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Fonda San Miguel, ThunderCloud Subs and County Line make it to 40

What does it take to last so long in Austin’s food culture?

Contrary to popular opinion, Austin was not a food desert in 1975 when Fonda San Miguel, ThunderCloud Subs and the County Line opened.

Along with steaks, seafood, Tex-Mex and barbecue, the growing city supported Italian, Continental and Asian eateries, albeit in much smaller numbers than today.

Yet the aforementioned three outfits, all celebrating their 40th anniversaries this year, added something essential to the food culture here. As their continued prosperity suggests, their owners found ways to surf the waves of a cyclical economy, changing tastes and vastly increased competition.

All three benefited by staying mostly small and local, although ThunderCloud counts 31 locations in all.

“Big corporations make decisions in ivory towers,” Tom Gilliland, owner of Fonda San Miguel, says. “Then it filters down. We are the ones who make the decisions by listening to what our managers — and customers — tell us.”

Mike Haggerty, the first ThunderCloud franchisee, agrees that customers and employees generate their own scene on the ground.

“They create the culture,” he says. “A cookie-cutter culture is made in some corporate office. One thing is cool: We’re seeing a second generation of employees coming in. Their parents must have liked it.”

The County Line’s Skeeter Miller believes there is no such thing as too much focus on customer loyalty.

“We have customers that come every week on a Monday night at 6 p.m.,” he says. “They want to sit at the same table with their favorite waiter and two scotch-on-the-rocks – one with a straw and one without. They want their dessert to-go, so they can enjoy it at home. They never look at the menu, and they never have to order. We know exactly who they are and what they want. They feel like royalty, and the staff calls them by name. In fact, several of them have plaques dedicating certain tables or chairs to them.”

Andy Cotton, co-founder of ThunderCloud, also thinks a certain amount of internal continuity helps keep his business going.

“Austin in 1975 was so different,” he says. “But we don’t feel threatened. We do the best we can. We are not competing with chefs.”

Classic Mexican food

For most of its 40 years, Fonda San Miguel indeed has had a chef — Miguel Ravago. His name is paired throughout the restaurant’s history with Gilliland, 77, who studied law at the University of Texas and opened his first eatery, San Angel, in Houston in 1972.

It might seem hard for newcomers to believe that when the culinary partners moved to Austin in 1975, virtually no one served interior Mexican cuisine or, as Fonda advertisements from that time broadcast, “Classic Mexican.” Nowadays, in some Austin neighborhoods, it’s hard to find a Tex-Mex spot for all the interior alternatives.

Gilliland exported the formula for the intricately atmospheric Fonda only once.

“People later missed us in Houston and asked us to open another one,” Gilliland recalls. “It was a blessing in disguise. I learned more from that situation than any other. For instance, don’t open during a down economy. And in Houston, there are two markets — daytime and nighttime — for one location.”

That is because Houston was — and is — much bigger geographically than Austin. Until recently, Gilliland observes, Austin’s market has not been split for Fonda’s only location, at 2330 W. North Loop. Yet as traffic grows, some customers who might be located centrally during the day won’t venture back at night.

That failed Houston experiment was the only time Gilliland has considered expanding.

“Multiple locations tell a lot,” he says. “Here, everything is under one roof. But imagine having 16 locations, staffs, managers, health inspections. Basically, I’m pretty lazy. It takes a special personality to do an empire.”

He is proud that his staff has stuck around, often for decades.

“I hope we have a good work environment and that they make good money,” he says. “Regulars tip better, for instance. We’ve been blessed in that sense. But that’s changing, too. It’s harder to get and keep people.”

Unlike ThunderCloud and County Line, Fonda depends on customers who are willing to pay $40 or $50 for a full evening of food, drink, service and atmosphere. So when the economy sputters, Gilliland feels it. The expectation of local or organic sourcing also drives up costs.

“Some years ago, we were among the first to bring in Niman Ranch” meat, he says. “We’d fly it in, but it came in spoiled. We were ahead of our time, and the customers weren’t with us.”

Austin is catching up, however, and he feels like the new competition educates the diners.

“The public has changed, with all the food writers and restaurant critics,” he says. “(Cookbook author) Diana Kennedy once said: ‘What does it take to have good restaurants? Good eaters.’ Austin now has better eaters. Better ingredients.”

An ongoing headache for Gilliland — and other restaurateurs — is what they consider inconsistent health inspections and numerous roadblocks to fresh construction projects.

“We’ve had to abandon projects,” he says. “A recent study said Austin had the worst permitting department in the country. It’s discouraging to small businesses that want to do something different.”

Gilliland spends more time in Fonda than he did in the beginning. He admits to being short-tempered when things don’t go the way he wants, but he has never felt burned out.

He jokes, “Every once in a while, the staff takes up a collection to send me on vacation.”

Recently, Gilliland attended a seminar for eatery owners. He realized that he hadn’t lived up to his original mission to make every detail right.

“It reaffirmed what I already knew, but that I didn’t practice it,” he says. “Miguel and I discuss it quite a bit: ‘OK, at 40 years, we have the fundamentals down. Now let’s get better.’”

Sandwiches in a groove

Cotton, 67, has lived in Austin since 1970, and it is safe to say that he witnessed Austin’s post-hippie lifestyle.

“I worked at Les Amis as a cook, if you call that a restaurant,” he kids about the long-gone West Campus haunt. “I knew how to slice lettuce.”

He co-founded laid-back ThunderCloud with John Meddaugh. Haggerty came on as the first franchisee in 1980.

“We have people who make sandwiches who have worked for 20 or 30 years,” Cotton says. “It’s mind-boggling, because we are getting old. We knew their moms when they were in high school.”

Cotton once tried to branch out beyond subs with a concept called Johnny’s Bar and Grill, but it didn’t last long.

“The restaurant business is complicated,” he admits. “Grill, bar, staff, it’s all amazing.”

On the sandwich side, however, he can remember only one bad year, at the start of the Great Recession.

“But it wasn’t a disaster,” he says. “Always upward.”

Some food trends, while well-intended, have complicated business.

“Buying local is easier said than done,” he says. “The biggest we buy local is bread. Producers can’t keep up with our needs. And we can’t pass the cost along to customers.”

He, too, has seen problems with obtaining city permits.

“In 1975, John and I drew by hand the layout of the first ThunderCloud,” he says. “That’s all we needed to get through the permitting process. Now it’s a thousand times more difficult.”

What is the secret to his success?

“We stubbornly insist on getting the same quality food or better,” he says. “And we’ve gotten better. In 1975, we didn’t know what food costs meant. We didn’t know to make a tuna salad, so we just glopped it on. Perhaps one reason for our early success: Our portions were so big!”

Haggerty, 62, graduated from the University of Texas.

“I knew squat about restaurants, but Andy brought me up to speed,” Haggerty says. Although he now owns 15 stores, he has ventured beyond his home base only with great caution.

“Most people lose their authenticity by design,” he says. “We’ve worked hard not to. The magic we do is to capture the personalities of our staff and duplicate it. That didn’t translate well in other markets. History, expectations, you’ve got to meet those. You’ve got to maintain what you’ve created.”

Although low-priced, ThunderCloud sees some drop in sales when the economy starts to decline.

“But recession is ultimately good because people are pricing down to us,” Haggerty says. “Our biggest booms came out of recessions.”

From speak-easy to landmark

The County Line started at one landmark location. Then expanded to another.

Before it became a barbecue place, the County Line on the Hill, off of RM 2244, was outside the city limits and once served as a speak-easy.

“It was originally built as the Moosehead Lodge, which burned down, leaving only the red-tinted slab and the mirror of the two moose fighting that still hangs in the bar,” says Scott Ziskovsky, director of marketing and advertising for County Line. “It was rebuilt as the Cedar Crest Lodge around 1934, which went through various owners and changes and finally closed in 1960. It sat empty for the next 15 years.”

The County Line on the Lake, off RM 2222, was once the Bull Creek Lodge. There are other County Line locations outside the Austin area.

Miller was working as a roughneck on West Texas drilling rigs before he saved enough money to head back to Austin in 1975.

His first restaurant experience had been in Dallas at age 14.

“I rode my bicycle built for two down Northwest Highway to the Royal Coach Inn, lied about my age and got a job in the kitchen preparing the food for the 5:30 a.m. daily morning breakfast buffet,” he recalls. “I had to leave the house on my bike at 4:00 a.m. to make it to work on time every morning. I had started cooking with my mom at the age of 6, so I had a good idea of how to prepare the basics.”

Miller says County Line came about when a group of Texans — including co-founder Bruce Walcutt, who died in 2006, as well as Rick Goss and Ed Norton — expressed their love of heritage by offering high-quality barbecue and sides in generous portions at reasonable prices. Along with that came table and bar service at, of course, historic locations.

When asked what advice he would give to those hoping to duplicate this success, Miller is careful to put city permits in perspective.

“There are so many great chefs and restaurateurs out there that can prepare incredible dishes, but when you come to Austin, that alone won’t get you open to the public,” he says. “Do your planning, do your research, and hire consultants to help you get through the permitting process at the city. You have to have substantial capital earmarked for this process, because it can take months on end to get all the approvals needed before you ever start construction, and you have the inspection process to go through, which is yet another mountain you have to climb.”

Another common theme: Keep your staff loyal.

“You let them be a part of the decision-making process,” Miller says. “Be it anything from a money-saving idea, to a better way to prepare something, to listening to their feedback on our customers’ wants and needs. If we did things the way we did them 40 years ago, we would no longer be in business. Our County Line team’s ideas, inventions to save time and labor, and feedback have been the inspiration for change that sustains us today.”

As for customers at the pair of high-traffic spots, Miller talks a lot about creating memories as much as meals.

“Many times I find myself talking to a complete stranger on a plane, at a meeting, or even another restaurant, and they start telling me about a great memory they have about eating at a County Line,” he says. “We have longtime customers that have called and had family members in their final hours, and they have requested County Line for their last meal. When we surprised the family, and showed up at their home with the food, there were tears of joy at a time of sadness. “

Over the years, Miller has added salads and grilled items, as well as a fryer for queso fries. He has offered a to-go menu and catering. He has even dared to update the much-loved decor.

“In the beginning, we had 1940s artwork on the walls — Chesterfields ads and old Life magazines,” he says. “We were playing Benny Goodman and big band music. Then the customers who knew what that was were not going out anymore or dying, so we switched all that out for a more contemporary roadhouse look and feel.”

American-Statesman staff writer Addie Broyles contributed to this report.

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