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October 14, 2009

Is the liquor board getting too tough on bars?

club phantom baltimoreI couldn't help but chuckle when I read this piece by Sun reporter Brent Jones. The article takes a look at how the liquor board has started cracking down on Baltimore bars and clubs. Here's an interesting little snippet:

The board has issued more than $94,000 in fines this year, and $325,000 since January 2008. It has also revoked five liquor licenses dating to 2007, a move rarely used in the past and generally reserved for clubs and restaurants with long records of serious misconduct. The previous panel revoked just two licenses.

I've been writing about nightlife for just about four years now. I didn't get involved on the legal side (liquor license revoking, etc.) until the past couple years.

But I've kept an eye on the liquor board hearings and the punishments doled out to bars who break the law for a while.

I have to say, I think on the whole, the liquor board is doing all right. If anything, they should have cracked down even more on some of these spots (namely, Suite Ultralounge) ...

Take Club Phantom, for instance. I think this other piece (also by Brent Jones), sums it up perfectly:

The license was awarded to owner Shane Anderson last year with several conditions, according to the liquor board. Phantom was not allowed to have live entertainment, performing disc jockeys or promotions for parties.

But the club advertised 13 parties this year, using an outside agency to create fliers and promote the events, according to testimony during the 90-minute hearing. Neither Anderson nor a lawyer represented Phantom at the hearing, but the club's manager testified that he was unaware of the agreement, liquor board Chairman Stephan Fogleman said.

Um ... what? Unaware of the agreement? Sounds pretty simple to me. The liquor board said, OK, guys, you can open this place as long as you don't throw DJ dance nights. And what did they do? They threw DJ dance nights. A bunch of them.

Of course the community is going to be up in arms. They signed a petition to shut the club down.

Remember, this little strip of Boston Street clubs has been a bane of the neighborhood for several years now. The clubs have brought several incidents of violence, noise and disorderly conduct. That's why Club Phantom wasn't allowed to do live entertainment.

So the liquor board pulled Club Phantom's license. To me, that's not harsh -- that's common sense.

I'm not going to go case by case here, because that would take too long. And I'm sure the liquor board has made mistakes, and fined certain bars too much. That's inevitable. But as a bar-goer and a city resident, I'd rather have the liquor board be too tough on these joints than let them get by with whatever they wanted to do.

(Photo by me)


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Posted by Sam Sessa at 8:01 AM | | Comments (25)
Categories: Bars & Clubs
        

Comments

The Liquor Board is just inconsistent.
You said you have been writing about nightlife for about 4 years, research the last 10. Lots of controversies, conspiracies, improper bahaviors, etc...

The city gov't needs money, because they don't know how to budget, so they are forcing departments to get it by any means possible. Except of course firing people who make 6 figures and do nothing at city hall, that wouldnt be acceptable. They would rather fine small businesess for petty offenses. Small Businesses that actually DO something for our community.

If they revoke a license, that just means they can sell it to someone else then, right?

Good question, What happens when they revoke a liquor license? Do they literally take possession of it and resell it? Or does the owner of it sell it to someone else? They are worth a lot of money.

Are liquor licenses really worth a lot of money? If I bought one from someone would I be able to use it as colateral for a bank? I do not think that you could. The real value is that it has already been approved. But there is still the process of getting the transfer approved.

I believe that there is a limit of licenses for a particular area so when the license is revoked that just gives the board one more to approve if it is applied for. I do not believe that the cost of the application is much for a new license but the money that the board required to spend on the business is rather large. I think that it is around $500,000.

Amen Oscar. You hit the nail on the head, the city is desperate for revenue so they are going to send out inspectors to nickle and time establishments and citizens for anything and everything. Look at Cafe Hon this week. I play in the BSSC and for years nobody would say anything if you happened to enjoy an adult beverage after a football/softball game. The community was happy to have us use the parks and take care of them. Now we have to worry about getting open container tickets if someone brings a can to an outdoor venue. sign of the times

I think the value of a transferred Baltimore City liquor license is between $50,000 and $100,000 (I'm guessing based upon stuff I've heard). It may depend upon the neighborhood and the type of license (6 vs 7 day, carry-out, etc). There has been a freeze on new liquor licenses in Baltimore City for many years, with the exception being if you have a large new business (Harbor East) or make big capital improvements on an existing location.

I'm sure someone other than me is more qualified to answer this.

OMGuestimator--You win the prize. Your comments are spot-on, i.e., correct.

As to the other comments:

Once revoked, a license is dead. It cannot be resold. Like Monty Python's parrakeet, "it ceases to be". Nor does that revocation open up a spot for a new license.

The liquor board is completely independent of City Hall. It is a state agency. No one has ever told us (nor would we listen) to increase revenues by going out and fining bars. The fines we give are based on legal infractions and have to do with deterrence.

"They would rather fine small businesess for petty offenses. Small Businesses that actually DO something for our community". Oscar, please tell me you are not defending bars that we have fined for open drug sales, obvious prostitution violations or places that continually sell to children.

There are many great bars in Baltimore, but you only hear about the Board's involvement with the troubled ones.
The average bar owner has no problems with the Board. Go ask the owner of your corner pub. They play by the rules and we let them earn their livng without sticking our noses into their daily business.

BTW, Cafe Hon's awesome flamingo has nothing to do with the liquor board.

"They would rather fine small businesess for petty offenses. Small Businesses that actually DO something for our community". Oscar, please tell me you are not defending bars that we have fined for open drug sales, obvious prostitution violations or places that continually sell to children.


YES, that's exactly what I was doing, good job.

A state agency eh? Well, that's much better then, sorry for getting that wrong, because those bureaucrats have no connection with baltimore city.

I was reffering to the Pink Flamingo. OK, it isnt from the liquor board, its still an un needed infration penalty from GOV'T agency.

And I am glad my tax dollars are being spent so wisely by arguing with a commentor on blog.

Oh, and sorry I couldn't tell you are a state agency, not with baltimore city.

Where is your website located again, can you provide me the URL?

Well I'm sure I could find it SOMEWHERE.

And I am glad my tax dollars are being spent so wisely by arguing with a commentor on blog.

I think government officials who make themselves available to the public in such a forum is an excellent thing. What is the Rule of Law? That the laws are applied equally to all and that the laws are known.

Openness in government is a big deal. Thank you, LiquorBoarding.

Liquor Board
http://www.baltimorecity.gov/government/liquor/

I think reading the infractions under the hearings schedule are kind of fun to read.

Thanks OMG, I agree, you are right, openess is important.

But regarding the URL, I was trying to point out that their site is on Baltimore City's .gov site, which to me indicates they are a city agency, not a state agency....

Thanks OMGBTP!

I didn't think I was arguing with Oscar. Just trying to answer some questions posted by Sam's readers. Oscar's the one with the loaded comment about how we're all out to fleece the little guy.

The City lets us use their website and they let us use City Hall for our hearings. That's about the extent of our relationship. I understand that it is confusing. I just wanted to point out that we don't take marching orders from the City Council, nor do we take budgetary directives from them, either.

You'll all be glad to know that not one government cent was spent for my prior post (and all posts). It was all done at my day job where I am self-employed. Private IP, private computer and even the electricity was paid for at private expense.

Should I not be permitted to post? Heck, the article was about the liquor board. I thought I might be permitted to chime in. If the readers would prefer not to hear from me on liquor-related issues, then post your thoughts on it.

Funny how everyone likes responsive government until the government responds-- to an erroneous comment on a blog.

Hey hey hey -- this isn't just "a blog," Mr. LiquorBoarding. This is Midnight Sun, where, even at night, the light of justice and awesomeness shines.

Hiccup.

Yeah, blog sounds so cheap, doesn't it? Especially when it's run by the new "King of all media". Love you, Love your show!

you win this battle wate..i mean liquorboarding, but will get my revenge, ahahhhahah.

no probably not, im not as smart or articulate as you educated types.

Once the Licence is POOF GONE, and another one dosen't replace it, at what point do you decide to "issue" more? I understand there has to be a limit and you can't hand them out willy nilly, but should we limit people wanting to start their own legitimate business, that will in turn, generate tax dollars?

It should be pointed out that LiquorBoarding's state job is part time. Part time pay, but full time hours.

We'll see you at the hearings tomorrow.

Oscar, don't worry. Liquor Laws are the most confusing laws anywhere. And you can beat me up at the Midnight Sun Social!

This is the wierdest part.
Since 1968, there has been a moratorium for new licenses, with limited exceptions, like a bona fide restaurant or a big place that's willing to make a capital investment of $250-750K depending on the neighborhood. So, if you're willing to spend big, you get a liquor license for $1200 (from us) rather than from a private sale (like OMG said, around 50-100K depending on your legislative district). You can now only transfer a license within the same legislative district. The 46th district 7 day license is the Porsche of licenses--talking Fed Hill, Fells, Canton, etc. These licenses can sell for 100K and up. Licenses in other districts can cost a fraction of what they do in the 46th.

6 day licenses are a cheaper way in, but eventually licensees usually decide they want that Sunday (What's a bar without Sunday football?) They run about $10K-$50K through private transfers. Just ask the folks at Yellow Dog and One Eyed Mikes. There is no way to auto-upgrade your license to seven days. In their cases, they had to buy an existing 7 day and then re-sell their six-day on the market. Not exactly user-friendly, but it is state law.

Also, remember that most corner bars are grandfathered in--they're within 300 feet of a church or school, meaning if a license moves from that original location (through revocation, non-renewal, or transfer), then there will likely never be a liquor license in that spot again.

Because we hand out so few new licenses, the price for existing licenses have gone up dramatically over the years.

It's not exactly easy to get into the bar business in Baltimore without a lot of capital, unless you buy your license with some owner-financing. That can be a sticky wicket, too. The interest rate might blow your mind and you may have to put certain machines in the bar. What might surprise you is that there are licenses that have just expired because no one would even buy them for $5K. Of course, these licenses are not located near the "Gold Coast", but if you're willing to try a non-traditional spot, you can get in much cheaper.

If any of Sam's readers are actively looking for a license to buy, they can call me at the Board and I'll tell them what I've heard is for sale. There are also full-time liquor license brokers who do this for a living (think real estate agents selling pieces of paper). Thanks for reading this!

I personally and honestly think that the liquor board is extremely fair, I have been to many hearings where the neighborhood associations try to bash a prospective restaurant/ bar owner and the liquor board does listen to both sides. The problems sometimes seems to be in zoning and in the bunch of red tape in the city. Keep up the good job Mr. Fogelman.

I think the thinking is that the city has too many licenses already. The web site says that there has been a moratorium on new licenses since 1968. Given the declining population in the city in the past forty years there is some logic there.

On the other hand, the development of tourism and neighborhood development means that the character of bars and restaurants in parts of the city has changed drastically for the better in the past thirty years.

From the LB web site:
Currently, there are approximately 1,470 alcoholic beverage establishments in Baltimore City which is a reduction from the approximately 2,200 licenses there were in 1968.

Given the high cost of buying an existing license and transferring it, I would say that the demand for licenses exceeds the supply.

hey liquorboarding, i'm done with those land of the lost dvds if you wanna borrow them!

There is an interesting case before the LB tomorrow.

http://www.baltimorecity.gov/government/liquor/downloads/1009/Liquorboardshortdocket101509.pdf

There is a laundry list of violations for Red Square in the Belvedere. I don't know if they have any connection to Suite UltraLounge.

Thanks anyway, Evan, but that gol-durn Will Ferrell had to go and ruin childhood memories for me.

10-4

I counldn't do your job, that's for sure.

I just had to call a help desk manned by a gov't employee, here in MD. The first time I called I got hung up on without a hello, the second time, I was bothering her because she was in the middle of eating her lunch. HELP DESK!

I can't stand gov't red tape and people getting paid to not do anything, just to see my taxes increased each year.

Mr. Fogelman seems like the exception, and I really appreciate his responses.

Now when you gonna shut down Suite Ultralounge!?!?

I applaud Chairman Fogelman for coming here to speak with us, and I look forward to seeing him at the social.

It is my understanding, it's been a while since I've engaged in any secured transactions, that you can collateralize a loan with a liquor license. How exactly does the repossession of the license by the lender occur? Would it be easier for me to obtain a license by lending several bars money and securing the loan with their liquor licenses?

Oscar, I can't comment on Suites Ultralounge right now as that case is on appeal.

John, a repo by a secured creditor involves temporarily shutting the bar down until you find a new buyer. A secured creditor alone can't run a bar. Once you physically take the license from the creditor, then you'd have to apply to be the new owner and go through a hearing. See, we check licensees for their felony records, but we don't run background checks on secured creditors. (That's state law again). So, you'd have to be vetted for licensing. If you have the kind of money to lend to start several bars, it might be cheaper to just buy your own license!

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About Erik Maza
Erik Maza is a features reporter at the Baltimore Sun. He writes for several sections of the Sun paper and contributes weekly columns on music and nightlife. He also writes and edits the Midnight Sun blog. He often covers entertainment, business, and the business of entertainment. Occasionally, he writes about Four Loko, The Block, the liquor board, and those who practice "simulated sex with a potted palm tree." Before The Sun, he was a reporter at the Miami New Times. He's also written for Miami magazine, the Orlando Sentinel, the Sarasota Herald Tribune and the Gainesville Sun. Got tips? Gripes? Pitches? He's reachable at erik.maza@baltsun.com. Click here to keep up with the dumb music he's listening to.

Midnight Sun covers Baltimore music, live entertainment, and nightlife news. On the blog, you'll find, among other things, concert announcements, breaking news, bars closings and openings, up-to-date coverage of crime in nightlife, new music, round-the-clock coverage of Virgin Mobile FreeFest, handy guides on bars staying open past 2 a.m. on New Year's Eve and those that carry Natty Boh on draft. Recurring features include seven-day nightlife guides, Concert News, guest reviews of bars and concerts, Wednesday Corkboard, and photo galleries, as well as reader-submitted photos. Thanks for reading.
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