Is it possible for government restrictions to kill your business?
In this episode, Toby Mathis, Esq, of Anderson Business Advisors welcomes entrepreneur Lars Jacobson, who purchased an entire town called Jake’s Landing right on the Canadian border. Lars shares his story of how border shutdowns, Covid restrictions, and lack of promised support from the US government have nearly killed the town’s business (and are still being enforced!). Canadians were accustomed to driving just minutes over the US border for cheaper gas, convenient shopping, and for dining and entertainment at the area’s casino. Tune in to hear this real-life story of government restrictions almost wiping out an entire town’s economy. Donate to help this town recover by clicking the Venmo link in the resources section.
- Buying a town- it was a calling from God
- Jake’s Landing and its businesses
- Charging less for goods and services in town – serving Canadians
- Border closing for Covid – it hit the town hard
- Unable to get SBA supplemental support
- Ridiculous Covid restrictions that have not been lifted at the border
- Business has only recovered 30% of the previous levels
- News coverage and meetings with local politicians have not helped
- The US is still handcuffing our own citizens with outmoded Covid restrictions that are killing small businesses
Full Episode Transcript:
Toby: Hey, guys. It’s Toby Mathis here with the Anderson Business Advisors podcast. Today I am joined by Lars Jacobson, a person I’ve known for decades now since we first started talking. I want to get an update on Lars. Lars, you and I did a podcast probably two or three years ago now.... Read Full Transcript
Lars: Probably a couple of years, two or two and a half years.
Toby: I’ll let Lars tell his story, but in a nutshell, a few years ago during the COVID crisis, we were talking about the impact of what the government was doing on small businesses. In this particular case, Lars is up in the northern part of Idaho right by the border and has businesses that serve a Canadian town. Because of the border happening to be right in the middle has been really impacted by this COVID thing, continues to be, and not a lot of people are aware of the actual impact that it is having on businesses to this day. Not like this has been awhile, it’s still kicking people on the shin. Lars, first off, thanks for joining me. I want to get an update.
Lars: It’s a pleasure to be here, Toby. Thanks for inviting me. I love to tell our story and the fact that you had mentioned to me all business can just be obliterated by the government if they want to do it, not that we have been singled out. This has affected so many people over these three years. In fact this was just three years ago, March 21st of 2020, that they closed the border. I remember the day.
Toby: How many years ago was that?
Lars: That was three years ago just this week. It was a devastating thing to see. We purchased this town. The area is called […]. It’s another corporate area. The previous owners purchased each business in the town over the years they owned it. They were marketing it as buying your own town. When we saw it we were thinking about it, it’s about nine months to actually decide and do it.
Toby: I’m going to do a timeout here because you were saying you bought a town. Lars is a successful investor and when I met him it was all about making money, stock market, and all that stuff. Then he gets a calling to take basically your whole family. How many of you did you take up there into this area?
Lars: My wife and I have 10 children. One of my daughters is married. I have a granddaughter. As you say, we changed our entire life.
Toby: Mom and brothers. How many in total? Did you count how many you moved up there?
Lars: My family now is around 40, 42, or 39 people that moved up here to this little town right at the border. We live in Bonners Ferry. Porthill is 30 minutes north where the border is. I can go into all of the spiritual things that moved us here, but I basically was instructed.
Toby: Everybody likes transparency. In my world, everybody seems to like transparency.
Lars: We felt very directed by God to come here.
Toby: You moved 40 people up there. Everybody made their own decision. I have a brother and his family came. A sister, her family came. My mom and another sister came. Another sister and her family later came. It hasn’t been easy. There has been a lot of stress and heartache. I have learned over my life, specifically now, if God asked you to do something, it’s probably going to be hard. If you want proof, just read the bible. He asked his son to do the hardest thing of all.
I try very hard not to complain, but it’s been very difficult because my whole life is gone. All the stuff that we used to do together, we’ve known each other since the 90s, as you were saying, that’s all gone. We moved not knowing what we were going to do. Then we saw this town a year or so after moving here and it took us another nine months. We were called to do that as you used that word.
We bought all of these businesses and things were going well. If I throw a rock over, it lands in Canada. We’re the border. If you look up Jakes Landing on Google, they’re going to see the border is just 200–300 feet.
Toby: jakeslandingusa.com, you can go see. I can see images of your gas station, your restaurant, and all of that. When we say they bought the town, they bought a lot of businesses that go into this town.
Lars: The only business that we don’t own is the US Postal Service.
Toby: But I know you do packages too. The Canadians ship it to you and they drive down and get it?
Lars: Yeah. We have a town […]. It’s just six miles north. They call it 10 kilometers. A beautiful little town. We got hundreds of packages delivered everyday before COVID hit, hundreds of packages everyday. I think the Christmas right after we bought it, we bought it in June of 2019, we kept all of the previous employees, the owners stayed with us for a little while and stuff and we hit over 400 packages in one day leading up to Christmas. They said that was the most they’ve gotten in 15 or 20 years they’ve owned the place. It was expanding, it was growing. Things were exciting.
Toby: In this town in Canada, you’re their depo. This is where they get their gas, this is where they get groceries. This is where they go get something to eat.
Lars: They have that all up there too, but it’s so much more expensive. For instance, I was just talking to a gentleman who was down and they were paying $1.69 a liter. We’re charging 99¢ a liter for gas. Even with the exchange rate of about 35 or 37, I think right now, one gentleman said I save $35 a tank. I have a truck, it’s a big tank.
When I do the conversion, it’s a little over a dollar savings per gallon, for us to understand. They come down for that. They can send a package to us for their free Amazon shipping type of deal and it doesn’t take three weeks to get to them plus the duty and all the paperwork. They just drive down, get some cheap gas, and pick up their package. We charge $1 for a box or something. Just $3 depending on the size. It’s a great service for them.
They love our little store because they can come down and get cheese. Cheese up there, I guess is through the roof. They can’t get Tillamook, they love Tillamook. There’s all these perks that the previous owners of this location and all of these locations just built up this clientele. The Canadians love to come down.
Toby: It will come back again. It’s just a waiting game because during COVID, they just shut down the border. They just said you can’t come across. It’s not like you can go hang out the packages over the border.
Lars: We couldn’t even do that. The border was closed to the extent that 95% of our customers could not come to us. They have the business exclusion. A handful of businesses up there can come down. We were making maybe 5% of sales, or 4% of previous to COVID.
Toby: What percent of your business is Canadian versus United States citizens?
Lars: It’s probably close to 100%. We have our little community in Porthill but maybe three or four people in Porthill will stop by a day.
Toby: How close is the closest US town like a little city?
Lars: That’s 30 minutes south. It has one light. I think the population in Bonners Ferry now is like 2,900.
Toby: You just don’t have a lot out there so you’re the place they go and because the government and its infinite wisdom decided to not have exceptions, they closed the borders down, and all of a sudden everybody in that area no longer can use.
Lars: When they made that announcement that they are closing the border on March 21, 2020, my wife and I looked at each other and went oh man. We brought the employees together and we said okay, we’re going to have to cut back on hours and stuff. My wife was like this isn’t going to last very long, this is going to last a few weeks. They have to have the border open.
A month went by and they were saying it might not open for a long time. Reality started hitting us and what can I tell you, I don’t know how we survived it to be quite frank. We are still here. We are fighting everyday. During the worst of COVID, we were only open 12 hours a week. Twelve hours for the whole week.
Toby: This effectively shut down your business. But aren’t there programs and things designed to help businesses like yours?
Lars: This is right. You hear on the news all the time, wow, small businesses are all going to get these things. We did get a loan from the SBA and that helped us for a few months. They had a supplement that we can go after. It was called the…
Toby: Economic Injury Disaster Loan.
Lars: We couldn’t get the supplement for whatever reason. I was going back and forth with the SBA for a year and a half.
Toby: Maybe they didn’t like your financials. Nobody believes that a business can get shut down. They always say oh, you can do something else then they want to see your records. They didn’t like your records. They didn’t like that you weren’t really able to continue, that 95% of your business got shut down and they were holding that against you.
Lars: Due to no fault of our own. They closed the border and then they penalized us for not having income, but they said they are going to support us and get us through that time. It’s cost us coming up on half a million dollars just not too close. That’s pretty much frivolous.
We’re now three years old. They’ve kind of opened the borders, mostly opened, last April 1st of last year. It’s almost a year now. They removed the total restrictions and let Canadians come in based on certain criteria, but that criteria was pretty stiff. We saw an increase, but it was maybe 20%–25%. October 1st, just six months ago now, they removed all restrictions. Canadians, all the restrictions, Canada removed all of them.
Toby: But the US still had restrictions.
Lars: The US did not reciprocate that so we still have some restrictions. One of them is if you’re not vaccinated, and the community north of us in Creston, many of them in conservative areas are not vaccinated. You probably heard that the number one tennis player in the world can’t come to the US open because he is not vaccinated.
Toby: Correct, because we decided if you’re not vaccinated, you can’t come in. Even if you’ve had COVID, they’ll still restrict you. The Canadians are trying to come down, I remember they opened the first time and you were saying they had to drive to another town to get a test.
Lars: Canada has a restriction where they had to have not the quick rapid negative COVID test but one of the more…
Lars: Yeah, that’s it. They didn’t have that in Bonners Ferry. They had to drive to Spokane which is two and a half hours from the border where we are at. Where they are at Preston, a little bit farther north, it’s two and a half hours and pay $90 to get the test.
Now finally someone started doing it in Bonners Ferry, but still, if they want to come down and get gas and save $20–$30, they have to drive 30 minutes one way, see the doctor, get the test done, wait for the results, pay that money, drive back 30 minutes. It wasn’t feasible.
Toby: When you think of a border crossing, everybody has a different vision of what a border crossing is. Is this border crossing a big gate or is it just one of those little things that raises up? Are there just folks out there saying you just entered Canada?
Lars: The story is from 20–30 years ago, especially before 911, it was like hey and go by. No, there’s a border crossing that’s called the point of entry. There’s one for the US, 550 feet north. There’s one for Canadians. If you are coming in, you’re stopping at the US. If you’re going out, you’re stopping at the Canadian. They have border officers there, the customs and all that stuff. You show them your passport.
For us, we can still pretty much get by. Just give a birth certificate and a driver’s license. They haven’t cracked down too much on that. You couldn’t cross during that time at all.
Toby: You can see Canada, but you couldn’t go into Canada. Canada can see you but they couldn’t come in.
Lars: There’s a house that I can see. One of our customers, I can see their house. I can see it. It’s right there.
Toby: Sometimes we make these rules and we don’t really consider just how kind of silly some of it is. And to this day, they still restrict how late they can come in. Isn’t it five o’clock or something?
Lars: The border where we are at used to close at 11:00 PM. During COVID they moved it to 5:00 PM. Even though the administration had said COVID is over, they haven’t moved the time back to 11:00 PM.
This doesn’t just affect me, but it does affect everybody. One of the tribes has a casino here in Bonners Ferry and people would come down after work, get some dinner, maybe go to the casino or for me, they would go down after work, school, or whatever to get gas and go back. It saves them $20–$30.
At five o’clock they can’t and they haven’t moved it back. We have an economic development officer in our county and he asked me because many businesses and stuff are affected, but I don’t want to say we were affected the most but we lost 95% of our customers. I wrote a letter that went both to our senators in Washington, our representatives showing this is acutely affecting us specifically.
The folks in question, those wonderful friends of ours, those Canadians, they are like why can’t we just come down 500 feet? It didn’t make a lot of sense. My thought was hey, during that time I understand people are worried about infections and all of that stuff, but between us and them is a few hundred feet. Why couldn’t they have a rule that said hey, if you cross back over the border within 15, 20, or 10 minutes. They can come down, grab a package, fill up, take a gas, and go back. They don’t have the time to do anything else.
Toby: That would require creativity and thinking, and actually being logical about it. It seems like we lost all of that during COVID and I guess the point of this podcast is to let people know that’s still going on. There are still remnants because there are still these actions that are being taken under the hospices of the emergency and it’s still having an impact. Your business, what percentage have you recovered compared to what it was prior to COVID?
Lars: We’re just coming out of winter time and winter is slow. Definitely after Christmas, it’s pretty slow. I’d say maybe back to 25%–30%. I’m hoping this summer as we are moving in, the routine starts sinking in if they can remove the restrictions for those that are vaccinated. They can move the hours back to where it was.
I think we can go back to 50%. I don’t know where the other 50% have gone. Some people have said they just got out of the habit of coming down or they just don’t think about it anymore. We’ve advertised up there, I’ve done radio spots with the local radio stations up there and had done some things. To be quite frank, we’re still negative every month. It’s just not as much as it was, thank goodness, because we will not be able to go on.
Toby: There were no programs. None of these grants. You see all of these shuttered venues, all of these different grants, you wouldn’t qualify for any of them.
Lars: We looked at some of those. We definitely applied for one of them. I won’t mention it, but it was a really big one. You told me about it. We made a video and filled out their whole application and stuff and it was tough.
Toby: Big institutions, lots of folks got all this PPP money, the employee retention credit and all that stuff, you guys got left in the middle of nowhere.
Lars: All these things they said they were doing for small businesses, I didn’t see much.
Toby: You wrote your congress people, your senators, and your local politicians. I know you had some discussions with newspapers.
Lars: We were on CBS this morning. They came up and spent four hours filming us and put us on CBS. One of our senator’s staff in September 2021, they were coming to do a tour of North Idaho and we provided lunch for them. They came in and we spent two hours with them, telling our whole story. We have not been sitting in a corner. We have been trying to think of anything that can happen to make this.
Toby: But you’re still there. Nobody came in and helped except some good people. I know our listeners donated a little bit, by the way you still can. I’ll put a link up. You can always go to jakeslanding.usa.com, but realistically go to the link that I’m going to put up. It’s on Venmo.
If you want to be generous, this is one of the situations where this is true giving because you’re not going to get anything for it other than if you see Lars somedays and you stop off and you get a big old thank you.
Lars: Come see us. We would love for everybody to come see us. Because you mentioned it, I just feel really important to say to anyone out there that did help us, if it wasn’t for those earthlings, we would not be here. The government did not come to our rescue. No institution didn’t come to rescue, but individuals came in ways that I never thought. It was extremely humbling. We are still here because of them. We are still in debt.
One of the things I didn’t think about is you are just trying to do what is needed, but then you have repair shop maintenance. We don’t have money for that. That stacks up so even if we can get profitable, it’s going to take us a while to catch all that stuff up.
Gas stations, there’s a lot of regulations. I’m dealing with that right now, especially since it’s been hard to keep the maintenance up. There’s that stuff but as you pointed out there has been a lot of people who helped us.
I’m self sufficient. We’ve known each other for a long time. I’m not used to being in this type of situation but you know what? God gives you trials, struggles, and tribulations to help you grow. I’m trying. I haven’t done too good some days. Some days are harder than others, but we’re just going to keep persevering.
Toby: You’re going to get through it. I have no doubt. Again, if anybody is willing to help, please help. Every little bit. Hopefully this time next year, we have another conversation and you’re saying you’re back, it’s come back, and it’s a great success story. Until that time, we’re just going to keep fighting for you and keep encouraging you. Again, if anybody is willing to help, absolutely do it.
Lars, I really appreciate you coming on and sharing your story. A lot of folks, they get the tidbits on the news. A lot of restaurants and stuff got really torpedoed. You saw a lot of people never come back from that but you still see people that are making it through. They are hanging on by their fingernails and we just need to let them succeed. We need to quit doing this craziness.
The fact that we still have these restrictions. I don’t even know how many countries have these restrictions. I guess it’s very few and we’re still doing this to our own citizens.
Lars: Toby, if any of your listeners would like to go on a road trip this summer, we got an Airbnb up here. We got camping sites. We have 900 feet of river front on the property with this little flat area. It’s beautiful. They can camp. I think my wife set us up on dirt.
Toby: You have an air strip and stuff.
Lars: What I have been told, I don’t know if it’s true, it’s one of the longest grass airlanding. The planes land. We have two guys every week that come in, fly in, go and get a coffee, go and hang out in the store for a little bit. They visit with my wife and then they fly out. That was happening all the time before, by the way.
It’s called Eckhart International Airport because you can fly in Canada. You can look it up on YouTube or Google. We got a lot of stuff happening right there. They got boats, we got a line through the river. The river, it flows north. Where the boat launches, if you just sit there you are going to go to Canada within a couple of hundred feet.
It’s a very unique place. Where in the world can you go where there is a river running north into another country? Most rivers run south, west, or east. This is running north. It’s a very unique spot we are at.
Toby: If you want to see a river that is going north, come up and visit Lars. If you drive up there, you can fill up your tank.
Lars: Bring your kayaks, your fishing polls. My son caught a 17 inch rainbow trout with a spring of string, maybe it was a line, with a worm right up our bank. Come see us. I’d love to have anybody.
Toby: Thanks for coming on, Lars. I really appreciate it.
Lars: Thank you, Toby.