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Home My WebLink About[05] Legion Liquor License • • CITY OF ST. JOSM'H Council Agenda Item 5 MEETING DATE: June 16, 2011 AGENDA ITEM: American Legion Post # 328 — Liquor License SUBMITTED BY: Administration BOARD /COMMISSION /COMMITTEE RECOMMENDATION: PREVIOUS COUNCIL ACTION: The Council considered the annual liquor Licenses at the June 2, 2011 Meeting, at which time they were pulled from the consent agenda to discuss the Legion application for a club license. Discussion centered around an email received requesting the Council review if the Legion operates as Club under MN Statute or if they should require a full liquor license. The Council requested the Legion attend the June 16 meeting to further discuss. BACKGROUND INFORMATION: Included in the information is an extraction of the email that was sent to the Council along with the form that the City of St. Waite Park forwarded to the Waite Park Legion. The form is an extraction of MN Statute with the addition of bona fide and bona fide guest. As part of the license requirement, the Legion needed to sign the form acknowledging MN Statute and verifying that they comply. Also attached is the power point presentation of MN Alcohol and Gambling Control from training they provided in 2009. The training was provided by Mike Polla, Special Investigator for the Department. BUDGET /FISCAL IMPACT: License fee of $ 400 or License fee of $ 2,500. ATTACHMENTS: Request for Council Action 5:1 -2 Email Extract 5:3 Waite Park Form 5:4 MN Alcohol and Gambling Power Point 5:5 -16 REQUESTED COUNCIL ACTION: Liquor licenses expire on June 30, 2011, so action on either a Club or On Sale License should be approved. 5:1 THIS PAGE INTENTIONALLY LEFT BLANK 5:2 I believe you have an opportunity to increase revenue tonight by following state statute as it applies to "club" liquor licensing. The city of Waite Park charges the Waite Park Legion the normal off -sale license cost rather than the much lower club license cost. The W.P. Legion, like the St. Joseph Legion, opens its doors widely to any customer rather than to just members and guests. I am attaching a pdf copy of a document the city of W.P. gave to the W.P. Legion to sign in order that the Legion was well aware of what MN Statute 340A.404 states regarding club licenses. Most of you have likely entered our local legion without being a formal guest of a paid member and bought an alcoholic beverage (the law states that liquor sales will only be to members and bona -fide guests). The sheet from Waite Park also goes into MN Statute 340A.801 "Civil Actions" to show how the legion could be sued by illegally selling alcoholic beverages. It further lists what constitutes a legal sale. That list includes sales to bona -fide guests. It infers that sales to non bona -fide patrons therefore are illegal. I am not sure if the city could be named as part of a lawsuit if it knowingly continues to give an establishment a club license when the council and staff are well aware they openly sell liquor to non bona -fide customers. The State of MN does not make exceptions to the liquor law because a club donates money. It appears that is the main reason the St. Joseph council continues to charge $500 for a license rather than the standard $2,500. I have nothing against any veteran's club and am a retired veteran myself with a lifetime membership to the VFW and have been an . active organizer of veteran activities. I know if you take the fair route and force the legion to either operate within the state law for clubs or charge them like other bars it will be unpopular to the legion members But in these harsh economic times you should also factor in what is fair to the other citizens in St Joseph and to other business establishments. Thanks for your consideration. 1 5:3 Club liquor License Subd. 7. Club. "Club" is an incorporated organization organized under the laws of the state for civic, fraternal, social, or business purposes, for intellectual improvement, or for the promotion of sports, or a congressionally chartered veterans' organization, which: (1) has more than 30 members; (2) has owned or rented a building or space in a building for more than one year that is suitable and adequate for the accommodation of its members; (3) is directed by a board of directors, executive committee, or other similar body chosen by the members at a meeting held for that purpose. No member, officer, agent, or employee shall receive any profit from the distribution or sale of beverages to the members of the club, or their guests, beyond a reasonable salary or wages fixed and voted each year by the governing body. 340A.404-- License (4) clubs or congressionally chartered veterans organizations with the approval of the commissioner, provided that the organization has been in existence for at least three years and liquor sales will only be to members and bona fide guests; - - Dictionary definition of Bona fide In good faith, lack of fraud or deceit, valid under or compliance with, the law. - -Real world definition of Boni fide Guest. 1' ou can prove was a guest, in court, two years after he was a customer. 340A.801 Civil actions. Subdivision 1. Right of action. A spouse, child, parent, guardian, employer, or other person injured in person, property, or means of support, or who incurs other pecuniary loss by an intoxicated person or by the intoxication of another person, has a right of action in the person's own name for all damages sustained against a person who caused the intoxication of that person by illegally selling alcoholic beverages. A legal Sale Made during business hours Made to an person over 21 Made to a person not obviously intoxicated Made to a person you can prove is a member or a bonifide guest (in court, two years after the event) 340A.501 Responsibility of licensee. Every licensee is responsible for the conduct in the licensed establishment and any sale of alcoholic beverage by any employee authorized to sell alcoholic beverages in the establishment is the act of the licensee for the purposes of all provisions of this chapter except sections 340A.701, 340A.702, and 340A.703. Hall rental will be without liquor services unless you obtain a temporary license from the city for the event. (3.2 beer and setups may be provided.) I acknowledge receipt of this information • 5:4 • • Sales Sales must be to members or bona fide • 5:5 Authority to issue licenses Who Enforces What Who is liable to the public if Liquor Laws are not enforced 5:6 Who Is Liable If you are required to obtain something and fail Your city may be liable for your inaction 5:7 Who is Liable If you know a law is being broken, and fail to enforce it. Your city may be liable for your inaction 5:8 Club Liquor License • That they maintain sales to members and guests only • Your City • That they operate during proper hours and days of sales • Your City • That they don't sell to minors • Your City • All other laws concerning these licenses • Your City 5:9 On Sale Liquor Licenses • That they maintain proper business status • Your City • That they maintain sales during proper hours and days • Your City • That they don't sell to minors • Your City • All other liquor laws concerning these licenses ■ Your City 5:10 Example A club in your city openly sells liquor to the public, advertises dances, steak fries, and other public events. An injured party could hold the city liable for any damages beyond the insurance coverage from the club. Club or License Club must have been in exis - ce for at lease three years Club must have owned or rented a h. building for at least one year Club can not be illegally restrictive Club can not sell liquor to general public, safeguards must be in place to keep sales to members and bona fide guests only Keys only to members Manned guest book Greeter at the door at all times 5:12 Club .uor License AGED approves these licenses This inspection is triggered when .. •ved license application arrives at the sta • e. The inspection is to determine if the B meets the requirements of the license. No inspection will be done prior to city app of the license. 5:13 ubs Subd. 7. Club. "Club" is an incorpor. -d organization organized under the laws of the state for civic, fr. -rnal, social, or business purposes, for intellectual impro ent, or for the promotion of sports, or a congressionally ch. -d veterans' organization, which: (1) has more than 30 members; (2) has owned or rented a building or space in a bui more than one year that is suitable and adequate fo accommodation of its members; (3) is directed by a board of directors, executive committ: other similar body chosen by the members at a meeting for that purpose. No member, officer, agent, or employee shall receive any profit from the distribution or sale of beverages t% the members of the club, or their guests, beyond a reasonable salary or wages fixed and voted each year by th governing body. 5:14 Mike Poll. Special Investig. THIS PAGE INTENTIONALLY LEFT BLANK 5:16