U.S. notices, threats stall local startup

A Chattanooga small businessman trying to grow a venture selling a novel people mover says federal environmental regulators have unfairly set up bureaucratic roadblocks to the enterprise.

"I think a huge injustice is being done," said Bill Schultz, owner of Tuk Tuk USA.

About a year ago, Mr. Schultz had plans to set up a showroom in Chattanooga to sell the vehicles popular in South and East Asia.

He also envisioned dealerships in other cities to sell the Tuk Tuks (pronounced tuke tukes), which range in price from $9,950 to $14,900.

But, Mr. Schultz said a couple of "small oversights" in the importing of eight of the vehicles has led to months of costly dealings with the U.S. Environmental Protection Agency.

"They've treated us like criminals," said the 66-year-old former Marine.

EPA spokesman Dave Ryan did not respond to questions. He e-mailed information related to agency air pollution and enforcement guidelines.

Mr. Schultz said his company went through the needed testing to import the Tuk Tuks and received an EPA certificate in April.

However, when the vehicles entered the Port of Savannah, Ga., the U.S. Customs Service held up entry because a required EPA label on the Tuk Tuks was made of the wrong material.

Mr. Schultz said Customs seized the vehicles and held them for seven weeks at a cost of $5,400.

He said EPA later released the Tuk Tuks for storage in Chattanooga. EPA then asked the business to remove the catalytic converters, carburetors and mufflers and send them to an independent laboratory for testing, which was done, Mr. Schultz said.

He said the business received notification from EPA that there was another violation because it took less than a minute and 30 seconds to remove an idle adjustment cover on the vehicles.

In December, Mr. Schultz said he was told the company had to reship the vehicles out of the country or the Tuk Tuks would be seized and destroyed.

Mr. Schultz said this was even though the company had new labels and covers and the violations could be fixed in about 20 minutes.

"It makes no sense that we should have to ship them out for a $20 fix," he said. Mr. Schultz said he has been in contact with the office of U.S. Sen. Bob Corker, R-Tenn., for help.

Laura Lefler Herzog, Sen. Corker's communications director, said the office has been in touch with EPA since last fall on several occasions regarding Mr. Schultz' business to ensure he is receiving timely and appropriate attention.

"We have relayed all of the information given to us by the EPA to Mr. Schultz," she said.

However, Mr. Schultz, who said he has invested about $100,000 and 18 months in the project, added he is "extremely disappointed" over the way he has been treated by EPA.

"At a time with our struggling economy, and President Obama talking about helping small business, it just seems that something could be done for our company," Mr. Schultz said.