Twin Cities suburbs look to limit number of liquor stores

Minnetonka city leaders are grappling with a question more Twin Cities suburbs are asking: How many liquor stores are too many for one community?

Prompted by recent requests from Target and Total Wine, the suburb's leaders debated this month whether to change how the city regulates the growing number of ­off-sale liquor stores. On Monday, they'll continue the discussion but aren't expected to change the city's policy, which allows 12 liquor licenses.

Nearby, St. Louis Park leaders also will discuss Monday if the city can or should limit the size of liquor stores as more big-box stores move into the metro; the city put a moratorium on any new off-sale liquor licenses earlier this year, worried about the number and concentration of stores.

And last month in Burnsville, the city went the opposite direction, loosening its rules by removing the cap on the number of liquor licenses to accommodate increasingly popular businesses like brew pubs and specialty grocery stores seeking liquor sales.

It's a difficult balance for metro area suburbs, each of which regulates liquor stores differently. Some only have city-owned liquor stores. ­Others restrict the ratio of liquor stores per resident or limit how close stores are to schools and day cares. Minnetonka's policy does neither, allowing more flexibility, said Mayor Terry Schneider, for an ever-evolving industry.

"What do we want our community to look like? We don't want it to be too overwhelmed by liquor stores," he said of the city's 12-license policy. "We hear a lot about overregulation versus free market, and where does that balance lie?"

The TwinWest Chamber of Commerce, which represents 10 north and west metro suburbs, testified in St. Louis Park against the city's liquor license moratorium and recently sent a letter to Minnetonka urging it not to restrict liquor licenses.

"This is, in our eyes, a free-market decision," said Brad Meier, chamber president. "We really felt what they're trying to do is keep big-box liquor out of their community. And we feel it should be an open market."

Some cities like Eagan have just that, with no cap on the number of liquor stores. The south metro suburb has 15 off-sale liquor stores, or one for every 4,400 residents.

In Burnsville, the city was restricting liquor stores to one off-sale license per 5,000 residents, but that rule was eliminated last month. The City Council approved a revised ordinance June 2, removing the cap on the number of licenses. Businesses with off-sale liquor licenses must still be at least three-fourths of a mile apart and inside a free-standing building if located outside the Burnsville Center retail area.

In the north metro, the Blaine City Council considered eliminating its rule of one store for every 7,000 residents, but decided in May to keep it.

In the west metro, St. Louis Park put a moratorium in January on new off-sale liquor licenses after learning the suburb has one liquor store for every 2,800 residents — more liquor stores per person than all but two of 24 metro suburbs. The city had just approved a liquor license for SuperTarget, the 16th liquor store and 21st liquor license; the city has distance regulations but few other restrictions. In contrast, neighboring Edina — with nearly the same population but only city-run liquor stores — has one liquor store for every 15,800 residents. Hopkins has more — one store for every 2,200 residents.

While St. Louis Park's moratorium goes until the end of the year, the City Council will discuss Monday whether it could limit liquor stores by their size.

"The rules are pretty flexible here," City Manager Tom Harmening said. "There's real different views on the council whether they should limit the number of liquor stores in St. Louis Park."

Minnetonka is also split about how to regulate the industry. On Monday, the council will discuss minor wording revisions to its ordinance but expects to keep the city's separate policy the same.

The policy says that 12 off-sale liquor licenses is "generally adequate to serve the city" but the council has the right to not issue licenses if the number of liquor stores falls below 12 and would also consider liquor licenses over the maximum if the business offered a "distinctive specialty service, or is a small, complementary part of a new business," and is part of a redevelopment project in an area without a store.

"You don't have to go very far in Minnetonka to get beer or liquor," Council Member Brad Wiersum said, adding that the city has a sufficient number of liquor stores. "I don't want to be a magnet city to attract people [from] outside Minnetonka to buy liquor."

The city currently has 11 off-sale liquor licenses. And Ravi Jasthi wants to keep it that way. He owns a 6,000-square-foot store, US Liquor & Wine, off Hwy. 7 and was one of several owners at a July 1 city meeting expressing concern over changing rules.

"There's enough liquor stores for the city," he said.

He also owns a Hopkins store that he said lost business after SuperTarget in St. Louis Park started selling liquor. Now, he wants Minnetonka to keep its rules. "Twelve [liquor stores] is good," he said.

John Wolf disagrees. In 2010, he tried to open a large warehouse-style discount liquor store in Minnetonka. But the city amended its policy, saying that the 12 liquor licenses then in use was adequate. Wolf pulled his application and went to St. Louis Park to open Liquor Boy.

"I should have sued the city" of Minnetonka, said Wolf, an Edina resident who also owns Chicago Lake Liquors in Minneapolis. "Who says 12 is the right number [of liquor stores]? … Who knows what is the right number?"

Schneider said that the city felt limiting stores by resident ratio or location felt too arbitrary. "We do want to have some standards that allow some flexibility," he said. "Industry is always changing, so we don't want to be anti-competition."

Wolf thinks there's an easier way. "There have been an onslaught of people putting applications in," he said. "Let the market decide."

Kelly Smith • 612-673-4141