Critics attack liquor board

Licensing law not applied equally, some complain

December 27, 2005|By LYNN ANDERSON | LYNN ANDERSON,SUN REPORTER

Giovanna Blattermann dreamed of owning a pizza restaurant in Little Italy, but in July her plans were dashed when the city liquor board voided her license by invoking a little-used state law regarding licenses that have been inactive for as few as 180 days.

Blattermann was in the process of officially transferring the license to her name. She paid $1,100 a year to renew it and was never warned that it was in jeopardy. She was unaware that the liquor board had abruptly changed its policy and that her license, worth upward of $75,000, had been targeted.

In July, the liquor board announced it was cracking down on inactive licenses. It voided Blattermann's license and two others, saying the owners had held on to them for too long. But the board's detractors say it erred in its decisions.

State law places licenses that are in the process of being transferred in a different category than those that are inactive because they aren't being used, said Gerald Langbaum, an assistant state attorney general who works with the liquor board. In such cases, the law regulating inactive licenses does not apply, he said.

State Sen. George W. Della Jr., who sponsored legislation in 1999 that imposed the 180-day limit for inactive licenses, said he never intended the law to affect licenses that were pending transfer, but rather to put an end to license brokering and to protect neighborhoods from unwanted bars.

"My intent was pretty clear," Della said. "At least past boards understood what the law was and how to apply it. I don't know why there is a problem now. The law hasn't changed."

In the past, it was the board's practice to uphold a state statute that protects licenses pending transfer from expiration under the 180-day law. To that end, liquor board staff worked with licensees who were having trouble with construction, inspections or business partners. Progress updates were regular and mandatory.

But according to board Chairman Mark S. Fosler, the policy has changed. He said the board's recent decisions to void three licenses, including Blattermann's, were justified because the transfers had been pending for so long that the licenses were in effect inactive.

"This board wants to make the liquor board more responsive and effective and more of an enforcement agency," Fosler said. "All I can say about these recent decisions is: There's just one appeal."

`Dead' license

In July, board members were confident they were doing the right thing when they voided Blattermann's license. At her hearing, they told the business owner that they were bound to uphold the law and there was no way to save her license.

The three-member board had been sworn into office just days before. Two of the members, Edward Smith Jr. and Jeffrey B. Pope, were first-time appointees to the board - a state agency charged with enforcing city liquor laws.

"At this point, [we] are of the opinion that this license is dead," said Smith, who voted with Pope to kill the license.

Fosler, who had been reappointed for a second term, voted to keep the license alive because he said Blattermann had relied on bad information from liquor board staff.

The board did not consider the fact that Blattermann had not completed the transfer of the license. A transfer is official once licensees complete a checklist of items, including financial disclosure forms and proof of Health Department inspections. Blattermann had completed some items on the list but had encountered financial difficulties. At the time of her hearing, she said she was trying to refinance the project.

According to a state statute specific to the city, "the transfer of any license shall be completed not more than 180 days after the board approves the transfer."

And while it's clear that Blattermann had exceeded the time limit for completing the checklist - her transfer was approved in June 2001 - the law is silent in the case of a missed deadline, Langbaum said, adding:

"There is no specific consequence for failure to act."

Reflecting on her hearing, Blattermann said she was shocked at the abrupt change in liquor board policy.

"It was as if people were on the attack when they didn't need to be on the attack," she said. "They were coming at me with loaded guns."

The board also surprised James Quigley, a former City Council candidate, who lost his license under similar conditions Aug. 18. Quigley has filed an appeal to get his license back but is in the process of purchasing a new license should he fail. He declined to comment for this article, saying: "I just want to open my tavern."

Citing wrong law

Quigley's attorney, Melvin Kodenski, who represents dozens of bar and restaurant owners on liquor license issues, said he believes the board cited the wrong statute in voiding Quigley's license, which was also pending transfer. Kodenski said the board could have made similar mistakes by using the 180-day law to kill licenses covered under the pending transfer provision.

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