December 13, 2010 in City

Bars, restaurants chafe over city rules

Owners say Good Neighbor Agreements hinder business
By The Spokesman-Review
 
Dan Pelle photo

Soulful Soups and Spirits owner R. J. Portmann heads the Spokane Alliance of Bars and Restaurants, which is fighting city restrictions.
(Full-size photo)

One Spokane bar is restricted from serving shots after 1 a.m. Down the street, a restaurant is allowed to serve only “upscale wine and microbrews.” Around the corner, bartenders aren’t allowed to mix liquor and energy drinks.

The restrictions, contained in what the city of Spokane calls Good Neighbor Agreements, have been around for five years but just recently became a new point of contention between city officials and local bar and restaurant owners.

The city says the agreements protect the community from unsavory behavior, but business owners say they hinder local commerce and their ability to compete fairly.

Now, a business group is trying to get the agreements scrapped. Members of the Spokane Alliance of Bars and Restaurants contend the agreements lack legal merit.

“They are completely baseless in law,” said alliance lawyer Jerry Davis. “They can throw anything they want at them. It makes absolutely no sense.” Once the agreements are signed by business owners, even though some say they felt coerced, they become legally enforceable contracts.

City Administrator Ted Danek agrees that improvement can be made to the process but believes they help protect the community.

He said the contracts are meant to prevent businesses – bars and restaurants in particular – from becoming a nuisance to neighbors, and are tailored to each individual establishment to tackle problems specific to that business and the neighborhood in which it is located.

“It’s intended to solve problems,” Danek said. “We just need to adjust the process.”

Business owners contend the rules are applied arbitrarily and unfairly. An agreement in place at one establishment could be nonexistent for another.

“We need to have a template,” Davis said. “We need to have a standard.”

Alliance members said the inconsistency in the rules stifles owners’ ability to compete on an even playing field with similar establishments.

Although restaurant and tavern owners generally receive city support when seeking state liquor licenses if they sign the Good Neighbor Agreements, Danek said it’s up to each proprietor whether they want to sign them. However, those who refuse to sign could lose city support for their liquor license.

“We have input just like they do,” Danek said of the process the state goes through in deciding which liquor applications to approve.

But many business owners feel they are bullied into signing the contracts, said R. J. Portmann, alliance president and owner of Soulful Soups and Spirits.

When a business is applying for a local entertainment license, for example, the city will present the application with one of the contracts, Portmann said, and many business owners have signed the contracts believing it’s a required part of obtaining the city license.

Without that license, a business cannot have music or a dance floor, so many just agree to sign the contract in fear of having the entertainment license revoked.

Alliance members say it’s intimidating when a police officer and fire marshal walk into your business and ask you to sign a contract.

“An agreement is supposed to be two parties that mutually agree, but that’s not what’s happening with these Good Neighbor Agreements,” Davis said.

The current system allows an owner accused of a violation to request a hearing, but alliance members say this is just more bureaucratic smoke and mirrors.

Currently, an establishment has to close while awaiting the hearing outcome. For most bars and restaurants, that is impractical; having to close the doors for just one weekend could mean they close forever.

“That isn’t viable,” Davis said. “I’m not sure if the city understands.”

The possibility of going out of business as a result of the hearings makes bankers wary of lending to businesses, hampering the local economy and the growth of downtown Spokane, alliance members say.

Further, they say, the ability of the city to close down a business for contract violations supersedes the state Liquor Control Board. And, there already are laws in place to protect the community – such as those against over-serving or serving minors.

Danek argued the agreements are not meant to supersede the Liquor Control Board, but actually help businesses keep their liquor licenses when they seek renewal. If they have had violations in the past but have entered into an agreement with the city to show they are making an effort to address those issues, the city will pull for them in front of the board, Danek said.

The city has put a 90-day moratorium on the agreements to work with the alliance on creating a new process. Danek said the city just became aware of the problem and that their goal is not to hinder business.

“If we want a program that is supposed to help the community and help business owners but it’s not, we need to fix it,” Danek said. “It’s as simple as that. We just need to adjust out process.”

Alliance members will attend tonight’s City Council meeting to express their concerns.

“We do mean business,” Davis said.

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