Appointed Committees

LIQUOR ORDINANCE AD HOC COMMITTEE November 23, 2016 Page 1 Committee Members Present: Dean Frantsvog, Shaun Sipma, George Withus, Chuck Vennes, Wayne Whitty, Jesse Zwak Members Absent Chad Thompson Others Present: Kelly Hendershot, Kelly Matalka, Chief Olson, Derek Hackett, Alderman Hedberg, Alderman Schuler, Alderman Straight, Josh Wolsky, Jill Schramm Chairman Frantsvog brought the meeting to order at 2:00 pm. Approval of Minutes from November 9, 2016 Meeting Alderman Withus moved the committee approve the minutes from the November 9, 2016 committee meeting. Motion seconded by Alderman Sipma and carried unanimously. Discussion on Capping Various License Types Alderman Withus moved the committee make a recommendation to the City Council to amend Chapter 5, Article II, Sec. 5-16 of the City of Minot Code of Ordinances, to eliminate the limitation on the number of Retail Liquor licenses and to require an issuance fee of $150,000 to be paid to the City to purchase a license. Motion seconded by Wayne Whitty. Alderman Withus said he spoke with the Minot Retail Beverage Dealers Association and those in attendance agreed, they would be fine with lifting the cap on licenses if the fee to purchase a license was equitable to what a current license would cost. They believe the $150,000 issuance fee would ensure an owner was serious about pursuing a business and would keep the amount of licenses at a natural level. Alderman Sipma stated, he does not believe the City should put a value on a piece of paper. In a comparison, he said the City uses the market value to determine a price of a home for flood acquisitions not the cost put into the house. He said there are other options to retain the value of a license and disagrees with setting the fee at $150,000. Upon questioning by Mr. Zwak, Shawna Downing, the President of the Minot Retail Beverage Dealers Association said, there were eight or nine regular members in attendance at the meeting and two new members. Between all of them, they came up with the $150,000 fee. Mr. Zwak stated he is uncomfortable handing recommendations to fellow business owners on the value of their property. He said he believes the committee is overstepping its bounds in making this determination and would be more comfortable if the Liquor and Gambling Control Committee made the decision. Mr. Zwak moved the committee refer the item to the Liquor and Gambling Control Committee for discussion. Motion failed due to lack of a second. 1|Page LIQUOR ORDINANCE AD HOC COMMITTEE November 23, 2016 Page 2 Alderman Frantsvog stated, this is an advisory committee which will send its recommendation to the Liquor and Gambling Committee and then to City Council for final approval. Mr. Whitty explained, the Association believes the $150,000 fee is realistic. He said they took an average of the amounts paid by those members present at the meeting who were willing to share the information. He said they also considered the amount other cities set as a fee and what recent transfers have cost. Alderman Straight stated his opinion, the cap should remain in place and additional licenses can be added after the next census. He said, it is dangerous territory for the City to determine the value of this sort of property. Alderman Frantsvog said, the City can do a more frequent review of the census. The City Attorney added, that the ordinance could be amended to reference a population review with a specific resource (e.g., census website) and the source could be checked annually, or however often the council felt was appropriate. Alderman Sipma suggested leaving the current retail liquor license cap in place but eliminating the off-sale ability under the current retail liquor license and then creating a separate up-capped category specifically for off sale liquor sales, which would be available to licensees that only engage in off-sale (liquor stores) and to the licensees that have the on-sale license. He suggested that the licensees that liquor store owners could be required to change their license to the new off-sale license and then that on-sale license would be available for a new licensee. The City Attorney explained, even though the licensees that only use the license for off-sale, they still paid for a full on-sale/off-sale license when they originally obtained the license. She mentioned that it may be difficult for the City to require the licensee to forfeit their current capped on-sale/off-sale license, with no compensation, and to instead obtain an uncapped off-sale only license. Whereupon a vote was taken on the motion by Alderman Withus seconded by Wayne Whitty and carried by the following roll call vote: ayes: Withus, Vennes, Whitty, Zwak nays: Frantsvog, Sipma Closing Times Alderman Withus moved the committee recommend the City Council amend Chapter 5, Article I, Sec. 5-8 of the City of Minot Code of Ordinances, to allow establishments to stay open until 2:00 am but stop serving alcohol at 1:00 am. Motion seconded by Alderman Sipma. Discussion amongst the committee and those in attendance concluded it would be a good idea to allow extra time for patrons to find a ride home. Alderman Sipma moved the committee amend the motion to change the ordinance to be in line with State Law and allow establishments the option to serve alcohol between 1:00 am and 2:00 am and include the same holiday restrictions as State Law. Motion seconded by Alderman Withus and carried by the following roll call vote: Sipma, Withus, Vennes, Whitty, Zwak. nays: Frantsvog 2|Page LIQUOR ORDINANCE AD HOC COMMITTEE November 23, 2016 Page 3 Whereupon a vote was taken on the motion by Alderman Withus seconded by Alderman Sipma as amended and carried by the following roll call vote: ayes: Frantsvog, Sipma, Withus, Vennes, Whitty, Zwak nays: none Fencing Requirements Alderman Withus moved the committee recommend the City Council amend Chapter 5, Article II, Sec. 5-27 – Premises Requirements of the City of Minot Code of Ordinances, to reduce the fencing height requirement from 42 inches to 36 inches and from 72 inches to 36 inches and remove the requirement that prevents any opening in the fence from exceeding 4 square inches. Motion seconded by Mr. Zwak. Alderman Straight presented photos from Bismarck establishments and spoke in support of the motion. Upon questioning by Alderman Frantsvog, Chief Olson stated, he is not concerned with the potential for passing alcohol if the spacing requirement for the fence is modified. The City Attorney reminded the committee, this amendment will apply to businesses who own the area outside of their establishment but some properties, such as many of the downtown establishments, would need to obtain an encroachment permit and this process would need to be incorporated into the City’s ordinances. Alderman Sipma moved the motion be amended to incorporate the encroachment procedures from Fargo with the exception that Minot will use 36 inches for fencing opposed to 44 inches. Motion seconded by Alderman Withus and carried by the following roll call vote: ayes: Frantsvog, Sipma, Withus, Vennes, Whitty, Zwak nays: none Whereupon a vote was taken on the motion by Alderman Withus seconded by Mr. Zwak as amended and carried by the following roll call vote: ayes: Frantsvog, Sipma, Withus, Vennes, Whitty, Zwak nays: none Pool Halls Tommy Shaw, Manager of The Spot Pool Hall, came before the committee and said he had met with the owners of a previous pool hall, The Rack, and they said they were given permission from City Council to allow minors in their establishment. The City Attorney stated, generally minors are not permitted on a licensed premises, however, there are exceptions and the only one that would apply in this situation would be if the pool hall is a restaurant. To be considered a restaurant, the business must sell at least 51% of their gross sales in food. She further explained that she contacted the city attorneys in Fargo and they provided that the Fargo pool hall is operating under a restaurant license. the West Fargo’s ordinances provide for a recreational license which states that a pool hall, for example, can permit minors in a certain area of the facility, so long as the pool tables take up a certain percentage of the square footage and there is a section of the premises that is separated by a permanent barrier at least three feet in height in which the sale, consumption, or pouring of alcohol is not permitted; that separate section is the only area in which minors are permitted. 3|Page LIQUOR ORDINANCE AD HOC COMMITTEE November 23, 2016 Page 4 Mr. Shaw asked about events at the Auditorium which allow participants of all ages, to which the City Attorney replied by saying, there are special event permits under state and local laws; the rules for special events are different than the general rules. She further provided that a licensee cannot obtain a special event permit for an event on the licensee’s fixed or permanent premises. After some discussion amongst the committee, Alderman Frantsvog stated, the pool hall issue will be addressed again at the next meeting. Adjournment There being no further business, the meeting was adjourned at 3:28 p.m. Respectfully Submitted, Kelly Matalka City Clerk 4|Page