ARTICLE

Published in Brewpub Magazine, May 1999

So you are going to open a brew pub; you're ready to order brewery equipment and you can't wait to buy your first batch of malt. Well, long before you sell your first pint, get ready to sell your local planning department and city council on your brew pub. Selling local government on your concept isn't hard—if you know what they're looking for. This article is dedicated to giving the prospective brew pub operator the tips and traps of getting local approval.

While most aspiring brewers expect to go through the alcoholic beverage licensing process at the federal level and within their own state, many don't realize that local approval is also necessary—and usually fraught with greater peril. Most cities will require that you obtain a conditional use permit or similar approval for a brew pub, as for any restaurant or bar, and in many parts of the country, the license to retail alcoholic beverages is issued by the local authorities.

But first what does local approval entail? The areas of local control can be divided into two categories: (1) control over sale and production of alcoholic beverages and (2) land use or zoning controls.

In some states, like California, the retail sales of alcoholic beverages is licensed at the state level only, and local governments do not become not involved in licensing retailers. However, in most states local governments are given partial or even complete control over alcoholic beverage businesses. Local control extends to even the outright prohibition on the sales of alcoholic beverages—in many areas, local option laws allow individual neighborhoods or voting precincts to be dry, even when other parts of the same city or county are wet.

Typical controls or requirements imposed by counties' or cities' local ordinances include:

The local licensing law is normally administered by a Liquor or Alcohol Control Board or the Revenue or Licensing Department. We strongly recommend reading a copy of the local ordinance, and if something you read raises a question, ask an experienced expert or a regulator for an interpretation in your situation.

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The zoning game

Zoning or planning issues will always be a factor if you are planning on opening a brew pub. And because there is so much more politics and discretion in the area of land use, doing your homework is even more important. Since a city has no obligation to grant a use permit for a particular site, a crowd of angry or simply misinformed neighbors at a public hearing usually results in a denial or in conditional approval limited by severe restrictions.

Basic zoning or land use considerations include whether the use is consistent with the neighborhood, whether the site is zoned properly, and whether there is adequate parking. Downtown business districts, commercial strips, and shopping centers are generally a safe bet.

The mere fact that there is another restaurant or bar close to your intended site may not mean the area is properly zoned, since the established premises may be an "existing, non-conforming use." This means that the existing establishment is not properly zoned, but was allowed to remain because it predated the current zoning designation. Even if you have found an existing bar or restaurant location, be aware that you may not be "grandfathered" in—some uses are not transferable. Even if your location is zoned properly or has a history of a similar use, you may not be out of the woods. The remodeling you need to do may require new approvals, and problems caused by prior operators spell trouble with the neighbors and authorities.

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Winning the neighborhood popularity contest—before you open

If you are going to use an location that has been a bar or club, beware of inheriting the bad karma of the previous owners. A new owner recently took over a location that had been operated as a club for twenty-seven years, thinking that it would be a "shoo in" for his new business, only to find that its heritage was a liability rather than an asset. To his chagrin, he discovered that the sins of the last twenty-seven years (rowdy customers, gun fights, and drug deals) were heaped upon him, and he was denied the licenses necessary to serve alcoholic beverages. The new proprietor of an inn that had been a bar with live music and dancing for fifty years was in for a similar surprise. Although her license was eventually issued, complaints by neighbors resulted in numerous conditions being attached to her approvals.

The moral of these stories is that neighborhood opinion is critical in the approval process. Planning involves the balancing of competing land uses, so the opinions and wishes of the neighbors count. Planners and City Council members are extremely sensitive to citizen input (remember they represent votes). Businesses are expected to minimize or mitigate all the negative impacts they create.

Therefore, generating public support for your brew pub is probably the most critical factor in determining your success in the process. If the public and the planning staff support your application, you will get your approvals quickly and with few or no conditions. In some jurisdictions, public support is MANDATORY. Without a public survey indicating a felt need for your new establishment, you simply cannot get your brew pub licensed!

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Marketing your concept, step by step

As real estate people say, it all boils down to "location, location, location." Find the right location and half your battle with city hall is over. If you are savvy enough to pick a site that dovetails with local planning objectives, local bureaucrats may actually roll out the red carpet for your new business.

Cities often support locating a brew pub in historic or downtown areas that are undergoing redevelopment, because government wants to attract people to those areas and brew pubs are believed to be people magnets. The Village of Schumburg Illinois has actually promoted a site in a new "town square" area to potential brew pub operators--going so far as to advertise the opportunity at an industry trade show--because the planners saw a brew pub as a draw for this new city center. In Sebasol California, the city welcomed the conversion of a turn of the century streetcar powerhouse from offices to brew pub. Historical buildings often have their own set of problems, such bringing them up to modern building codes within limitations on changes to the exterior, but often incentives and special programs are available.

If your plans call for distributing beer to wholesalers or other retail locations, bear in mind that this may complicate your zoning situation. Distribution activities may shift your use from a "retail commercial" designation to a "manufacturing and distribution" category, which may require different location or approvals.

Parking is always a big consideration, and generally more parking is required for restaurants than other commercial uses. Creative solutions to parking problems often involve rights to use a nearby lot, or reciprocal arrangements with nearby businesses that use parking facilities at different times than your peak periods. Keep your parking away from residential areas, since the noise made by patrons leaving late at night is a huge issue.

After you've located a site, the next step is normally hiring an architect to design your brew pub. The exterior of the building should be consistent with the neighborhood, but also unique. A winning design often equates to very positive support by city staff, while a controversial design, means just that--controversy. Fortunately, the brew pub industry has an excellent reputation for its unique and beautiful buildings, so use this to your advantage.

You and your architect should meet with the planning staff as early as possible in your design phase to discuss any concerns staff has about the site and design. Listen carefully to what staff says and ask questions. Try to understand the basis of any concerns so you can creatively address the root problems.

Then it's time to build support for your plans in the neighborhood. If you're in a commercial strip, talk to your landlord and other merchants and get their support. If residences, churches or other public places are nearby, talk to people and find out their concerns or issues. Simply approaching your neighbors with your hat in hand and providing some real information about your plans will prevent unfounded fears from growing out of control. Some people will never be satisfied, but if you offer a solution that sincerely attempts to address a neighborhood issue, city staff will often support your solution. Finding reasonable solutions that work for you is so much easier if you identify the concerns early.

Once your conceptual plans are done, it's time to apply for any use permits or approvals. Even if the location is perfect and zoned correctly, you will probably still need a conditional use permit or similar permit that allows the operation of a brew pub at a specific location. Don't feel picked on, most cities require even churches to get one. The CUP outlines the conditions under which you can operate, such as hours of operation, whether live entertainment will be allowed and during what hours, whether you can sell for off premises consumption.

Normally your application is reviewed by a staff planner and the director of the department. If your application addresses the issues raised by staff and the public, review will be a snap and staff support assured. If additional arrangements or solutions need to be worked out before staff will support your project, this is the time to do it! The planning staff will soon be writing the conditions under which you will operate your pub for years to come.

Next, a public hearing is scheduled before some type of board or commission. Notices are likely to be mailed to nearby residents, published, and posted to invite public comment. Hopefully you have already canvassed the neighborhood and built positive support for your pub. Addressing concerns for a new location before the public hearing gives you time to come up with solutions and get the support you need for approval.

A proactive approach often assures success. A new owner facing numerous complaints about past operations at her location, held a "town meeting" to hear concerns and offered a signed "pledge" of responsible management that addressed noise, litter, and other concerns. The results were phenomenal: Almost all opposition disappeared, residents wrote letters of support, and many of the onerous conditions proposed by staff were reduced or eliminated. Some of the solutions which saved the day included:

Be ready to make a presentation at the public hearing stressing the positives, such your excellent site and building design, your contributions to the neighborhood, your family atmosphere, that food service is an essential part of your business, that responsible consumption will always be stressed, and that you have an effective policy regarding minors. Be ready to deal with the perception that your concept will attract a crowd that is young, fast and rowdy. Show how you have sought to identify and solve all the impacts of your proposed pub. If you have problems with a condition proposed by staff, say so and provide an alternative. It is the job of the board members to try to fairly balance the needs of your business against the needs of the public and the city.

The city staff and public will also have a chance to speak at these hearings, so set yourself a goal to have no surprises. You may not achieve absolute advance support from staff and the public, but at least you should know what opposition you have to address.

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Diplomacy is Key

Always remember, no regulatory process is purely technical. All governments are run by PEOPLE, so diplomacy is a big part of the process. If you treat public officials with respect and do what you can to make their job easier, they will work hard to help your project fit the requirements.

This goes for the professionals you hire, too. Of course you should choose engineers, architects, etc. who are experienced with brew pub development. But it is equally important to hire people who have good relationships with the regulators. Not all professionals are equally good at diplomacy.

A friendly, forthcoming manner will not only encourage a sympathetic result from government officials. It is also the best advertisement for the kind of place you plan to have--a place where friends can come together and share good times. If you play your cards right, you'll certainly see some of the same faces that confronted you at the hearing smiling at you over a cold, foamy glass of your brew.