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Gun Dealer Licensing Act consequences?

Tuesday, Feb 5, 2019

* Illinois News Network

Several gun dealers in Central and Southern Illinois are closing their businesses rather than pay what they’re saying is thousands of dollars in costs to comply with a law enacted last month.

When he signed the bill into law last month, Gov. J.B. Pritzker said the Gun Dealer Licensing Act was about stopping straw buyers.

“The reason for it is to deter straw purchases so that we can prevent someone from buying a gun for someone else who is not legally allowed to own a gun,” he said at the signing ceremony in Chicago.

* “Several”? I dunno about that, but INN does identify two. Here’s one

Mick Moore made the same decision for Walnut Creek Shooters Supply in Brownstown after seeing not only the cost of the license and the camera system. but also the uncertainty additional regulations and more fees.

“It’s just not worth it,” he said. “I’ve fought it and fought it but I’m just not up to the fight much longer.”

Mr. Moore explained his reasoning on his Facebook page

I’ve worked 8 to 12 hrs a day for the last 8 years building my business as an honest and legal gun shop and put all the money back into inventory so i could provide what my loyal customers want. Never drawn a paycheck for my time. I send a nice check to the state of Illinois for sales tax every month. Now they want to add more hardships on all of the small local gun shops. There’s no way we can comply and stay in business. We have allowed a few square miles in the north east corner of our state completely ruin the rest of the state. I will be selling off my inventory of firearms and ammo and not replace them and discontinue those sales. Then i won’t need their firearm license to sell all the rest of the accessories and supplies i have in stock. Time to go hunting and fishing and enjoy my retirement. A very heart felt thank you to all my loyal customers and friends.

If a business is operating on such a thin margin that the owner can’t even draw a paycheck for eight years, then almost any additional regulation and fees would put that person out of business.

That being said, it sucks when people have to give up something they’ve built.

Your thoughts?

- Posted by Rich Miller        

56 Comments »
  1. - TopHatMonocle - Tuesday, Feb 5, 19 @ 12:19 pm:

    I find it extremely hard to believe that someone would work 8 to 12 hours per a day for 8 years on a business where they made no money. Regardless of the truthiness of those number, this sounds more like a hobby to this gentleman than a business. The gun sales he’ll no longer be making will go to a licensed dealer who actually makes a profit and the state will still get its sales tax.


  2. - Anonymous - Tuesday, Feb 5, 19 @ 12:19 pm:

    Fewer gun shops means a larger profit for the remainder.

    If he never got paid, it sounds like he wasn’t running a business as much as a hobby.


  3. - Shanks - Tuesday, Feb 5, 19 @ 12:23 pm:

    My thoughts…same as before, it does more harm to businesses (particularly mom and pop shops) that good. For those struggling as it is, will be out of a job. The cost to comply with unjust regulations/fees, adds up fast…welcome to Illinois.


  4. - statehoss - Tuesday, Feb 5, 19 @ 12:23 pm:

    Obviously, I don’t speak for him.

    But I have a little knowledge of small business accounting. Even if an owner isn’t drawing a “paycheck for his time,” the business may be profitable, and the owner may be benefiting from that revenue stream. I doubt he was working 8 to 12 hour days for 8 years for absolutely nothing while his wife or parents supported him. Someone would’ve pulled the plug sooner.

    I suspect his business didn’t make him rich even so, and I can imagine that adding significant costs did put him under.


  5. - efudd - Tuesday, Feb 5, 19 @ 12:24 pm:

    2 thoughts-
    1) You have a brick and mortar store with firearms and ammo constantly in inventory, and your underwriter doesn’t require some form of video surveillance?
    2) If you had installed such video you may have got a reduction on your insurance, not to mention a tax deduction.


  6. - 47th Ward - Tuesday, Feb 5, 19 @ 12:25 pm:

    ===I find it extremely hard to believe that someone would work 8 to 12 hours per a day for 8 years on a business where they made no money===

    Sounds more like a hobby than a business.


  7. - Lock and load - Tuesday, Feb 5, 19 @ 12:26 pm:

    No check for eight years, this is probably the straw that helps make a decision he’d have to be thinking about already.


  8. - Bruce (no not him) - Tuesday, Feb 5, 19 @ 12:29 pm:

    I know one FFL in central Illinois, who is planning on closing. His business is small, and runs out his house. No way can he absorb the costs associated with the new law.


  9. - Flynn's Mom - Tuesday, Feb 5, 19 @ 12:30 pm:

    It sounds like his business plan was not very sound.


  10. - Rich Miller - Tuesday, Feb 5, 19 @ 12:31 pm:

    ===unjust regulations/fees===

    They can also be seen as reasonable. Gun dealers who can’t secure their inventory can have a high societal price.


  11. - don the legend - Tuesday, Feb 5, 19 @ 12:36 pm:

    ==Never drawn a paycheck for my time.==

    ==Time to go hunting and fishing and enjoy my retirement.==

    How are these two statements compatible?


  12. - Amalia - Tuesday, Feb 5, 19 @ 12:36 pm:

    more likely that law enforcement will visit and check. some people call that a cost to their business, I call it regulating items that kill.


  13. - AlfondoGonz - Tuesday, Feb 5, 19 @ 12:44 pm:

    I can’t bring myself to care about people whose hobby is so unessential yet tangentially causes such bloodshed.

    Guns are cool. We all know it. But they’re dangerous. Collect stamps or play bingo. I won’t cry for the poor persecuted gun enthusiasts.


  14. - steve - Tuesday, Feb 5, 19 @ 12:44 pm:

    I think the propose of the new gun law is working. Raise the costs of gun stores and drive them out of business.


  15. - downstate hack - Tuesday, Feb 5, 19 @ 12:46 pm:

    If a business is operating on such a thin margin that the owner can’t even draw a paycheck for eight years, then almost any additional regulation and fees would put that person out of business.

    That is an insane agrument that seems to promote more regulation without any concern about consequences. Maybe the owner didn;t draw a salry but what about his employees, supplies etc.


  16. - wordslinger - Tuesday, Feb 5, 19 @ 12:47 pm:

    –I’ve worked 8 to 12 hrs a day for the last 8 years building my business as an honest and legal gun shop and put all the money back into inventory so i could provide what my loyal customers want. Never drawn a paycheck for my time. –

    How is that a “business?”


  17. - Shemp - Tuesday, Feb 5, 19 @ 12:51 pm:

    So it’s okay that it was shut down because it must have been just a hobby? As was pointed out above, not taking a pay check doesn’t mean not-profitable.

    You can tell with 2 minutes of searching it is/was just a small shop that he ran from home, but he kept regular hours. I suspect service was a big part of the business. I call this an intended unintended consequence. There’s no shortage that voted for this law that want all the shops shut down that they can. If it closes some place 3 hours south of I80 with a clean record and takes someone’s side income away, what’s it matter, we might close down one of the actual bad dealers in the Chicagoland area (or at least make that bad dealer go to Indiana). Another feel good law that is unlikely to make a difference and drive a few more people out of work or drive both good and bad underground. And the only rifle I have is dearly departed Grandpa’s old rabbit hunting .22 that was passed down to me years after his death and hasn’t been fired since.


  18. - Anyone Remember - Tuesday, Feb 5, 19 @ 12:52 pm:

    Heard the INN audio - the dealers sounded older / elderly. Further, they’re located in smaller towns (Brownstown has 759 people, no website, and seemingly few businesses) that wouldn’t seem to be able to support a full-time gun shop. And 5 miles south of Brownstown seems more sparsely populated.

    Didn’t leaking underground storage tank regulations put a lot of small town gas stations out of business in the 1980s? DCFS regulations eliminate small town daycares except for in-home?


  19. - Mason born - Tuesday, Feb 5, 19 @ 12:52 pm:

    My 2 cents. I’ve shopped at Fishmans the 2nd dealer INN listed. He ran a good shop not a big by any means. His inventory was about as secure as you could get. It’ll be sad to see him close Girard could use every business they can get. At least they have Whirl-o-Whip

    Several people have talked about profit margins for these shops. The Internet has really cut price margins in this case it’s hard to beat a BudsGuns on price, esp when you have to buy through a wholesaler. You can make a little on doing the transfer, around $40, but that isn’t much to keep the doors open. Which if we’re honest isn’t a whole lot different than all Brick & Mortar stores.

    The niche for awhile was to operate out of your home/garage & carry no inventory but doing the Transfer paperwork for the $40 or so. It’ll be interesting to see how that changes.


  20. - Rich Miller - Tuesday, Feb 5, 19 @ 12:55 pm:

    ===That is an insane agrument===

    It’s merely factual.


  21. - 47th Ward - Tuesday, Feb 5, 19 @ 1:01 pm:

    ===I suspect service was a big part of the business.===

    What part of the law prevents him from continuing to provide the service portion of his hobby?


  22. - Flapdoodle - Tuesday, Feb 5, 19 @ 1:03 pm:

    I won’t comment on Mr. Moore’s account in the post, but people should realize that a fair number of firearms dealers in rural areas and small towns do it as a sideline to other employment, and not just as a hobby of sorts. I can think of two I’ve done business with where I live, and both provided valuable services otherwise unavailable in the area. It will be very unfortunate if businesses like these, that already do it the right way, are forced to close because of additional costs imposed by the GLA.


  23. - Flapdoodle - Tuesday, Feb 5, 19 @ 1:11 pm:

    ==What part of the law prevents him from continuing to provide the service portion of his hobby?==

    Some services must be provided by a FFL dealer, who would fall under the IL GLA. For examples, handling legal firearms transfers across state lines or online purchases, shipping/receiving firearms for repairs, holding firearms for the required waiting periods. It’s not just a matter of selling a few shooting supplies on the side.


  24. - Nick Name - Tuesday, Feb 5, 19 @ 1:14 pm:

    ===I send a nice check to the state of Illinois for sales tax every month.===

    The sales tax that customers pay, unlike the retail cost of a product, does not belong to you in the first place; and in the second place, the state’s role is just a pass-through. That tax gets returned to your community to fund municipal services.


  25. - 47th Ward - Tuesday, Feb 5, 19 @ 1:17 pm:

    ===For examples, handling legal firearms transfers across state lines or online purchases, shipping/receiving firearms for repairs, holding firearms for the required waiting periods.===

    Sorry, still confused. He said he was going to stop selling firearms and sell off his inventory. Handling a transfer is participating in a sale, isn’t it? And shipping/receiving? I thought the whole point was he was local, so who is shipping him firearms to repair? Holding firearms for the required waiting period, again, is only germane if he is selling it or participating in a sale.

    Can he still offer repair and refurbishing services, along with sales of supplies without needing this license?


  26. - Bobby Hicks - Tuesday, Feb 5, 19 @ 1:18 pm:

    I’m a lifelong Democrat supporter and I have several guns. I buy and collect, not to resell, but to have. This bill will not stop me from purchasing or collecting. If I understand it correctly, they pay a fee, register all of their gun numbers and install cameras. What gun business doesn’t have cameras now? Most small shops and surplus businesses are very high on their prices, do some research, compare them with Gunbrokers. If they can’t afford the fees, maybe they need a new line of work. It wont stop me from buying.


  27. - q3vropii7t - Tuesday, Feb 5, 19 @ 1:24 pm:

    I would expect to see a lot more of this sort of media coverage, all of which will somehow neglect to mention that demand for firearms is decreasing. “Unnecessary regulations put me out of business” is a story with an agenda if it doesn’t include “overall gun sales are down 8-10%” as part of the coverage.


  28. - Anonymous - Tuesday, Feb 5, 19 @ 1:26 pm:

    This will hurt many small manufacturers that have to have an FFL to sell components. Most of them are small suppliers and the “gun” business is a small part of their entire business. However, because they have to have an FFL and now have to comply with the cost of the new law (video, etc), they are getting ride of the FFL. Its not a huge impact but may cost a few people their jobs.


  29. - Anonymous - Tuesday, Feb 5, 19 @ 1:34 pm:

    Bobby - well said.

    This Democrat gun nut is comfortable with the law. It doesn’t actually ban anything and hopefully gives the State police more ability to ensure that the laws are being followed.


  30. - Randoplh - Tuesday, Feb 5, 19 @ 1:44 pm:

    Has anyone here talking about what a bad business man he is ever run anything larger than your check book? This isn’t unheard of and while he may not have made money it was because he was paying his employees and suppliers.

    This is anti-business bill. Will be interesting to see if it has any impact on violence as it’s already shown to have an impact on business.


  31. - Rich Miller - Tuesday, Feb 5, 19 @ 1:49 pm:

    ===it was because he was paying his employees===

    Um, did he have any?


  32. - Flapdoodle - Tuesday, Feb 5, 19 @ 1:49 pm:

    Sorry, still confused. — Fair enough.

    == Handling a transfer is participating in a sale, isn’t it? And shipping/receiving? I thought the whole point was he was local, so who is shipping him firearms to repair? Holding firearms for the required waiting period, again, is only germane if he is selling it or participating in a sale.==

    If I buy a firearm out of state or online, I can only take possession of it from an in-state FFL. So out-of-state ships to in-state, who completes transaction but not as a seller. Since 72-hour waiting period applies, the local FFL would hold the firearm for that period before releasing it to buyer, but again would not be part of the sale.

    Similarly, if I want to ship my firearm to a repair center, I may need an FFL to send/receive it. Not a matter of the local guy doing the repairs, but handling the shipping/receiving so the weapon is tracked at all times. Have done this several times locally when having warranty work or total breakdown cleanings done.

    Any better? (No snark)


  33. - Demoralized - Tuesday, Feb 5, 19 @ 1:53 pm:

    ==This is anti-business bill. ==

    That’s the standard argument for any regulation. Nobody wants to be regulated. But they are there for a reason.


  34. - logic not emotion - Tuesday, Feb 5, 19 @ 2:00 pm:

    The law is having its desired impact (not stated intent) . It is driving firearms dealers out of business (desired impact). It won’t decrease gun violence (stated intent).


  35. - ChicagoVinny - Tuesday, Feb 5, 19 @ 2:04 pm:

    Looking online this “store” looks like he just runs it out of his garage.

    Anyway as a fellow small business owner if you’re operating for 8 years and not making any money, maybe time to hang it up anyway.


  36. - JJJJJJJJJJJ - Tuesday, Feb 5, 19 @ 2:13 pm:

    “We have allowed a few square miles in the north east corner of our state completely ruin the rest of the state.”

    Those square miles in Chicago represent 20% of the state population. Cook County 40%. The collars… etc etc. That sort of comment always riles me up.


  37. - Anonymous - Tuesday, Feb 5, 19 @ 2:19 pm:

    Mick Moore can’t afford $300 a year for a state license?


  38. - 47th Ward - Tuesday, Feb 5, 19 @ 2:32 pm:

    ===Any better? (No snark)===

    Yes, very helpful. No snark either.


  39. - Mason born - Tuesday, Feb 5, 19 @ 2:33 pm:

    47th

    A Gunsmith is considered a Dealer for ATF purposes. I have talked to one about a year ago who said he would retire if Rauner had signed it. I don’t know if he will now I haven’ been back since.


  40. - 47th Ward - Tuesday, Feb 5, 19 @ 2:42 pm:

    ===A Gunsmith is considered a Dealer for ATF purposes.===

    Thanks Mason Born. Does that mean someone acting purely as a gunsmith has to comply with the new state licensing requirements even if they don’t actually sell/transfer firearms or maintain an inventory of firearms?


  41. - Mason born - Tuesday, Feb 5, 19 @ 2:43 pm:

    47th

    To expand on Flapdoodles comment. Federal law allows you to buy a long gun in another state from an ffl without transfering it to an IL FFL. A pistol must be shipped to an IL FFL before you can take posession.


  42. - Todd - Tuesday, Feb 5, 19 @ 2:47 pm:

    47, yes a person acting soley as a gun smith would have to operate under the new law. if they have open hours where customers walk in its $1500, not 300. and say their license expires in 09/19. then they have to pay $1500 for the current one and another $1500 for the new one in October


  43. - Mason born - Tuesday, Feb 5, 19 @ 2:57 pm:

    47th

    Sorry I misunderstood, I’m not lawyer enough to understand all of the State Law. I’m happily not an FFL holder. I considered it once but disliked the idea of dealing with anymore Federal Bureacrocy than my normal work requires.


  44. - 47th Ward - Tuesday, Feb 5, 19 @ 3:02 pm:

    Thanks Todd. If there are people/businesses that don’t carry inventory and are not involved with selling guns (in any manner), then they ought to seek an amendment to this legislation. Seems only fair.


  45. - Motambe - Tuesday, Feb 5, 19 @ 3:11 pm:

    Mason Born and 47th- I just completed purchase of a long gun from an out-of-state store and was required to provide the name, address and FFL # of a local dealer to which the gun was shipped. He took possession and handed it over after the waiting period and background check were completed.


  46. - Jack Kemp - Tuesday, Feb 5, 19 @ 3:28 pm:

    “If a business is operating on such a thin margin that the owner can’t even draw a paycheck for eight years, then almost any additional regulation and fees would put that person out of business.”

    If only we could all make our living gouging the State out of hundreds of thousands of dollars in subscriptions to our gossip blog.


  47. - Anonymous - Tuesday, Feb 5, 19 @ 3:32 pm:

    Todd: It’s $1500 for a five year license, which comes out to $300 a year.


  48. - Mason born - Tuesday, Feb 5, 19 @ 3:36 pm:

    Motambe

    Were you physically at the store or did you order online or over the phone? & was it one of our bordering neighbors?

    Just curious. I have bought Shotguns from Cabelas in Stl & brought them home after 24hrs.


  49. - Todd - Tuesday, Feb 5, 19 @ 4:13 pm:

    No its not. it is $300 for a non-retail license, for the duration of the license and $1500 license for a “retail” license again for the term of the license.

    SO if your licesne expires in 180 days when the applications are due out, you pay the $1500 for a retail license, then when you get your new license that expires 3 years from now you pay again The fee is for the “duration” of your license

    Section 5-70. Fees and fines deposited in the Firearm
    Dealer License Certification Fund. The Department shall set
    and collect a fee for each licensee certifying under this Act.
    The fee may not exceed $300 for a certified licensee operating
    without a retail location. The fee may not exceed $1,500 for
    any certified licensee operating with a retail location. The
    Department may not charge a certified licensee in this State,
    operating under the same or different business name, fees
    exceeding $40,000 for the certification of multiple licenses.
    All fees and fines collected under this Act shall be deposited
    in the Firearm Dealer License Certification Fund which is
    created in the State treasury. Moneys in the Fund shall be used
    for implementation and administration of this Act.


  50. - Whizbang - Tuesday, Feb 5, 19 @ 6:46 pm:

    When this was signed I remember an elected official… .Governor? Saying this law would not be a problem. They wanted to be told about any gunshops that were harmed by this law. I guess they have some to talk to now.


  51. - lollinois - Tuesday, Feb 5, 19 @ 7:13 pm:

    A century ago there were probably small mom and pop drug stores that were driven out of business when laws were passed regulating the dispensation of pharmaceuticals.

    I suspect there were small diners, inns, beds and breakfasts, etc. that had to close when food safety regulations were passed as well.

    To Rich’s point if business are running on too tight margins or if they don’t have the scale to make compliance economical, they’ll have to close.

    I don’t think this means we shouldn’t have regulations or that guns are somehow special. Public health and safety are better served by these regulations, even if it means that you can’t run a commercial restaurant out of your household kitchen or a commercial pharmacy mixing plant extracts you grow in your garden. Or yes, even if you can’t deal firearms without cameras and the ability to track purchasers.


  52. - Anonymous - Wednesday, Feb 6, 19 @ 6:55 am:

    “Gun Dealer Licensing Act is amended by changing the effective date of the requirement that a licensee who operates the business at a permanent physical location open to the public equip the business with a video surveillance system to monitor the critical areas of the business premises, including, but not limited to, all places where firearms are stored, handled, sold, transferred, or carried, to January 1, 2021. Provides a video surveillance system of the licensee’s business premises may not be installed in a bathroom and may not monitor the bathrooms located in the business premises. Provides the expiration date and renewal period for each gun dealer and dealership license shall be 5 years and the application fee or renewal fee for a license shall not exceed $1,000 for the 5-year period.”

    It was later changed to $1500.


  53. - truthteller - Wednesday, Feb 6, 19 @ 8:08 am:

    sounds like an excuse to close up shop….he wasn’t making it so now he can use this an excuse


  54. - Anonymous - Wednesday, Feb 6, 19 @ 8:31 am:

    Todd, where did you read three years? Also this law doesn’t take effect until Jan 1, 2021. So it can’t expire in 9/19.


  55. - Motambe - Wednesday, Feb 6, 19 @ 10:44 am:

    Mason born- I was not physically at the brick and mortar store, ordered online. Store was in northern Michigan. I have had the same experience as you with a shotgun purchase at Cabela’s St. Louis. But for a handgun purchase at that store an Illinois resident cannot carry it out of the store. My wife had to have hers shipped to our FFL dealer in our hometown.
    And that is a reason for my concern. He is local, convenient, has some gunsmithing skills, maintains a small inventory or can order what you need, and if you need to buy from another source charges a low transfer fee of $25. And he is careful to follow all state and federal laws. This new law does nothing to add to the safety of his premises, he already has the video system and keeps excellent records. It seems that in his case this amounts to a new tax for the “privilege” of operating a business in Illinois. My opinion.


  56. - Mason born - Wednesday, Feb 6, 19 @ 11:10 am:

    Motambe

    That makes sense. Federal law requires handguns to be dealer to dealer transfers. To my understanding you can buy longguns in a state that borders IL without a 2nd dealer. IL law still applies, foid etc., but not transfer.


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