Memo - Discussion of Policy 4 - B, Liquor Law Violations•
Administrative Services Department
Office of the City Manager
•
Memorandum
To: Honorable Mayor and Members of the City Council
From: Steven C. Mielke, City Manager
Date: March 19, 2004
Subject: Discussion of Policy 4 -B, Liquor Law Violations
In the most recent alcohol compliance check conducted on off -sale liquor
establishments, four of the eight establishments failed the check, selling alcohol to a
minor.
In 1989 the City Council established general policies regarding liquor license violations.
This policy is now classified as Policy 4 -B in the Legislative Policy Manual. Through the
years this policy has been used by the city to administer sanctions for violations of
111 liquor laws.
Background on Current Policy
In the mid- 1980's the City Council dealt with a number of violations to the liquor laws.
In each case the City Council held a hearing as required by law, and listened to
evidence on both sides of the issue, ultimately determining how to proceed. Due to the
difficulty of this process the City Council adopted a policy in 1987, which was eventually
amended slightly in 1989 providing presumptive penalties for various types of violations.
They empowered the City Manager to negotiate penalties with the violator in an attempt
to simplify the process of determining the sanction for liquor violations. The current
policy, however, does not usurp the license holder's ability to have a hearing before the
Council should they wish to do so.
Throughout the late '80's and '90's the policy has been used and most have utilized the
administrative process, rather than seeking a hearing with the City Council.
The presumptive penalties that are part of the current policy, leave quite a bit of
discretion to negotiations, theoretically based upon the conditions of the violation.
Since there is a negotiation held, quite a bit of discussion happens between the City
Manager and the license holder with a judgment call being made as to the level of
penalty to be assessed. If the City Manager and the license holder are unable to agree
upon a presumptive penalty, the item automatically goes to the City Council for a
decision.
Discussion
While the existing policy has worked reasonably well, there are a number of issues that
have been problematic from time to time. Additionally, staff believes there may be
better options for enforcement and inducements for better compliance by license
holders. These items include:
• Council concurrence with the negotiated agreement under the current policy
• Cost of compliance checks and enforcement activities
• Consideration of requiring mandatory ID checks
On one or two occasions the City Manager has negotiated a proposed agreement with
a license holder and brought it forward to the City Council. Under the current policy, the
City Council is allowed to reject the agreement and either direct the manager to attempt
a different negotiated settlement, or to require a hearing in front of the City Council.
This creates confusion when it occurs, even though it is proper and authorized for the
Council to have the authority to do so. A list of standardized penalties for violations
without the negotiation would give clear direction to the City Manager and to the license
holders on the Council's directives relative to penalties. On the other hand, the removal
of this negotiation also restricts the Council's ability to recognize violations that may be
more blatant than others.
Staff is aware of at least one city (Plymouth) that has standardized its penalties but
gives leeway to those organizations who are taking proactive steps to minimize the
• chances of having a violation through various activities. This carrot and stick approach
gives a greater chance for organizations to meet and comply with the law, but have a
reduced penalty if a mistake is made. In reviewing the Plymouth process, there is a
heavy involvement from the police department in training and assisting organizations
that wish to be proactive in their compliance activities. Staff is concerned about the
cost of the Plymouth system in Hopkins.
It is arcfuable that compliance checks on a more frequent basis will perhaps lead to
greater compliance by licensed sellers. The theory being that if the sellers do not
believe there is much chance of getting caught, they are more likely to be lax in their
compliance activities. Once again, cost becomes a consideration in that compliance
checks are somewhat expensive to conduct, without any revenue to support the activity.
Historically, revenues from the fines have gone towards the Chemical Health
Commission for education purposes. It could be changed to using those fines for
compliance activities within the police department, thus offsetting some of the cost of
doing compliance checks.
A final consideration would be the idea of mandating ID checks on all purchasers of
alcoholic beverages, both on- and off -sale. During compliance checks, the majority of
violations occur because the violator did not ask for an ID. Mandating ID checks may
help in compliance. There are also technological answers to checking ID's, such as
license reading machines that may or may not be connected to cash registers. The
difficulty with this may be the cost for the smaller operations.
•
Discussion of Policy 4 -B, Liquor Law Violations
Page 2
•
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Discussion of Policy 4 -B, Liquor Law Violations
Page 3
Summary
The last round of compliance checks was disappointing in that 50 percent of the off -
sale license holders failed the compliance check. The logical conclusion is that alcohol
is being sold to minors. Inasmuch as this runs counter to the goals of the Chemical
Health Commission and the City Council, staff is looking for ways in which to increase
compliance with liquor laws. Staff is looking for direction from the City Council on
whether or not the current system should be altered.
Attachments
•
•
•
POLICY 4 -B
LIQUOR LAW VIOLATIONS
1. PURPOSE
1.01 It is the intent of this policy to inform the public and business community in the
City of Hopkins that henceforth all criminal violations of liquor laws and
ordinances will result in automatic administrative action. Nothing in this policy
concerning the administrative procedures that will be followed in the event of
criminal violations of liquor laws and ordinances shall detract from the Council's
authority to impose sanctions for violations of other criminal laws occurring on
the premises of licensees or for complaints of non - criminal conduct.
2. PROCEDURE
2.01 In the event of any reports by the Hopkins Police Department of violations of the
laws of the State of Minnesota or the ordinances of the City of Hopkins relating to
alcoholic beverages, the administration is directed to take the following action:
1. Notify the Council of the report.
2. Monitor the Criminal case resulting from the report.
3. If the criminal case is dismissed or results in an acquittal or if the
administration otherwise finds the evidence of the violation unreliable, the
Council shall be so informed. The Council, at that time, shall decide whether
to dismiss the matter or proceed.
4. If the criminal case results in a conviction or payment of the court cost or if
the administration otherwise finds the evidence reliable, the City Manager
shall meet with the licensee and invite the licensee to sign a conditional
admission and waiver of hearing that includes a proposed sanction.
5. If the conditional admission is signed, it shall be presented to the Council for
approval or other action.
6. If the conditional admission is not signed, the licensee shall be provided
notice of a suspension/revocation hearing and the matter shall be set down on
the Council agenda for hearing.
7. The hearing will be in accord with the Administrative Procedure Act. Minn.
Stat. 14.57 to 14.70. The hearing shall be recorded, the City Manager shall
present the evidence establishing the violation, and the licensee shall have the
right to cross - examine witnesses, present evidence, and make a statement to
the Council. The council will issue written findings on whether a violation
occurred.
1) Commission of a
felony related to the
licensed activity.
10 - 25 consecutive
days of suspension
Revocation
N/A
2) Sale of alcoholic
beverages while
license is under
suspension.
10 - 25 consecutive
days of suspension
Revocation
N/A
3) Sale of alcoholic
beverages to under age
person.
0 - 5 consecutive
days of suspension.
6 - 15 consecutive
days of suspension.
Revocation
4) Sale of alcoholic
beverage to
intoxicated person.
0 - 5 consecutive
days of suspension.
6 - 15 consecutive
days of suspension.
16 consecutive days
of suspension to
Revocation.
5) Sale of alcoholic
beverages after hours.
0 - 2 consecutive
days of suspension.
3 - 9 consecutive
days of suspension.
10 consecutive days
of suspension to
Revocation.
6) Illegal gambling on
premises.
0 - 3 consecutive
days of suspension.
4 - 9 consecutive
days of suspension.
10 consecutive days
of suspension to
Revocation.
7) Permit person to leave
premises with
alcoholic beverage.
0 - 2 consecutive
days of suspension.
3 - 5 consecutive
days of suspension.
6 - 10 consecutive
days of suspension to
Revocation.
8) Violations of City
Ordinances pertaining
to fire or building or
health codes.
0 - 5 consecutive
days of suspension.
6 - 15 consecutive
days of suspension.
16 consecutive days
of suspension to
Revocation.
411 3. PRESUMPTIVE PENALTIES FOR VIOLATIONS
•
•
3.01 The following list of presumptive penalties be assessed as deemed necessary:
1st Violation
2nd Violation
3rd Violation
3.02 Computation of time. For the purpose of determining the number of occurrences
of violations, the council shall consider a violation as a second occurrence if it
occurred within 18 calendar months of the first violation; and shall consider a
violation as a third occurrence if it occurred within 30 calendar months of the
second violation.
3.03 Other penalties. Nothing in this section shall restrict or limit the authority of the
council to suspend up to 60 days, revoke the license, assess a civil fine not to
exceed $2,000, to impose conditions or take any adverse action in accordance
with law, provided that the license holder has been afforded an opportunity for a
hearing.
Established: 5/5/87
Revised: 2/7/89
Disposition of Liquor Violations
Since January 1, 1982
S Id!
! 1SJldl
lsMJ
is-
is-llJ
Second I
V/N
Action Taken
Suspension of license - Seven
consecutive days.
!No suspension
Suspension of license - Three
consecutive days
!Suspension of license - Three days
Suspension of license - One day plus
legal costs incurred by the City.
Suspension of license - Three days
Suspension of License - Two days
Suspension of License - Five days
One dollar fine
One dollar fine
Suspension of License - Three days
! au!3 00L$
$500 fine with conditions
au!1 009$
Suspension of license - Seven days
None - Sold business
uo!lelo!A
Allowing immoral conduct with
customers and dancers
Sale to minor
Sale to minor
Jowl of ales
Failure to transfer license
on a timely basis
Joulw 01 ales
Sale to minor
Sale to minor & Assault charges
against bouncers
Sale to minor
Sale to minor
Sale to minor
Sale to minor
Consumption after hours
{
Sale to minor
1
Sale to minor
ioulw of ales
Location
Tremont Plaza
East End Bottle House
Knutson Liquor
Richards Liquor
MGM Liquor
East End Bottle House
Hopkins Bowl
Westwood Bar
Jims Liquor
Richards Liquor
East End Bottle House
East End Bottle House
Mainstreet Bar and Grill
Ken Meinert (Hopkins Liquor
Ken Meinert Hopkins Liquor
Kevin Johnson East End Liquor
Charles Daisy
JaploH asuao!l
James Maxwell
Virginia Miller
Hung Van Dinh
Kevin Johnson
Charles Daisy
H
Marc Maslow
Council
Action
Z86 l./6141. !
2864/94/£ I
3/16/1982
9/28/1982
17864 /4Z /Z
1786 4/6 4/9
9861181./9
L864/9/4
L96141441.
L96 Mil.
696 4 /£ /Z
I 17661./9/6
L66 4/9/£
966 4 /£/ 4
I L661./9/£
Date of
Offense
L96 4/L/9
L864/0£/9 I
1
886 4/O 4/9
2/4/1994
■
9664/9/44
17661
1 9661./£/9
Disposition of Liquor Violations
Since January 1, 1982
Offense #
tsJld
Second
V/N
tsild
Is-lid
tsnB
Second
tsJld
Second
lsJld
fsn�
is-lid
Action Taken
aul; 009$
Suspension of license - Six days
None - Sold business
Suspension of license - Two days
plus $500 fine
$500 fine & Suspension of License -
Fourteen days (combined penalty)
au!g 009$
None - Sold business
a u! f 0 09$
6ulpuad
pending
pending
6ulpuad
Violation
Sale to minor
Joules of ales
Sale to minor
Consuming alcohol after hours &
Failure to notify City of ownership
change
Sale to minor
Sale to minor
Sale to minor
'Sale to minor
Sale to obviously intoxicated
person
Sale to minor
Sale to minor
Sale to minor
Sale to minor
Location
£
£-M8
Hopkins Liquor
MT Bears
Hopkins Liquor
Hopkins Liquor
Hopkins Bowl
MT Bears
Mac's Liquor
Mac's Liquor
MGM Liquor
Best Buy Liquor
Hopkins Liquor
License Holder
Stone Creek Inc
Mark Maiser
Stone Creek Inc
Mark Maiser
Ken Meinert
Stone Creek Inc.
Harsch,Harsch, Alexander
La Truong
La Truong
ERW Industries Inc.
Eugene Wright
Stone Creek Inc
Harsch,Harsch, Alexander
Carrie Sue McCarville
Carrie Sue McCarville
F.T.L. Corp.
John J. Lanners
HCR.LLC
Cher Pao Lo
La Truong
Council
Action
9661/6/06
9661./1./01,
auoN
966 1 /L 1/£
12/2/1998
12/2/1998
6661./101.
auoN
3/3/2004
pending
6ulpuad
6ulpuad
6ulpuad
Date of
Offense
966 1 /£ /9
9661./01./9
12/28/1996
L66 I./01./01,
12/12/1997
3/30/1998
966119/9
9661/91101,
5/19/2003
£00Z /61 /Z 6
12/19/2003
12/19/2003
12/19/2003
Selected
Points
Item
✓
15 *
Inspection /Investigation to ensure criteria are being
met
✓
10 *
Minimum75% of employees trained by Public Safety
✓
10 *
Program in place for on -going training of new and
current employees
✓
15 *
Yearly meeting between designated Operating
Managers and department personnel
25
Participation in TIPS training program with minimum set
number of employees certified
10
Policy requiring identification checks for anyone
appearing to be 40 or under
10
Employee reward program (program for rewarding
employees who catch underage persons attempting to
purchase)
20
Automated identification card scanner system
10
Approved internal compliance check program
25
Pre - agreement to meet immediately on violations (meet
with Police Department personnel immediately instead of
waiting for criminal court proceedings)
10
Pre - agreement to work with the police department on
secondary sales
•
•
*These four items are mandatory
o�P
CITY OF PLYMOUTH
• U -21 PROJECT U
BEST PRACTICE AGREEMENT
•21 pre
business, operating in the City of Plymouth
with an [on -sale off -sale] [intoxicating wine wine /strong beer malt] liquor
license agrees to be a "Best Practices" establishment.
With this agreement we understand we must agree to several of the following items,
including the first four mandatory items, to a total point value of at least 100 points.
Section 1201 - State Law Adopted/Definitions Page 1 of 2
Section 1201 - State Law Adopted/Definitions
1201.01. Provisions of State Law Adopted. Except to the extent the provisions of this Chapter
are more restrictive, the provisions of Minnesota Statutes, Chapter 340A, as amended, regarding the
terms, licensing, consumption, sales, hours of sale, and all other matters pertaining to the retail sale,
distribution, and consumption of intoxicating liquor and 3.2 percent malt liquor are adopted and made a
part of this Chapter as if set out in full.
•
•
1201.03. Definitions. For the purposes of this Chapter, and in addition to those definitions
contained in Minnesota Statutes, Chapter 340A, as amended, the terms used in this Subsection are
defined as follows:
(a) Display: The term "Display" means the keeping, storing, or permitting to be kept or
stored of an alcoholic beverage which has been poured, dispensed or has had its package seal
broken on, in, or at any table, booth, bar or other area of a licensed premises accessible to the
general public, except when the alcoholic beverage is stored in a normal storage area during non-
sale hours.
(b) Interest: The term "interest" as used in this Chapter includes any pecuniary interest in
the ownership, operation, management or profits of a liquor establishment, but does not include:
bona fide loans; bona fide fixed sum rental agreements; bona fide open accounts or other
obligations held with or without security arising out of the ordinary and regular course of
business or selling or leasing merchandise, fixtures or supplies to such establishment; or any
interest of 5 percent or less in any corporation holding a City liquor license. A person who
receives monies, from time to time, directly or indirectly from a licensee in the absence of a bona
fide consideration therefor and excluding bona fide gifts or donations, shall be deemed to have a
pecuniary interest in such retail license. In determining "bona fide," the reasonable value of the
goods or things received as consideration for the payment of the licensee and all other facts
reasonably tending to prove or disprove the existence of any purposeful scheme or arrangement
to evade any prohibitions under this Chapter shall be considered.
(c) Licensed Premises: The term "Licensed Premises" is the premises described in the
approved license application. In the case of a restaurant, club, or exclusive liquor store licensed
for on -sales of alcoholic beverages and located on a golf course, "licensed premises" means the
entire golf course except for areas where motor vehicles are regularly parked or operated.
(d) Operating Manager: The term "Operating Manager" as used in this Chapter means a
person designated by the license holder who works full -time at the licensed premises and is in
charge of day -to -day liquor sales.
http : / /www2.ci.plymouth.mn.us /pls /cop /docs/FOLDER/CITY GOV /CG CODE /CODE_... 3/18/2004
Section 1201 - State Law Adopted/Definitions Page 2 of 2
Plymouth City Code 1201.03 (e)
(e) Properly Designated Officer: The term "Properly Designated Officer" means and
includes (i) the Plymouth City Fire Inspector; (ii) the Plymouth City Building Official; and (iii)
the Health Inspectors employed by Hennepin County or the State of Minnesota acting in the
course of the scope of their employment.
(f) Underage Person: The term "Underage Person" means a person who is under the legal
drinking age as provided by Minnesota Statutes Chapter 340A.
(Ord. 98 -2, 01/07/98)
http : / /www2. ci.plymouth.mn.us /pls/ cop /docs/FOLDER/CITY_GOV /CG_CODE /CODE_... 3/18/2004