Contrary to popular belief, you can fight city hall. Matt Graham, city manager for PedalPub Chicago, is living proof: His business is currently embroiled with the city over a misunderstanding on how his bike-powered pub crawl company should be classified for a business license. If you haven't heard of PedalPub, that's because it has been unable to operate without the license. That's why Graham got impatient and decided to get lawyers involved -- to help speed along the process.
PedalPub, founded in Minneapolis in 2006, has been aggressively expanding over the last few years into a dozen cities and is only running into trouble now here in Chicago because the city has incorrectly assumed it's a sightseeing operation and should therefore utilize a motorized vehicle. It's a simple misunderstanding, really, but it's been stretching on for most of this year.
I gave Graham a call to get his side of the story and gain a better understanding of what happens behind the scenes in a legal battle with the city.
So what happened with this permit? When did the trouble start?
Matt Graham: We've simply been trying to apply for a limited business license. It's kinda the catch-all here in Chicago if you don't fit into any of the other categories. You get a limited business license because they don't know what to put you as. There's not a specific rating, if you will, for the license. We applied for that and they put us in the category of "charter tour or sightseeing operator." Which, because they saw the word "tour" that was they thought we were applying for. So we weren't able to then change that at all. They weren't interested in revisiting the classification. They just wanted to rule on that classification they had given us, which is incorrect.
We are not a chartered tour operator by definition because we do not operate a public passenger vehicle. You may or may not know that a public passenger vehicle by definition is a motorized vehicle. We are not a motorized vehicle. We will never be. That didn't even come up as an option. By definition you rule yourself out in that classification. So we just wanted a license to operate. They were stuck on that, the word "tour" that we use in Minneapolis. It's a flag they used to reclassify us into a business we're not doing. We don't do sightseeing tours at all. We don't provide information about the neighborhood. We just allow our passengers to rent us and pedal from bar to bar, basically.
Is this just something quirky with Chicago law?
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MG: No, just about every city is going to have trouble with it. It defies most definition. The laws were never written for a 16-person bike because it's so far ahead of any legislation or ruling or anything. It's a blessing and a curse. In Minneapolis we operate without a business license because it's not required. In Chicago, however, you have to have a license to operate in one manner or another. And so we applied for the only license that was applicable and they denied it.
Where do you go from here? What recourse do you have?
MG: There are a couple options. Our attorneys -- we did not even really want to involve an attorney ever. We just wanted to just get the license like any other normal business person. But when they denied our license, we had to take it up on appeal. And you have to go in front of a board with a hearing and all of these things that you want to step carefully. We decided we needed to have counsel. Somebody to tell us what would be the most beneficial next step, what to do, what to say, what not to say. That was forced upon us by the virtue of the fact that we had to have an appeal.
When did they stop your application in its track?
MG: It's a long process. They don't let you know that first day or that first week. It takes a longer time than that. We applied back in February or something. They sent us an appeal and we weren't actually in town yet. We went to the location that we were renting and the mail was not forwarded to us. So we missed that first appeal, so we had to re-apply in April. Then they sit on it and they think about it. It was taking so much time that we had to bring our attorneys in. We were seeing our season just quickly evaporate.
In mid-May they finally said, "No, we deny your license application." June 3 was our license appeal. At our hearing they said they'd rule on it, but it took them 25 days. That's one-seventh of our season right there. On the 28th we heard and then we were kinda forced to escalate it to the next level because there was no quick resolution on the horizon.
The other option is we've talked to the aldermen of the districts we operate in: the 1st and the 27th. Walter Burnett and Alderman Moreno. Walter Burnett went down, we talked to them, but it was during the appeal and they couldn't talk to us. He was doing the job of the alderman but Moreno took it on: "This is cool, I like this. It should be in Chicago. It's green. It's fun. There's no reason if it's in operation in all these other cities that we should be having an issue with it."
You can go the legislation course, which is getting an ordinance passed if that's necessary. Currently we're trying to have a talk with the commissioner and just have a dialog. Which is not something in the city you can have over the license. We know the reason that they denied it, because they think we're doing sightseeing tours, which we're not. But there's no, "Hey, what if we do this? Will that be approved?" Moreno and his business liaison is going to hopefully help us with that. Just to open the door and have a conversation about what we can do to resolve this.
Is there a resolution in sight?
MG: I'm hoping so. Monday is the day we should find out. There should be. Nothing about what we're doing is illegal. In our appeal denial, the only reason they gave is that we're doing sightseeing tours and we need a motorized vehicles. That's the only reason the city of Chicago has given to deny us our license. All we have to do is explain that we're not doing sightseeing tours. Even if we were, there are other similar models in operation. The Segway tour. They're not operating passenger public vehicles. It's a motorized vehicle, but it's not by definition an actual public passenger vehicle.
There's another guy who's operating bicycle tours throughout the neighborhoods. He's doing sightseeing tours on bicycles, which is explicitly what the city has told us we're not allowed to do. With that information it is becoming clear that the decision is not really fair to us. We need to do something to escalate the decision.
