Opponents call it the "foodie tax," and it's frustrating organizers of the food festivals that have become such a big part of Dallas dining.
Dallas organizations are facing drastically increased costs for temporary food vendor permits at events after the city increased the cost of obtaining these permits nearly fivefold.
A regular event food permit costs $156 per booth, per event, with a daily fee of $7. But until recently, a “variance” to Dallas city code allowed events to bundle permits, essentially getting five permits for one price, which became the norm for festivals, like Chefs for Farmers, that have dozens of vendors at multiple events.
The city put a stop to that after consultants ran the numbers and found Dallas wasn’t recouping costs, says Kris Sweckard, the director of the Department of Code Compliance. The consulting group also proposed a new figure of $123 per booth per event, with a $14 daily fee.
“About a year ago, we started looking at our budget — our revenue and cost recovery — to see if we were recovering costs as we were supposed to,” Sweckard says. “Based on the volume of the permits you’re issuing, based on the staff time that goes into that — granting the permit, reviewing it, working with the vendor on getting the details right, and going out and doing the inspection — we were not getting anywhere close to our full cost-recovery back. We were actually spending more resources on those events than we were getting back from those vendors.
“[Permitting is] intended to be cost-recovery service … so you’re not putting that burden on taxpayers," he explains, "because they’re not necessarily benefiting from that business operating.”
Event organizers, who now face thousands of dollars in unforeseen added costs and additional hours spent obtaining permits, are dubious.
“[Menu review is] non-extensive; it’s not like they’re delving in and figuring out whether they’re serving ceviche or sugar,” says Andy Rittler, executive director of the Greater Dallas Restaurant Association. “It doesn’t take that long to process these [permits].” He says he walked out with a stack of permits after 15 minutes, which included menu review.
The Chefs for Farmers festival is also feeling the pinch — or maybe it’s more like a punch.
“This type of change can be devastating to us,” says Renee Strickland, its director of operations. "Without the variance, festival fees would increase to $34,000 this year from $3,207 last year. “We’re a young, still scrappy festival. … Our pockets are not that deep.”
Organizers for food festivals like Savor Dallas signed an email sent to the City Council's Quality of Life Committee asking council members to rethink additional food permitting fees.
The Greater Dallas Restaurant Association is feeling squeezed as well, Rittler says. Dallas alternates with Houston every year as host for the Texas Restaurant Association Marketplace, a massive industry convention. The event draws thousands of restaurateurs and companies from all over the world, filling the show floor of Kay Bailey Hutchison Convention Center and most of the Omni Hotel with hundreds of vendors.
“All the sales tax and convention fees that go into that, the city’s recovering that. But in addition, they want to charge us [for permits],” says Rittler, who was surprised when the city started charging this year; it never had before, he says.
According to Rittler, permits cost him $24,000 this year with the variance. If the city does away with the variance? It’ll be $89,000.
It’s going be cost prohibitive to host the convention in Dallas.
“Houston doesn’t charge us. San Antonio isn’t charging us. We’ve had discussions with Fort Worth — they aren’t going to charge us, and they’re welcoming us with open arms,” Rittler says. “We have a 40-year history of holding this show in Dallas. It would be a shame to have to move it elsewhere because of out-of-control costs.”
The need to recoup costs is reasonable motivation for increasing fees, but the drastic increase has people like Strickland and Rittler concerned for the future of their events.
“How would an event like Chefs for Farmers cost $19,000 for two inspectors?” Rittler asks, referring to the estimate for the Chefs for Farmers event last year. “That’s $2,500 per hour. I’m wondering, is it $2,500 an hour for code inspectors to do their jobs? ... I’m hard-pressed to understand why these fees are wildly out of control as compared to other cities.”
In a post on Facebook, Strickland contends that, after checking with cities across Texas, Dallas charges more than any other Texas city of comparable size.
Sweckard doesn't see as big of a discrepancy, arguing that Houston’s fees are roughly $67 per day, per booth, plus a $11.18 admin fee. That’s versus Dallas’ one-time event fee of $156 plus daily $7 fee.
“So, for a two-day event, Houston is $145.34, which is comparable to Dallas at $170,” Sweckard says.
One of the most bitter pills to swallow for many of these festivals and organizations, like Chefs for Farmers, is that organizers weren’t notified of the changes, Strickland says.
“We only have three months until the festival,” she says. “We may have to cancel the fourth day. If we’re facing these increase in costs, we’re having to seriously look at our budgets and see what we can do … but it’s going to require working with the city.”
Sweckard says the city sent out official notices about the change in January. Yet major festivals and entities were left off the distribution list, including Chefs for Farmers and its permitting third-party, which handles permits for many festivals, including Greater Dallas Restaurant Association events and even the State Fair of Texas, according to Rittler.
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Organizations have a chance to bend City Council members’ ears in one-on-one meetings before the council votes definitively on the fee changes and the end of the variance becomes permanent. The Department of Code Compliance will present its findings in an Aug. 14 Quality of Life Committee meeting before the council decides what action to take.
Organizers of several festivals — including the North Texas Irish Festival, Savor Dallas and Tacolandia, a Dallas Observer event — signed on to an email Rittler sent to Dallas City Manager T.C. Broadnax and the Quality of Life Committee on July 18.
"These excessive increases, coupled with time-consuming handwritten processes, are forcing our leadership to make difficult decisions," Rittler says. "With other cities and jurisdictions offering simpler processes and far less punitive fees, many of us will be forced to consider options outside city limits or drastically scaling back operations and events."