09/02/2024
We would like to provide some context to the post we made on Friday about the closing of our Tropical Sno stand.
When we first had the idea of opening a Tropical Sno stand, we contacted the City of Winterset to see if there would be any issues with locating the shack next to our laundromat. At that time, I was told to fill out an application for a Peddlers, Solicitors and Transient Merchant License. The fee for that license was $100/yr for Winterset residents, or $25/day or $150/week for Non-Residents. Per the city administrator, “the reason the permit is required is because brick and mortar structures pay property taxes and the Tropical Sno is not a permanent structure but is a place of commerce”. I found this frustrating as I own and pay property taxes on the building and land on which the Tropical Sno shack is located.
We completed the application and submitted it to the city with a $100 check. We were then notified after we dropped off the check and application that we are non-residents. We found that very strange since we have a Winterset address own the building/lot within the city limits. The city administrator got involved and said, “A resident of a municipality is defind by the corporate city limits. A resident has a primary domicile in the defined area (Winterset City Limits)”. The city inspector and city attorney were copied on the email. The City of Winterset still has our application and our $100 check.
Effective 6/12/2024, the City of Winterset adopted a new Peddlers, Solicitors and Transient Merchant Application. The new application has a fee of $50/day or $300 week with no option for an annual fee. They also did away with separate rates for residents and non-residents. I was told the reason for the increase is to keep food trucks away so the local restaurants would be protected.
I consulted my attorney and had some conversations with some people within the city. We all came to the conclusion that our Tropical Sno shack did not meet the State of Iowa definition of a transient merchant. State code defines transient as operating 60 days or less per year. Our shack would sit by our building and be connected to the City of Winterset power grid with it’s own electrical meter. We bolted the shack to the concrete and followed all instructions given to us by the city inspector. We planned to be open way more than 60 days.
We opened our Tropical Sno shack on July 3rd. We have not had any correspondence with anyone from the City of Winterset since the day we opened (July 3).
On Friday, August 30th, I reached out to the city to see about expanding our product offering at the Tropical Sno shack. We wanted to have a fall menu with apple cider and mini donuts. I wanted to know what was required to have an electric donut fryer in the shack.
The gentleman I spoke to advised that I stop making any plans until I spoke to the city attorney. The city has determined that the Tropical Sno shack is now a permanent structure in the eyes of the city. That means that we are breaking several city codes. We are not connected to the Winterset city sewer system among other deficiencies. He also mentioned that we are in violation of downtown historic code.
Upon learning this information, it became very clear that the City of Winterset did not want our shack in their town. We contacted the City of Winterset electrical department and immediately had our shack removed from the power grid and the meter removed. We will be moving the shack to a temporary location until we can find a new home for it.
I know most people are thinking that we should just pay the $50 and move on. Let me share some real numbers from the past two months. Our shack was open for 29 days between July 3rd and August 25th. Our gross sales for those 29 days were $6,480.83. That is an average of $223.45 per day. If you subtract the $50, that leaves $173.45. The employees of our shack were my daughter and her friends. We made sure there were always two people in the shack for safety reasons. The approx. payroll cost for a 5 hour shift was $110. That leaves $63.45 for cost of goods sold, utilities, overhead and debt service. There is no way to not lose money paying the $50 fee. If we were open three days per week all year, we would have paid the City of Winterset $7,800. That is more than the annual property tax paid by most buildings around the square.
The shack that we brought to Winterset had been located in Ames, IA for several years. The City of Ames had no issues with the shack and did not charge them excessive permit fees to operate. You would think a city the size of Ames would have more regulation than a small town like Winterset. Not the case.
We did not open this business to be a big money maker. We opened this business to give our kids a safe place to work and teach them about business. We were hoping to employ some of their friends in the process. The shack worked great this year as there aren’t many employment options in Winterset for 14 year olds. We sponsored some high school sporting events and were looking forward to supporting little league and other community programs next year. We all learned a lot over the past 3 months. No matter how good your idea or how hard you work, the government has the power to shut it all down.
We would like to thank all of our customer for their support the past two months. The kids truly enjoyed serving you all. We hope to find another town that will welcome our Tropical Sno shack. We will post more on our page as we know more.
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