Some cities are making it a lot easier to open a restaurant
Government is your friend
Published: December 1, 2012
Every business person knows you can’t fight City Hall. But what if you no longer needed to? What if city officials, instead of piling up obstacles between a restaurant and its opening day, tried to bulldoze them out of the way?
That’s a tantalizing experiment underway in two of America’s biggest cities. In New York and Chicago, the mayor’s offices are serving up a new paradigm for licensing restaurants: treating them like customers instead of combatants.
“Restaurants have often had an oppositional relationship with the city,” acknowledges Tokumbo Shobowale, chief business operations officer for New York City. “This program has flipped that on its head.”
The program he’s referring to is the New Business Acceleration Team, an initiative to simplify the city’s regulatory maze. The goal is to help new businesses open more quickly. Its first test case: restaurants.
“We focused on restaurants because they were touched by so many agencies,” says Shobowale.
The core idea is coordination. Instead of dealing with each agency separately, a budding restaurant owner has a single contact person at NBAT. The Client Manager schedules inspections, arranging for multiple agencies to arrive at the same time.
“Now you have a go-to person,” says NBAT executive director Robinson Hernandez. “You have one person in the city you can talk to, to communicate plans, challenges and opportunities out there.”
Other rules aim to make inspections more efficient. An inspector can pay an informal visit before a formal one, to alert an operator to issues that might need correcting. Some inspectors cross-train to serve more than one agency. Health inspectors, for example, can now inspect grease traps for the Department of Environmental Protection.
In two years, NBAT has helped open nearly 1,000 restaurants. Three of them belong to John Agnello. Each location of The Burger Bistro was licensed in 30 days or less. In years past, his typical wait had been four to six months.
“They were available by phone or email, and they returned calls in a timely fashion,” says Agnello. “I believed they really cared about getting us open.”
If the process is user-friendly, it’s partly because restaurants had input. Says Andrew Rigie, executive director of the New York City Hospitality Alliance, “The Alliance met with the city and different regulatory agencies and explained the pain points that operators find and ways they could fix the process.”
Overall, he says, “People are happy. They’ve often felt lost. Now they feel they at least have someone they can call in the city when they’re opening up a business.”
NBAT’s principles have rippled beyond the Big Apple. A nonprofit foundation affiliate gave grants to five other cities to explore efficiencies. One of those cities, Chicago, consulted with NBAT before launching a Restaurant Startup Program.
“Restaurants are a leading job creator in Chicago, responsible for nearly 10 percent of the jobs in the city,” says Jennifer Lipford, spokeswoman for the Department of Business Affairs and Consumer Protection. “Too often, inspections add to the cost of starting a restaurant, with some new restaurants enduring as many as 20 inspections.”
By synchronizing visits from various agencies, the program cuts the number in half. In addition, a proposed city ordinance would trim license categories by 60 percent. So far, reports Lipford, 120 restaurants have opened in an average of 25 days.
As in New York, restaurants were consulted on the program’s design. “The city reached out to us,” says Sam Toia, president of the Illinois Restaurant Association. “This is a breath of fresh air.”
Chicago’s effort launched in June, and may still be working out its kinks, reports Mickey Hornick, who’s opening a second location of the vegan Chicago Diner. He ran into problems like having an occupancy card revoked two hours after it was issued. But calls to the Mayor’s office quickly cleared the roadblocks.
“It’s going to take some time for people at City Hall to get used to it,” says Hornick. “But once I got the initial drawings in, it’s been very efficient and timely. Last Tuesday, they said the electrical inspector was coming, and there they were. On Thursday [they said] the plumbing inspector was coming, and there they were.”
Both cities see restaurants as models for other small businesses. New York is now reforming licensing for other food-related firms, like convenience stores, bakeries and bars.
The ultimate goal of the program, says Shobowale, is to “re-establish the city’s relationships with its customers, the small businesses. This has transformed the way people see their relationship with government.”