13.2: Legal Regulations

There is no universal checklist for all of the necessary licenses, permits, inspections, postings, and signage for your new restaurant. These requirements vary greatly between states, cities, restaurant types, and even counties and neighborhoods. The experts that you hire to help you -- specifically your designer, architect, and contractor -- will help you get through everything, but you will need to be an active part of the process and take on responsibility as well. Here are 10 best practices to ensure you obtain everything you need to open your restaurant legally from the beginning.

Review your lease in detail	Before you sit down with your team and put together a master list of action items, review your lease in detail so you have a clear understanding of what your property owner will be responsible for, as well as the duties that fall on you, the tenant. If your lease states that your property owner is responsible for trash removal, they may be required to post a decal showing which company they use and what the pick-up schedule is. Make this your first step to avoid confusion and help facilitate a healthy, productive, and accountable relationship between you and your property owner.
Draw on the experience of your team	Your contractor, designer, engineer, architect, and kitchen equipment vendor will be your most valuable allies in getting all of your licenses, permits, inspections, and postings completed properly. Gather this team and ask them to provide you with a list of everything that they know you will need, as well as areas of uncertainty so that you know where you will need to do focused research. You need to have a team established that has experience, otherwise you will experience a lot of surprises and unmet expectations throughout the process. For the person that’s just going through this for the first time, it’s going to feel like an infinite list and like there are so many people that have their hand out that need to get paid for some sort of application, license, or permit.”
Learn your city	Some municipalities are much more organized than others are when it comes to providing practical, accurate information and resources to help you better understand what is required for you to open and operate your business. Cities like San Francisco and New York have relatively advanced online resources, while others may have nothing at all. Still, even the most sophisticated online tools are only a starting point. If your city does not have a centralized Internet resource for new businesses, they likely have an office you can call or visit to get the same information. Track down the information up front to avoid delays and surprises. Remember, investing a day at your municipal office early in the process can save you weeks or months of costly setbacks down the road.
Research the requirements of each individual city agency	Do independent research online. Call or visit the major city and state agencies you will need to obtain permits from, and by asking peers with similar concepts in your market what they needed to get their doors open. It is important to understand that city agencies do not communicate with each other. In New York City, for example, you need a Certificate of Occupancy from the Department of Buildings and from the Fire Department and there is no link between the two. Once you visit central websites, make sure you are then researching the requirements of each individual agency. For example, the New York City Department of Environmental Protection but also the Department of Health, Department of Sanitation, and Department of Buildings monitor Grease traps. They all have different rules that can trigger violations, so you need to understand the requirements of each.
Make a master list, assign responsibilities & follow up	Once you have consulted every available resource and done as much research as you can, sit with your team and compile a master list of every permit, license, inspection, and posting you will need. Delegate each item to a member of your team and assign due dates as necessary. In your weekly construction meetings, update each other on relevant progress, ask questions, and work together to get through inevitable setbacks and complications.
Get comfortable with the health code in your municipality	Department of Health (DOH) requirements vary greatly from state to state and city to city, and many DOH specifications will dictate parts of your restaurant design. Once you know where you are going to open a property, contact the Department of Health for your municipality and read the entire health code so that you do not get in too deep without knowing the regulations. Once they start pouring concrete and putting pipes in, it can be very expensive to retract the work. Even though many standards are consistent across the country, there are some things drastically different, like outdoor seating regulations. The Department of Health really drives much of the construction for your kitchen, back of house, and outdoor seating areas. You need to be coordinated with whatever the regulations are in your specific location.
Keep all of your finalized documents in a centralized location	Some permits and licenses will need posting in a place where they are visible to guests and employees, and others will need to reside on site and presented to inspectors before and after you open. Jennifer recommends keeping copies of everything in one centralized binder that the General Manager of the property has access to so there is no confusion when inspectors arrive. This will also make it easier to replace expired permits and keep track of renewal dates.
Calendar renewal dates immediately	As soon as you receive any type of license or permit, put a reminder on your calendar for the appropriate renewal date, as well as a reminder a few weeks or months before the actual date. Clearly delegate and note on the reminders who is responsible for each renewal and assign one person (probably your General Manager) to follow up as important dates approach.
Include health code and food handling safety in employee training	Some states require every employee on staff to go through food safety training, while others only require certain individuals to go through it. Even if your municipality does not demand that every person carry a food safety card, Jennifer recommends ensuring that every employee has some level of food handling and safety training. This creates a safer environment for staff and guests and helps to maintain your equipment. Employees are better equipped to understand when something is failing if have knowledge about their workstation, how to set up, and how equipment needs to function to align with code. This helps us avoid huge violations for the restaurant, as well as damage to major equipment. Even if the law does not require it, having a staff that is knowledgeable and responsible about food safety will help shield you from the liability of an unfortunate mistake and help you sleep at night, knowing your team knows the basics.
Set up service contracts right away	Before your contractor and subcontractors disappear, bring in your equipment service vendors and set up maintenance contracts. Preventative maintenance measures make sure you do not incur massive emergency service bills when equipment breaks. It is very expensive to call for service at night and on weekends, which are most restaurants’ primary operating hours. In sum, negotiate service contracts, calendars the dates for their visits, and always follow up with them before and after they come in. Always keep in touch with them to make sure that they are holding up their end of the bargain. Too often contracts are in place, but no one really monitors work completion.

When it comes to licenses and permits necessary for operation, please heed the following takeaways to bring your facility on-line as quickly as possible.

Do your research	Contact the people in your city and state and ask what you need based on your specific project. Get on top of scheduling critical inspections with long lead times right away.
Take advantage of your team’s experience, but do not disengage from the process	Surround yourself with people that have done this before and take an active role yourself.
Get (very) comfortable with Department of Health regulations in your municipality	The Department of Health (DOH) dictates many aspects of construction including kitchen design, and even extending to how your ‘service station’ set up. Educate yourself on the requirements of your specific area and ensure that your general contractor and designer are on top of it, too.

As stated, licenses and permits necessary to open and operate a restaurant will vary from one city or state to another. The agencies and respective departments involved in the licensing and permit process appear below. Your state or municipality of choice may require more, or fewer, licenses and permits than the table contains.

Permit Sources

Federal Agency	Department of Treasury – Alcohol permit Internal Revenue Service – Employment ID
State Agency	State Liquor Authority – On-premise alcohol Department of State - DBA certificate, New business registration, Department of Taxation – Certificate of authority
City Agency	Department of sanitation – Food Service Establishment permit, Resuscitation equipment, Safety Data Sheets, Food Protection Certificate, Signage, Fire Department - Open flame permit, Range Hood and Duct Inspection, Portable Fire Extinguisher Tags, Gas Authorization, Ansul Tags, Sprinkler System, Certificate of Occupancy / Place of Assembly, Fire Alarm Test.
Utility Company	Electric / Gas Service , Gas Authorization
Contractor, Architect (In most cases, installation and performance of these items require professionals.)	Certificate of Occupancy, Equipment Use Permits, Building Permit, Sign Permit, Emergency Lighting & Foot Candle Letter