SHILOH — There are a number of reasons Gary Hurst won't open another restaurant in Illinois. Now, he has another.
Hurst, the co-owner of the Golden Corral in Shiloh, says the cost of doing business in the Land of Lincoln is already higher than other states such as Missouri, where he also owns and operates restaurants. But he recently learned that he'll be paying more to conduct business here, after he received a letter from the Illinois Department of Transportation informing him of a 42-year-old law requiring businesses to register for a permit for all signs visible from the highway.
Depending on the square footage of the sign, the one-time fee is costing businesses between $50 and $200.
Hurst is asking why.
"I really don't have an opinion," Hurst said. "I'm more confused as to why it hasn't been enforced in the past."
The letter was issued to a number of businesses located along Interstate 64. The News-Democrat received a copy of one letter, dated Dec. 4, that IDOT sent to the O'Fallon 15 Cine, of Wehrenberg Theatres, that states the transportation department has "recently completed a statewide inventory of all outdoor advertising signs regulated by the Highway Advertising Control Act of 1971, 225 ILCS 440."
The letter says some signs that were inventoried by the department lack a permit or registration records. The theater has been asked to provide these records.
Kelly Hoskins, marketing director of Wehrenberg Theatres in Des Peres, Mo., said the metro-east theater received a notice from IDOT stating the fee dates back several years to when the movie theater opened, but it was never collected.
"We certainly want to live up to our obligations," Hoskins said. "We enjoy doing business in that community. We're looking forward to making sure we pay what we need to pay."
IDOT spokeswoman Paris Ervin said the department has been reviewing its records to notify businesses that are not in compliance with state and federal laws on the issue.
"IDOT is required by the Federal Highway Administration and state law to register outdoor advertising signs on the interstate for state and federal compliance reasons," Ervin said. "So it's something IDOT takes very seriously, as we do with other regulations. And in that letter, sign owners who are not in compliance with the federal or state, we're asking them to submit an application requesting a valid IDOT permit for the sign."
Ervin also said the state started reviewing interstates and other major highways and primary routes in the south end of the state, and is working its way north. Each sign requires a separate permit, and fees are determined based on square footage.
"It is a process that started two years ago," she said. "We have since completed that inventory and now we're at the next stage of informing these individuals without permits to get their documentation."
The letters caught many businesses by surprise. Kent Newbold has been selling cars off I-64 in O'Fallon for the past 15 years, but said he had not heard of the law until after he received one of the letters from IDOT.
Newbold said he was caught off-guard when he received three letters form the state transportation department for three different signs on his property, which he opened in January 1998 and has since expanded.
"It surprised me," Newbold said. "I just assumed that all the studies were done during construction. I'm sure that that would have been taken care of at the time of construction, because we went through so much stuff because of the variance process."
Jamie Auffenberg's Auto Mall that bears his name is also visible from the interstate. He said he received about a dozen letters for every piece of signage visible from the highway. He estimates that it will cost him "a few thousand dollars."
"I would say I was surprised by it, but not really surprised," Auffenberg said.
Holiday Inn Express in Shiloh and Lacefield Music received letters from IDOT. When Lacefield Music received its notice, company vice president Steve Lacefield contacted its landlord and the company that designed its signage at its Shiloh store.
"We are contesting that," Lacefield said.
Lacefield said his business has contacted the company that made the signs for the metro-east music store and was told that the Shiloh store has proper permits on file.
"So our next move was to contact the landlord," he said. "That is where we're at and we're waiting to hear from them. But we were surprised to get that."
Lacefield, Hurst, Auffenberg and Newbold each said they have not been notified about how much they will owe for their sign registration and permitting. Newbold said he is currently working to be in compliance. He said he read the law and understands that it applies to all signs within 600 feet of the interstate. But as he began to fill out the forms, Newbold said he does not understand how the fee will be determined.
"The forms you have to download are kind of confusing," he said. "Do you measure square footage of the signs? I'm not sure what you measure. Some signs are on the building. Does that mean I measure the building or do I measure the letters? It seems like a nuisance. Some signs, I don't own them. I lease them."
Hurst said the letter that his business received was "very ambiguous." He also said that, in his opinion, this is another way for a financially-strapped state to raise revenue.
"It is what it is, I guess," he said. "It's state government. If they say we owe and if it's a law on the books, we will pay."
Auffenberg said this fee is another sign of the increasing cost of doing business in Illinois.
"I imagine in the state that we live in and do business in, that unfortunately there is going to be a whole lot more of this type of stuff in the future because we can't seem to pay our bills, pay them on time or pay them at all," Auffenberg said.
Michael Norsworthy said he estimates it will cost the 54th Street Grill & Bar at Green Mount Crossing in Shiloh about $150. He is the president of KRM Restaurant Group in Kansas City, Mo., which owns and operates the restaurant chain, which includes another metro-east locale at Edwardsville Crossing in Edwardsville. Norsworthy said he is not stunned by anything when it comes to the expense of conducting business in Illinois.
A $150 fee "is not going to break us. But it's like death by a thousand cuts," Norsworthy said.
KRM Restaurant Group also has 17 other 54th Street Grill and Bar restaurants in Missouri, Kansas and Texas. Norsworthy said any future expansion will not include Illinois.
"To be honest with you, it doesn't surprise me," Norsworthy said. "It never ceases to amaze me what lengths the state of Illinois will take to exploit money from individuals. They have an insatiable appetite for tax revenue."
When he and his business partners were planning the Edwardsville location, the fee to tap into the city's water was $77,000. He said that elsewhere the fee is usually no more than $10,000 -- and is sometimes free. When the Edwardsville restaurant added another 1,000 square feet, the business had to pay a $36,000 fee.
"We decided a long time ago that we are not going to put any more restaurants in the state of Illinois," he said. "The current tax and business environment is too cost-prohibitive, based on the risk of initial investments."
In Shiloh, Hurst said the sewer tap fee at Golden Corral was almost $50,000, while a sewer tap at their Missouri restaurants only costs around $2,000.
"We only own one Golden Corral in Illinois," he said. "It is very expensive to do business in Illinois. We will never ever open another business in Illinois. It's just too expensive."
Meantime, O'Fallon Zoning and Planning Director Ted Shekell said he and other city officials are working to make sure businesses along the interstate are in compliance. However, he questions the state's motives. He is especially concerned about how businesses will respond.
"It's frustrating," he said. "It frustrates me for them because they get these letters and have to comply."
Norsworthy said: "It's another expansion of taxation and a barrier to entry the state of Illinois has. It has to stop or at least subside. It's just crazy."
Ervin said: "The bottom line is we're enforcing the law. We are trying to ensure people are in compliance."
Contact reporter Will Buss at firstname.lastname@example.org or 239-2526.