Licensing Ordinance Amendments City Code Chapters X and XII April 12, 2010

CHAPTER X General Business License Provisions

New Section 1003 Background Investigations  Purpose of ordinance: In order to utilize the BCA’s criminal database for background investigations, the BCA requires a local ordinance  Types of background investigations:  Employment  Licenses

Section 1003 – Background Investigations  Section – Employment  All applicants  Current employees (ability, not requirement)  Volunteers who work with  Vulnerable adults  Children  Unless Asst. City Mgr determines it is unnecessary  Section – Licenses  Sexually-Oriented Business  Gambling  Liquor  Massage  Pawnbroker/Precious Metal  Firearms range  Carnivals  Car Sales/Rentals  Peddlers, Solicitors  Rental Evaluators/Rental Dwellings  Tattoo/Body Piercing  Tobacco  Ultimate Wrestling

Section 1003 – Background Investigations  Requirements for both categories:  Written authorization from applicant/employee/licensee  BCA data must be kept at the PD  PD will release a summary of the findings to parties who need to know and destroy the BCA data  Reasons for denial  Conviction of a crime (punishable by jail) in the last 5 years that is related to the job or license ( b and b)  Material misrepresentation on the application ( a (2))  Not of good moral character ( a (3))  Must give applicant/licensee notice of basis for denial and ability to appeal the denial

Section 1005 – Licensing Procedures  Overview:  Add a process to address when a business conducts a licensed activity without a license  Move, eliminate, and add appropriate licenses to specific categories  Clarify the documents needed for a completed application  Provide criteria for the Police Chief to recommend denial  Change insurance coverages  Clarify fees related to refunds, late fees, pro-rated fees  Add a Provisional License  Change the renewal date to 30 days prior to its expiration  Provide a clearer hearing process for approval, denial, revocation or suspension

New – Section b Activity conducted without a license  Remedies available for when a licensed activity is conducted without a license:  Not approve a license until the business pays the late fee  Criminal citation  Administrative citation  Post a Cease and Desist Order  If it is an existing business who failed to renew, then provide business with 20 days’ notice to Cease and Desist. If fail to renew, then City can post the Order at the end of the 20 days.  If new business, immediately post with an Order. If licensed activity is continued, each day is a new violation and can pursue criminal or administrative citations

Section subd. 1 Licensed Businesses  Eliminated the following licenses:  Skating Rinks  Theaters  Public Dances  Taxicabs  Added the following licenses:  Dangerous Dogs  Precious Metal Dealers  Moved the following license:  Tree Removal from Commercial and Service to Building and Related Trades  Other changes made to clarify existing practices (i.e. Sidewalk Installation receives a Masonry/Sidewalk license)

Section subd. 1 (cont.)  Intoxicating and 3.2% Malt Liquor  Intoxicating Liquor  Off-sale  On-sale  Outside Service (patio)  Sunday  Wine  Temporary On-sale  Temporary Outside Service  3.2% Malt Liquor  Off-Sale  On-Sale  Outside Service (patio)  Temporary On-Sale  Temporary Outside Service

Section subd. 1-4 The Application  Adding:  Person must provide Social Security Number  Businesses must provide federal tax ID and MN employer ID number  Personal business license must provide written permission to conduct activity at the location  Eliminating:  Partnership must provide tax returns for previous 2 years  Requirement for plot plan  Requirement for preliminary building plans  Requirement for a Cert. of Occ.

Section subd. 5 Background Investigations  Added clarifying language  If applicant is applying for more than one license and each license requires a background investigation (tobacco, liquor), shall only pay one personal fee and one business fee  Applies to all Initial and Renewal applications  Gives Police Chief criteria to recommend denial

Section subd. 6 - Insurance  Removed Auto Liability Insurance (covered by State Statute)  Currently only required for trash haulers

Section subd. 7 – License Fees  Changes:  Refunds – No refunds, unless approved by the Council  Late Fees – If no application submitted 30 days prior to expiration of existing license, then must pay a late fee equal to 50% of the license fee (currently it is 15 days)  Pro-Rated – (currently no pro-rating is allowed)  Only licenses that require continuous monitoring throughout the license term will be allowed to pro-rate a license for a partial year  The Council may find unique circumstances in particular cases for exceptions  Add a Provisional License fee – Additional fee for this special type of license, set on a case-by-case basis

Sections and  – Application Submission & Renewal  Renewal Date to submit an application changed from 15 to 30 days prior to expiration and is consistent with initial applications  Moved “Late Fees” and “Activity Begun Without a License” to other sections  – Application Consideration - Repeal  This section involving the hearing approval process was wholly incorporated into the revised section at , which now addresses approval, denial, suspension and revocation

Sections , , ,  Section – changed to be consistent with the background investigation criteria  Section – Clarified that licenses are non- transferable person-to-person or person-to-business but are transferable to a new location  Section – repeal. We do not currently compile, obtain or review information on a manager of a licensed activity  Section – Added the specific licenses for which a pre-license inspection is required

Section – License Hearing  Changes to clarify and articulate the approval process versus the denial, suspension or revocation process  Subd. 1- New and renewal applications  City Staff makes a recommendation  Council takes action, typically on consent agenda  Options for Council:  Approve  Deny (then requires a subd. 2 hearing)  Approve a Provisional License - New  Approve a license with conditions - New

Section subd. 1c & 1d - New Provisional License License with Conditions  Existing business  3 violations of City Code or State Statute within preceding 12 months (public nuisance)  Council approves a mitigation plan  License term coincides with regular license term  Council sets an additional fee based on the level of monitoring that will be required  Existing or new business  Reasonable conditions may be added to address particular concerns (parking, hours of operation, lighting, noise)

Section subd. 2  Grounds for denial, revocation or suspension  Many provisions were clarified to be consistent with other sections  Added the following reasons:  If applicant is delinquent on any city fees  If applicant has been found guilty of professional misconduct  If a background investigation finds that licensee would be a menace to the public  If licensee has violated a condition of a Provisional License  If the activity was conducted without a license  Other good cause (catch-all)

Section subd  Subd. 3 – Temporary Suspension – added “designee” to allow ALJ or some other authority to take action  Subd. 4 – Notice – clarified language that requires 20 calendar days’ notice, and indicating where notice should be served  Subd. 5 – Hearing – same change as in Subd. 3  Subd. 6 – Final Decision – Articulates the actions that may be taken at a hearing:  No action  Add conditions to the license  Convert it to a Provisional License  Suspend  Revoke  Deny

Other  Repeal – Public Dances  Repeal 1155 – Taxicabs  Recommend ordinance be adopted by summary publication to avoid expensive publication fees for such a lengthy ordinance

Chapter XII Intoxicating and 3.2% Malt Liquor Licenses

Section 1200 – Intoxicating Liquor  Overview:  Change sections to be consistent with State Statutes  Consolidate On-Sale licenses from 3 categories into 2  Change Seasonal Outside Service Licenses to the on-going Outside Service Licenses for patios  Eliminate duplicative processes between zoning and licensing  Eliminate redundancies in various provisions of the City Code and State Statutes  Change penalty provision to reflect liquor violation sanctions adopted by the Council

Section subd. 1 – On-Sale Old Ordinance New Ordinance  No more than 20  3 categories:  1: (11 or more) Restaurants with at least 40 seats, 3,500 sq. ft, 55% gross income from food  2: (6 or more) Restaurants that prepare and serve food  3: (up to 3) Taverns  Reduced by attrition  No more than 20 (but no limit on Clubs, theaters, hotels and bowling centers and restaurants)  2 categories:  1: Clubs, theaters, hotels, bowling centers, and restaurants (def. as one that prepares and serves food)  2: (up to 3) Restaurant with limited food menu selection  Reduced by attrition

Section subd. 2 – Off-Sale  Eliminated the off-sale liquor tax  Eliminated reduction in the license fee for employee training, since it is a condition of approval of the license  Added a $100 reduction in the license fee for the installation of a digital video security system

Section subd. 5 Outside Service  Eliminated all redundancies with zoning requirements  Added that a conditional use permit for outdoor seating is required  Eliminated the ability to revoke with 3 days’ notice, since any revocation would be required to follow the process outlined in Chapter X

Section subd. 6 Temporary On-Sale  May be issued to any Club, or charitable, religious or non- profit organization  For consumption on the license premises only  In connection with a social event sponsored by the licensee  When liquor sales will be made only to members and guests  New – Added that an On-sale licensee may be issued a temp. on-sale license to dispense liquor at an event being held at a sports facility owned by the City

Section subd. 7 Temp. Outside Service - New  May be issued to an On-Sale licensee, Club, or charitable, religious or non-profit organization to dispense liquor off- site at a community festival  Subject to the following requirements:  Specify date, time and location  Location must be compact and contiguous  Location must be separated from the general public  Location may not encroach into the ROW  Must provide written consent from property owner of location  Must provide written consent of 75% of residential property owners within 350 feet  Cannot reduce required number of off-street parking spaces  No CUP is required, thus the extra provisions

Sections , , ,  – Persons Ineligible – eliminated statutory redundancies  – Conditions – Added ability for removal of wine from restaurants, pursuant to State Statute, eliminated statutory redundancies, simplified closing hours (without changing intent), added that off-site storage is prohibited for intoxicating liquor licenses  – Repeal – Transfer of licenses is covered in Chapter X  Repeal – Certain Conduct prohibited is covered in other sections of the City Code related to Sexually- Oriented Businesses

Section – License Penalties  Removed sections related to the previous penalties for liquor license violations and replaced the language to reflect the Resolution that was adopted by Council last fall regarding the imposition of civil penalty sanctions for liquor establishments

Section 1210 – 3.2% Malt Liquor  Overview:  Terminology change from “non-intoxicating liquor” to “3.2% Malt Liquor” pursuant to State Statutes  Made many sections consistent with Intoxicating Liquor  Eliminate redundancies in various provisions of the City Code and State Statutes  Add Outside Service License and Temporary Outside Service License  Change penalty provision to reflect liquor violation sanctions adopted by the Council

Section – License Types  Subd. 1 – On-Sale: Added bowling centers and golf courses (statutory)  Subd. 2 – Off-sale: no change  Subd. 3 – Temp. On-Sale  May be issued to a Club, or charitable, religious or non-profit organization for consumption on the licensed premises and in connection with a social event  Subd. 4 – Outside Service – New – Same requirements as for Intoxicating Liquor  Subd. 5 – Temp. Outside Service – New – Same requirements as for Intoxicating Liquor, except that consent from neighboring property owners is not required

Other  Remaining sections are changed to be consistent with State Statutes and reduce redundancies  Section – Hours of Sale – changed to reflect that state law requires that hours of sale must be the same for Intoxicating and 3.2% Malt Liquor  Section – License Penalties – changed to reflect the new civil penalty sanctions for liquor establishments  Recommend ordinance be adopted by summary publication to avoid expensive publication fees for such a lengthy ordinance

Action Steps  Both ordinances on Council agenda for 1 st Reading tonight  If no substantive changes, may move forward with 1 st Reading  If substantive changes, may continue one or both ordinances to next meeting  Will be published for public hearing and 2 nd Reading  Minor modifications (non-substantive) will be made between readings to adjust terminology and assure consistency throughout the ordinances