Franchise require liquor license; city has none

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Kayla Bunge
Sunday, January 27, 2008
— A restaurant group wants to open a Ruby Tuesday franchise on the city’s east side, but the city isn’t sure how many liquor licenses, if any, are available.

RT Restaurants of Southern Wisconsin has offered to purchase an outlot at the new Target, 660 N. Edwards Blvd., but the purchase is contingent upon obtaining a Class B liquor license. The group applied for a license but was denied because city officials said none was available.

The confusion about the number of licenses available stems from a 1997 change in state statutes, limiting municipalities to no more than one liquor license per 500 residents. But Lake Geneva never filed the required paperwork in 1997 to inform the state how many licenses it had issued and how many were available, City Clerk Diana Dykstra said.

In a Dec. 5 memo to the city’s Finance, License and Judicial Committee, Dykstra wrote that because the paperwork never was filed, she must say no licenses are available.

Dykstra contacted the state Department of Revenue, but state officials told her they have no information, saying “each municipality monitors and is responsible for their own licenses,” she said.

Dykstra looked through minutes from city meetings “to try to piece together” how many licenses the city had issued and how many were available.

"Unfortunately, the result is sketchy,” she wrote in the memo. “There is no discussion of any available licenses, and I must assume there were none.”

Dykstra said the city attorney told her, “the city’s always never had any.”

The city has 24 Class B liquor licenses issued, four of which became available after the 1997 quota law went into effect, Dykstra said. Those four are reserve licenses, which cost applicants $10,000 initially.

Ruby Tuesday requires a liquor license before construction can begin, Dykstra said.

Members of the restaurant group did not return phone calls from the Gazette. Brian Randall, an attorney representing the group, said they are “in the waiting period” and likely will reapply for a liquor license should one become available.

In the Dec. 5 memo, Dykstra identified four ways a license could become available:

-- Miscalculated population: An entire subdivision was excluded from the 2000 census, which means more than 1,000 people weren’t counted.

The city has filed an appeal with the state Department of Administration for a new population estimate. But that wouldn’t result in any additional licenses until late this year, “if we are lucky,” Dykstra wrote in the memo.

-- Misappropriated license: The Cove, which holds a reserve Class B liquor license, qualifies for a hotel exemption license. Dykstra said The Cove is willing to turn in its reserve license in exchange for a hotel exemption license.

The city cannot force The Cove to turn in its reserve license; that’s something RT Restaurants will need to talk to The Cove about, Dykstra said.

-- License granted to yet-to-be-built business: Wisconsin Hospitality Group was granted a Class B liquor license Aug. 22, 2005, for an Applebee’s restaurant to open across from Home Depot, 550 N. Edwards Blvd. Ground hadn’t been broken, however, by the time the license came up for renewal.

City ordinance requires a business to be open at least once in a 90-day period to retain its liquor license. The city granted the restaurant group a waiver, but the city said the license might not be renewed if there is no progress soon.

-- License held by closed business: Hillmoor Country Club, which currently holds a Class B liquor license, has been closed since Oct. 21. Because the business hasn’t been open in the last 90 days, the city can revoke the license.

What kinds of liquor licenses does Lake Geneva offer?

-- Class A fermented malt beverage licenses allow the sale of fermented malt beverages (beer) for consumption off the premises. Examples: grocery or convenience stores.

-- Class A liquor licenses allow the sale of intoxicating liquor (including wine) for consumption off the premises. Examples: liquor stores or grocery stores with full liquor sales sections.

-- Class B fermented malt beverage licenses allow the sale of fermented malt beverages (beer) for consumption on or off the premises. Examples: restaurants or “beer bars.”

-- Class B liquor licenses allow the sale of intoxicating liquor (including wine) for consumption on the premises, and wine in original containers for consumption off he premises. Examples: bars and restaurants with full alcohol service.

-- Class C wine licenses allow the sale of wine for consumption on the premises and allow the carryout of a single opened (resealed) bottle if sold with a meal.

How much do licenses cost?

License fees are set by the municipality. In Lake Geneva, regular Class B combination liquor licenses cost $600. Reserve licenses cost $10,000. Renewals of both types of licenses are $600.

How many liquor licenses does Lake Geneva have?

Lake Geneva has issued 20 Class B combination liquor licenses and four reserve licenses. The reserve licenses are held by The Cove, Harbor Side Café, Lake-Aire Restaurant and Su-Wing Chinese Restaurant.

Last updated: 12:48 pm Thursday, December 13, 2012

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