Reporter's Notebook

Why Jimmy John's is putting Champaign on ice

This is part of Nation Restaurant News' special coverage of the 2012 MUFSO conference, taking place Sept. 30-Oct. 2 at the Hilton Anatole Hotel in Dallas. Follow coverage of the event on NRN.com's ‘At the Show’ section, read onsite blogs from NRN editors at Reporter’s Notebook, and Tweet with us using #MUFSO.

Jimmy John's Gourmet Sandwiches founder and chief executive Jimmy John Liautaud usually is the most enthusiastic and engaging speaker on any stage he happens to share. Tuesday morning at MUFSO's CEO panel was no exception. Sitting with other restaurant leaders who had been honored the night before with MUFSO's Golden Chain award, Liautaud seconded many of the common grievances attendees and panelists voiced about government intrusion in business during this election year.

But while many restaurant operators and business owners claim that the threat of further regulations after health care mandates and menu labeling have them taking a wait-and-see approach, Liautaud told the MUFSO crowd that he's taking action right now. Liautaud had finalized plans to move Jimmy John's licensing division from its headquarters city of Champaign, Ill., to Florida early next year. The announcement was hardly a snap decision: Liautaud had publicly complained nearly two years ago that the Illinois state goverment's January 2011 increase of the state income tax from 3 percent to 5 percent would drive him away from the Land of Lincoln.

For now, Jimmy John's headquarters will remain in Champaign, though Liautaud would not commit publicly to either keeping that small part of the business in the state or moving it to Florida, Texas or Indiana. He summed up his decision in this impassioned rant:

"It [the state income tax increase] just pissed me off. I can move myself and my licensing division to Florida, and I can move 70 percent of my income from Illinois to Florida. And it's going to cost Illinois 5 percent of that income, and you know what? It's going to pay for my house and my boat. It's not a bad thing. When I have 1,500 people every night at 3 and 4 a.m. scraping 40 cents of mayonnaise out of a one-gallon Hellmann's mayonnaise jar, that money is so respected. And we take that money, and we pay our people. Our managers get 25 percent of the profit, area managers get 10 percent of the profit of our stores. Our managers make $80,000 to $90,000 a year. We so respect this money that we work so hard to earn, and we send it in, and they [Illinois lawmakers] puke it away. It hurts me. My mother's in the front row here, and she came to Ellis Island in 1953 as a refugee bombed out of her farm in Lithuania after two years on the run, and she was homecoming queen at the University of Illinois in '59, where she met my dad — African-American dude and the first Liautaud that ever went to college — and here we are. We love America; this is our spot. And we gotta protect America. I don't mind paying the tax in Illinois if they'd just spend it the way I respected it. I'm sorry, I'll shut up."

The crowd went wild.

Liautaud opened the first Jimmy John's in 1983 near the campus of Eastern Illinois University.

Find more MUFSO 2012 coverage online at NRN's sister publications, Restaurant Hospitality and Food Management.

Contact Mark Brandau at mark.brandau@penton.com.
Follow him on Twitter: @Mark_from_NRN

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Reporter's Notebook is NRN's newsroom blog, where our editors give their points of view on news happening in the restaurant business.

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