Review of Liquor License for MLJB Companies LLC, DBA The 507.

Adoption of the attached resolution which includes a civil penalty of $2,000, per the strike matrix, and revocation of the "grandfathered" Class B, Bar license.

Over the past 12 months, the following violations were reported at the licensed premises formerly known as The 507 (526 South Front Street):

1. On August 23, 2025, at 8:04 p.m., officers responded after an individual was denied entry at another downtown establishment for presenting a fake ID. That individual and her companion were later located inside The 507 with a pitcher of beer and two cups. The companion admitted to purchasing the pitcher of beer for the underage female. Staff confirmed the pitcher was sold to a single person, which is a direct violation of city ordinance prohibiting pitcher sales unless at least two individuals over the age of 21 are present. The underage female admitted to consuming alcohol, provided a PBT result of .179, and was cited. The adult companion was arrested for providing alcohol to a person under 21. Two staff members advised that they were unaware that pitchers needed multiple individuals for sale and consumption, which is clearly outlined in city ordinance and in the liquor agreement that was signed by the licensee. 
2. On August 24, 2025, at 1:28 a.m., officers on downtown patrol observed suspicious activity inside The 507 consistent with underage consumption. Upon approach, several individuals fled out of the back exit. Two individuals were detained, one of whom provided a false ID before producing his true ID, showing he was underage. The other individual used another person's ID to gain entry. In reviewing the ID used to gain entry, it was clear that the ID displayed did not belong to the individual possessing it, based upon facilities differences and a 6-inch difference in height.
    
    
3. On November 1, 2025, and into the early morning of Sunday, November 2, 2025, officers and fire staff documented liquor violations at The 507 consisting of over-occupancy and failure to ensure proper monitoring of patron entry. The occupancy was far beyond the licensed number of 70 people, as it was estimated that the crowd was approximately 100 individuals and there was no staff at the front door or checking ID's or counting patrons. A review of camera footage confirmed that additional patrons entered after the establishment had already exceeded its legal capacity.

The above incidents demonstrate multiple, significant violations of the Minnesota State Statute and Mankato City Code, including, Minnesota State Statute § 340A.503, underage consumption, entry into a license premise, and provision of alcohol to underage individuals; and Mankato City Code Sec. 3-160(8)(d), prohibiting sale of a pitcher to one person, requiring responsible alcohol service, and ensuring staff are properly trained and knowledgeable of regulations.

As you will recall, this is a "grandfathered" Class B, Bar liquor license, which means that per the Mankato City Code Sec. 3-49 (e), the on-sale establishments without food service that were grandfathered in when the changes to this chapter were passed in 2007 will continue to be allowed to renew with a Class B license at the existing location and under the existing ownership. A change in ownership at the existing location will be allowed. A transfer of location or expansion of the licensed premises by the license holder will also be allowed. No new Class B licenses shall be issued in the central business districts (CBD-C and CBD-F). 

The city was made aware that as of Monday, November 3, 2025, The 507 was officially closed at the location of 526 South Front Street after the building owner chose not to renew their lease; thus, the licensee shared that they were exploring options for a new location. 

Pursuant to Mankato City Code, Sec. 3-164, a third strike within a twelve-month period requires review by the City Council, which may impose suspension, revocation, or additional conditions upon the liquor license. Due to the short time period of the three strikes, and the fact that the business is no longer in operation, the recommendation would be for payment of the penalty fee of $2,000, and the revocation of the "grandfathered" Class B, Bar license.