call 877-521-8600 to speak with someone who can guide you through the unknowns.

If we could get rid of things that aren’t necessary, I think it would absolutely help to create more momentum and allow for more businesses to start and grow.John Gendron

Apart from NetWork Kansas, Layton recommends online resources from the City of Wichita and the Small Business Administration (SBA). Another local resource is the Small Business Development Center, although they also declined to be a part of this article, which casts some doubt on how responsive they might be for some small business owners.

Peters says the SBA is a good source, but not every business is getting an SBA loan.

"A good solution could be if the City of Wichita had one to two people who are dedicated to guiding people like me and others through this process," he says.

The SBA also recently created a small business regulatory reform survey to allow small business owners to share the federal regulations that are burdensome to their businesses. While this doesn’t help at the local level, it could start the conversation about which rules are necessary at which levels, and that is always a useful conversation to have.

"If we could get rid of things that aren’t necessary, I think it would absolutely help to create more momentum and allow for more businesses to start and grow," Gendron says. "To stay current is imperative to what we are describing as success."

NEXT STEPS:


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