City Charter change revises long-standing liquor rules

Will the changes impact development along the University Green Line light rail corridor?

By JANE MCCLURE

Will the ability for restaurants to more easily obtain a liquor license attract more dining spots to area neighborhoods? St. Paul city leaders hope so.

Whether a major change in liquor licensing will indeed bring about the desired influx of restaurants along Green Line light rail remains to be seen. But the way was cleared Dec. 16 when the St. Paul City Council unanimously approved a city charter change that lifts the citywide and ward limits on on-sale liquor licenses. The charter change, which takes effect 90 days after council adoption, opens the door for restaurants to serve liquor with food.

Ward Four Council Member Russ Stark has heard from prospective restaurateurs wanting to open along the light rail, and from parties redeveloping old Midway industrial buildings for mixed-use. But many restaurants want the ability to serve a cocktail with a meal, and under the city’s long-standing license cap that couldn’t happen.

Ward Four has 16 licenses under the old cap system, and all but one are spoken for.

With the charter change approved, Stark was able to shelve a proposal for a commercial development district that would have been the largest in city history. But, now that restaurants (that meet specific conditions) can seek on-sale licenses, the district isn’t needed.

St. Paul Department of Safety and Inspections (DSI) Director Ricardo Cervantes and Deputy Director Dan Niziolek said the changes are already being implemented. It will likely be March before restaurants can apply.

Niziolek said the licenses allowed under the charter change will have the same neighborhood notification process as existing on-sale liquor licenses have, with district council review and City Council approval.

The City Council made regulatory changes to ensure that restaurants obtaining on-sale liquor licenses don’t operate as bars and that they make and sell food, Cervantes said. The City Council adopted regulatory changes defining what is, and is not, considered a food preparation area. They also dropped the long-required 60 percent food, 40 percent alcohol ratio now in effect for liquor, beer, and wine license holders. That ratio was skewed by the prices of craft beers, boutique cocktails, and premium wines. The old ratio was replaced by a reference to a “substantial amount” of sales of food versus alcohol. Critics still question how “substantial” will be defined.

The change almost went down the drain when Ward Six Council Member Dan Bostrom expressed skepticism. A charter change requires a unanimous City Council vote. Had it not passed Dec. 16, proponents would have had to take the issue to the voters.

Bostrom had several concerns about loosening the liquor license regulations. One is that restaurants would cluster and have adverse effects on neighboring businesses and residents. Another concern is how the city will monitor the changes, and make sure that restaurants don’t operate as bars.

Bostrom also raised red flags with companion ordinances for the charter change. He noted that a recently adopted companion city ordinance states that restaurants must prove that a “substantial amount” of sales are of food and not liquor. Restaurants that obtain the liquor license must close at midnight, but Bostrom fears some will seek a 2am closing time. Current establishments with 2am closing times are grandfathered in.

But Bostrom said that his concerns were addressed and that he believes there will be adequate enforcement to prevent problems.

The charter change, and other related changes, are seen by supporters as allowing St. Paul to better compete with other cities for businesses, bring liquor regulations more into line with state law and to encourage economic development. Several district councils, business owners and business groups, the city’s Business Review Council, St. Paul Area Chamber of Commerce and Minnesota Licensed Beverage Association all supported the changes. The

St. Paul Charter Commission recommended approval of the charter change in November.

The charter change and related regulatory changes have met little opposition. The advocacy group St. Paul STRONG raised questions about what it saw as not enough public input and an overly-aggressive approval process.