March 12, 2014
Maine House of Representatives
2 State House Station
Augusta, ME 04333
Members of the House of Representatives:
As a hotel franchisee in Freeport, I am writing to urge you to oppose LD 1458, an Act to Enact the Maine Small Business Investment Protection Act due to the negative impact it would have on my franchise business and the more than 3,500 franchises in Maine.
I am the owner and co-founder of Maine Course Hospitality Group, based in Freeport and which owns and operates a dozen franchise hotels, including Marriott and Hilton brands, with approximately 350 employees. I am proud of the relationships I have established with these brands and what we are able to bring to the people of the great state of Maine. We are excited about the continued opportunity to grow, serve more customers, and create more jobs in our state – but that won’t happen if you pass LD 1458.
I’ve been a franchisee in Maine for over 25 years. In the last several years we have invested over $100 million in franchise hotels in Maine and as we’ve grown the business, we have always tried to hire more Mainers and create those much-needed jobs. While you may have heard lately from a loud but vocal franchisee group having one-off issues with their own franchise, that certainly does not necessitate a new law, especially this kind of onerous legislation that would go further than any franchise relationship law in other states.
I can tell you that there is nothing about this bill that advocates for good business practices. In fact, if this bill is enacted it would hurt my existing business relationships by decreasing the value of my contracts, and discourage the creation and further expansion of any new franchise businesses in Maine. The four onerous provisions of this bill would take away the very standards that make my franchises valuable and that equity we have built. Perpetual contracts, such as those that would be created by LD 1458, will force franchisors to leave Maine at the end of their current agreements with Maine franchisees like me. Franchisors must be able to control who owns and operates their franchised hotels. If they can’t, brand standards are put at risk, and that hurts me as the franchisee, and consumers who rely upon that consistency in my hotels.
I urge you not to interfere in my private business contracts, which are best managed between me and my franchisor – for the betterment of both parties and our system as a whole. My contracts provide the safety and assurance that both parties will honor those existing agreements. This bill could do real damage by placing a host of unheard of regulations on an entire industry for the benefit of a few business owners’ individual battles. The will of a small special interest group is threatening to change the rules in the middle of the game, and could have a lasting, negative impact on not only my businesses, but the entire franchise industry in Maine.
Maine Course Hospitality Group
15 Main Street
Freeport, ME 04032
207-865-6105 ext. 110