UPDATE: Woodbury approves Total Wine & More liquor license
Woodbury City Council members said they didn’t see a reason not to grant discount retailer Total Wine & More a liquor license following a lengthy public hearing Wednesday.
The council unanimously approved the measure despite numerous opposing comments by residents, liquor store owners and lobbyists, who say the company’s predatory pricing practices would shut down small business competitors.
City Council Member Amy Scoggins said she has never seen so much data presented on a liquor license application, but after looking at the correspondence, city attorney opinion and hearing comments Wednesday, she voted yes.
“I don’t want to cause anybody to go out of business, that would not be my intention,” Scoggins said. “Hopefully people will choose to shop at different places. If you have a place you like to shop, you’ll continue to go there and if you want to go to Total Wine then so be it.”
Jack Lanners, owner and operator of MGM Wine & Spirits, asked the City Council to consider the application based on public health concerns, moral and ethical grounds and legal violations that Total Wine & More allegedly had on its records over the years.
Lanners urged city officials to consider societal issues that come with cheap liquor.
“The lower the cost of liquor, the greater the issues and number of problem drinkers,” he said, adding, “This is a health and safety issue, which is why liquor licenses are regulated unlike Cheerios or milk or other products.”
It’s not so much about competition, he said, because the city currently has six licenses within a 1.5 mile radius and eight within 2 miles, including MGM, Rainbow, Cellars and Kowalski's.
“This is rather about the key factors that the state determines as criteria for issuing a license,” he said. “A license that is once issued is much more difficult to take away.”
City officials heard concerns from Minnesota Licensed Beverage Association (MLBA) representatives who said Total Wine & More raises many red flags.
Bill Griffith, attorney with MLBA, said he investigated the business in 17 states and gathered 5,000 pages of public data pointing to violations that weren’t reported because the company called them settlements, including $1 million in fines for infractions that occurred in New Jersey in the mid-2000s.
City Attorney Mark Vierling reviewed all the necessary legal documents to determine whether Total Wine was eligible for a license in Woodbury.
In a letter to City Council he said the company reports 29 violations from 101 store locations that consist of sales to minors, compliance checks and other regulatory offenses.
They include a trade practices violation in 1993 and another in 1991 for sales below cost. All but eight violations occurred more than five years ago and the ones within the past five years are non-felonies, he said.
“That doesn’t mean they’re not important,” he told City Council, but there is no pattern that proves the company has a history of violations and would continue to operate that way.
“It is noteworthy that none of the stores have ever lost their license to sell, although a few of them have undergone suspension for limited periods of time as a result of the violations,” Vierling wrote in an opinion to the council. “Without question, the vast bulk of the applicant’s operations have proceeded in business without incident or difficulty in the jurisdictions in which they operate.”
Maryland-based Total Wine & More has been facing many hurdles since it began making its way into the Minnesota market last year.
The company submitted liquor license applications in Bloomington, Burnsville and Roseville. None of them were instantly approved.
The Roseville store opened after a February Minnesota Court of Appeals ruling stated liquor licensing laws are not intended to protect the competition, therefore opponents didn’t have standing to challenge the city’s granting of a liquor license.
Total Wine & More has also been working to open a store in Bloomington since December. It withdrew its application when the city requested the company address ownership, personal and operational information. The company resubmitted another application in May and was able to schedule a public hearing for September.
Steve Burwell, owner of Fairview Wine & Spirits in Roseville, spoke at the Woodbury public hearing expressing concerns over Total Wine’s business model that he claimed involves lowering prices to a point that no other business can compete, especially because smaller stores don’t have the space to store large quantities.
His business of 29 years has suffered since Total Wine opened 1,200 feet from him about four months ago, he said.
“As far as I’m concerned, it would appear to me that they’re trying to drive the little guy out of business,” Burwell said, adding, “It’s been that tough since they opened and it’s all through pricing, pricing, pricing.”
Total Wine sells wine ranging from $3 to as much as $1,000 a bottle, in addition to beers and distilled spirits.
Roger Wright of Total Wine said the store is a regional attraction with its well-designed, well-lit concept and trained and educated employees.
“We are not a warehouse store,” he said. “We don’t have forklifts running up and down the aisles.”
The business is expected to add 50 employees with 75 percent as full-time with benefits, he said.
Woodbury City Council received dozens of letters, emails and phone calls in opposition and in support of Total Wine joining the Woodbury Village shopping center.
After reviewing documents and hearing concerns, Council Member Christopher Burns said his own buying practices won’t change as he will continue to buy local from MGM, Cellars and Haskell’s to keep supporting local businesses.
“All that said, for me as an elected official it came down to this: I think Total Wine satisfied state statutes and our ordinance,” he said. “I think we should do everything we can, in our capacity as elected officials, to let businesses compete against one another and should let our residents decide.”