Gleason offering land for liquor store to city for $1

(Update log 12/2 11:30 a.m.) One Northfield resident is concerned the City Council could dismiss a good opportunity for a new liquor store location because it would lie beyond the area specified in September’s request for proposals.

Virginia Gleason of Oak Street proposed to sell the city a nearly 50,000-square-foot vacant lot across from Target on State Highway 3 for just $1. Her son, James Gleason, also of Oak Street, helped his mother with the proposal and he said he wants the general public to know about the offer.

“Our family has been in Northfield forever and we made the offer because we’d just really like to get ‘er done,” James Gleason said on Monday.

The site, which has been for sale for about six years, does not appear to fulfill at least one of the minimum requirements set by the City Council and members of the city’s staff in September.

That requirement is that the property lie “in an area which is currently or proposed to be zoned C-1 or C-2 in the City of Northfield zoning code or located in a area zoned C3 within one quarter mile of an area zoned C-1 or C-2.” The property is zoned as C-3, which is a “gateway commercial district” and is nearly a mile* from the nearest C-2 district, which is the “downtown fringe district.” C-1 is the “downtown district.” (*I checked the zoning maps online again and it appears the site would actually be a little more than a mile from a C-2 district).

James Gleason said he learned by reading a Representative Journalism story online that officials began to consider five proposals via a scoring process two weeks ago and his was not among them. Gleason said city officials had yet to tell him whether his proposal had been rejected or to return his $1,000 “good faith” deposit.

Brian O’Connell, Northfield’s Community Development Director, said the City Council would still review Gleason’s proposal and that the proposal was still one of seven listed on a scoresheet that the council and staff designed to collect input from four knowledgeable groups of people.

The members of one of the groups, however, said on Monday that they scored only five proposals two weeks ago. Steve Engler and Victor Summa said Gleason’s proposal and another submitted by A.K. Kayoum were not on the list because staff members took them off. Engler and Summa represented the Economic Development Authority’s Infill Committee. Joel Walinski, interim city administrator, said he could not comment about how many proposals were on the scoresheets that Engler and Summa completed.

Gleason said he would not want to ask the City Council to make any decision that would result in a detriment to the city’s downtown. He said he believed building a new liquor store on the site his family proposed could be the most lucrative for the city.

Councilor Scott Davis, who represents the City Council at Economic Development Authority meetings along with Councilor James Pokorney, did not return a phone call or email message about the matter by Tuesday morning.

Update 12/2 11:30 a.m.: Griff Wigley uploaded a clearer version of the property map in the first comment below this story.

The images below show the five sites the Economic Development Authority’s Infill Committee rated two weeks ago. The first shows a lot on Water Street with two buildings, the second shows a lot on the “Q-Block” and a lot on the property across the street from the “Q-Block” where The Crossing residential building lies, the third building is on Division Street, the final photo shows a residential lot on the southern end of Water Street (Note 12/2 12 p.m.: the final photo is of a residence built in a Downtown Fringe district).


  1. Griff Wigley said:

    Here’s another version of the site plan/map. I’ve put an an arrow on it, pointing to the property in the proposal, and I’ve labeled the lot on which the Arby’s restaurant currently sits.

    December 2, 2008
  2. Holly Cairns said:

    I wouldn’t like to see the liquor store replace that ancient Northfield hospital building.

    The hosptial can be seen in your photo of the “residential lot on the southern end of Water Street” (in yellow). I believe that is zoned commercial instead of residential, by the way.

    The old hospital is owned by racquetball player Darryl if you want to discuss it with him, BTW, if I am not mistaken.

    December 2, 2008
  3. Hello Holly,

    Thanks! I should have said the lot has a residence on it, not that it was a residential lot.

    December 2, 2008
  4. Tracy Davis said:


    Thanks for the info on this process. I think the Council was right to come up with the criteria they did, and the Gleason location simply doesn’t fit. (Too difficult to get to by any means other than car; too close to Firehouse Liquors in Dundas; removing a healthy draw from downtown…)

    However, it seems to me that being able to purchase the land for $1 might put that proposal back on the table for consideration, simply to see how the financial projections might be altered by the store’s having a lower mortgage payment. Of course that depends on what is built on the land; $1 land doesn’t necessarily mean that their overhead will ultimately be less than another location.

    I don’t really see anything “wrong” with what’s been described, other than as it illustrates the frustrating lack of transparency and communication with which City Hall continues to operate. I would have hoped that on this stupid issue, given the all the history and bad blood, the Council would have had the good sense not to try to rush the process.

    December 2, 2008
  5. kiffi summa said:

    The contradictory facts in this report need to be resolved ASAP.
    I have every reason to believe that ms. Obremski has reported this accurately.
    The statement by Brian O’Connell, the city’s Comm.Dev. Director, in paragraph seven of this report are in direct conflict with other testimony of persons who participated in the scoring, and also a possibly evasive (politic?) comment by interim administrator Joel Walinski.
    This is precisely the kind of “action” that has caused accusations of staff overstepping their bounds. Mr. Walinski has been put in a very uncomfortable position by Mr. O’Connell’s statement.
    The council never wants to ask the hard questions of staff; here they must… the council are “parents”, no matter how much they want to be “friends”.
    This entire issue should be dropped until the new council is seated, and I hope they have the stomach for it.

    December 2, 2008
  6. Griff Wigley said:

    Tracy, I think the global financial meltdown/recession makes it even more important that the Council (current and new) take a hard look at those criteria in light of this proposal.

    December 2, 2008
  7. Curt Benson said:

    Bonnie, who owns the property adjacent to Gleason’s proposed site? Are there any plans pending for the adjacent properties?

    Kiffi is right, hold off until the new council is seated.

    December 2, 2008
  8. Griff Wigley said:

    Curt, of those 3 lots that make up Gleason’s “Bridgewater Commons,” there are plans for a KFC in the north lot. The fine print on the map indicates this. I don’t know if the center lot has been sold or not.

    December 2, 2008
  9. Holly Cairns said:

    Ah, good, Northfield will again be a KFC town. I mean, is that good? KFC didn’t make it here, before.

    What’s going to make it way out there? That’s probably a Gleason concern? There’s traffic to the a liquor store…

    what’s Bridgewater Commons? I hope that is high density and inexpensive.

    December 2, 2008
  10. Holly Cairns said:

    Well thanks for checking on that Bonnie. I guess it’s residential, then. Or commercial. 🙂

    December 2, 2008
  11. Please survey the Northfield Municipal Liquor Store staff and publish the results here.

    December 2, 2008
  12. Leonard Witt said:

    Why would anyone want to sell a property for $1?

    “Our family has been in Northfield forever and we made the offer because we’d just really like to get ‘er done,” James Gleason said on Monday.

    I am not sure what that means? Is it for the public good, or is there a profit motive for the Gleasons and if so what is it?

    December 2, 2008
  13. Bart,

    Thanks for the suggestion, what questions were you thinking I should survey them with?

    December 2, 2008
  14. kiffi summa said:

    Mr. Witt: First I need to comment on what a ‘show of faith’ it is for Mr. Gleason to have delivered this story to Bonnie. She is the only news source doing in-depth journalism in Northfield at this time; this story coming to her, from the developer, is a recognition of the quality of the work she has done.

    Secondly, in this small town, long time families like the Gleasons do often do good works just for the public good. I’m not sure how facilitating a municipal liquor store would fit that definition…
    But,I happen to think the municipal liquor store is a good fit for Northfield; the additional revenue for the General Fund has been welcome, and would be hard to find elsewhere in the budget in these economic times.

    The location of this property is a difficult one to develop because of the problems with access from the highway. MNDOT is wary of competing accesses and the traffic hazards they pose. Since this property is very close to the Target entrance, and the area is newly congested with traffic going in many directions, and also close to a major county road intersection, there may be some MNDOT concerns about more entries and exits there.

    Rather inexplicably, there have been some actions (expunging existing easements, and establishing new easements [although those not yet platted, which caused concern with Councilor Nelson]) taken at the council level, as recently as last Monday, which in the words of the Community Development Director were an effort to be ‘customer friendly’.

    One has to wonder at the return of this proposal to the group which will be presented to the council, after having been pulled from the group rated last week by some EDA members and some Staff. There is yet no explanation for that.

    At the bottom line, I can imagine a long term NF family giving the land, in order to facilitate the further development of the rest of the parcel; would that not be a pragmatic choice?

    December 3, 2008
  15. What about a location survey or poll of existing Northfield Liquor Store customers. Customer service and satisfaction trumps short-term fiscal advantages.

    December 3, 2008
  16. Anne Bretts said:

    Bart, great idea. It would be wonderful to have a quick survey featuring the proposed locations (with photos) and asking customers which is most attractive to them. This is the kind of research that would seem obvious to most businesses.
    It also would be interesting here to have participants evaluate the locations and briefly give their ideas on which would work best and why. Obviously, we don’t have the cost component, but we could evaluate traffic, size, convenience, etc.

    December 3, 2008
  17. John S. Thomas said:

    Say what you will, but I strongly feel that those that want to buy liquor will go to wherever it is sold, regardless of location.

    Now, whether that location is downtown, or 3 miles from downtown is irrelevant.

    If you have only two locations within say, a 10 mile radius… they are both going to get used.

    Honestly, in the times that I have been in and around the liquor store, I have not witnessed a lot of walk up traffic. I have not seen students hauling a case or two back to Carleton.

    I have however seen folks using a cab, or coming in groups in a vehicle. I have only seen a cyclist once.

    These folks also came downtown for one specific purpose… to purchase booze at the local booze-mart.

    Now, it can also be said that folks would like to have close proximity to their beer and wine… but let me ask you… If it was downtown, or out on Highway 3, your still going to go and get your beer or wine, if you really want it right?

    Has someone done a market analysis, and proven that the liquor store has a positive impact to other businesses downtown?

    Were those folks going to the grocery store anyway?

    Were they headed downtown for a 6 pack and a shirt from Ragstock? or a bottle of wine and a book?

    In order for a business to have an impact on another business, you have to have a corollary, or a complementary product. For instance, a bottle of wine and a oil change do not go together… but wine and cheese do.

    But, was the customer ALREADY going to come out of their home to buy a bottle of wine, and a chunk of cheese? Did the cheese spark an impulse urge to go to the liquor store, or did the wine spark an impulse to get some cheese… maybe or maybe not. But if they are both desired… the customer will locate and purchase them.

    Customers also have their favorite places to shop. They will go out of their way to patronize them. So if they get wine on Highway 3, they will probably still come to the place downtown they enjoy that has the best cheese selection in town.

    Call me naive, I still think that Northfield is small enough that it just doesn’t matter where the liquor store is. Anything in Northfield is 5 minutes from anything else.

    I think that this and all other sites should be analyzed on a simple cost/benefit analysis and sound accounting principles, a decision made, and implement the choice…

    I still think personally that the city should not be in the liquor business, but if the majority (by referendum) state that they want a new liquor store… then so be it.

    A site (or two) should be picked, then the decision to spend the money should be up to the voters.

    I think there is an opportunity here, and all avenues should be considered, in the best interests of the city and its residents.

    Even though we elect persons to represent us and our interests on the council, sometimes the big decisions need to be placed back into the hand of the voters.

    On this one, in these tough economic times, we also have to evaluate if this is a WANT or a NEED for our city.

    And, if it comes to pass that we need to build it, I think that it should be financed in such a way that it has zero impact to the taxpayers, and is paid for by operating profits coming directly from sales activity from the store itself.

    Just my $0.02. One mans opinion…

    December 3, 2008
  18. kiffi summa said:

    How could the city staff suggest going back to the Gleason site, which was pulled from the first group of seven (as announced on the NFNews website on 11.18) because it did not fit the location criteria set by the council, without creating an unfavorable situation for other property owners in the south Hwy 3 area who did NOT apply, knowing their property did not meet the council’s location criteria?

    I believe the Jasnoch family owns property in that area, and they must have not applied, having read the council’s initial four basic criteria, which included a requirement of the C1/C2 zoning districts.

    Would this $1 offer trump the council’s stated criteria?

    Would the re-inclusion of this site mean that applications would have to be opened up to all Hwy 3 property owners outside the C1/C2 zoning?

    Then is North Hwy 3 a better location so that it is not competing with Firehouse Liquors in Dundas, on Hwy 3, just south of County road#1 ?

    Are we starting over for the gazillionth time ?

    December 4, 2008
  19. Philip Spensley said:

    Surely whether Gleason’s offered the land for $1 as a benificent gesture to the community or whether there is a hidden profit motive behind it is beside the point. It was out of line.

    As I see it, the issues are:

    1) do we abide by the Comp Plan which seeks to place development in infill areas wherever possible, first (and the City ought to be the first to adhere to its own comp plan);

    2) do we abide by decisions already made (ie we mean what we say and say what we mean) or do we remake decisions (at what cost?) when we are enticed by saving a quick buck (at what unknown long-term cost?);

    3) do we thoughtfully plan (that takes time) or react from moment to moment.

    Gleason’s offer, while it seems enticing (without further understanding of the implications), should not be entertained. Might it not be termed presumptuous? The offered location does not fit the published criteria for the project. How therefore can it be entertained? Does it not assumes that money talks loudest? I hope we are not going to give in to that sort of enticement in place of considered reasoning. The project, as advertized, was based on a lot of thought (I admit I do assume that). We need to hold to principles, especially when planning for the long term.

    If the City responds to this money-dangle, who next will dangle a (yet another?) carrot at the City and attempt to bypass the will of the citizens as expressed in the Comp Plan (time and effort and money was involved in that process), or attempt to overthrow the principles of the Council (this time because these are hard economic times — and there will always be a reason)? The Liquor Store will be in place long after we have recovered from this difficult economy. The busy vibrant downtown is to everyone’s benefit. The Liquor Store adds to that vibrancy. It should not be removed for a quick buck. Cost needs to be a factor, yes, but not the only factor, or even the primary one, necessarily.

    And Kiffi is right that for the Gleason’s offer to be considered, the whole process (legally and ethically) would have to be opened up and started again so others outside the originally designated area can compete equally. To do that would be a waste of yet more time and energy and cost more money. And once those guidelines were posted, who might come out of the woodwork with another bigger enticement to start it all again?

    And no, I would not want to have to drive all the way out there…I rarely do…I like to walk the downtown and yes, ride my bike, and yes, reduce my carbon footprint. What would be the incentive to not shop at Firehouse Liquor if one was that far out and they had cheaper deals? Principle? If principle is important, the City should stand by its own.

    December 4, 2008
  20. David Ludescher said:

    What is wrong with building it where it will have the best return on the investment?

    December 4, 2008
  21. Tracy Davis said:

    David, if you and the Chamber can encourage the city (and offer some business expertise) to use best practices to create thorough, as-accurate-as-possible ROI matrices for each proposed location, along with a critical look at projected revenues for each scenario, the citizens of this town would be very appreciative.

    December 5, 2008
  22. David Ludescher said:

    Tracy: I think the Chamber would be willing to do that if someone in a position of authority requested some assistance. I probably couldn’t be involved because our office may still be in the consideration.

    December 5, 2008
  23. Jerry Bilek said:

    there is an underlying assumption by many that downtown is a sympathy location rather than a good business or economic decision. All of the discussions about downtown assume that downtown is neat but not as competitive as highway 3. As if hwy. 3 is magical, cheaper, paved with gold.

    1. DT is a central location, making it the most convenient for the most residents.
    2. The Q block is on hwy 3
    3. the Crossing is on hwy 3

    personally, I think the Phoenix building looks attractive as it is an existing structure, but I believe the end decision should be which location has the best long term return on investment.

    December 5, 2008
  24. David Ludescher said:

    Jerry: The downtown location will be seen as a sympathy location so long as other properties, such as Gleason’s are automatically excluded. Let the downtown compete with the other locations; we might just discover that the downtown is not a sympathy location.

    December 5, 2008
  25. Griff Wigley said:

    Former Mayoral Candidate David Hvistendahl argued that the Safety Center should be considered as the site for the liquor store after the new Safety Ctr is built:

    I know that the City leases that site from MNDOT:

    but I assume it could be part of the negotiation with MNDOT if the new Safety Center is built on the MNDOT property at Woodley and Hwy 3.

    My point: if a new Safety Center is deemed the #1 Capital Improvement Plan (CIP) priority, shouldn’t the City wait to decide about a liquor store relocation until after that’s resolved?

    December 5, 2008
  26. Hey folks! I have been at a conference at the University of Missouri this week trying to spread the word about Representative Journalism and brainstorm about where to go from here with the project. I hope to get back to the hometown news very soon. Thanks for everyone’s continuing input on this story!

    More about the conference, which is centered in part around finding a way to financially support journalism in the future:

    December 5, 2008
  27. Kiffi- I appreciate your encouragement. Just to be clear, Mr. Gleason asked Griff to post something about the proposal on LocallyGrown. But, Griff recommended that Mr. Gleason speak with me so it could be a Representative Journalism story.

    December 5, 2008
  28. Jerry Bilek said:

    I agree. I just think we need to get beyond the belief that DT will always be less competitive.

    December 5, 2008
  29. Anne Bretts said:

    Griff, I think I heard MnDOT has concerns about putting a liquor store in the safety center building due to the traffic it would generate so close to the busy intersection.
    Of course, there’s so much information out there that it’s hard to keep it all straight. And so maybe it’s time to do a civic version of decluttering and clean up this mess.
    It would seem that the council and staff should invite the newly elected officials, the Chamber, the NDDC and everyone who is interested in the liquor store to a morning (maybe Friday or Saturday) meeting where everyone can go through all the existing studies, go over the properties on the map, ask every darned question one more time and just talk through the decision in a workshop session.
    Morning is good because people come into the meeting fresh (I have rarely seen a good civic decision made after 10 p.m.). Saturday would be good because people want to get out and get on with the weekend, but there’s enough flexibility that you don’t have to feel rushed. Friday also would be a good option.
    Sure, none of the many liquor store studies was perfect, but there are enough that some common threads can be seen. Sure, people have prejudices about one site or another, but talking it through should eventually let a site rise to the top.
    Yes, it would be exhausting, but wouldn’t it be great to have a resolution to this, whether that resolution is renovation or a new building. The only rule should be that there’s no dredging up past battles.
    If everyone comes to the meeting with a real goal of finding a solution, we could have the matter settled and let the new and existing councilors show a united front and then let the new mayor start fresh on all the huge and pressing budget, economic development and other issues that have been buried by this godawful mess. If it is clear that the public and the new council are opposed to the conclusion of the current council and staff, there would be reason for the current council to step aside and table a decison until January. But to throw away all their hard work, research and consideration and start over is a waste of time when there are so many other pressing issues in town.
    I sense that there is a chance here for a real example of local peace and good will.
    It has taken just a few months to turn the theater into a restaurant. A group of dedicated people have beaten the curse of their location and created a successful new market on the Q Block. The local veterinary practice is completing a huge new business expansion. And St. Olaf has built a $65 million science building.
    All I’m saying is that it shouldn’t take years to make a simple retail business decision about the liquor store. It’s time to let go of the drama, get down to business and then celebrate with a holiday toast.

    December 5, 2008
  30. David Ludescher said:

    Griff: The Safety Center and the liquor store are completely different. One will cost money; the other will make money.

    With tight budgets, it may be that we can’t afford a new safety center unless we build a new liquor store.

    December 5, 2008
  31. Patrick Enders said:

    In the short term, a liquor store will cost money. It will take years for a new liquor store to pay back the cost of construction.

    December 6, 2008
  32. Griff Wigley said:

    David L, yes, I know they’re completely different. But our ability to make money on the liquor store in the near term is partly dictated by the size of the revenue bond we use to build it.

    If we don’t need to buy property for the liquor store, that’ll significantly reduce the size of the revenue bond needed.

    If we don’t need to build a whole new building for the liquor store, that’ll significantly reduce the size of the revenue bond needed.

    So our pitch to MNDOT could be “we’ll take the Woodley and Hwy 3 property along with the Safety Center property and give you a chunk of city land near the City Maintenance Facility on Riverview Drive”.

    December 6, 2008
  33. Griff Wigley said:

    A St. Olaf staffer told me that (many? some?) college students regularly take the Nfld Transit to Firehouse Liquors on Hwy 3 in Dundas once a week to make their alcohol purchases because Firehouse is cheaper than the Muni.

    Why is Firehouse significantly cheaper?

    December 6, 2008
  34. Jerry Bilek said:

    firehouse is a little cheaper. not much. usually $.50-$1 for a 12 pack. they probably pay lower wages.

    I think the downside of the gleason site is it would more directly compete with Firehouse. do you want to go head to head with the competition when you offer higher prices. I use the muni because it is convenient. If I have to drive, I’ll go for the savings.

    The wine selection at the Muni is better than Firehouse.

    December 6, 2008
  35. John S. Thomas said:

    I would be willing to bet that their overhead is less, especially their labor cost.

    Being a city employee, versus an hourly employee with no benefits is cheaper for them?

    Just my guess.

    December 6, 2008
  36. kiffi summa said:

    David: You said “Griff: the Safety Center and the liquor store are completely different. One will cost money; the other will make money”.

    I know that you do realize that the City’s first responsibility is to the health and safety of its citizens.
    That is an oft-stated given, by both Council and Staff.
    So one would think the Safety Center would be the first priority, without question.

    BOTH of these projects will cost money.
    You seem to think that a new liquor store comes at no cost because it is an enterprise fund (creates its own revenue). If a NEW liquor store is built, at a NEW site … and the cost has been estimated at 3 mil…then all the revenues generated (profit) will first have to be used to retire that debt, and the excess profits from the liquor store that now support the city’s General Fund (120-180K) will not be available for that purpose for as many years as it takes to retire the newly created debt.

    Even if the city had ‘free’ land on which to build a newly located store, it would not be a cost-free project.

    The Finance Director, Kathleen McBride, has stated that there can be no more cuts to the city’s budget without affecting essential services to the citizens.
    Do people prefer a new liquor store or their garbage picked up, or a water bill that is greatly increased, etc. etc. ?

    There has been rhetoric about additional profits from a larger store, but there has not been an ACTUAL cost benefit analysis done .

    Given that actuality, how is it not best to do the required OSHA repairs (under 200K)(the roof is simply the city’s choice of deferred maintenance) and then when budgets are less tight, reconsider the additional value of a new liquor store, POSSIBLY on a new site, and undertake that project ONLY after a THOROUGH cost benefit analysis has been done?

    December 6, 2008
  37. kiffi summa said:

    While cleaning out my studio of excess paper yesterday, I came across this in a city council packet from last summer, while I was doing the LWV observing because Jane McW. was away.

    City Council packet, 8.04.08 Item # 15 – Liquor store site selection
    From a paragraph re: OSHA repairs: “Staff has contacted Doran Construction and have preliminary cost estimates from $90,000 -$100,000 for abating the conditions identified in the citations ”

    That should put some degree of fact to the enlarged numbers that have been floating around, relevant to work needing to be done at the liquor store.
    Much of the work costs to be done there are either deferred or ongoing maintenance.

    The city CHOSE not to do the roof after the hailstorm two years ago (which, by the way, was not good stewardship of a city facility) and I have never understood the $100 K figure they use; my DT building roof is 4000 sq.ft, and was just under $30K.
    What is the sq.ft. of the Muni roof? Over 12ksq.ft? I sincerely doubt it.
    Some other costs that have been mentioned are things like new carpet: an ongoing cost in any accounting.

    I think the really BIG ? here is: WHY is this being pushed before this council gets out, and WHO is doing the pushing?

    December 9, 2008
  38. Here is the Northfield News’ report on Monday’s City Council meeting, regarding the liquor store:
    “Council eliminates two of seven sites for liquor store
    By: SUZANNE ROOK, Senior Reporter
    Posted: Monday, December 8, 2008 8:21 pm
    Comment Email Print
    City officials have some work to do before the council settles on a site for a new liquor store.

    The council Monday night rejected two of the seven proposals for a new store site submitted by Northfield property owners and asked staffers to begin negotiations with the other five land owners.”

    December 9, 2008
  39. What does everyone in the discussion believe are the five most important questions I could find answers to regarding the liquor store?

    December 9, 2008
  40. kiffi summa said:

    Everyone interested in this discussion should read David deLong’s comment on Last night’s city council open/closed/open meeting .
    It’s attached to the “no city hall friday memo; CCmeeting tonight” thread.
    Pay close attention to the opinion he quotes from IPAD (state office, Information Policy Analysis Division) re: last year’s closed CCmeetings about the liquor store, and the need for them to be closed. The IPAD opinion says: The commissioner is not aware that such data are classified as anything but public.

    Mr. DeLong’s outrage is warranted. The sooner this entire Council/Mayor/Administrator/Liquor store
    Fiasco is recognized as such, by the public …and recognized as a complete breakdown of a public process … the better.

    December 9, 2008
  41. David Ludescher said:

    Am I the only one that finds it incredible that the criteria exclude the City from even considering getting a $912,000.00 piece of land for $1.00?

    I am generally a fan of the City Council. But, the liquor store criteria defies common sense. At the very least, the City Council should figure out how much money it is sacrificing by not building at the Gleason site, just like the hospital board did in building our new, city-owned hospital.

    In 1998, I went to a hospital board meeting where the hospital folks presented the projections for the previous west side site versus the new site (which had to be annexed). Ken Bank and his number crunchers had run all kinds of calculations. In almost every scenario, the new site came up better.

    We are throwing away $911,999.00 without even running a single calculation. Incredible.

    December 9, 2008
  42. David Henson said:

    Whoa – I thought the new hospital was bleeding red, was that in the projections ? I would say “love the one you got !” and make OSHA repairs.

    December 9, 2008
  43. John S. Thomas said:

    I feel that the old city council’s criteria, along with the old city council has flaws, and a deep breath should be taken before action is taken on this measure.

    I think the new council needs to be installed, and this whole thing be re-evaluated using basic accounting principles, a cost-benefit analysis, and criteria that is good for all of Northfield.

    Once of the criteria needs to be not doing it at all, and fixing the one we have.

    Personally, I think a new liquor store is a nice to have, and having it downtown is a nice to have as well.

    If someone can show me the analysis on how a liquor store anywhere in the city, even one on highway 3 has the maximum benefit to the city, I would be all for it.

    I would like to see the store downtown, but… are we limiting ourselves by that criteria?

    The first round of evaluation should have the property being anywhere in the city limits.

    December 9, 2008
  44. Philip Spensley said:

    Can someone explain to me, if the Liquor Store, owned by the City, is the only place in town allowed to sell alcohol retail. This is what I have always understood. Hence it’s ability to make money for the City instead of having private retailers make the money from sales. Evidently I am wrong as Cub sells beer by the 6pack, 12 pack, and maybe 24…not sure of that.

    December 10, 2008
  45. Bright Spencer said:

    Bonnie, I think that the liquor store is costing more in city time than it makes in tax breaks.
    Am I wrong?

    December 10, 2008
  46. Interesting thought Bright, but would be hard to determine. I think most people would agree that government processes take time, perhaps especially in Northfield where an above-average amount of people seem to want to contribute.

    December 10, 2008
  47. Bright Spencer said:

    Well, maybe I can come up with an even more difficult to determine question. Yes, I can…
    What else could the city be doing with it’s time and talent now besides going over and over this liquor store issue?

    December 10, 2008
  48. John S. Thomas said:


    For “hard” beer, the muni is the only choice.

    Cub, and the local gas stations all sell 3.2 % or less beer.

    I believe most beer is around 6%.

    I hope that helps.

    December 10, 2008
  49. John S. Thomas said:

    What else could the city be doing with it’s time and talent now besides going over and over this liquor store issue?

    But of course Bright, that should be:

    1. Updating the city website.

    2. Making copies of documents for the public.

    3. Working on transparency and public input.

    4. Figuring out how to be fiscally conservative, and do budget projections and analysis for the next 3 to 5 years, using a reduction in revenue model.

    5. Working on the capital improvement plan, prioritizing what is “needed” rather than “wanted” or “nice to have” and implementing it in a prudent, fiscally responsible manner.

    I sure hope we see some of that change that everyone ran on as a campaign promise. 😎

    December 10, 2008
  50. Martha Cashman said:

    As I have said on more than one occasion, if Lansing had not tried to bully the decision for the muni on his property, the decision would have been made long ago. Many, many $$$$$ would have been saved (staff, council, all of the attorney fees, police time, etc) and we could have stopped by new muni during Winter Walk and sampled a mug of mulled hard cider.

    December 10, 2008
  51. john george said:

    Martha-I personally have no need for a liquor store, either municipal or private, and I have no problem with those who desire one. But, I just couldn’t resist a comment in your last post #52 about “mulled hard cider.” Perhaps the reason the cider is hard now is because the issue has been mulled over for so long. In fact, it would seem, according to some comments, that the cider has turned to vinegar!

    December 10, 2008
  52. kiffi summa said:

    I just envision the whole ugly nonsense starting over again.
    This is a fact, a series of facts : In mid October, 2005 a site for a new liquor store was discussed at the city council. The 600 block of Division was considered ideal, in fact the building at 618 Division, the hardware store.
    From mid October , 2005 until a council meeting in February of 2007, that was the council’s identified preferred site … for 1 and 1/2 years.
    At the meeting in February of 2007, Mr. Roder told the council that the 618 site was absolutely off bounds; the city attorney said it was a conflict of interest. However, the council then identified the 600 site, and was going to leave it at that. Mr. Roder said he would prefer that they have two sites, for the sake of the comparisons/negotiations, and the Econofoods lot south of their building was selected by the council as the second site.
    Nash-Finch, the parent company of Econo foods was not interested, and the 600 Division site was left.

    You don’t have to believe me; go and look up the meetings at the Library, where the council packets are kept. You won’t be able to tell much from the minutes; when you identify the relevant meetings go to city hall and ask for the tape of the meeting so you can witness the discussion.

    What happened to change 1 and 1/2 years of council designation, and 1 and 1/2 years of the city attorney NOT alerting the council to the conflict of interest?

    The answer is : nothing factual, to either the council’s designation or the conflict. The conflict was always there, and not just for the Mayor , but for any property belonging to a “blood relative” … that’s what the city code says … read it yourself.

    Everyone knew the Mayor had owned the hardware store; everyone knew the Mayor’s son owned the 600 site. Certainly all the involved parties, council, etc.

    But when the personalities, and the lawsuits, started flying around, and sides had been chosen, all of a sudden everyone REMEMBERED!

    Except the council … they would like you to believe they were always horrified at the thought of either of the 600 block properties. Of course… THEY would never endorse a ‘conflict of interest’ ! What is the classic way to shift the focus? Become the prosecution … Attack.
    There was no way out of the mess they created , someone must be at fault… who? couldn’t be them, the council, regardless of their actions for the last year and a half.

    It is so sad.
    There is such monumental BS swirling around this whole series of events.

    The council was either willfully ignoring the conflict of interest, or woefully ignorant of it.
    But for one and a half years it was NOT an issue.
    And if the city attorney warned them during that time, they did not listen.

    Now two generations of a longtime NF family, who have worked continuously for the community, have their lives … and business, ‘trashed’, and I can’t help but think its also impacting the third generation.

    You need to think long and hard about this sequence of events, and ALL of those who have had roles in this ungodly mess.
    Tell me who, of the elected officials, and the senior staff involved, has had NO role in the decision making … who has had NO responsibility to the outcome.

    Does anyone even care about the liquor store any more?
    Will it ever be anything but an icon to poor judgement by ALL?

    I have always previously supported the idea of the municipal liquor store , especially because of its financial contribution to the general fund … but no more. The whole thing is sickening.

    It should be anathema to everyone in town , no matter which ‘side’ they’re on.

    December 10, 2008
  53. norman butler said:

    Doesn’t Dan Sugarman’s new thread suggest that it was the arrival of Jon Denison, Noah Cashman and Al Roder (at around the same time) that caused the whole plan/plot to go off the rails and into the valley of darkness from whence it has yet to emerge (hopefully in the form of a privately owned liquor store).

    December 11, 2008
  54. Martha Cashman said:

    John George,

    It has indeed turned to vinegar! I guess we can mix that with a little water and use it clean the windows in Northfield, welcome in Mayor Mary, and the new city council. Clean windows, new players, new year — sounds like a good fresh start!

    December 11, 2008
  55. Griff Wigley said:

    Is this cause for celebration?

    There’s an updated story in the Nfld News that ends with this:

    Walinski said he hopes to sit down soon with each of the property owners whose sites are still being considered and see whether any can come close to meeting the city’s financial expectations. Once negotiations are complete, the administrator said, city staff will again meet with the council, sometime in January or February, he said. Depending on what comes from the negotiations, Walinski said, there may be still an opportunity for public input.

    So it appears that a liquor store site decision will be made by the new council.

    December 11, 2008
  56. Anne Bretts said:

    If the council determined in 2005 that the hardware store was perfect for a liquor store, how was the RFP done? What were the financial justifications? Where was the public process?
    It seems that the protests should have come then, when the mayor and his staff offered the council only one choice, saying due diligence had been done. It seems the city attorney should have spoken then, the legal experts and public watchdogs should have spoken then. What were the costs of repairs to the existing store then?
    It’s possible the problem wasn’t that the newcomers derailed a legal process, but that they uncovered an improper process and stopped it.

    December 11, 2008
  57. Patrick Enders said:

    Sounds like the plan is in good hands, and that the transition from one council to the next might proceed smoothly.

    December 11, 2008
  58. Bright Spencer said:

    Kiffi, I agree with almost everything you said, with one exception and with one addition.

    The addition would be that if anyone deserves special consideration, or even regular consideration, it should be the family of a man who has given years of service, both as a commercial vendor and a competent volunteer, elected by the people. I wonder how many good people considering volunteering for office are lost because they need to keep safe all ‘conflicts of interest’ clauses.

    The exception to post #54, where I disagree, is that I would most likely be against the government dabbling in private enterprises.

    December 11, 2008
  59. Bright Spencer said:

    Furthermore, in a town like this where many people have had family like ties with each other over the years, and in a world where we are all brothers and sisters, ‘conflict of interest’ is really a pseudonym for something else, and I emphasize-in this particular situation.

    December 11, 2008
  60. Peter Waskiw said:

    Hi Bright, Thank you for your interesting thoughts. I am intrigued by your comment, “people have had family like ties with each other” and “‘conflict of interest’ is really a pseudonym for something else”.

    Please expand further, I would really like to understand your thoughts beyond these interesting perceptions. Excuse me for second guessing here, are you suggesting the conflict of interest issue does not really exist because we already now everyone business and therefore the pseudonym analogy describes something else going on between these very people? Forgive me if I am wrong, I am just trying to explore your thoughts based on this very interesting notion.

    December 11, 2008
  61. Bright Spencer said:

    Hi, Peter. Let me first say that I understand a goodly amount of your ideas because my bff is a woman from England.

    I am saying that while the notion of conflict of interest should be held true in some instances, I don’t think it is required in all situations.
    When we write laws, we write them to cover a myriad of situations, blanket laws, which oftentimes do not fit individual situations.
    In the case where trying to keep the conflict of interest from doing damage actually causes more damage, then it should be dropped. And if full disclosure laws are met, then, it should be dropped as well.

    Furthermore, I tire of people playing we are all brothers and sisters under the skin card on Sundays, and then pretending like we are all strangers with hateful agendas on the other six days of the week.

    I am coming from the place where I believe if you start with a shaky notion, like food for fuel, or saving taxpayers money by govt. selling drugs, you are gonna end up with a shaky deal, but let’s make the best of it and not waste everyone’s time and talent on this when there are so many other fish to fry. No disrespect meant to the fish. hth, hope that helps.

    December 12, 2008
  62. kiffi summa said:

    Bright : Thanks for your common sense re: conflict of interest, specifically about causing more damage than the original ‘conflict’ ; also your comment about full disclosure.
    One does expect that both of these will be taken into consideration when these difficult cases come up; and then of course there’s always the ‘vendetta’ factor.

    You would think full disclosure would take care of many situations, we have seen that that’s not the case.

    The ‘Law’ can be arbitrary, as well as finite.

    December 13, 2008
  63. Ray Cox said:

    Griff, your post #34 hits the crux of the issue when you ask “why is Firehouse cheaper?” The city operates a liquor store in a facility that does not pay any real estate taxes. That alone should allow it to offer products at least equal to or less expensive than Firehouse. However, that generally is not the case.

    My personal take on this issue is that if the city is not willing to consider a property offered for $1 in a location that has high traffic and will generate excellent revenue, then we should just keep the liquor store where it is. Remodel it to make it work and stay there.

    However, with that said I continue to believe that a municipal liquor store is not something the city should be involved with at all. Governments should do those things that citizens and private enterprise cannot do for themselves…police, fire, water systems, you get the idea. Liquor stores do not in my mind fall into that category at all.

    December 13, 2008
  64. Anne Bretts said:

    Ray, I agree. I don’t support city liquor sales, but I was willing to consider choosing a downtown site over a highway site if there were a real cost/benefit analysis and a rationale for giving up some revenue for a defined benefit to downtown.
    By limiting the pool of proposals to the downtown, however, the city has prevented any public discussion of the value of having the liquor store downtown.
    Say, for example, that a highway store could generate $500,000 in revenue, while a downtown store could generate $200,000. I could live with the $300,000 lost if it could be proven the store delivered xxx number of shoppers to other stores.
    Alas, there has been no real documentation of the benefit of the liquor store to downtown. If the store doesn’t create a real, defined benefit, perhaps the $300,000 generated by the liquor store could be better used for more promotions, building upgrades or other services to businesses.
    Defining the benefit doesn’t require a costly study. Simply taking two weeks and having storekeepers at the liquor store and elsewhere ask each customer whether they are doing other business downtown during their trips would give a pretty good snapshot.

    December 13, 2008
  65. David Ludescher said:

    Ray: Shouldn’t the City build a new downtown liquor store if it can make more money than the current site, even if it might make a lot less than the Gleason site?

    It seem like there are 4 options:
    1. Leave it where it is;
    2. Build a new downtown site;
    3. Build the liquor store where it will make the most money;
    4. Get out of the business.

    You suggest #4, but advocate for #1. Why?

    December 14, 2008
  66. norman butler said:

    Running a liquor store is a business and City Hall has demonstrated time and again that it has little or no business acumen. So, if City Hall is to stay in the business than let it do so at its current location (and use local tradesmen to fix the OSHA problems). Otherwise get out of the business.

    A distinction should be made between generating more sales and ‘making more money’. After debt servicing a brand new multi-million dollar liquor store, not much if any money will be left over to maintain the skate-board park.

    It would be a worthy gesture in these harsh economic times if City Hall would bite the bullet and set the example of restraint or prudence and put a moritoruim on this project (other tham the OSHA stuff) and others like it for say 5 years.

    December 14, 2008
  67. Ray Cox said:

    I like Norman’s comments…..either fix the existing building or get out of the business. I don’t know if anyone really knows what the liquor store ‘makes’. I’ve seen the yearly reports that the State Auditor hands out. We generally don’t look all that good compared to a lot of other cities.
    But I stand behind my thoughts that government shouldn’t really be involved with things that private enterprise can do just fine. Liquor stores are one of those things. I’d like to see cities focus more on running their core government functions well.
    As far as a location for a new liquor store…if we are to have one….I don’t think it makes any difference. Doesn’t matter what it costs because city dollars are only vaguely monitored. Don’t forget the $2.9 million that has vanished and remains a very silent topic. If a city like Northfield can lose $2.9M and not reallly miss it at all, then we are funding them very, very well and what happens at the liquor store really doesn’t impact us much as taxpayers.
    I’ll vote for David L’s #4—get out of the business.

    December 14, 2008
  68. David Koenig said:

    As I have said before (next I’ll hold my breath until someone listens) the City can get the same, or more, revenue by issuing one or two licenses to sell liquor in Northfield to private enterprise(s).

    This is especially true if the private enterprise(s) can run the businesses more profitably/effectively than the City does and if the City structures the license to be revenue-driven.

    The license should be x% of gross sales, where x times expected gross sales is equal to the expected “profit” from the City’s current operation. Issue the license to two stores to keep them competitive with each other.

    It’s not that hard and it removes all of the liability and capital issues associated with City ownership of a business.

    The risk-adjusted return would be substantially higher and that is what the bottom-line should be.

    Can someone tell me why we shouldn’t/couldn’t adopt this approach?

    December 14, 2008
  69. norman butler said:

    Can anyone list the five sites with the valauations of the land/buildings. I hear rumours of $1.3M and $1.4M and cannot think of any building that is a contender being worth even half that much..?

    December 14, 2008
  70. David Henson said:

    The idea that more revenue is guaranteed is a fiscal fantasy, fix the one we have and move on to more pressing issues (eg. every other issue).

    December 14, 2008
  71. David Koenig said:

    David H,

    Let me rephrase my suggestion a bit so that we could flush-out whether private enterprise could do better than the City.

    If the City nets $130K per year from the Muni (I think that figure is roughly correct), then a private enterprise would be willing to pay at least $130K for the right to have the license if it thinks it could make more money than the City does.

    So, by offering a license for a flat fee of $130K, the City would find out if any business thinks it can beat the City’s performance.

    The City might consider offering two licenses for a sum total of greater than $130K and see if two businesses think they can split/beat the City’s liquor sales and profits.

    If no one steps forward to buy the licenses, then the answer about whether the City can run the liquor business better than the private sector would be answered.

    I tend to think that there are a couple of enterprises that would snap up the licenses….perhaps even to build one store by the Gleason site and one on the Q-block.

    The bottom line to the City would be:

    1. Same or greater revenue
    2. Less risk
    3. No capital expenditures
    4. Control of access to liquor done by enforcement checks

    December 15, 2008
  72. David Henson said:

    David K – your solution is reasonable excepting if you factor in about 10,000 hours of citizen and government time in debate, about a billion in consultant and legal fees in getting to a point of agreement. I think on this one Northfield should let sleeping dogs lie.

    December 15, 2008
  73. Bruce Anderson said:

    David K, I agree with you (and Ray) that this is a function that the private sector can and should provide. I also agree with you that it would be a relatively straightforward exercise to identify the revenue level desired ($130K, $200K, $250K annually, whatever), offer one or two licenses totaling that amount, and see how the market responds. Why does the city keep spending such a huge amount of time on this relatively trivial issue???

    David H, I share your concern about the huge amount of time and money spent thus far. However, we’re STILL not at a point of agreement. Why not take David K’s suggestion and see if we can get to a more or less immediate private sector end-game and get the city out of the booze biz, except to the extent that it remain a source of revenue via the license fee(s)?

    December 15, 2008
  74. David Koenig said:

    Thanks, Bruce….I can exhale now! 🙂

    December 15, 2008
  75. David Ludescher said:

    David K: You didn’t figure in the property taxes associated with a private enterprise. What would be the taxes on a $2 – $3 million dollar building? I would suspect close to $100,000.00. Remember, those property taxes go to entities other than the City.

    Also, from my time on the City Council, I remember that some of the City’s expenses were allocated to the liquor store, when the expenses were more appropriately more City-wide expenses than an actual enterprise expense.

    I don’t know why we can’t run all of the scenarios at the same time, so that we can make an informed decision. But, that doesn’t look likely.

    I’m starting to believe that Ray and Norman are right about giving up on Northfield’s ability to do it right. There are just too many political pressures to make a decision that doesn’t adequately consider the profit motive.

    December 15, 2008
  76. David Henson said:

    I really do agree that the city should not be in the booze biz … my point was that as a practical matter fixing up the one we got and moving on seems most prudent. That said I have to add that the concept that Northfield will benefit as a community from the sale of more booze is patently absurd.

    December 15, 2008
  77. David Koenig said:

    David L and Ray,

    I’m open to a meeting in my office where the three of us could draft a proposal to the City that offers an alternative to the City running a store.

    While it would not fit with their current RFP, I am sure we could put something together that makes sense from a risk and economic standpoint.

    David L, your legal advice on what the City can and cannot do as far as license fees would be additionally very helpful.

    I’m game if you guys have an interest. Maybe we’d be wasting our time, but maybe not.

    December 15, 2008
  78. norman butler said:

    Why not dust off the Just Foods business plan and expand it to Just Liquor as well?

    Maybe buy (not lease!) the Rees-Shmidt building kitty corner from the current liquor store for Just Liquor and share the carpark (staff and other shareable resources). Then put The Chamber, NDDC, NEC, Tourist info, etc in the current liquor store location.

    Just Foods, Just Liquor, Just Brainstorming.

    BTW. For the private business person in a brand new liquor store, all or most of the profit on the Profit & Loss account will go to debt service on the Balance Sheet for about 20 years (only to be demolished to comply with OSHA requirements 2o years from now). So, $130,000 for a license sounds just silly (what does Firehouse and other privately owned stores pay and how is it calculated?).

    Also the P&L for the Cty-owned liquor hides more than it reveals and little can be learned from it (has it ever been made public?). And no one can compete with an entity (City Hall) that assumes no risk, no penalties, no business-reality.

    Lastly, why not sell the City-owned liquor store complete with staff and big blue sky to the highest qualified bidder?

    December 15, 2008
  79. Patrick Enders said:

    David (and David and Ray),
    Go for it, please. Sounds like a great idea.

    December 15, 2008
  80. victor summa said:

    $130,000 fee? I don’t think so.

    David K., are you suggesting that private enterprise can successfully buy land, build a new Liquor Store on it, provide all the necessary bells and whistles required of a successful retail business, AND PAY AN ANNUAL FEE TO THE CITY OF $130,000 for the right to do that … simply by tapping into the entire local liquor store SALES?

    What business plan would you use to make that case?

    Excepting for sales that go out of town today (Dundas, Twin Cities, etc) the mini, has, the entire market right now, right? It is likely making the maximum profit any liquor retailer could make here. Why do you think profit will jump merely because we have a new liquor store in Northfield, anywhere?

    Incidentally, does the city have the right to charge a $130,000 licensing fee? Why would that fee be greater than the fee the local watering holes pay?

    Years ago, before the current fiasco at city Hall called Cashman, Denison, Roder, et al… the city might have considered the Lansing Hardware store as a likely site for a new store. Times were okay then I suppose … that is, except for DT retail including Lansing’s Hardware who had suffered irretrievable loses as a result of Target’s and Menard’s deep pockets and invasive capability to capture a market.

    That was before the crisis brought on by 9/11 and further exacerbated by Bush’s war … and now, adding insult to injury, the top has blown off with the current financial crisis. Different game! The ball’s not round, doesn’t bounce and the playing field is littered with pot holes and land mines.

    Assuming you were merely a cold hearted profit oriented business man who didn’t care if the profits came from sale of liquor or sale of books, would you invest in a business that was limited to the potential profit that you can generate in Northfield, and required a $130,00 operating fee every year?

    Seems to me that takes the first 130K right of the top making meeting the debt service on the 2 or 3 million of development costs for 20 or more years even more dicy.

    Conversely, Northfield can maintain a significant DT presence with the Muni which supports the rest of the fragile DT, helps control the wise consumer’s purchase of alcohol, and generate revenue for the city (and contrary to Ray Cox’s remark #69, I believe I can find statistics that show Northfield’s muni has put up excellent revenue numbers per capita.)

    I’ll look for these, meanwhile, Ray said:

    I don’t know if anyone really knows what the liquor store ‘makes’. I’ve seen the yearly reports that the State Auditor hands out. We generally don’t look all that good compared to a lot of other cities.

    Perhaps one reason “no one knows (really) what the liquor store makes, is that the city, for years has massaged the books, paying out a variety of chargebacks to the Lq.Store that are not necessarily all that legitimate … or at last, that’s what I’ve been led to believe.

    December 15, 2008
  81. victor summa said:

    Speculating on the established cost to Firehoue Liquors? Well, if an on sale license is what is required for a liquor store, then Dundas’ fee for such an animal is $2,335 annualy. If OFF SALE is the category, that’s a $100.00 …. annually!

    Either way, your gonn’a have to sell a lot of Bud Lite to make up the fee difference in Northfield.

    I’d think this plan would ensure Firehouse dominating the market.

    Maybe there are state fees for a Liquor Store too.

    We’ll wait for the conference report.

    At this juncture, the only changes I can see that are worthwhile are those that would make what we’re doing now more cost effective.

    December 15, 2008
  82. David Henson said:

    Norman both suggestions are excellent, tie to Just Foods to support their sales and even sell “Organic Vodka” (disclaimer, this web site is a bit racey)

    or sell the existing business so staff keep jobs, get value of existing bsuienss and future moves etc no longer burden city politics.

    December 15, 2008
  83. Bruce Anderson said:

    I spent a few minutes doing a little research earlier this afternoon and can report the following:

    • Our neighbors to the south, Faribault, have eight establishments with off-sale liquor licenses. They currently charge each a $200 annual license fee. This will increase to $560 in 2010.
    • By statute (MN Stat. 340A.408), a city of Northfield’s size can not charge a license fee (combined with any “occupation tax”) greater than $560 per year:

    Subd. 3.Intoxicating liquor; off-sale.

    (a) The annual license fee for an off-sale intoxicating liquor license issued by a city, when combined with any occupation tax imposed by the city, may not exceed the following limits:

    (1) $1,500 for cities of the first class;

    (2) $560 for cities over 10,000 population located outside of the seven-county metropolitan area other than cities of the first class;

    Bummer. While I’m no attorney, it seems that it might be difficult or impossible legally to replace the putative $130K net revenue the Muni generates via anything resembling a license fee. Whether that $130,000 is a real number or not, I have no idea.

    I also took a brief look at Rice County tax records online for one Northfield commercial property in the same ballpark, market-value-wise, as the proposed new Muni, Walgreens (2008 estimated market value, $2.189 million), pays $66,756 in 2008 property taxes (combined city, county, school district and “State General Tax” — which goes to education). The city share appears to be about $38,764. Assuming a $3 million price tag for the new Muni (I think that’s the number I remember), an extrapolated city share for a private liquor store with a $3 million estimated market value might be about $53,000. FWIW.

    December 15, 2008
  84. Ray Cox said:

    Excellent comments and thoughts folks. Maybe we will actually get somewhere with all this!
    One issue that David L could probably look at very quickly: are cities limited in the amount they can sell off sale liquor licenses for? From my 2 years on the Regulated Industries committee in the Mn House I seem to remember that liquor laws are more arcane and out right strange than any other section of law. I know cities are regulated about how many off sale licenses they can grant. Some cities are before the legislature on a regular basis asking to increase the number due to growth between censuses. I don’t remember how many licenses a city the size of Northfield is allowed…or what they could sell one for.

    December 15, 2008
  85. David Henson said:

    If the city is not restricted in types of terms used when selling the business entity then they could probably work in a fancy way of capturing the $150,000 a year (higher price paid out yearly over time, profit share, etc )

    December 15, 2008
  86. John S. Thomas said:

    Just a correction for the record. Just Food is a singular, not a plural.

    Just Food

    No worries, I made the same mistake for a bit myself. 😎

    December 15, 2008
  87. David Koenig said:

    So, if Bruce’s citation is correct, it does seem an arcane rule to limit the fee that a city can charge.

    Do we need to focus on changing state law?

    Or, is there another way? Can cities charge there own off-sale liquor tax?

    It seems to me that cities ought to be allowed to “compete” for liquor store business through setting their own local fees for the license to sell.

    December 15, 2008
  88. Scott Neal said:

    Ray: Cities may issue as many on-sale liquor licenses as their city council sees fit to issue. The law limiting the number was changed a couple of years ago.

    One issue someone must sort out about this proposed site is that it places a new municipal store in a closer proximity to an existing private store – in Dundas. There is state law that prohibits this sort of thing from happening in order to protect small Mom & Pop liquor stores from competition with new muni stores, especially in the metro area.

    December 15, 2008
  89. David Ludescher said:

    David K: We also have to factor in the income taxes that would be paid on the income by a private enterprise.

    December 16, 2008
  90. William Siemers said:

    Can the muni add on-sale?

    December 16, 2008
  91. norman butler said:

    How about allowing pubs & bars to do off-sale?

    December 16, 2008
  92. David Koenig said:

    David L, yes, there are several items left out of the simple analysis, including taxes and the cost of the risk that the city has with its facility, business and other.

    I am still very willing to sit down with you, Ray and anyone else who’d like to map out some of the issues and try to put it into a realistic option for the city to consider.

    We may be too late and the idea of changing state law, if that is what is needed, may be too big of a task. But, it may still be worth trying and could provide the city with a different way to think about the Muni and its contributions to the budget.

    December 16, 2008
  93. David Ludescher said:

    David K.: It doesn’t make much sense to look at the issues unless someone connected with the Council or City Hall is going to be involved.

    December 16, 2008
  94. Ray Cox said:

    William…Northfield used to operate on on/off sale liquor store. It was the only place you could purchase liquor, except I believe for the two veterans clubs. I seem to remember after the 1970 census that Northfield went over the 10,000 population figure. That triggered a vote where we had to select between a) maintaining the muni on/off sale, b) keeping only the off sale or c) keeping only the on sale.
    The voters decided to keep the muni off sale and jettison the on sale.
    The old on sale was in the same building where the off sale is now, but I seem to remember it was only on the lower area.

    December 16, 2008
  95. David Koenig said:

    David L, I disagree.

    I assume you look at issues with the Chamber and come up with recommendations even if no one from City Hall is involved.

    Come on…try to work with me…it’s not that scary, actually, once you’ve tried it. 🙂

    I’ve also had another knowledgeable person contact me on the outside interested in this discussion. And, I think you, Ray, this person and I might be able to conduct a thoughtful review of issue and present an interesting idea to one or more of our City representatives.

    The worst thing to come out of it would be that no one listens…but we’d still have learned some things ourselves.

    December 16, 2008
  96. David Ludescher said:

    David K: Northfield doesn’t need any more divisions. If someone with the power to change the course agrees to listen I am in.

    December 16, 2008
  97. Ray Cox said:

    Thanks Scott….the only thing that may be goofier than liquor laws in Minnnesota is election laws. I’d forgotten that the cities off sale state limits were lifted Scott. I’m sure that frees up many countless hours on Regulated Industries committees! I do remember one growing suburb city coming to the committee in 2004 and asking for I believe 4 more stores. The committee decided to give them 10 more stores and not make them come back so soon.

    I’ll have to say I’m more with David L on this issue—is the city really serious about doing something with the liquor store, or is is just a continuation of old discussions? My one desire is that they not spend any more scarce resources on outside consultants to talk to them about the liquor store. Talk to the community as David K says.

    December 16, 2008
  98. Peter Waskiw said:

    David, I would recommend that you continue to work through the issues. I believe your previous thoughts above on running “all of the scenarios at the same time, so that we can make an informed decision” were valid. You probably where referring to the City undertaking these scenarios rather a small citizen group, but if the point is get to an “informed decision”, than lets continue this train of thought. Reading above, I also see a few missing parts that tip the balance between scenarios. A real BCA would easily determine the difference. The process so far has not produced one result except wasted time and frustrated residents. Perhaps informed citizens would provide the motivation for elected officials to resolve this issue once and for all. This is probably a good exercise in managing a moderated response to an emotional issue that has and will continue to rip Northfield apart until we resolve it for good.

    December 16, 2008
  99. John S. Thomas said:

    Can someone please explain the difference between off-sale and on-sale? I am not familiar with the terms.

    I come from a state where the only place you can buy hard liquor is from the state liquor store. Beer and wine can be purchased at the grocery.

    Can someone please enlighten me?

    December 16, 2008
  100. Griff Wigley said:

    John, yeah, those are definitely weird terms.

    ‘Off-sale’ means liquor that’s sold to consume OFF-site. So basically, liquor stores are all off-sale.

    ‘On-sale’ means liquor that’s sold to consume ON-site… bars and restaurants.

    December 16, 2008
  101. Rick Esse said:

    This is what I think and/or have learned over the last few days re the liquor store discussion.

    1. There is no way that an off sale liquor license fee can approach the perceived $130k that the municipal liquor store contributes to the city general budget.

    2. The state limits the off sale license fee for municipalities outside the metro area to $560 per year.

    3. The city can determine the number of off sale licences that it will allow.

    4. Many cities use a formula of one off sale licence per 5,000 to 7,000 population.

    5. Given those ratios, Northfield would likely allow two to three licenses for a total fee of less than $2000.

    6. Private liquor operations would also contribute sales and real estate taxes – this math exceeds me.

    7. It appears that the state requires that off sale liquor establishments be located more than one mile from each other (See Scott Neal #90). I am not clear whether this is within each city, or if this would preclude a Northfield based private liquor store from being less than a mile from Firehouse Liquor in Dundas.

    Now, responses to a few specific comments or questions:

    John Thomas #101: “On sale” means you purchase liquor to be consumed on the premises. “Off sale” means you purchase liquor to be taken off the premises. This may be a strictly Minnesota designation, I’m not sure. The other thing that may be confusing to someone who grew up outside of Minnesota is the 3.2 designation. This applies to beer that contains less than 3.2 percent alcohol. Convenience stores, grocery stores, etc. are allowed to sell 3.2, but “strong beer” (over 3.2 percent) can only be sold at liquor stores.

    Norman Butler #93: In many rural communities, bars (pubs) are allowed to sell both on and off, so yes, it would be possible for the city to allow an establishment such as The Cow to sell off sale. Last I checked, the L&M in Dundas has off sale. This may have changed.

    William Siemers #92: This is be possible, but would set us back three decades or so. (See Ray Cox #99) In the early 70s, the muni was the only public establishment with an on sale hard liquor license (clubs such as the VFW and American Legion could also sell hard liquor). The bar was located on the upper level of the existing Muni with a separate entrance onto Fifth Street. Establisments such as the Rueb ‘n’ Stein were strictly 3.2 beer joints. As a practical matter, the liability of on sale is much higher than off sale; I doubt the city would/should take on this risk.

    I still question whether the city should continue to operate a liquor store. If it chooses to do so, I would suggest it mind its p’s and forget the q’s – parking, parking, parking and pricing, pricing, pricing.

    December 16, 2008
  102. William Siemers said:

    It looks to be a foregone conclusion that the city will have a muni. It seems it does contribute at least 130k a year to the revenue side of the budget…there is no way a private store(s) would contribute that much.

    I guess we won’t have on-sale, although I still like the idea of an upscale bar adjacent to the off-sale, but it’s clear that this would generate opposition from local booze purveyors…I don’t know about the insurance issue…there are a whole lot of muni off-sale/on-sale combinations around MN and insurance cost doesn’t seem to be stopping them. In any case it seems the voters have spoken on this issue.

    I think if we are going to do it…then let’s do it to make the most money possible. They should consider gourmet foods, gift baskets, accessories. Can’t have on-sale?…maybe a wine-bar that charges for regular tastings.

    I sense a frustration with the whole process here on LG, and in the community. But this frustration should not get in the way of picking the best site and then designing a state of the art store that will be both attractive and efficient. If that means hiring consultants/professionals to insure that outcome…so be it.

    The right design would, by decreasing labor cost, increase the bottom line considerably. (Firehouse, and Haskil’s in Faribault operate appear to operate with about half the staff of the muni). A beautiful, bright new store would undoubtedly bring in higher revenues.

    Wait… all this ignores the elephant in the room…Strong beer and wine sales in grocery stores. Every year the lobbying for this change in MN law will continue. I have no idea what the chances are for such a change…but if enacted, Northfield, might be throwing away alot of cash on this new store. Doe anyone have an idea of the odds of this change occurring?

    December 17, 2008
  103. Tracy Davis said:

    Maybe I missed something in my skimming of the comments here, so feel free to jump all over me if someone’s already answered this:

    Isn’t the reason the current liquor store shows “profit” of approx. $130k/year is because the building is paid for?

    Even allowing for possibly increased sales with a new larger store, debt service and taxes on the property would probably eat up most if not all of that.

    It’s not by any means certain that a new liquor store would add one penny to the city coffers. It’s much more likely that it will COST us money.

    December 17, 2008
  104. Anne Bretts said:

    This is fascinating. Where has this discussion been for the last three years? What happened to the critical need for a liquor store downtown to anchor the business community? Where is the importance of anchoring the south end of Division Street?
    Now that the city is close to a decision, there is a big push to abandon liquor sales. I never supported municipal liquor stores, but this turn of events is just very odd.

    December 17, 2008
  105. Rick Esse said:

    W.S. #104 – The concept of offering gourmet foods at the Muni is wonderful. However, Minnesota does not make things easy, and it all ties in to the food sellers vs. liqour sellers battle.

    The liquor guys said “you can’t sell wine, strong beer or spirits.” The food guys said, “well, then you can’t sell food.” Thus, one cannot buy a bag of potato chips in a liquor store to enjoy with that bottle of real beer. It is possible, however, to buy a lime for your gin and tonic or a jar of olives for your martini. Garnishes are allowed I guess.

    This separation of chow and suds is why stores such as Byerly’s or Cost Plus will have attached liquor stores with their own entrances and checkout counters. I suppose the Muni could ad a cheese shop a la Surdyk’s in Minneapolis, but this further muddies the government vs. private enterprise issue. Would our supermarkets or Just Foods like to add the City of Northfield to their list of competitors?

    As to the ultimate resolution of the wine in supermarkets issue, I have no clue. Perhaps Ray Cox or one of our current legislators could chime in here.

    If the rules do change, I would not want my city to be heavily invested in the liquor business.

    December 17, 2008
  106. William Siemers said:

    Tracy…I don’t know if the muni pays taxes, but I doubt it. Re: debt service…since money is pretty much free these days (if you can get it), to me it is more a matter of payback. Cost of the land/building minus the sale price of the existing building divided by projected net revenue.

    So if the building/improvements/land are 2 million and the existing building sells for 600k and the projected improved net goes to 200k, the payback is 7 years. (These estimated figures are strictly off the top of my head).

    I suppose there would also be a loss in revenue from the property tax no longer collected on the building and/or land once it is sold to the city. But that would be somewhat offset by the property tax collected on the existing muni building once it is sold.

    December 17, 2008
  107. Bright Spencer said:

    I have some ideas. Tear down the liquor store building, replace it with state of the art Green building, sell organic freshly made on site juices and teas and honey based candy and cookies and order your alcohol online and have it delivered.
    Then, the extra revenues you get from all the people talking up your very prominently displayed green building with organic juice and honey treats building will bring in more revenue, make a lot of us anti alcohol- sales- by-govt people real happy and we will come downtown more and show our financial support, the cops and city employees can do other good work and everyone will live happily ever after.

    December 17, 2008
  108. David Henson said:

    Cheers to that Bright !

    You might even get some top flight corporations thinking what exceptional thinking lets locate a 1000 employee factory there.

    December 17, 2008
  109. Bruce Anderson said:

    OK, here’s one more set of thoughts.

    1. There is no philosophical basis for additional City investment in the existing Muni ($100,000 + to remedy OSHA violations) or a new location ($2 million +). The current debate is strictly about how to maximize revenue to the City.
    2. Rather than staying in the booze biz (a good biz, I recognize, and one I’m happy to patronize on a regular basis when I’m not drinking my own homebrew–one or two drinks a day as a health-enhancing measure!), the City gets out of the biz and turns it over to the private sector, perhaps in the following way:
      • Authorize (by council action) replacement of the Muni by private off-sale liquor establishments
      • Issue one (or two, or more if the market is there) off-sale license to a new off-sale only establishment
      • Issue one (or two, or more if the market is there) off-sale licenses to existing or new on-sale establishments (e.g. the Cow, Froggy Bottoms, The Rueb, Eagles, VFW, a new brew pub??? whoever)
      • Sell the existing Muni building once the new establishment(s) are up and running
      • Collect annual license fees and increased property taxes from new private off-sale establishment(s) and whatever private enterprise eventually takes root in the Muni building
      • Stop wasting time and money arguing about the issue

    Revenue to the City:

    1. Current estimated market value of the Muni building according to Rice County records: $394,000. Actual eventual sales price: anyone’s guess in today’s market.
    2. License fees (small change of hundreds or a few thousand max annually)
    3. Increased property tax revenues: perhaps on the order of $50K annually?
    4. Avoidance of payment of OSHA-mandated improvements and/or
    5. Avoidance of interest payments on debt for new building

    Additional benefits:

    1. Encourages entrepreneurship and private local investment
    2. Allows elected officials, staff, and civic-minded busybodies such as myself to dedicate time and energy to more productive civic pursuits
    December 17, 2008
  110. David Ludescher said:

    All: This a.m., the Chamber Board, at my prompting, voted to have me draft a proposed position paper to present to the Chamber. The Chamber may decide not to publish a position paper. However, as a leader in a healthy business environment, I felt it our duty to see if a consensus exists regarding this matter.

    Anyone interested in providing comments can email me at Preferences will be given to Chamber members, but no idea will be turned away. You may also call me at 645-4451 before 8:00 a.m. or after 5:00 p.m.

    David K. and Ray: I would be willing to strategize on this matter further in person.

    December 17, 2008
  111. David Koenig said:

    David L and Ray, I’d be happy to schedule a conf call or we can meet at my office if you wish. I’m meeting with someone tomorrow to discuss the matter as well.

    How is Friday afternoon? I’d enjoy collaborating with you to see if we can offer anything of value to the powers that be., o)507-301-3149

    December 17, 2008
  112. William Siemers said:

    If the new building scenario continues: This is an excellent time to negotiate a real estate purchase, partiuclarly with one player offering the land for a buck. So any offers on the other properties should be of the lowball variety. Very low.

    December 18, 2008