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Brainerd City Council: Members revamp liquor license ordinances

An aerial shot of downtown Brainerd with the borders of the liquor zone markered in. The Brainerd City Council is moving to remove the liquor zone to better accomodate a citywide cap. Aerial photograph / City of Brainerd1 / 2
The Parlor Saloon is one of six "bar" liquor establishments in downtown Brainerd. According to state statutes, a city can only have 12 such establishments within its borders. Kelly Humphrey / Brainerd Dispatch file photo2 / 2

The Brainerd City Council took significant steps to overhaul city ordinances regarding its liquor licenses and liquor zones during a special meeting Monday, June 12.

Council members convened the workshop to address the shortcomings of ordinances already in the books—a hodgepodge assortment of guidelines described by city staff as poorly constructed and not meeting the needs of the city.

As a result of these bureaucratic headaches, staff requested a 30-day moratorium May 7 on new on-sale liquor licenses to ascertain whether the city was still in compliance with state regulations or its own ordinances. After discussing the issue again during the meeting Monday, June 4, it was quickly determined the matter warranted an extended conference to hash out the particulars.

Much of Monday's special council meeting played out in reflection of the vague, obsolete and sometimes contradictory ordinances the city cobbled together over the better part of a century.

Council members needed to revisit foundational aspects of the discussion at multiple points. Consensus was reached, just for a new suggestion or consideration to be introduced. There were contradictions in interest, difficult distinctions to be made and long-term ramifications to contend with.

Council members voted to remove the liquor zone, create a three-tiered classification system for liquor-peddling establishments in Brainerd, set a strict cap on bars and to formulate a definition of what constitutes a restaurant. The council also directed staff to pursue the creation and implementation of a clear and concise grandfather clause to protect businesses established prior to these changes.

The workshop

During the special meeting, the council worked to craft a new ordinance for liquor licenses in the city of Brainerd and tackled these subtopics specifically:

• Pinning down a clear and useful definition of what constitutes a restaurant (versus a club or bar, for example). It must be an establishment with 30 or more seats, feature a food menu, contain a kitchen that produces more than deep-fried or microwavable food or frozen pizzas (prepared, vs. heated or assembled), as well as a distinct chef or cook position specifically employed for culinary purposes. Council members decided to incorporate aspects of state law and statutes implemented by the city of Duluth after considering the approach of neighboring communities. These approaches varied from complex ordinances for the city of Moorhead, to Grand Rapids, which has no ordinances of its own and follows state statutes.

"I like the Duluth definition of a restaurant," said council member Gabe Johnson, who lauded the straightforward and concise definition. "If it smells like a restaurant, it's a restaurant."

• Redrawing the liquor zone. Council members opted to remove the liquor zone entirely (which constituted downtown Brainerd, the only place in city limits where bars currently operate), but stipulated a strict cap on these establishments to stop encroachment on places like schools and churches, as well as bars currently operating in the community. Currently, a resolution for bar cap numbers in the range of six or eight are being considered. State statutes dictate a cap of 12 bars in any city, while restaurants and clubs do not count against the cap.

Previously, the council explored expanding the zone to facilitate new ventures, while curtailing the concentration of bars in downtown Brainerd. Steven Shepherd, the owner of Shep's on 6th—along with other bar owners in downtown Brainerd—opposed the expansion of available licenses (or attached proposals to expand the zone) on the grounds it would hurt current businesses and tax the resources of the city to maintain order in that portion of the city.

"Maybe, we go three blocks down the road and have four more bars—it still affects us down there, guys," Shepherd said. "I'm just saying, you go three or four blocks away, it's still another bar in our area. The competition, seriously, it's fierce out there, man. We're only 13,000 people here—I know we grow during the summertime—but we depend on our regulars downtown. And when you start adding more, six blocks here or three blocks there—ouch."

• Replacing the grandfather clause. Pertaining to businesses grandfathered in 2001, the council is now looking to formulate a replacement grandfather clause to protect the various liquor-selling establishments in Brainerd. Namely, this is intended to safeguard these businesses in the event they make a change—such as the closure of a kitchen, or similar food-service operations—which would otherwise render their current licenses invalid (depending on the nature of their liquor license) and strip them of their ability to operate. It is still to be determined how this clause will function in terms of moving business addresses and other property changes.

Council members and bar owners in attendance discussed the possibility of provisions to protect current businesses from policy changes down the road—however, without further study on the matter and input from proprietors, the council deemed it wasn't in a position to properly determine a grandfather clause fair to all involved: the current owners, potential future ventures and the city of Brainerd.

"I think this is the best way to do it and it would eliminate us from running into this issue again," said council member Dave Badeaux, though he cautioned against "creating too much wiggle room" until the stipulations became confusing, vague and easily abused. "We would know and it would be easily tracked—you could just open up a file, this is this and this is that and they don't have to go back and count seats. Once they apply, they're applying for a specific style and if you want to apply for a restaurant, you'd have to refile for that."

• Creating classifications. The council passed a motion to create three separate classifications for liquor licenses (how bars, restaurants and clubs/bowling alleys would be classified, as well as how other businesses like distilleries, hotels, eateries, municipal establishments and the like factor into these distinctions). The council is also looking at implementing differentiated fees for these categories to incentivize the establishment of restaurants.

Currently, the city makes no distinctions between on-sale liquor licenses for restaurants or bars. City Administrator Cassandra Torstenson—piggybacking concerns raised by Mayor Ed Menk—said the council should not move forward without creating a separate index for restaurants. If the city didn't, she noted, it would stall any new ventures if every current business is classified a bar and the state cap is filled as a result.

"What (Menk) is trying to say is you have to have restaurants in here because they don't count against the 12 (cap)," Torstenson said. "So you have to include definitions for bars or restaurants—that's a must—because we have to make sure we don't preclude any new establishments from coming here."

Current businesses could possibly have the option of declaring which type of business they're operating as—say, as a restaurant, or a bar—to fit into the proposed legal framework for liquor licenses. Council President Dave Pritschet expressed misgivings at allowing businesses to define themselves.

"We'd be effectively giving them the tools to cut out the competition," said Pritschet, who advocated instead adding stipulations in the grandfather clause to protect the businesses. "That would be what you do for the sake of your business—just declare, 'Ope, I'm a bar now and now we can't have any more bars.'"