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CR 95-229 Liquor & Other Licenses For BW3December 11, 1995 Proposed Action Staff recommends that the Council approve the following motion: Move that the Hopkins City Council approve a liquor license, Sunday liquor license, and other licenses for Stone Creek, Inc., dba BW3. Adoption of this motion will allow BW3 to conduct business in 1996. Overview Stone Creek, Inc. dba BW3, has been in business since June of 1995. Since that time there have been a number of police calls connected with this business. The police department has attempted to work with the management of BW3 to address these problems. The problems, however, persist. The problems which are detailed in the attached memorandums have not been serious enough to warrant suspension or revocation of BW3's liquor license. They do, however, indicate a lack of training and management control. Staff is recommending that the City Council approve the licenses but also make it perfectly clear that the City expects these problems to be addressed. Primary Issues to Consider What sort of problems have been occurring? The problems have dealt with such things as building security, dealing with problem customers, and proper identification of personnel. Has the City Attorney reviewed this application? The City Attorney was asked to address the issue of granting a license conditioned upon the completion of certain requirements. His response, which is attached, states that the City may suspend or revoke a license given sufficient cause. Supporting Information Memorandum from the City Attorney. Memorandum from the police captain. Memorandum from Sergeant Neff Jame( Genellie C Jerk LIQUOR AND OTHER LICENSES FOR BW3 Council Report 95 -229 Date: December 11, 1995 To: James Genellie From: Jerre Miller Re: BW3 Liquor License c: \file \hopkins \,jg C I T Y O F H O P K I N S MEMO In connection with your November 28, 1995 memorandum concerning the City's authority to attach conditions or restrictions on the annual on sale liquor license of BW3, 1 have reviewed Minnesota Statute 340A which pertains to that subject. Minnesota Statute 340A.415, a copy of which I have attached, says in Paragraph (5) that the City may revoke or suspend a license up to 60 days or impose a money penalty or any combination thereof if the license holder has failed to comply with any ordinances, rules or statutes relating to alcoholic beverages. There was a case in 1991 titled Ball, Inc. v. _city of $t. Paul 469 N.W.2d 341 where the city revoked a liquor license and it was upheld. The case, however, had some rather egregious facts which highlighted the licensee's negligent operation of the bar which constituted a nuisance. That same case said that the Court had to uphold a city counsel's decision if the record contained substantial evidence that supported the decision to revoke. At this point, I am not sure the contents of Jim Liddy's letter has reached a level of a suspension or revocation but an expression of the Council's concern and disclosure of their authority to deal with the annual license issuance 1 general might accomplish a wake -up call to the owners of hi establishment 1010 First Street South Hopkins, Minnesota 55343 Phone: 612- 935 -8474 Fax: 612 -935 -1834 An Equal opportunity Employer LIQU + subd. 13 prohibi renewing on -sale in no on -sales have b subd. 3, designated (b) and (c). • that may be iss e may be issued up to 200 Iicens one for every 2,5 ton were repeal enses; licenses; licenses; four licenses; a ses. LIQUOR (5) a resort as defined in section 157.01; and (6) a club as defined in section 340A.101, subdivision 7, or an unincorporated club otherwise meeting that definition. (b) The commissioner may not issue a permit to a club holding an on -sale intoxicating liquor license. [See main volume for 3] Subd. 4. Permit expiration. All permits issued under this section expire on March 31 of each year. [See main volume for 5 to 7] Subd. 8. Lockers. A club issued a permit under this section may allow members to bring and keep a personal supply of intoxicating liquor in lockers on the club's premises. All bottles kept on the premises must have attached to it a label signed by the member. No person under 21 years of age may keep a supply of intoxicating liquor on club premises. [See main volume for 9] ' Amended by Laws 1991, e. 249, § 17, eff. June 1, 1991; Laws 1991, c. 249, § 18, 31. 1991 Legislation Laws 1991, c. 249, §§ 17 and 18, in subd. 4 changed the expiration date from June 30 to March 31; and in subd. 8 raised the minimum age for keeping intoxicating liquor in bottle clubs from 19 to 21 years of age. 1991 Legislation The 1991 amendment authorizes the commis- sioner of public safety to impose civil penalties for conducting or permitting unlawful gambling or li- censed premises, or for failure to remove impure products. 1993 Legislation The 1993 amendment rewrote this section, which formerly read: Historical and Statutory Notes Laws 1991, e. 249, § 31, instructed the revisor of statutes to change "nonintoxicating malt liquor" to "3.2 percent malt liquor". 340A.415. License revocation or suspension; civil penalty On a finding that the license or permit holder has (1) sold alcoholic beverages to another retail licensee for the purpose of resale, (2) purchased alcoholic beverages from another retail licensee for the purpose of resale, (3) conducted or permitted the conduct of gambling on the licensed premises in violation of the law, (4) failed to remove or dispose of alcoholic beverages when ordered by the commissioner to do so under section 340A.508, subdivision 3, or (5) failed to comply with an applicable statute, rule, or ordinance relating to alcoholic beverages, the commissioner or the authority issuing a retail license or permit under this chapter may revoke the license or permit, suspend the license or permit for up to 60 days, impose a civil penalty of up to $2,000 for each violation, or impose any combination of these sanctions. No suspension or revocation takes effect until the license or permit holder has been given an opportunity for a hearing under sections 14.57 to 1169 of the administrative procedure act. This section does not require a political subdivision to conduct the hearing before an employee of the office of administrative hearings. Imposition of a penalty or suspension by either the issuing authority or the commissioner does not preclude imposition of any additional penalty or suspension by the other so long as the total penalty or suspension does not exceed the stated maximum. Amended by Laws 1991, c. 249, § 19; Laws 1993, c. 350, § 11; Laws 1994, c. 611, § 23. Historical and Statutory Notes "The authority issuing or approving any retail license or permit under this chapter shall either suspend for up to 60 days or revoke the license or permit or impose a civil fine not to exceed $2,000 for each violation on a finding that the license or permit holder has failed to comply with an applica- ble statute, rule, or ordinance relating to alcoholic beverages. No suspension or revocation takes ef- fect until the license or permit holder has been afforded an opportunity for a hearing under sec- 19 § 340A.415 MEMORANDUM DATE: November 28, 1995 TO: Jim Genellie, Asst City Manager FROM: Jim Liddy, Captain, Police Dept. SUBJECT: Liquor License Renewal Application - BW3 The police department has a number of concerns about the operation of BW3 which the City Council should be aware of before approving the renewal application. BW3 has been the source of numerous police calls for service since opening in early June of 1995. When considering only calls such as assault, fights and customer disturbances, etc., the BW3 establishment has generated more calls for service in a little over 5 months than any other on -sale establishment in Hopkins has had in the previous 12 months. While there have been no chargable liquor license violations, rumors persist that violations of the liquor laws, particularly serving after hours, occur on a regular basis. The Department is currently doing proactive investigations to determine if the rumors are true. One factor contributing to the "after hours" problem is that they are open until 2AM (serving food). All other Hopkins on -sale establishments close at lAM. It is the feeling of the officers who respond to the calls to BW3 that most of the problems stem from problems with people who are employed there. The consensus is that they are poorly trained. They have a very high employee turnover rate and have resorted to hiring bouncers from a temporary service. Sgt. Warren Neff and Chief Johnson have had discussions with the BW3 management about the problems and our concerns. Numerous suggestions have been given to management on things they might do which we feel would help the problems. Very few of these suggestions have been adopted. Attached is a copy of a memo from .Sgt. Neff detailing his experience with BW3, its management and employees. The Department will continue to work with BW3 and try to assist them in any way it can but the Department recommends that before the Council approves the renewal application, that it make perfectly clear to the management of BW3 that their license is under close scrutiny and that continuing problems at the establishment and reluctance to respond to suggestions could result in their license being suspended or revoked at any time. To: Captain Liddy From: Sgt. Neff Date: Tuesday, November 21, 1995 Subject: Problems at BW 3 Restaurant You are well aware of the numerous calls for service and numerous problems that we have had at the BW 3 Restaurant since its opening in June. Therefore I will not address those items in this memorandum. What I want to address is the items that were discussed during meetings with the management at BW 3 and the requests and suggestions that were made by me so that they might clean up their operation and better educate their employees. In September of 1995, I met with the General Manager, Mr. Mark Maiser, here at the police station during the day to discuss a number of problems that we had been having at the BW 3. At that time we had done a three month study and found that there had been a total of twelve calls at the establishment, seven of which had to do with thefts, warrant pick ups, two were fight and assault calls, two were suspicion calls, and one was a report call. At any rate I wanted to alert him to the number of calls we were having there at his establishment, and I also wanted to address some issues with him regarding security of his business. Upon their opening one of the things I observed was the side doors going into the kitchen area were constantly left open and standing open and on numerous occasions I observed people coming and going through the kitchen door. I explained to Maiser that sooner or later he was going to have someone walk through the door and rob his establishment and that he should take immediate steps to secure the door and to keep the door closed during business hours. Since that meeting it appears that this has been done. l also mentioned to him that the door on the south side of the building which leads to the bar area was also constantly standing open and Mr. Maiser told me that the reason that they keep that door open is because there is a ventilation problem in the bar; however, they were taking steps to correct that problem. Once that was fixed they would keep that door secure. Apparently they have not fixed the ventilation problem in the bar area because this door is continually standing open and is being used by customers to come and go from the bar area. This door should be kept secure and be used only as a fire exit. Memorandum - November 21, 1995 Page Two Also during my discussion with Mr. Maiser in September, I indicated to him that after dealing with many of his employees at night, it did not appear to me that his employees had been trained regarding handling problem customers. Basically, just dealing with people that come into their business. Mr. Maiser told me that his staff held regular training sessions on Wednesday afternoon and during those training sessions he would address those issues. I suggested to Mr. Maiser that I would be happy to come to his establishment and assist him in training his employees in dealing with bar patrons and problem customers, and help him to answer some of the questions his employees may have. Mr. Maiser assured me that he would let me know when they wanted me to stop by. To date I have still not been contacted to assist with that education problem. I have also observed, after numerous calls for problems at the bar /restaurant, that a number of the key employees, such as the bouncers, are not identifiable as employees of BW 3 because they wear no identification which would identify them as employees or management or bouncers. I have observed that bartenders, some of the waitress and waiter staff, and some of the cooks are wearing golf type shirts that indicate BW 3 on them. Yet the people at the door and the bouncers still have no type of identification. This practice has caused problems within the establishment because when the bouncer has approached a problem person, patrons in the bar think that this is just a person out of the bar area because the bouncer, or manager, has no identification, and therefore the person is perceived as just a drunk from the bar trying to pick a fight with someone else in the restaurant or bar. I have repeatedly asked the bouncers and management personnel to provide their employees with a golf shift, sweat shirt, T shirt, or at the very least some type of name tag that they can wear to identify them as employees of BW 3. Lately I have learned that a number of the bouncers have been hired from a temp service and it would appear that there is quite a turn over in employees. With the large turn over of employees, 1 can only guess that it must be very difficult to train their employees on how they should be dealing with customers and potential problem customers. Therefore, we have a continuing series of altercations at the restaurant. In October I received a telephone call from a night manager inquiring as to what they should do with a patron who wanted to go into the bar area and drink and who the management or bouncer did not feel had proper identification. I would think that the management staff, bouncer and /or bartender would have enough training or at the least enough common sense to refuse serving liquor to anyone with questionable identification or who they do not feel is old enough to be in the bar. Instead of taking that initiative, the management called the police department to ask what they should 1. Memorandum - November 21, 1995 Page Three do, which indicates to me that there is still a little or no training whatsoever of employees at BW 3. Both Chief Johnson and I have had separate meetings with Mark Maiser the General Manager to discuss these problems. I have also talked with Mr. Maiser on the telephone and I have also met with night management personnel on numerous . occasions and have given them tips and even some on site mini training sessions about taking care of potential problems before they grow into large problems. All of these efforts have not helped based on the continuing problems we are having. Personally I would certainly like to see the BW 3 lose their liquor license for a time until they can indicate that they have trained their personnel properly and cleaned up their operation; however realistically I do not think that we will be able to revoke their liquor license all together. 1 strongly recommend that the City issue a restricted or limited liquor license contingent on BW 3 training their personnel, making their personnel identifiable to customers, and adhering to other restrictions which may be invoked by the City Council. RECOMMENDATIONS Secure the bar room door at the south side of the building so that the patrons cannot go and come from that door and restrict its use for a fire escape only. Train their employees properly with the help of the police department so that they might deal with liquor control and problem customers more effectively and tactfully. 3. Require all employees and /or staff to wear some type of identification shirt or ID badge so that they are easily identified by customers as employees of BW 3. Restrict the hours that the bar or restaurant is open and require them to close at 1:00 A.M., rather than remain open until 2:00 or 2:30 A.M.. It is imperative that the City place restrictions on BW 3 in order to convince them to take whatever steps are necessary to train their personnel and to make whatever changes are necessary in their operation to end the continuing series of serious problems that keep taking place at their bar /restaurant. It is evident that without these restrictions no useful changes will be made.