Dana Schultes always planned to renovate Stage West Theatre.
But first she had to navigate a maze of city rules she says have not caught up with the times. The city’s permitting tries to be a one-size-fits all, she said, but that doesn’t always fit a company’s needs.
“The trouble is that when you try to diversify and bring in new ideas and try new things, and be progressive and technologically up to date, those new things don’t always square with the old way of doing things,” Schultes said.
Part of the challenge, she said, was figuring out electricity requirements for the 16,000-square-foot venue. The building is plumbed by code to have 2,200 amps of electricity through it, but they use less than 500 amps.
She had to pay $30,000 for an expeditor, a consultant, who helps move projects through the permitting process.
“If I were starting this up, trying to figure and navigate all of this with the rules that I have encountered, I think I would probably have given up,” Schultes said.
Schultes is one of many business owners who spoke to the nonprofit Institute for Justice for a study about barriers to starting a business in Fort Worth. The study comes as city officials and small businesses work together to improve the process through a task force.
Among the institute’s findings are regulations that make it expensive, confusing and time consuming to open a business in the city.
The institute also studied barriers to starting a business in 20 cities across the country. The national study found the biggest barriers are high fees, long wait times and complex paperwork. Nationally, entrepreneurs have to complete an average of 55 steps and pay more than $5,300 in order to start a business. Most cities also did not have a one-stop-shop where entrepreneurs can go for guidance on how to comply with regulations.
The study in Fort Worth took a look at starting a restaurant as an example to examine barriers. Jennifer McDonald, assistant director of activism special projects at the Institute for Justice, said while it costs less than the average city to start a restaurant in Fort Worth, the city has a larger number of individual fees entrepreneurs have to pay.
It costs an average of $4,250 in permitting and licensing fees to start a restaurant in Fort Worth between 21 fees. This is the highest of the 20 cities in the study, next to Jacksonville, Florida, which had 20 fees.
By the numbers: starting a restaurant in Fort Worth
Total cost in fees for permitting/licensing: $4,250
Number of fees: 21
Agencies involved: 9
Number of forms: 18
Number of steps: 63
“We’ve heard from entrepreneurs that you can feel nickel and dimed. You have to pay for something every step of the way,” McDonald said. “And so if there’s a way to combine some of those fees, or better yet, eliminate some of those fees (and) reduce that cost burden, that would really go a long way toward making the process easier and more accessible.”
Washington, D.C., is one city that has implemented changes. In 2019, the city’s department of consumer and regulatory affairs organized 128 categories of business licenses into 13 groups and removed revenue caps for cottage food producers.
The study also recommends creating a one-stop shop on getting information and applications for starting a business, streamlining permitting and consolidating duplicate paperwork. The city plans for its future City Hall in the former Pier 1 headquarters to be a one-stop shop for services such as development services and permitting.
While the city does offer a website for applicants to organize information and track progress in one location, McDonald found it doesn’t have the following:
- A website that connects city requirements with process from other levels of government such as corporate registration
- A single online portal where forms and registrations can be completed
- Sufficient information on all the requirements for starting a business from departments such as zoning
- A guide for entrepreneurs through the process effectively with step-by-step instructions
When Henry Wasonga Abuto, owner of the catering company Wasonga to-go, was opening his food truck in 2021, he had to print out a huge stack of papers because the information was scattered across the city’s website. He had to make his own checklist to make sure he had everything necessary to open.
Other food truck owners helped him navigate the permitting process, Abuto said.
“Efficiency is a big deal to me,” Abuto said. “When things aren’t efficient, I’m like, ‘I’m out.’ (Fort Worth’s) system is not efficient.”
Offering a more user-friendly website, hiring more people who can work with people who don’t speak English as their first language and eliminating redundant fees would improve the process, Abuto said.
Fort Worth District 3 council member Michael Crain, who leads the city’s small business task force, said he’s excited about the results of the study and will work to make changes.
He said there can be forms or questions on forms that can be consolidated and the website could be changed to be more user-friendly.
“As a small business owner myself, I understand that small business owners don’t have the time, or the resources, to engage with the city in a way that maybe a larger business can, meaning they don’t have the time to sort through where to go and what to do and who to talk to,” Crain said.
Some changes will take longer than others, he said. Changes to conditional use zoning, for example, will have to be approved at a zoning meeting.
DJ Harrell, development services director for the city of Fort Worth, said in an emailed statement that the city will validate the report’s findings and work with the Institute for Justice, Small Business Task Force and Development Advisory Committee to explore how to implement the recommendations.
“The city of Fort Worth remains committed to our small business community, and it is our goal to provide the most transparent and streamlined process for all of our customers,” Harrell wrote.
Fort Worth’s development services department is adding 40 new employees to the department and is seeing a $10 million increase in the 2023 budget. The city also approved $100,000 in the 2023 budget to make amendments to the zoning ordinance.
A Fort Worth architecture firm previously told the Fort Worth Report about troubles with the city’s zoning department, which temporarily stopped their newest development. The firm claimed the rules were unclear and up to interpretation.
The Development Advisory Committee and Real Estate Council of Greater Fort Worth are also working to make inner-city development easier. City council will discuss and likely approve $250,000 to add an infill chapter to the subdivision ordinance.
Rules for starting businesses start with good intentions, McDonald said. But as regulation accumulates over time, it can become a barrier, she said.
“Regulation starts because the government has an interest in making sure that everything is safe and equitable and good for the community,” McDonald said. “But just kind of the nature of regulation and bureaucracy is that things start to add up. And once something is in place, it’s much harder to take it away.”
Seth Bodine is a business and economic development reporter for the Fort Worth Report. Contact him at email@example.com and follow on Twitter at @sbodine120.