The City of Dallas' Anti-Small Business Sign Gestapo

The state of Texas received high marks this week from the Wall Street Journal for its "free market and business-friendly climate" that has been responsible for the creation of 265,300 jobs there since the recession ended in June 2009.  The WSJ also credits the Lone Star state for regulatory conditions that are "contained and flexible."

But after hearing this story about how the city of Dallas is harassing small businesses and using "extortionary, mob-style and vindictive" legal tactics to preserve its petty sign ordinance, one has to wonder just how many more jobs might have been created in Texas over the last two years if regulations were just a little more contained and more flexible.  

From the Washington Times:

"The Institute for Justice was forced last week to end its constitutional challenge to a Dallas city ordinance that prohibited small businesses from displaying large window signs advertising specials or even specifying the store’s hours of operation. To prevent the case from going to trial, Dallas bureaucrats threatened a mom-and-pop vacuum store, travel agency, uniform store and dry cleaner each with $300,000 in fines.

The ordinance specifies that no sign may appear in the upper two-thirds portion of any window or glass door. In the space that remains, signage may not take up more than 15 percent of the available window space. The ordinance carefully carves out an exemption for artistic and political speech. So a gigantic “Vote Obama” sign is acceptable, but one that states “20 percent off on Wednesdays” is not. “To claim that the citizens of Dallas were harmed to the tune of $300,000 per business is just ludicrous,” said Institute for Justice attorney Matt Miller.

Typical big-box stores like Wal-Mart and Best Buy have plenty of money to advertise specials and mail out flyers that inform customers about upcoming sales. For the little guy, a notice in the window is often the only cost-effective way to entice passersby to try out their products or services. That’s why the small shops in the case only asked for $1 in damages. Their only goal was overturning an ordinance they believe violates the First Amendment. Rather than allowing the case to go to a jury, the city unleashed code-enforcement officers who levied $1,000 in “nuisance” fines for each of the 300 days the businesses were in violation of the ordinance during the litigation."