Fridley recently approved a plan to provide financial assistance to liquor licensees due to the impacts the COVID-19 pandemic has had on local businesses.
On June 8, the Fridley City Council authorized proration and grants for 90 days based on the intoxicating liquor licensing fees to certain entities impacted by the pandemic.
As Gov. Tim Walz began slowly loosening restrictions in the state, he issued an executive order allowing restaurants to open outdoor dining areas beginning June 1. Then he announced indoor bars and restaurants could open for indoor service at half capacity starting June 10.
In response to the executive orders, Fridley passed a temporary waiver May 26 to make it easier for restaurants to provide outdoor dining. The City Council then directed staff to explore other options to assist local businesses, said Daniel Tienter, Fridley’s director of finance, city treasurer and city clerk
On June 8 Tienter suggested the city prorate applicable fees for liquor licenses.
According to city code, the proration could only apply to liquor licenses granted after the beginning of the license year, which runs May 1, 2020, through April 30, 2021. The Fridley City Council placed a hold on approving liquor licenses until Walz allowed the reopening of businesses so all were approved after the licensing year began, Tienter said.
City code also allows Fridley to prorate applicable fees for up to 90 days associated with buildings unavailable for occupancy, Tienter said.
The proration of applicable fees, which Tienter said are being issued as grants, will cost the city approximately $14,800 in revenue. But Fridley would be eligible to receive reimbursement through the coronovirus relief bill.
The United States Treasury Department also allows cities to tailor how grants are being given to businesses in need of assistance, Tienter said.
Businesses that currently can’t open due to financial constraints or lack of ability to practice social distancing will only have to pay for the months their liquor license is activated.
“Essentially all of the liquor license holders will get something as a part of this process,” Tienter said. “It just depends on when they decide to open and what their liquor license liability ends up being at that time.”
The grant program can also be modified in the future if a second wave of COVID-19 occurs or if the pandemic continues on longer than expected.
“The liquor license essentially renews May 1,” Mayor Scott Lund said, addressing Tienter. “The COVID-19 started mid-March, so are we giving them basically three months starting mid-March to mid-June when they’ll start opening up? What’s the time frame on the grant we’re offering here?”
“For the purposes of this program, the grant is for liquor licenses ending April 30, 2021, so we aren’t looking back to previous year,” Tienter said. “We understand there are some challenges with when COVID-19 began and when the governor’s executive orders that limited business operations began compared to our annual licensing year. The rational behind using the 90 days was ultimately the amount of time that businesses were closed was around the 90-day period. Even though we’re not looking back to a previous licensing year and provide a refund so to speak, which would not be permissible under the code, we’re taking advantage of the fact the buildings are generally unavailable for 90 days, so therefore we can provide a grant moving forward consistent with the CARES Act.”
Lund responded that he was in full support of providing a grant for 90 days for the licensees in the new liquor licensing year.
“I’m fine with that quite frankly,” he said. “In this unique time if we can help them survive, I think this is appropriate.”
City Council Member Ann Bolkcom asked what the response was from business owners on the proration and grant program.
“Overwhelming,” Fridley Police Department Deputy Director Ryan George said. “They’re just happy with some sort of recourse. As you can see these liquor licenses are expensive. ... They’re not looking for some freebie. They’re just looking for some reduced fee.”
The City Council unanimously approved the measure.