City Council Meeting Date: February 16, 2021
To: Mayor and City Council
From: Ben Martig, City Administrator
Title
Discussion of Budget Amendment Waiving Liquor License Fees for 2021.
Body
Action Requested:
Discussion.
Summary Report:
Due to the COVID-19 pandemic, Minnesota Governor Walz issued several needed executive orders that have impacted businesses. In recognition of these impacts, staff has been researching potential options to help impacted businesses. Liquor license fees are meant to pay for license issuance, inspection, monitoring compliance (insurance, training, etc.), enforcement, and compliance checks of the licensee. With the effects of the pandemic allowing most businesses to only be open to full capacity about 10 weeks of 2020, staff feels waiving these renewal fees for 2021 would have a positive impact on these businesses and help them recoup some of the missed revenues from the pandemic.
The City of Northfield licensing year runs from April 1 - March 31. Northfield currently has licenses issued in the following license categories:
|
Type |
Fee |
Permitted to sell |
|
On-sale Only: |
|
|
|
On-sale Intoxicating |
$2,600 |
All types of liquor |
|
On-sale Wine & 3.2% malt liquor |
$800 |
Wine, malt liquor (strong beer, hard seltzer, cider) |
|
On-sale Club |
$300* |
All types of liquor to members |
|
On & Off Sale: |
|
|
|
Taprooms/Cocktail rooms |
$300 |
Only the products they produce. Fee covers on & off sale |
|
Off Sale Only: |
|
|
|
Off-sale 3.2% malt liquor |
$300 |
Permitted to sell 3.2 malt liquor off-sale only |
* Fee based on number of members and is set by the State.
Staff recommends waiving renewal liquor license fees for 2021 for On-Sale Intoxicating, On-Sale Wine/3.2% Malt Liquor, Club, Taproom, Cocktail Room, Sunday and Off-Sale 3.2 Licenses, renewal background check fees and Rice County certification fees and amending the 2021 Budget to reflect this.
City Code Sec. 6-63 (c) states in part that no license shall be granted or renewed for operation on any premises on which taxes, assessments, service charges or other financial claims of the city or of the state are delinquent. Staff recommends that the waiving of renewal fees follow this same language related to delinquent financial claims of the City.
Rice County Board of Commissioners waived the liquor license fees for year 2021 at their January 26 Board Meeting. The City of Faribault has reduced their liquor license fees by 50% for 2021. Cities in Dakota County have been across the board with either issuing refunds/credits from 4-12 months, reducing fees or waiving fees for 6-12 months.
Alternative Options:
Council could choose partially waive the 2021 renewal fees, not to waive fees at all or change the licensing categories proposed to waive renewal fees.
Financial Impacts:
Estimated financial impacts for waiving renewal liquor license fees for 2021 for On-Sale Intoxicating, On-Sale Wine/3.2% Malt Liquor, Club, Taproom, Cocktail Room, Sunday and Off-Sale 3.2 Licenses, renewal background check fees and Rice County certification fees is as follows:
|
License Type |
Per License |
Total Cost |
|
On-sale Intoxicating |
$2,600 |
$49,400 |
|
On-sale Wine/3.2 |
$800 |
$6,400 |
|
Club |
$300 |
$300 |
|
Off-Sale 3.2 |
$300 |
$1,500 |
|
Taproom/Cocktail Room |
$300 |
$900 |
|
Sunday |
$200 |
$3,800 |
|
Background Check |
$200 |
$7,000 |
|
Rice County Certification |
$10 |
$350 |
|
Grand Total |
|
$69,650 |
In the 2021 Budget, Liquor License fees were budgeted at $79,000 and the budget amendment resolution reflects this number.
The funding would come from the general fund designated reserves. The City had designated reserves of over $600,000 for a contingency in the event of local government aid cuts from the State of Minnesota. While the budget session is in process, it appears very unlikely there would be any local government aid cuts for the budget they are preparing for the next two years.
The Federal government is also exploring additional stimulus that may be available to cover these costs. However, that is an unknown at this point and still pending.
Tentative Timelines:
• March 2nd - Regular Meeting Proposed Consent Agenda
The Northfield City Council considers approving the attached Resolution approving a budget amendment waiving renewal liquor license fees for 2021 for On-Sale Intoxicating, On-Sale Wine/3.2% Malt Liquor, Club, Taproom, Cocktail Room, Sunday and Off-Sale 3.2 Licenses, renewal background check fees and Rice County certification fees.