7.2.
CC Regular Session
- Meeting Date:
- 06/23/2020
- By:
- Tim Gladhill, Community Development
Information
Title:
Discuss Potential City Code Changes to Liquor Licenses and Tobacco Licenses
Purpose/Background:
The purpose of this case is to consider directing staff to begin a City Code Amendment process pertaining to issuing both an Off-Sale Liquor License and Tobacco License (for electronic cigarettes) in a same location.
At the May 23, 2020 City Council Meeting, the City Council requested a policy discussion regarding businesses that desire to sell off-sale liquor and electronic cigarettes at the same location. This was in response to an actual application for license. The license application was tabled pending this discussion.
At the May 23, 2020 City Council Meeting, the City Council requested a policy discussion regarding businesses that desire to sell off-sale liquor and electronic cigarettes at the same location. This was in response to an actual application for license. The license application was tabled pending this discussion.
Notification:
Notification is not required at this stage.
Observations/Alternatives:
Staff has intentionally kept this report high-level in order to seek high-level policy direction. Staff will fill in details with future cases. In its most simplistic terms, Staff simply needs direction on the following policy question.
According to the City Attorney, the City would have the legal authority to be more restrictive that State Statute in this regard. In other words, the City could amend City Code related to Liquor Licenses and Tobacco Licenses to restrict the sales of off-sale liquor and electronic cigarettes in the same location.
This topic was originally scheduled for Work Session review. However, the topic list did not allow for sufficient time for review. The City does have a License Application on the table impacted by this policy discussion. Time is of the essence to get initial policy direction.
Attached is the House Research file which provides some good information on the current interpretation and the ability of cities to be more restrictive relating to the the type of products that could be sold at liquor stores.
The City Attorney has consulted with the State of Minnesota and the State on this topic. The State of Minnesota response is as follows. In short, the State of Minnesota states that municipalities may allow the sales of off-sale liquor and electronic cigarettes in the same location. However, the business may not sell off-sale liquor and products such as CBD in the same location.
As you know, Minnesota Statute 340A.412 subdivision 14 lists items that may legally be sold in an exclusive liquor store in Minnesota. The statute does allow the stores to sell tobacco products. Minnesota alcoholic beverage statutes chapter 340A and Minnesota Rules Chapter 7515 do not define the term tobacco related to its allowable sale in exclusive liquor stores. This has tasked our division with how to address the question of what is tobacco for purposes of enforcing the statute.
We have looked to tobacco license regulations for clarification of products that can be sold by holders of a locally issued tobacco license. See Minnesota Statute 461.12 https://www.revisor.mn.gov/statutes/cite/461.12. Subdivision 1 covers tobacco licensing by a local jurisdiction. The subdivision includes electronic delivery devices such as e cigarettes.
Local municipalities do issue tobacco licenses to exclusive liquor stores, and it appears that the tobacco license allows for the sale of e cigarettes. I have attached a pdf file from the Minnesota House of Representatives House Research last updated in June of 2018 where e cigarettes are licensed and regulated as tobacco related devices.
The concern I have related to an e-cig operation trying to become an exclusive liquor store would be related to other items they might sell in their store, such a CBD oils and related products. There are many products these stores sell that would not be allowed in the exclusive off-sale liquor store.
It is going to be a business decision on the part of the business as to whether or not they limit items they can sell by combining the current store with a liquor store or whether they open a liquor store to operate exclusive with no public access to the e-cig store.
- Does the City Council desire to restrict the sales of off-sale liquor and electronic cigarettes in the same location?
According to the City Attorney, the City would have the legal authority to be more restrictive that State Statute in this regard. In other words, the City could amend City Code related to Liquor Licenses and Tobacco Licenses to restrict the sales of off-sale liquor and electronic cigarettes in the same location.
This topic was originally scheduled for Work Session review. However, the topic list did not allow for sufficient time for review. The City does have a License Application on the table impacted by this policy discussion. Time is of the essence to get initial policy direction.
Attached is the House Research file which provides some good information on the current interpretation and the ability of cities to be more restrictive relating to the the type of products that could be sold at liquor stores.
The City Attorney has consulted with the State of Minnesota and the State on this topic. The State of Minnesota response is as follows. In short, the State of Minnesota states that municipalities may allow the sales of off-sale liquor and electronic cigarettes in the same location. However, the business may not sell off-sale liquor and products such as CBD in the same location.
As you know, Minnesota Statute 340A.412 subdivision 14 lists items that may legally be sold in an exclusive liquor store in Minnesota. The statute does allow the stores to sell tobacco products. Minnesota alcoholic beverage statutes chapter 340A and Minnesota Rules Chapter 7515 do not define the term tobacco related to its allowable sale in exclusive liquor stores. This has tasked our division with how to address the question of what is tobacco for purposes of enforcing the statute.
We have looked to tobacco license regulations for clarification of products that can be sold by holders of a locally issued tobacco license. See Minnesota Statute 461.12 https://www.revisor.mn.gov/statutes/cite/461.12. Subdivision 1 covers tobacco licensing by a local jurisdiction. The subdivision includes electronic delivery devices such as e cigarettes.
Local municipalities do issue tobacco licenses to exclusive liquor stores, and it appears that the tobacco license allows for the sale of e cigarettes. I have attached a pdf file from the Minnesota House of Representatives House Research last updated in June of 2018 where e cigarettes are licensed and regulated as tobacco related devices.
The concern I have related to an e-cig operation trying to become an exclusive liquor store would be related to other items they might sell in their store, such a CBD oils and related products. There are many products these stores sell that would not be allowed in the exclusive off-sale liquor store.
It is going to be a business decision on the part of the business as to whether or not they limit items they can sell by combining the current store with a liquor store or whether they open a liquor store to operate exclusive with no public access to the e-cig store.
Funding Source:
This case is being handled as part of normal Staff duties.
Recommendation:
Staff recommends that City Council provide direction to Staff to begin a process to amend City Code if it so desires.
Action:
Motion to direct Staff to begin a process to amend City Code pertaining to Liquor Licenses and Tobacco Licenses.
Attachments
Form Review
| Inbox | Reviewed By | Date |
|---|---|---|
| Kurt Ulrich | Kurt Ulrich | 06/18/2020 04:28 PM |
- Form Started By:
- Tim Gladhill
- Started On:
- 06/18/2020 11:19 AM
- Final Approval Date:
- 06/18/2020