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4.5. SR 11-18-2002City MEMORANDUM Item # 4.5. TO: Mayor and City Council FROM: Sandra Peine, City Clerk DATE: November 18, 2002 SUBJECT: Consider Liquor/Tobacco Fee Increases/Public Hearing The Council has requested staff to look at the possibility of increasing liquor fees. Attached is a memo that was previously given to the Council regarding proposed liquor fee increases. The memo also includes a survey that was taken of 34 cities in regard to liquor fees. The proposed changes to the existing liquor fees are listed below. Also listed is the average fee derived from the survey. LICENSE TYPE [ *AVERAGE (taken ELK RIVER- ] ELK RIVER from survey) Current Fee Proposed Fee Tobacco $160 $100 $150 On-Sale Liquor $5500 $4,000 $5,000 On-Sale Wine $895 $ 650 $700 3.2 Beer On-Sale $265 $ 225 No Change 3.2 Beer Off-Sale $66 $ 75 No change Investigation Fee Approx. $450 $250/$150 $400/$200 According to state law, license fees should cover the costs of issuing, inspecting, and other directly related costs of enforcement. According to the police department, some of the related costs for enforcement include the following: · DWI Calls · Fights in lots · People trying to enter with bad ID's · Arrests · Initial arrest report and follow up reports · Prosecution costs S:\CLERK\LICENSES\LIQUOR\fee increase public hearing memo.doc Court time Maintaining files and reporting to the state · Compliance checks The on-sale license fee of $4,000 has not increased for at least 20 years. I have notified all liquor establishments of this meeting, and according to law, they should be given the opportunity to speak to the issue. I have been informed that the Council should anticipate many of the liquor establishments to be present to speak against the proposed increases. ACTION REQUESTED Council action either approving, amending or denying the proposed liquor fee changes. S:\CLERK\LICENSES\LIQUOR\fee increase public hearing memo.doc City MEMORANDUM TO: FROM: DATE: SUBJECT: Mayor and City Council Sandra Peine, City Clerk October 28, 2002 2003 Fee Schedule- Proposed Liquor License Fee Increases ATTACHMENTS: · 2002-2003 LIQUOR LICENSE LIST · EXCERPT OF JUNE 10, 2002 COUNCIL MINUTES RELATING TO LIQUOR FEES · LIQUOR/TOBACCO FEE SURVEY · COPY OF LETTER TO LIQUOR ESTABLISHMENTS The City Council requested that staff look into the issue of an increase in liquor license fees and tobacco fees. A random fee survey was conducted by staff to find out what other cities were charging for liquor and tobacco licenses. The survey is attached. LICENSE TYPE *AVERAGE (Approximate) ELK RIVER Tobacco $160 $100 On-Sale Liquor $5500 $4,000 On-Sale Wine $895 $ 650 3.2 Beer On-Sale $265 $ 225 3.2 Beer Off-Sale $66 $ 75 Approx.$450 Liquor Investigation Fee $250/$150 The fee survey indicates Elk River's liquor license and tobacco fees are lower than the average of those cities surveyed. The reason for some of the high liquor fees is due to the fee structure being set by the size of the establishment or percentage of food sales. Those cities would probably have Liquor Fee Increase Memo October 28, 2002 Page 2 enough staff to provide inspections and monitoring of the required criteria set for the liquor license (i.e. percentage of food, size of establishment). State law requires that license fees cover the costs of issuing, inspecting, and other directly related costs of enforcement. The following comments have been provided by the Chief of Police and Assistant Police Chief regarding liquor enforcement. "The liquor industry in general creates a very heavy call load for us in the evening and early morning hours. Calls of possible intoxicated drivers, fights in lots, person trying to get in with bad ID's - all of these eat up our manpower allotments and time. If we make an arrest that takes up time, not only for the initial report but follow-up, reports and then of course prosecution costs, court time (usually overtime) and maintaining files and reporting to the state. Add to that increased patrols due to nature of calls and past reports and it really starts to build in a hurry. Finally, add compliance checks and over-time costs to insure that each business is within the legal limits provided by statute and ordinance." It seems that there is an increased demand on law enforcement resulting from the liquor licenses in the City. Elk River currently has 9 on-sale liquor establishments, with a potential to increase this to 18. The State law requires that that liquor related fee increases require a hearing by the council with a notice of the hearing to be sent to all affected licensees. This notice has been sent to all liquor license holders. Staff has made recommendations regarding the liquor and tobacco fee increases. These are only recommendations and can be decreased or increased as the council deems appropriate. The recommendations are as follows: LICENSE TYPE Tobacco Proposed Fee $100 Proposed Fee $160 $5,000 On-Sale Liquor $4,000 On-Sale Wine $ 650 $700 3.2 Beer On-Sale $ 225 No Change 3.2 Beer Off-Sale $ 75 No Change Liquor Investigation Fee $250/$150 $400/$200 Staff has already heard from a couple of the licensees regarding the increase. I expect that liquor licensees will be in attendance at the November 18 Council meeting to express their opposition to this increase. S:\CLERK\LICENSES\LIQUOR\Letters \Increase memo,doc Liquor Fee Increase Memo October 28, 2002 Page 3 ACTION REQUESTED Staff is requesting Council to consider whether it is appropriate to increase liquor and tobacco fees. If the Council deems it appropriate to increase liquor fees, a hearing will be held at the November 18 Council Meeting. S:~CLERK\LICENSES\LIQUOR\Letters\Increase memo.doc ~0 0 0 0 ~g ~o_~ o _.~ ~ ' ~_~.~ m mom 0 + 0 + ~D ~ Cn e- "~' · 0 ::r =c ,0 0 0 0 0 0 City of~ Kiver 13065 Orono Parkway Elk River, MN 55330 October 17, 2002 Dear Liquor License Holder: The City Council will be considering an increase in liquor license fees at a City Council meeting on November 18, 2002. The meeting will be held at the City Council Chambers located at 13065 Orono Parkway, Elk River, MN at 6:00 p.m. According to the City's Ordinance the City must notify liquor license holders of a proposed fee increase. The current liquor license fees are as follows: On-Sale Liquor- $4,000 On-Sale Wine - $650 3.2 Beer On-Sale - $225 3.2 Beer Off-Sale - $75 The Council will receive public input during consideration of this issue. If you have any questions prior to the Council meeting, please feel free to call me at 763-441-7420. Sincerely, Sandra Peine City Clerk Phone: 763.441.7420 Fax: 763.441.7425 www. ci.elk-river, mn.us City Council Minutes June 10, 2002 5.2. Request by the City, of Elk River for Ordinance Amendment Section 900 - Regarding Building Permit Escrows Requirements - P.H. Page 4 Building and Zoning Administrator Steve Rohlf requested Council to consider an ordinance amendment that would require an escrow of a maximum of 50% of the value of the unfinished landscaping when a C.O. is requested. Mayor Klinzing opened the public hearing. Tom Bakritges, representing D.R. Horton reviewed the issues in his letter to the Mayor and City Council on June 4, 2002. He noted that D.R. Horton would prefer that escrow be done through the City and not a title company, bank, or other financial institution as it would hold up closings and financial and title company processes and could be a hindrance to future homeowners. He stated that he would prefer to see the escrow at the time of building permit issuance. There being no further comments, Mayor Klinzing closed the public hearing. COUNCILMEMBER MOTIN MOVED TO ADOPT ORDINANCE 02-11 AMENDING SECTIONS 900.30 AND 900.38 OF THE CITY CODE OF ORDINANCES - CASE NO. OA 02-02B WITH THE DELETION OF THE WORD "ONLY" IN SECTION 900.38 2 (B). THE MOTION CARRIED 4-0. 5.3. Consider Hiring Environmental Technician Building and Zoning Administrator Steve Rohlf requested authorization to advertise for an Environmental Assistant. Steve reviewed the proposed duties for this position. COUNCILMEMBER TVEITE MOVED TO AUTHORIZE STAFF TO ADVERTSIE FOR THE POSITION OF ENVIRONMENTAL ASSISTANT. COUNCILMEMBER KUESTER SECONDED THE MOTION. THE MOTION CARRIED 4-0. Liquor and Tobacco Fees The City Clerk indicated that the Council previously requested Staff to research the city's existing liquor and tobacco fees to see if expenses are being recovered. The City Clerk indicated that she compiled information in a survey from other cities regarding tobacco and liquor fees. The City Clerk noted that of those surveyed, the approximate average charged for tobacco licenses is $160 compared to Elk River's fee of $100. She noted that based on the cost of enforcement and administration, the fees could be increased in the City of Elk River. The City Clerk noted that according to the survey, Elk River's liquor fees are also quite a bit lower than the average. She indicated that the on-sale liquor fees have not been increased for at least 20 years. She also noted that after reviewing the police reports, it is evident that there is an increase in demand on law enforcement due to liquor licenses. The Clerk indicated that if the Council wants to consider increasing the license fees, it would be best to coordinate the increase with the resolution considering the fee schedule at the end of the year so that new license fees are in place at the beginning of 2003. She also noted that City Council Minutes Page 5 June 10, 2002 hquor fee increases require a pubhc hearing and notification of the hearing to all liquor licensees. The Clerk also noted that State Statute indicates that on-sale liquor fees are intended to cover the costs of issuing, inspecting and other directly related costs of enforcement. It was the consensus of the Council that liquor fees and tobacco fees should be increased to meet the City's cost of enforcement. The Council authorized the City Clerk to have further research the cost of police enforcement related to liquor licenses. 5.4A. Renewal of Liquor Licenses The City Clerk presented the list of liquor licenses for approval. She noted that all liquor fees have paid, and all hcensing requirements have been met. COUNCILMEMBER TVEITE MOVED TO APPROVE THE LIQUOR LICENSE RENEWALS AS INDICATED ON THE STAFF REPORT. COUNCILMEMBER KUESTER SECONDED THE MOTION. THE MOTION CARRIED 4-0. 5.5. Consider Amendment to Animal Ordinance Relating to Kennels The City Clerk indicated that staff is requesting an amendment to Section 502 of the City Code pertaining to animals. She indicated that the amendment is necessary due to confusion in interpreting the ordinance. The existing ordinance indicates that a person can have 3 dogs or cats before a kennel license is required. The Clerk noted that the question always arises as to whether this means 3 dogs and 3 cats or a total of 3 animals. She noted that the proposed ordinance reflects that a kennel license is required for anything over 3 animals. Discussion was held regarding the total number of 3 animals. The Council requested Staff to rewrite the ordinance using language that allows up to 4 animals, but no more than three dogs. 5.6. Consider Amendment to Billiard Hall Ordinance Council recently directed staff to revise the existing Billiard Hall Ordinance to allow the Council flexibility to extend the hours of operation beyond the 1:00 a.m. requirement through a conditional use permit. COUNCILMEMBER TVEITE MOVED TO ADOPT ORDINANCE 02-10 AMENDING SECTION 712.10 OF THE CITY CODE RELATING TO BILLIARD HALLS. COUNCILMEMBER MOTIN SECONDED THE MOTION. THE MOTION CARRIED 4-0. 5.7. Consider Lease for House at Woodland Trails Park The City Administrator indicated that the City owns a house that has been rented out since it was purchased. He noted that the most recent renters have now moved out and the house is currently vacant. He indicated that the Mayor has suggested that the Council consider using the house as transitional housing by renting the house to a non-profit organization.