Minnetonka rejects Total Wine, saying the suburb has enough liquor stores

Minnetonka has enough liquor stores, city leaders decided this week.

The City Council on Monday rejected a liquor license request from Total Wine & More, the first time that a Minnesota municipality has turned down the growing Maryland-based liquor superstore chain.

Although the council voted 4-3 in favor of a liquor license for Total Wine, five of the council's seven votes are required for a license to be granted.

The rejection "raises serious questions about the council's ability and desire to create a level playing field in which all businesses can thrive," Total Wine spokesman Ed Cooper said in a statement. "This unfortunate action could make it more challenging for Minnetonka to compete with other communities for expanded tax base and employment."

Minnetonka already has 13 off-sale liquor licenses, 11 of which are full-service liquor stores. The city's liquor policy says 12 full-service liquor stores are "generally adequate" for Minnetonka, though there's no official cap.

That's why Council Member Brad Wiersum said this week he thinks the city has enough.

"Why would we want our city to have more off-sale liquor establishments per capita than are allowed in either Minneapolis or St. Paul?" he said.

Last year, the city turned down Target Corp.'s application to sell liquor at its SuperTarget store on Hwy. 7. It was the first time Target had been denied a license since adding liquor and wine sales to its Minnesota stores in 2014, though it does have approval in Minnetonka to sell 3.2 percent malt beverages.

Now, Total Wine's request is the one under scrutiny.

"Total Wine is significantly intensifying the liquor business in Minnetonka and does make it a regional draw," Wiersum said at the meeting. "So I ask the question: What kind of city do we want to be? Do we want to be the city where people come from a long ways away to buy liquor? Or do we want to say we want to have our citizens adequately served, which is occurring already?"

The emergence of more big-box liquor stores like Total Wine has prompted local cities to re-evaluate liquor policies.

Each city regulates liquor stores differently. Some have only city-owned stores, while others restrict the ratio of stores per resident or limit how close stores are to schools and day care centers. Minnetonka's policy does neither, allowing more flexibility, city leaders say, for an evolving industry.

Since 2014, Total Wine has spread across the metro area, with stores in Bloomington, Burnsville, Chanhassen, Maple Grove, Roseville and Woodbury. The company initially faced concerns and delays in Bloomington, but the City Council allowed it after an administrative law judge recommended approval. An Eagan store will open next.

Total Wine officials said they want to open a store in Minnetonka next summer on Plymouth Road near Interstate 394. The 13,500-square-foot store would be the smallest of its metro stores. The retailer would plan to buy Big Top Liquors on Ridgedale Drive and close it in January, leaving the city with one less liquor license.

"We know that consumers in the west metro overwhelming support Total Wine & More coming to Minnetonka," Cooper told the council.

But in a discussion lasting more than two hours, several residents and business people raised concerns about traffic, public safety and a saturated liquor store market. The proposed store would be 1,200 feet away from a Haskell's store.

Burnsville also had packed City Council meetings over Total Wine and other new liquor stores, Tom Taylor of the Burnsville Chamber of Commerce told the Minnetonka council. But in the end, he said, public safety and traffic weren't problems. "The sky didn't fall," he said. "In fact, in Burnsville, the sky was much brighter. ... Total Wine has been a positive impact on our community."

As with any new development, people fear the unknown, said Council Member Dick Allendorf, a Total Wine supporter. "If a CVS came in and wanted to be across from a Walgreens, I'd say let the market just fight it out," he said.

According to a Star Tribune analysis last year of suburban liquor stores, Excelsior has the highest ratio of stores per resident, with one for every 575 residents. Hopkins came in second, with one store for every 2,200 residents, followed by Rosemount, St. Louis Park, Bloomington and then Minnetonka, where there's one store for every 4,280 residents.

License requests from Target and Total Wine spurred Minnetonka council members to tweak the city's liquor policy last year, differentiating Ridgedale from other areas because it had the capacity for more liquor stores.

The city's policy says the council doesn't have to issue licenses even if there are fewer than 12 liquor stores. It also could consider issuing a license even if there were already 12, if the business offered a "distinctive specialty service, or is a complementary part of a business," and were to locate in a "village area" without a store.

Total Wine's proposed site was in the Ridgedale area, and Cooper said Wednesday that its application met the city's requirements. With the purchase of Big Top, the city wouldn't have had a change in the number of liquor stores, he added.

Total Wine isn't giving up on Minnetonka just yet.

"Our customers love us; our competitors don't," Cooper said, adding that the company is exploring next steps that may include legal action. "We believe we have other options."

Kelly Smith • 612-673-4141

Twitter: @kellystrib