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Chicago cuts red tape for business licenses

Chicago Mayor Rahm Emanuel is shown file photo. | AP file pho

Chicago Mayor Rahm Emanuel is shown in a file photo. | AP file photo

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Updated: May 19, 2012 8:11AM

Chicago would reduce the number of business licenses by 60 percent — from 117 to 49 — under a sweeping consolidation proposed by Mayor Rahm Emanuel Tuesday to save retailers money and countless hours of aggravation.

The bureaucratic maze is about to get a whole lot simpler, freeing new businesses to create jobs and city inspectors to concentrate on problem businesses instead of citing the good ones for having the wrong license.

Currently, Chicago issues 117 different categories of business licenses—more than Los Angeles, Philadelphia, Phoenix and Atlanta combined.

Emanuel’s plan would reduce the number of business licenses to 49, a 60 percent reduction that, the mayor contends, could save small businesses more than $2 million, in part, by reducing the number of business fines.

“To sell a dog, clean a dog and buy a collar are three licenses. Now, do you feel safer?” Emanuel asked facetiously.

The mayor said he believes in oversight and regulation “because the end result is a healthier, safer city.” But, he also believes small businesses are the “lifeblood of economic activity and job creation” in Chicago neighborhoods.

“If you have 117 licenses — many doing the same thing, some of ’em sometimes contradictory — you’re not really helping small business and government has become your competitor. . . . The way we have proliferated licenses, we have them focusing on City Hall — not on their customers — and that is wrong.”

In 1992, then-Mayor Richard M. Daley nearly cut in half — from 230 to 120 — the categories of city business licenses. At the time, individual businesses were required to obtain as many as 25 different licenses.

The streamlining was supposed to pave the way for 30 percent of the city’s 60,000 businesses at that time to satisfy their licensing needs with a single, all-purpose permit, known as a general license. The remaining businesses were supposed to need “two or three licenses at most.”

It didn’t happen, according to David Vite, president of the Il. Retail Merchants Association.

“Today, if you own a grocery store, you might have seven or eight licenses and you don’t know every license you need when you’re going into business. This will make it easier for businesses to comply with the law,” Vite said.

“Every time it’s been done before, it’s been tinkering at the edges. This is a major, sweeping plan to change the system. I don’t know what it will save in hard costs. But in the soft costs of compliance, it will save bundles of money and hours, which is money.”

Emanuel announced, what would be the city’s biggest license consolidation in 20 years at Logan Square Kitchen, 2333 N. Milwaukee, after three retailers told licensing horror stories.

“The process of getting three licenses that I need to do automotive repair took me about seven months, many trips to court and was a nightmare. Every inspector had a different thing they wanted me to do. They were often completely conflicting,” said Tom Simmons, owner of Midwest Performance Cars.

Zina Murray, owner of Logan Square Kitchen, said she was in a bureaucratic “meat grinder” for several years because her shared commercial kitchen that rents space by the hour “didn’t fit it any existing categories” of city licenses.

If the City Council approves the mayor’s ordinance, the city would be empowered to issue a temporary permit that would allow “novel” businesses to get up and running while City Hall determines what sorts of permanent licenses they need.

“Innovative businesses don’t have categories currently. . . . Zoning, Business Affairs, Health were churning away for months trying to figure out how to define us. That drag took a tremendous toll on our business,” Murray said.

The mayor’s ordinance would also arm city inspectors with “additional tools” to crack the whip on reckless retailers, including those who sell tobacco to minors.

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