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Licensing will be easier for Detroit businesses under new rules

July 9, 2025

Detroit City Council has unanimously approved ordinances to streamline business licensing processes, reducing burdens on small businesses by extending license renewals from annual to biennial periods, creating provisional licenses, and eliminating redundant health licenses for restaurants. The reforms, developed after a year-long review and consultations with business owners, aim to dismantle complex regulations that disproportionately hindered small local entrepreneurs compared to large corporate chains. While these changes will reduce city revenue from licensing fees by approximately $530,000 annually, officials believe the economic growth from supporting small businesses will ultimately benefit Detroit's neighborhood corridors and change the culture for entrepreneurs.

Who is affected

  • Small business owners and entrepreneurs in Detroit, particularly "mom-and-pop shops"
  • Restaurant owners (including those with patios)
  • Local entrepreneurs who previously faced insurmountable licensing hurdles
  • Detroit's Buildings Safety Engineering and Environmental Department (BSEED)
  • Detroit residents and neighborhood commercial corridors
  • Detroit's General Fund (through reduced revenue)

What action is being taken

  • Business licenses are being changed from annual to biennial renewals
  • A new provisional license is being offered to allow businesses to operate while working on obtaining a full license
  • Redundant health licenses for restaurants are being eliminated
  • A repayment program is being created for businesses owing under $350 in fees
  • A new business concierge team is being formed to help entrepreneurs navigate permitting and licensing
  • BSEED staff are being redirected to enforce regulations on unlicensed businesses

Why it matters

  • The previous regulations were described as "protectionism" that shut out small businesses essential for neighborhood development
  • Starting a restaurant with a patio previously required 10 months, 13 inspections, $4,300 in fees, and coordination with six city departments
  • These changes represent the most substantial reform to business licensing in 15 years according to Council President Pro Tem James Tate Jr.
  • The reforms signal that "Detroit is a place you can do business in" with greater predictability
  • While the city will collect less in fees (about 24% of BSEED's General Fund allocation), officials believe this puts money back into the hands of small businesses

What's next

  • A new five-member business concierge team is being created with funding from the 2026 city budget to help businesses navigate permitting and licensing processes
  • The team is currently hiring staff in preparation to begin operations this year

Read full article from source: bridgedetroit.com