South Loop restaurant pioneer still shuttered
Italian joint Gioco claims it'll reopen soon, but tax issues remain
04/20/2011 10:00 PM
One of the South Loop’s first fine-dining restaurants, shuttered a month ago for not forking over its sales taxes, is no closer to reopening despite claims that it’s just “remodeling.”
Gioco, 1312 S. Wabash Ave., was closed in March after a series of slaps on the wrist from the Illinois Department of Revenue, which first revoked the restaurant’s liquor license in January and, eventually, its business license to operate last month.
Signs in the Italian restaurant’s window that first said the restaurant would be closed “till further notice,” have been replaced with ones that say “Pardon our dust, Gioco will be re-opening soon.”
While renovations are indeed being done at the restaurant, it’s clearly not the main reason the eatery is closed. Around the same time, several other establishments owned by KDK Restaurants Inc., Gioco’s parent company, were shuttered or sold. Gioco’s sister restaurant in the West Loop, the Asian restaurant Red Light, had its license revoked at the same time. Opera, in the South Loop, closed its doors on New Year’s Eve, but that didn’t stop the Illinois Liquor Commission from also taking away its liquor license on Jan. 18 with Red Light and Gioco’s. Marche in the West Loop closed last June.
KDK co-owners Jerry Kleiner and Howard Davis did not return numerous calls for comment over the last month, but in interviews with Crain’s Chicago Business and the Chicago Tribune, Kleiner said he planned to reopen Gioco while shuttering Red Light for good.
“We’re going to make good on the taxes owed,” Kleiner told Crain’s. “Gioco is very profitable. It just got caught in the fire.”
But Gioco still has serious tax issues that are unresolved, said Illinois Department of Revenue Spokeswoman Susan Hofer. KDK also needs to pay the back sales taxes from Red Light before it can get the go-ahead to reopen.
“Our goal is not to shut down restaurants or take away liquor licenses of thriving restaurants,” Hofer said, but the amount of money Gioco and Red Light owed the state was substantial. “If it had been a couple bucks, we wouldn’t have shut them down.”
The state had been negotiating with KDK on paying the back taxes, Hofer said, but those negotiations broke down.
“If you think about sales tax, they collect tax on everything they sell. As the customer, you have to pay it. That’s the law,” Hofer said. “But when they don’t hand over that money, they’re in effect pocketing your $3 and using it for the business — not what you paid it for. That’s bad.”
So Hofer said KDK needs to pay up if they want to re-open Gioco — something she said the Department of Revenue has seen no sign of.
“All I can tell you is that when it comes to a point where that a license is revoked, the revenue department feels it’s moved as far as it can with talking,” Hofer said.
In terms of what actions KDK could take to move forward, she said, “Well, if they want to reopen, it would have to be check-writing actions. That’s kind of where we are.”