Municipal liquor store site selection begins anew; Council has four preferred sites

 Liquor store site selection presentation Northfield zoning map
Monday’s City Council work session included a presentation by consultant Mike Berg on the site selection process for a new Muni. According to today’s Nfld News article, Liquor store sites down to four, these are the preferred sites:

SW corner of 5th and Water The Crossing at 2nd and Hwy 3 The Q-Block at 2nd and Hwy 3 Churchill Tire/Grundhoefer Neuville & Ludescher law office building at 6th and Water

Left: SW corner of 5th and Water
Left center: The Crossing at 2nd and Hwy 3
Right center: The Q-Block at 2nd and Hwy 3
Right: Churchill Tire/Grundhoefer Neuville & Ludescher law office building at 6th and Water

(Photo screenshots captured from Google Maps Streetview.)

47 thoughts on “Municipal liquor store site selection begins anew; Council has four preferred sites”

  1. Why not consider locating the liquor store in the Safety Center after the new one is built at Woodley & Hwy 3 on the MNDOT property?

    Dave Hvistendahl wrote about this in his announcement for Mayor:
    http://locallygrownnorthfield.org/archives/3270/

    The highest priority should be given to building a new police/fire complex on the MnDOT site between Woodley and Ninth Street. The municipal liquor store should go into the present fire station, with the basement used as a warehouse. A freight elevator can move the product to the first floor, where it can be high stacked. The police offices should be recycled for use by the Chamber, the Convention and Visitors Bureau, and the NDDC. The present Muni could be recycled as a home for the youth groups, such as the Union of Youth, and youth service organizations.

  2. Yes, Griff, that’s a great idea and one that has been mentioned by others over the last couple of years. With a building designed for heavy weight loads, plenty of parking and a prime location, it would seem to be a no-brainer. Of course, the building’s garage doors and high ceilings would make it a fascinating canoe rental/visitor center/community room/indoor play area, but that’s another discussion.
    My question about the four sites mentioned is which offers the biggest financial return. It seems with the cost of land, the possible loss of existing businesses to the downtown and to the tax rolls and the cost of construction, it would take a community wide surge in alcoholism to produce enough revenue to make the moves profitable. And profits are the reason for selling alcohol rather than issuing licenses to the private sector.
    Perhaps the financial return figures are in the consultant’s report, but I’m surprised they aren’t in the newspaper stories. They are — or should be — the key factor in this decision. This is not an investment in a government service, like a new safety center, this is a business decision based on profit and loss.
    So which site is the best deal?

  3. Griff, I seem to recall that the Safety Center is in the flood plain, even the one that was re-mapped early this decade. So, it might not be possible to build a retail facility there.

    Also, that parcel suffers from not having open space around it to develop, or existing businesses that would benefit from the addition of a high traffic facility. One of the primary values of a magnet like a liquor store is to put it adjacent to other taxable properties. In theory, the value of retail land next to a liquor store should increase, generating more tax revenues to the city and school district.

    This is similar to why big box retailers prefer to build in open fields. They purchase the land around their site knowing that when they build, all land around it will become more valuable. They either sell that land to recover their building costs, or garner increased rents to achieve the same.

    From what the city’s objectives seem to be for the new muni, the Crossing site would be ideal as it would stimulate more retail business around it, quickly filling the other vacant spaces there. Whether Crossing residents want that or not is a different matter, but it would seem a good way to keep a property with high visibility from degenerating or continuing to look under developed.

    A similar argument could be made for the Q-block, but that area seems to be the Bermuda triangle of businesses, save the Q itself.

  4. I would think the irony alone would eliminate the safety center as a liquor store. And in light of Northfield recent national publicity – one would also think making the liquor store a focal point as visitors enter town would not be a good PR move.

  5. Does anyone know why all four sites are within such a small area? Is the consultant from out of town or something? The sites seem like what you’d come up with if you drove into the downtown area and left again as soon as you could. I’m surprised he didn’t suggest a site out by Cub and Target as one possibility. I don’t know if Target is making any money, but there are always plenty of people shopping there. And a couple of local banks, who you’d expect to know something about business, opened branches out there too, so perhaps they’re onto something.

  6. Ok, I have to say it… but is the council’s criteria in the best interests of the city?

    Some might classify having the liquor store downtown as a “nice to have”.

    If one would research it, they might find that building a facility in between Cub and Target would provide many of the needs, but… not bring other benefits.

    Personally, I feel that there are not that many viable sites, with room for growth and parking downtown.

    These sites are HORRIBLE…

    #1: No additional parking at 5th and Water, and next to an already stressed to capacity lot with Just Food. The increased traffic would be awesome for Just Food, but you would have issues with access for delivery vehicles. You would also be losing some of the back of this property to extend the riverwalk / bikepath. The site is not all that much bigger than the current facility. Parking is still the huge issue here.

    #2: The Crossing. undeveloped space, in a good location, but still fairly small.

    #3: The Q block. Everyone’s dream. Take out the former Maria’s / now the Mexican Grocery, and build it there. Good access, and decent parking. Stick it to another mexican business however. Seems to be the way of the city and state to displace them.

    #4: Another site that would displace 2 long time existing successful businesses. Parking is still an issue.

    My questions are these:

    1. Why do these 4 sites make it look to me that the city really wants the Q block and the Crossing, and are not really serious about the other two sites. Options 1 and 2 don’t make that much sense, and 1,2, and 4 displace existing downtown businesses. Also, if you choose 1 or 4, and relocate the Key to the old muni, you have the liquor store and the youth in closer proximity than you do now.

    2. Why is there not consideration of taking a large space in the Riverview Mall complex? Is it because the city would rather own than lease?

    I do not disagree that the city council should try to keep the liquor store downtown, but I think that looking at the full options that are available in the entire city might better benefit the city as a whole. Out behind Target, Between Target and Cub, on HWY 1 and HWY3 on the Dundas line, or by Arbys are all viable options, as well as property near the new Tires Plus in the new retail complex near Allina Clinic. Another option could perhaps be the AutoHaus location on HWY 3 and Jefferson that Kwik Trip was once considering.

    There are many options. I think that they should all be considered. The fact that we are trying to shoe-horn this into a small, tight infill in downtown is concerning, and the city council may be limiting themselves to future growth.

    Even a better idea may be to sell the rights to sell to a private enterprise, and get out of the city run liquor business completely. I still think that there are many more important things that the council should be focusing on that are listed on the capital improvement plan. The Liquor store should not be at the top of this list.

    Sorry for the rant. Just my $0.02. I look forward to the ongoing discussion.

  7. Jerry (#6): Thanks; I didn’t know if they were holding out for a downtown location this time around.

    and John (#8): I basically agree with your analysis. Of the downtown sites, only the River Park Mall really makes any sense, and that wasn’t even on the list.

  8. David K., you make some good points about the synergy needed among retail stores.
    And Scott, you bring up the same point many of us have made about the location and the overall purpose of the liquor store. I’d like to see a real comparison of how much the liquor store can make in the downtown locations and how much more or less it would make out near Cub or elsewhere along Hwy 3.
    If the goal is to raise money to promote downtown, perhaps it would make more sense to build where the profits are highest and use the money to aid downtown. At the very least, residents should know how much traffic the current store generates for downtown businesses. We also should know how much it will cost the city in lost profits each and every year to keep the store downtown. Residents should have the right to know how much of a subsidy — if any — the downtown is getting before the decision is made. I’m not saying the investment isn’t worth it, but the decision must be a transparent one.
    If downtown is the most profitable site, fine. If not, spell out the cost before we’re asked to pick up the tab.

  9. I was surprised to here that the city leases the safety center site from MNDOT that isn’t what I recalled. But I’ve been wrong before, so I checked the Rice County web site for property tax information. Parcel # 22.01.1.00.023 has the City as deed owner not MNDOT.
    But when you look at the parcel map of Ames Park the City owns a strange shaped parcel on the east side next to the river and MNDOT owns a big chunk of the west part towards the highway. Follow the right of way line down towards the safety center and it looks like we built right on the line but it still appears to be a separate parcel.
    I wonder if it might be some kind of easement thing? I’m not a lawyer, that’s the other Dave, but I suppose there could be some condition on the deed, but if there is a deed restriction I wonder if it says safety center or maybe something along the lines of municipal use?

  10. With regard to the safety center, it is a deed issue. If a municipal use is no longer desired at the site, ownership reverts back to mndot. Although our liquor store is municipally owned, I understand that that would be pushing the limits of what mndot considers an appropriate municipal use. Any change of use would need to be negotiated with mndot and it would be their decision to approve that or not.

  11. One good reason for it to be somewhere downtown is the central location. Since the muni has a monopoly it would seem that a location in the middle of town would draw the most customers. Firehouse is not far from cub/target…I don’t know if locating near the competition makes sense.

    Anyway…I agree with John T…There are better things to do with the money than building a new liquor store…

  12. Jon D. thanks for chiming in on the safety center deed issue. It sounds like the information was put out in a staff memo or something .Do you remember when that might have been so a could request a copy? Thank you.

  13. John T, you said:

    No additional parking at 5th and Water, and next to an already stressed to capacity lot with Just Food. The increased traffic would be awesome for Just Food, but you would have issues with access for delivery vehicles.

    But the way I read the property analysis, it indicates that the building the co-op leases from would be included in the Liquor store package of land, meaning they’d have to relocate:

    500 Water Street:

    500 Water Street South (PIN: 028+22.01.1.00.019)
    A 24,795 SF site zoned urban commercial. Property must be combined with adjacent parcel to South… 516 Water Street South (028+22.01.1.00.020)

    A 17,856 SF site zoned urban commercial. Property must be combined with adjacent parcel to North… Site History: Cooperative market.

    I would not be pleased if the co-op, a business that is just beginning to flourish, was forced to move.

  14. Moving Just Food for a new Liquor store?

    Yea, try that one… See how public opinion would respond to that.

    I can tell you, that more than likely the 2000 or so owner families would not be too pleased.

    I know I would not be pleased.

    I just do not understand the thinking behind this. They want to promote business to downtown by moving the liquor store, but in doing so, displace existing, established businesses.

    It makes NO sense to me.

  15. Let me clear up a number of misconceptions:

    1. The liquor store makes money. Building a bigger one will probably result in making even more money.

    2. As long as the City doesn’t try to take by eminent domain, let the landowners worry about “displacing businesses”.

    The law office building is NOT for sale now. But, at the right price, we could be convinced to change our mind.

  16. I still do not see it that way…

    Most of these folks have businesses that are barely getting by. You go in, and throw in a variable like this, one of several things happen.

    1. You lose the business, they take the money, close up, and go retire somewhere warm. This is a net loss to the city and the tax base.

    2. Many of the businesses LEASE their space. If say for instance that 516 Water was in play, the landlord would be in no obligation to find a new place for Just Food. It would be up to Just Food to find a new place. This would impact the business, and could force a business on thin margins to close, and not move. Also the cost of the move would be on the renter, who would not be compensated by the city. 500 Water is full of RENTERS, not owners. What kind of assistance is the City, the EDA, the NDDC, the Chamber, etc. going to provide them to keep them as viable businesses in town?

    Let the Landowners worry about “displacing the businesses”… sounds like “tough luck, I got paid” to me…

    I thought the goal of the city was to draw folks downtown, not make money.

    If the goal was to make money, certainly placing the LS downtown is a negative over putting it out on HWY 3. You would want to go toward the traffic for the $$.

  17. Gabriel R. (#16) is correct. I was at the City Council work session when the “SW corner of Water and 5th” site was discussed. The gentleman from Donnelly referred to this site as “500/516 Water”. The old bank on the corner (500 Water) is too small – and the council discussed this – a new building could not be built there (in all likelihood). The city could probably have the building torn down. To me that means if this site is chosen – the coop would have to move. Thankfully, Jon Denison expressed concern, and told the work session he was against having to find a new site for the coop.

  18. Ok, I went and re-read the NNews article.

    In a nuthshell, you have 4 sites, all of which are not perfect.

    One of the most ideal sites does not want to be sold by the owner, regardless of circumstances.

    The second site has land dispute issues that are still unresolved by MNDOT, and is a high cost “signature” corner, which may not be the best location.

    The other two locations are not ideal, are small, lack parking, and will displace businesses that are leased. One of the two other sites is not currently available.

    It looks to me that the consultant did his job and brought back exactly what the council wanted to hear. 4 locations downtown.

    Again, I ask the council. Are you sure this action is in the best interests of the city?

    We have a council that is up for election, a city administrator that is leaving, and possibly a leadership change in the council itself.

    I ask, what is the urgency of getting this done. The only thing I see is the OSHA violations, but either way, those need to be addressed short-term. Even if we build a new store, the City needs to mitigate the non-compliance.

    I am not necessarily for or against the liquor store being downtown. I just think that the city needs to look around a bit more and see what is available.

    Does it really take a consultant to look out our windows and see what is available and what might work?

    I also ask the council to speak and listen to its constituents. Do they really want a new Liquor store? Especially when there seems to be more important things to address such as public safety issues with new fire equipment, etc. etc.

    I think the current council should send this back to staff, do a city wide analysis, take a deep breath, and continue to discuss this after the election.

    I want to see the complete, prioritized capital improvement plan, and why this is so much more important that several other things that are on the list.

    Also, I want to see the cost / benefit analysis, and the projected schedule for how long this store is anticipated to take to pay for itself. I also want to know how much it is going to cost the taxpayers of this city. Tell me please, is this all going to be paid out of existing store revenue, with zero impact to the taxpayer?

    Tell me more. I understand that determining a viable site is the first step, but I don’t think we have found it in this round of searching.

    Time to keep looking.

  19. The first thing Northfield needs is a consensus that the city SHOULD NOT be in the retail liquor business. Do we have a municipal gas station? Or a municipal grocery store? A private business, skilled in retail, can always run a business better than government! And can also be more competitively priced. Government is charged with providing fire and safety, utilities and infrastructure, libraries and public administration and tax collection, streets and roads, schools and parks – NOT RETAIL.

    As each day goes by, with more and more studies initiated, our liquor store “profits” are being eroded to pay for them. With talk of a new building, no matter where it might be located, the costs will continue to erode the liquor revenues.

    Liquor stores in Savage and other suburbs are being run out of separate-entrance buildings managed by the grocery store retailers. But, until Northfield approves private retailers to sell our liquor, John Thomas is correct in demanding that the city provide a solid cost/benefit analysis to all of the city’s taxpayers.

    I will vote for the first mayoral candidate who can show knowledge and leadership toward a more fiscally conservative city budget and structure.

  20. As I recall, the bottom line is that the liquor store clears about two hundred thou a year. If we are talking about borrowing millions to build a new store, how many years will it take to recoup our investment. I’m not convinced that a bigger store will neccessarily mean much greater profits. Then there is the question of whether the city should be promoting the use of one drug ( yes, alcohol is a drug) even as it condemns the use of others.

    Northfield has a number of expensive projects being planned besides the new liquor store- the new/remodeling of the library, the remodeling of city hall, a new safety center, and a possible new ice arena come to mind; and this a t a time when the city has lost millions in some investment scheme gone bad. Do we need to do all these projects? I mean, sure, they sound fun, but can the city really afford them? Can I afford paying the inevitable taxes these projects would consume? Can you? What’s the hurry on all this development? I would be interested in a candidate who at least takes the time to ask a few of these questions.

  21. While I cannot provide the date the status of the Safety Center site was discussed recently, it was the mayor’s remark that first brought this situation to the Council’s attention. As I do recall, in what are usually ambiguous discussions, the work session environment didn’t allow for much more clarification on the site’s status Suffice to say, it was the mayor’s sense that the site was owned by MNDOT and was not easily available for relocating the Liquor store. He offered this in a liquor store discussion. Whether he asked for, or received conformation, I cannot say. Indeed I’m not even certain that Kathleen McBride (Financial Director) was present at that meeting. Certainly I don’t recall any further comment at that time.

    I do feel that it was never brought back as an information item, so I’m pleased to see that Mac is in there now with the facts.

    Coincidentally, in the past few weeks, as some discussion for this site as a new location for the liquor store, heated up … the mayor again mentioned this probability to me.

    Now, in light of this revelation from Mac, and … the cost of Safety Centers and liquor stores ,,, and in light of our fireman not getting all over heated over the need for a new Safety Center … it seems these are good reasons to put these outgoing city administrator driven plans on a back burner.

    But, since they (the plans) might have legs, it would be good to hear from all the candidates now, what their position is on these massive expansion projects they might inherit from the outgoing council … what dollar limits they’d impose and how they’d prioritize any plans they are in favor of.

  22. As an employee, I was not allowed to “speak” of the liquor store.
    Now that I am not an employee, the best thing to do is this.
    Let the liquor store go to the Crossings. Create a City parking Lot there, and people could walk downtown, get a sandwich, or shop and not disrupt what little parking there is Downtown.
    Maybe even tear down the old liquor store and add some parking there too. or let one of the neighboring businesses grow.
    A municipal liquor store that makes money, is a smart move for the City. It provides control and a money maker in this economy is a smart move.

  23. On Highway Three you will also draw out of towners into the community and take their money.
    You definately want the exposure…It’s a Liquor Store folks.

  24. Griff: Since you were originally expecting to be an owner at the Crossing, and then decided to opt out for reasons you have discussed on LG, how would you have felt about having the liquor store there, if you were a resident?

    I can see how the uncertainty of what will ultimately be developed there, mostly in the second residential building, would be of great concern to potential owners.

    Does the retail development for the corner hold as many concerns?
    Would it be good or bad, in your opinion to have the liquor store there?
    Would it be better to get something going there, so the empty space doesn’t look as derelict as it does now?

    Of course, there is still the question of why we need a new liquor store at all, when there seem to be more pressing concerns…

  25. Is it possible that our taxes our being used up just trying to decide where this city owned business might be located and then who will build it and who will
    do this and that and the other thing. I think it is fast becoming a loosing proposition. Isn’t there another way a city can raise funds?

    Americans spent $250,000 this weekend at the movies. Couldn’t Northfield get out of the liquor business and put up a movie house and make money that way???

  26. Charlene, thanks for speaking out! A parking structure seems an excellent addition to help feed traffic (foot and auto) into downtown.

    Much of the land where the Crossing sits used to be considered flood plain. It was remapped to be mostly out of the flood plain earlier this decade. However, I think that you can still only have flood plain uses on the lower parts near the river. So, maybe a city parking garage there would make sense, especially if you put first level retail on the West side of a parking structure, which is slightly higher than the East side of the structure.

    There is an excellent example of how retail can be built into a parking structure in St. Paul across the street from Cafe Latte. You might not notice the parking structure if you drive by on the main street as it is occupied by retail, but it serves the local business community quite well.

    By putting the liquor store at the Crossing, and a parking structure, the City will generate more retail tenants on the property, which will help to support the TIF bond funding and will naturally help to support the further development of the riverwalk northwards.

    While the City doesn’t technically have any financial risk to this particualy TIF bond, future TIF sales will be hampered if any investors lose on a TIF bond in Northfield. So, there are downstream costs to seeing this TIF fail and reasons for the City to take actions to support the property.

    Charlene, are any TIF proceeds remaining that could be used to fund the parking structure? Would that be allowed given that it would be a tax-exempt structure (except for the retail part)?

  27. I have to admit, the Crossing sounds like a pretty good place for a liquor store and public parking (a parking lot, anyway). There’s enough land there that careful landscaping could make it a pleasant riverside entrance to downtown.

  28. Tom Kotula, the 2008 Northfield budget for the Liquor Fund plans revenues at $2,476,500 with expenses at $2,518,430 for a net loss of $41,930. The city plans an annual $125,000 of transfer funds out of the liquor fund – which could be considered a liquor profit.

    The other Northfield Enterprise Funds, Water, Wastewater, Garbage and Stormwater all make more money than their costs. This is all listed in the City Council approved 2008 budget on pages 195 – 198.

    I think the city has dreams of making a net profit over and above the $125K. In 04 and 05 the city showed a net loss. In 06 we saw a $55,542 profit over the $125K and $13,120 in 07.

    The net realization is that it will take a lot of years for a liquor fund to pay back a $3 million expense for a new liquor store.

  29. The “unique” way the TIF was done as it relates to the Crossings Project, is beyond my ” belief” and twenty year career history in the field.
    Normally they have an eight year commitment and eventually make money, not break even nor place the owner in a poor financial position. The majority of the work was done by Brian and Ehlers, so I am sure the questions raised could be answered by them.

    Another crucial part to the Crossings Development involve Mindot releasing/selling the land. This is another brick wall that needs to come down.

  30. Following up on Tom Kotula’s and Larry DeBoer’s comments: The Muni has always struck me as an odd public entity. The public sector typically provides services that the private sector can’t/won’t provide for all members of society. On the municipal level, this includes fire and police protection, physical infrastructure, education for all students regardless of ability to pay, etc. Selling beer, wine and booze doesn’t fit very neatly conceptually with these other services, to say the least.

    I realize there are historical reasons why Northfield and many other municipalities operate liquor stores, but the ostensible reason (greater profits/revenues for the city) for relocating the Muni baffles me. The amount of money and city council time and energy spent, and public turmoil generated over the YEARS that this has now been debated, analyzed, consultantified, and litigated, seems CRAZY.

    Why not cut our civic losses on this issue by identifying a desired site (such as the Crossing, where a liquor store could be coupled with a parking facility, as suggested by others), inviting bids from interested private parties, turning the liquor-selling business over to the private sector, start collecting property taxes from a new profitable business, and get on with the pressing issues that face the community?

  31. The fire station should be seriously considered for the Muni site. The council has not investigated it. Otherwise, the cost of land acquisition and construction will eat up any profits for the foreseeable future. Even if MNDOT recorded restrictions (other than easements) on the property, the restrictions have likely expired under M.S. 541.023 subd. 1, which requires actions affecting title or possession to be commenced within 40 years of the date of the instrument creating the interest.

    The expanded parking for the Muni could be built at the rear in the flood plain, which is also where the product would be delivered. A freight elevator, which would cost about $150,000, would have to be installed to bring the product from the basement to the street level. A new front would improve the energy efficiency of the building. In short, the cost of renovating the fire station is far less, probably around 10%, of the cost of acquiring land and building a new structure. And it does not take commercial property off of the tax rolls.

    I believe that a new police and fire station should be our top municipal construction priority. Public safety should not be relegated to a “wish list.”

  32. David H., I was wondering what it is that makes the present Safety station so unsafe in it’s present location. I missed that somewhere along the line.

    Thanks in advance.

  33. No one seems to be asking the question, “How is the consumer better served by having a municipal vs. private liquor store?”

    I’ve not seen a recent pricing study, and I’m sure the “Muni” management strives to be competitive, but it seems to me that there are less expensive alternatives. Anecdotal evidence from discussions with friends and acquaintances suggests that a significant percentage of liquor purchase dollars are spent out of town. Will a new, improved retail operation recapture some of those dollars? Perhaps, but to what extent?

    What happens if the state legislature decides to allow supermarkets to sell wine? My understanding is that supermarkets in municiple liquor cities may not be allowed to participate in wine sales. (I would like to hear a more definitive comment on this.) How would that serve the Northfield consumer from either a convenience or competitive pricing standpoint?

    How can a taxpayer owned retail establishment justify offering special pricing to some of its citizens, e.g. the senior discount? Do we have senior sewer days?

    Finally, regarding location, if a private liquor operation such as Haskell’s or MGM were allowed to locate in Northfield, how many of the four “preferred” locations being discussed would fit in a top ten list compiled by either of these retailers?

    It seems odd that after years and years of study and discussion, we still seem ill-prepared to move forward on this issue. Perhaps the logical decision is for the city to get out of the liquor business.

  34. I like the idea of a Liquor Store / retail front / parking structure idea, with the caveat that we make some sort of allowances for Transit.

    Park & Ride spaces need to be added, as well as the ability for the college students to catch shuttles to the airport, and residents to catch pools or a bus to the cities. Northfield transit can also use this as a dispatch office with a bus transfer hub.

    All of these would generate a huge amount of traffic, that any retailer would love.

  35. The comments about cost/benefit are all spot-on. Rick’s point about how the consumer is best-served also hits the mark.

    It seems, then, that the question is whether the combination of annual license fees and new property taxes (assuming a new private store opens) would provide a greater risk-adjusted return to the city.

    The City’s financial risks obviously drop without the infrastructure (physical and human) needed to run a Muni. Does the argument still hold that the social risk is increased by allowing more liberal sales of off-site liquor?

    Maybe a private entity would find the Crossing attractive if they knew that a very limited number of licenses to sell off-site would be available. Does anyone have a sense for what a city Northfield’s size could charge for an off-site liquor license?

    Jon Denison and Scott Davis, are you guys out there to answer our questions on this?

  36. David K: I remember you being a solid advocate for cost benefit analyses of projects when you were on the council; that was very sound, but that idea has not”caught on” yet. Most of us, even in our private finances , at least do a cost-benefit in our heads, if not actually.

    Here’s the question: Why can’t we see a true and complete cost benefit study of the liquor store redevelopment? including land purchase for a new site, demolition if needed, construction of new facility, debt service, additional staff (what am I leaving out David?) AND all that set against projections for additional income to offset those new costs, as well as loss to the general fund while the debt is being serviced?

    The consultant did begin to get at SOME of that, as his comparison charts on the four properties the council was looking at did include some demo costs.

    But it would be great to hear from councilors who have spoken here, on why they do not feel more specific fiscal analysis is needed. In council discussion, it seems to be just accepted that projected increased sales will cover all costs, as well as possible loss of revenue to the general fund.

  37. As far as city fees for private wine, beer and liquor licenses go, the town of Minnestrista in Hennepin County in 2007 charged $30 for off-sale beer, $100 plus $3,000 bond/insurance for off-sale liquor and a wine license was $3,000.

  38. When you do that cost benefit analysis, keep in mind that the price of corn doubled last month, and doing a search of ‘corn liquor’ reveals that whiskey and scotch have a corn base. I wonder how many people will choose the cheaper brands with dwindling expendable cash reserves.

  39. Larry, sorry to have missed your post before…thanks for digging up that information on fees. It seems that licenses alone will not fill the gap left from the $100K to $150K that the City gets from the store. But, I do tend to agree with you that we are past a point in time when a City can either control alcohol consumption more effectively or manage a store better than a private entity (although I do like the people at our Muni very much).

    Should we be looking at something similar to the cable franchise fee for someone to operate a new liquor store? Perhaps the franchise could be licensed for a 3-year or 5-year term at a % of gross sales, with a floor of $130,000 per annum.

    Like the cable franchise fee, this could be used to support programs that benefit the community. Consider using the fee to support debt payments on a new ice arena, for example, or to endow a fund to support anti-drug programs.

    $130,000 per year would fund a little over $1.6 million in debt issuance to support some capital investment, assuming that we could issue the debt at 5% interest, paid over 20 years.

    It’s hard for me, as a taxpayer, to argue for the City to make the capital investment in a new building for a liquor store when we have other capital investment priorities in front of us.

  40. Why are we expecting Northfield residents to use this store instead of the one down the road?

    Are we building this store so that someone else wont put up a trashy-looking one somewhere else in town?

    Does the city think that if they suggest 4 sites, we are automatically going to pick from those 4, and not look any further.

    The profit is basically non-existant, why are we doing this again? Are we just moving money around for the fun of it? I think this idea needs to be thought through until it makes financial sense.

    If a private business showed up tomorrow and purchased a good site, would the city fight them? The city seems so emotionally invested in this project.

  41. I don’t think Northfield should be selling liquor.

    Like others have commented, there is hardly a consensus that Northfield should be involved in selling liquor. Without a consensus, we are spending a great deal of time on a seemingly non-urgent issue.

    Like others have commented, it is a retail function that is an unusual involvement for cities. It’s even more unusual for cities simultaneously selling alcohol and funding police programs to reduce alcohol-related problems.

    Displacing other businesses, directly or indirectly, will have a chilling effect on businesses wanting to come to Northfield. What effect will that have on revenue? Displacing businesses should be a last resort, not an act of convenience.

    If Northfield wants the revenue, moving the liquor business to the private sector can provide us with revenue and wash our hands of being involved in the liquor business. Let the private companies sell what they’re legally entitled to sell, let them find their own building and meet our zoning requirements, and let’s not invest city time and money in the retail business.

Leave a Reply