Letter: Setting the Record Straight on Liquor Licenses

Dear Members of the City Council,

First, thank you for your thoughtful review of the proposed liquor license ordinance changes that you will consider on Monday. No doubt, it’s a passionate debate. I thought it may be helpful to provide some context on my committee experience and clarity on the recommendation I put forth.

I was asked to join the committee after an original member resigned. Specifically, the committee leaders asked me to join the committee to provide my perspective as an owner of multiple businesses in Minot, including as a minor owner in two restaurants. During the committee meetings, I disclosed and was very transparent about my involvement in those entities. 

Yet, some have said my involvement was a conflict of interest, even though the City of Minot asked me to provide my perspective. For the record, a full liquor license holder was also on the committee to represent his perspective and those of other full liquor license holders.

Our committee conversations were open to the public, comprehensive, transparent, frank, and respectful. To be abundantly clear, our entities’ “supper-club” licenses are completely sufficient, and we have absolutely no interest in pursuing a full license or establishing a “bar,” regardless of your decisions.

In terms of the question at hand, I’ve approached the debate over the “cap” through the lens of free market capitalism. At risk of oversimplification, I leaned on the principles that have formed my world view, which is to say that a freer market is always better than a less free market. Maintaining a cap is not a free market approach. Removing the cap represents a shift towards less government regulation and more free enterprise.

That said, I recognize the insensitivity of diminishing or deleting the liquor license values of current holders. Right, wrong, or indifferent, they have played by the rules and don’t deserve a devaluation of an important asset to their businesses. 

Hence, my recommendation. I sought a compromise while standing on free market principles, which calls for eliminating the cap and providing two key protections for existing license holders:

1) Set the purchase price of new licenses from the City of Minot between $100,000 – $150,000 which reflects the average purchase price of recent transactions. This maintains a market value.

2) Enact a “first right of refusal” protection for existing license holders. This means existing owners would be given the first opportunity, over the City of Minot, to sell their licenses to new liquor license applicants and honor the current market norms.

While I don’t like high license fees, it seems to be the fairest avenue toward protecting existing license values. Some would argue that the fee in this proposal is too high, and they likely wouldn’t be wrong, save for the pursuit of compromise.

Aside from high fees, the only logical argument that remains against the proposal is protectionism. Some may argue protectionism is necessary in this case, but I believe that anti-free market and zero-sum thinking should not win this debate. It is antithetical to American exceptionalism. 

Removing the cap will facilitate growth, expand the realm of thinking and possibility, and empower entrepreneurs. I know what side of the argument I want to be on. If others disagree, I respect that.

Thank you for considering my perspective, and I wish you the best as you consider this important topic. 

Respectfully,
Kevin Black, Private Citizen