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GUNS OFF STREETS: What the Gun Dealers Think

January 5, 1994

Undated (AP) _ A nearly $600 increase in the cost of the federal license for firearms dealers wouldn’t put Frank Kendrick out of business.

But the Houston gun manufacturer and part-time dealer in competition pistols says some acquaintances who hold licenses to take advantage of manufacturers’ discounts and enjoy other conveniences probably wouldn’t pay.

″Unless they buy a lot of guns,″ he said, ″it won’t be worth it anymore.″

That is the goal of a proposal Tuesday by Treasury Secretary Lloyd Bentsen, who wants to see the fee for dealer licenses raised to $600 a year.

Dealers who sell across their kitchen table or out of car trunks are often the source of powerful weapons for criminals, Treasury officials said.

The license fee was $10 a year before Congress increased it last year to $200 for a three-year license - or $66 a year - and $90 for a renewal.

Federal officials contend that raising the fee would reduce the 258,000 licensed dealers by 80 percent, cutting down on the flow of guns and making it easier to trace weapons and enforce existing laws.

While many dealers agree $10 was too low, they worry a sudden fee increase would drive many buyers and sellers into the unregulated sales arena of gun shows and want ads, making many more guns untraceable.

″Gun traceability is directly tied to quality gun dealers doing the paperwork for federal government,″ said Tom Koessl, a custom firearms dealer in Baileys Harbor, Wis. ″If we eliminate 75 percent of existing gun dealers, they are just going to increase two- or threefold the number of people selling guns without any of their previous responsibilities.″

Since 1968, anyone with a clean criminal record and no history of mental problems has been able to get a firearms license from the Bureau of Alcohol, Tobacco and Firearms, an agency of the Treasury.

The license offers several advantages: the ability to ship guns across state lines, access to wholesale prices and federally endorsed legitimacy to buy and sell guns without going through constant background checks.

The one major requirement for those holding licenses is filing information on every gun they buy and sell. This paperwork allows ATF to trace firearms used in crimes.

Even at $66 at year, the license is considered a good deal to gun buffs.

″It’s cheap. Best bargain in town,″ Bentsen said Tuesday.

A 1992 ATF study found 74 percent of those holding licenses conducted their gun business from their homes.

Many of the licenses see little activity: 45 percent of the license-holders had not bought or sold a gun within the last year.

Still, the licensing has proved a burden to ATF, which does the background checks, issues licenses and conducts on-site inspections of dealers’ records.

With only 240 inspector positions, the bureau conducted 27,000 such inspections last year. That’s only about 10 percent of all licensed dealers.

The effects of the license glut can be seen in Houston, which leads the nation with 1,967 federal firearms licenses. At the Freer Gun Shop, which specializes in custom rifles and shotguns, the last ATF inspection was in 1986.

Shop owner Richard Freer called the $10 annual fee ″ridiculous″ but said a jump to $600 is punitive.

″It’s just punishing us for being in the firearms business,″ he said. ″It’s like adding $1,000 to the cost of an automobile because of all the people who are hurt in automobile accidents. We’re putting the fault on the wrong person here.″

The tenfold fee increase means trouble for Terry Theis, a Fredericksburg, Texas, gun engraver. Theis engraves about 10 guns a year for customers. Even though he does not buy or sell weapons, he is required to hold a license.

″I don’t intend to go out of business,″ he said, ″but it’s going to be a very big hardship.″

-01-05-94 0028EST

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