Gunsmithing as part-business

[Jim K]

Hi, newfalguy,

You are, of course, perfectly correct that anyone in business should/must obey local laws. But that does not mean that the federal government should be responsible for enforcing those laws.

For many years, BATFE and its predecessors issued FFL's without checking or caring about local zoning laws. It was not until President Clinton ordered them to reduce the number of licensees by putting home dealers and "kitchen table" gunsmiths out of business that they began to take local laws into consideration when issuing licenses.

As to the 03 FFL, the gun control movement has been trying for many years to eliminate the C&R category and the 03 FFL, so far without success. That pressure has increased as more modern firearms (e.g., post-WWII era) reach the 50 year mark. In line with the recent use of executive orders to effect the administration's goals without congressional action, I would not be surprised to find restrictions imposed on collectors. That could take the form of rigid conformity to local laws; requirements for secure storage in the form of heavy safes, reinforced walls, alarm systems, etc., or banning direct shipment of any firearms to 03 FFL's.

Jim

 

[newfalguy101]

ATF doesn't enforce those ordinances, I don't even know if they check on them, to be perfectly honest.

They do make it completely clear that in order to have an 01 ( which I have had for the past 10 years, working out of my home part time ) you are required to conform to all state and local laws.

In fact I would suggest that MORE "kitchen table FFL's" have been put out of business/denied licenses by LOCAL ordinances than have been shutdown/denied by the ATF.

 

[Jim K]

BATFE does check; they require that an applicant for any FFL other than an 03 undergo a premises check and certify that he is in conformity with all local laws and regulations before approving the license. They may enforce that inconsistently, as they do other rules, but ANY violation of the local laws can result in loss of the FFL. If you are in an area where there is no zoning or where a business is permitted, you might have no problem. But if you are in a residential area, BATFE can and very well might refuse to renew your license if they become aware of the violation.

Those "dealers" may have been put out of business for violating local laws, but over 75% were put out of business by BATFE through refusal to renew FFL's. The local rules were just the mechanism they used to do that.

You seem very confident that you are in total compliance with all the laws in your area. Are you sure?

Jim

 

[Jim K]

Just for evidence of a deliberate federal program to reduce the number of FFLs:

Year Number of 01 FFLs in 1000's
1975 146
1994 213
1997 79
2011 48

Clinton was elected in 1992 and served until 2000. His administration used deliberate, executive action to reduce the number of FFL dealers in the U.S. That was not the action of local authorities, it was the action of BATFE in using local laws or any other means to deny renewal of FFLs. (Few were revoked; they just weren't renewed.) One dealer I am aware of was denied a renewal after a BATFE agent reported an unsanitary rest room to the local health department. He was found in violation of the health code, so no FFL.

Jim

 

[newfalguy101]

BATFE does check; they require that an applicant for any FFL other than an 03 undergo a premises check and certify that he is in conformity with all local laws and regulations before approving the license. They may enforce that inconsistently, as they do other rules, but ANY violation of the local laws can result in loss of the FFL. If you are in an area where there is no zoning or where a business is permitted, you might have no problem. But if you are in a residential area, BATFE can and very well might refuse to renew your license if they become aware of the violation.

Those "dealers" may have been put out of business for violating local laws, but over 75% were put out of business by BATFE through refusal to renew FFL's. The local rules were just the mechanism they used to do that.

You seem very confident that you are in total compliance with all the laws in your area. Are you sure?

Jim

Am I sure?? Well seeing as you are so certain that ATF checks everything so closely, and they have renewed my FFL 3 times, I would have to say, yea, I am sure...

Being in a residential area, is NOT an automatic denial, there are hundreds of thousands of small home based business being operated in Residential areas, as is my business.

For what its worth, I suspect the Renewal fee tripling had as much to do with many FFLs not being renewed as anything else. Further I would suspect that the $200 first time fee stops many from applying.

I am NOT disagreeing that ATF and the Clinton administration did take deliberate steps to reduce the number of FFL's, however, when it comes right down to it, many of the FFL's that chose to not re-new, did so because they had no interest in running a business to begin with and were using their FFL to increase their own collections, hence when the "price of admission" went up, they opted out.

I find it interesting that the ATF actually doing their job seems to upset so many people.........when they refuse a renewal because the FFL wasn't complying with local laws ( which they swore to as part of the application ) , isn't that what ATF is supposed to do??

 

[Jim K]

I agree with much of what you say, but the idea that BATFE "is just doing their job" clashes rather badly with their own actions in the past. Whether they have changed appears to be a question, but if you read the current administrations plans for gun control there is little doubt that they will be the front line of a planned attack on gun owners and dealers.

I am glad you have had no renewal problems; perhaps the agents in your area have better things to do than check on your zoning, or perhaps your city does not have or does not enforce its zoning laws, if there are many businesses in residential areas. But I can assure you that they have done so in other areas and that the drop in licensees has not been solely because the "dealers" have voluntarily dropped their licenses, unless you define sometimes heavy pressure and threats as "voluntarily."

And no, those dealers were violating no federal laws; they did not "lose" guns, they did not supply terrorists, they did not traffic in illegal weapons. Their only "crime" was being small businessmen operating out of their homes.

I have said many times that it is not a good idea to run a gun dealership or gunsmith shop out of a home. If the "bad guys" decide to target the gun shop one night, it is better that it be in a business district than in the basement. And you won't be waked up at 3 AM on opening day by someone who wants you to fix his gun.

Jim

 

[Bibbyman]

Thanks guys, you resurrected my memories of when I had an FFL and was a factor in my letting it go. The other factor was starting another business that absorbed all of my free time and efforts. I literally stored all my stuff for 20 years. I started dragging it back out and sorting through it. I found a lot of stuff I didn't remember having.

 

[hueyville]

I recently jumped though the hoops to start up a smithing business. Owning two other companies that have been successful and now some health issues slowing my ability to lead all of the rigging projects and unable to hire any reliable riggers I am contemplating shutting them down. Having run two companies for decades, liability insurance, workmans comp, sales tax license and all that are everyday parts of business. Out of these two businesses I have a paid for commercial building zoned for manufacturing, office and retail sales. A full machine shop including CNC machines, a full fabrication shop, welding shop and paint facilities. A big ol perfect 5,000 square foot shop that most would dream of with all American made equipment from 60" toolroom lathe to TIG welders and everything in between. Its the culmination of 30 plus years of hard work completely paid for.

I was rear ended three years ago by a witch text messaging and broke my neck and my back. Now running two businesses and keeping payroll met, chasing the hired help whose job I have to do when they lay out or fail their drug test has lost its joy. I thought I would go to gunsmithing without any employees and just take enough work to pay the insurance and utilities and am not ready for the rocking chair full time.

I recently set up a separate LLC for my gun work. Then got my federal I.D. number, separate sales tax number, all FFL's necessary for what I want to do and went shopping for liability insurance. My intent was just a one man "mom and pop" gunsmith shop to keep me from driving my wife crazy hanging around the house. Thus far all my quotes for basic liability insurance are in the 1,200 to 2,000 dollar per month range. I asked some other smiths about this who told me they don't fool with all that insurance and tax stuff. I was appalled. Both at the cost of insurance and the fact people are actually running gunsmith businesses without it. So for the meantime I have an antique Harley Davidson on a lift doing a restoration to keep me busy while I decide if working on guns is worth the effort. I have been doing all my own smith work for over 30 years and have found I am darn good at it. From F class rifles to metal checkering, finishing, chambering, welding up broken or cut receivers, etc. But no way am I signing up for insurance in the thousand plus a month range for a way to keep from having idle hands. Anyone out there found a way of insuring at a reasonable price?

 

[BBBBill]

...Anyone out there found a way of insuring at a reasonable price?

Check with the NRA.

 

[No_Expert]

Like the IRS...

ATF violates its own regulations with impunity. They interpret their own rules any way they choose when they want to make a case. They will argue both sides of a case to win. If they decide to come after you, good luck! The local ATF folks told me that: 1. Working on anyone else's gun for any reason whether money is involved or not is at least gunsmithing. It could be firearms manufacturing if they choose to interpret it as such. 2. If you keep anyone else's firearm overnight AND you work on it, you MUST have an FFL license. If we ever get past the current liberal idiocy, things may return to normal. I am amazed at how many people who support gun rights vote for Democrats! ANY vote for ANY Democrat is a vote against gun rights! You might google "Operation Choke Point" for your own information.

 

[Jim K]

In case you don't know, what is now BATFE under the Justice Department was once the Alcohol and Tobacco Tax Division (ATTD) of the (guess what?) Internal Revenue Service of the Treasury Department! That was because the original NFA and FFA were gun control laws disguised as tax laws, so they went under the IRS.

But of course that meant they picked up all the IRS bad habits, including "enforcing", not the law, but the wishes of the administration, a la Lois Lerner.

Jim