A Restaurateur's Take on Liquor License Policy

The Hermosa Beach City Council meets Tuesday to discuss adopting strict regulations for restaurants that serve alcohol. In previous meetings, the council debated moves such as limiting the eateries' operating hours.

The city turned its attention to licensing this month when a request was made by Sharkeez owner Ron Newman to transfer a liquor license from one person to another. At the time, Hermosa Beach Police Chief Greg Savelli suggested earlier operating hours be required before transferring the license. 

Newman explained in an exclusive interview how he believes the council's policy decisions could affect local restaurants and businesses:

Patch: How do you hope for this liquor license policy discussion to end?

RN: Hopefully, they'll just keep it simple and let the business owner
and the police handle it by themselves, otherwise it can be tied up
in courts for a year. As far as existing [policy], if someone wants to
increase hours, it's not going to happen unless the council decides
to make a exception. Even if Alcoholic Beverage Control [the state
agency that issues liquor licenses] approves it which they won't
without the city's approval. The ABC cooperates with what the city
wants.

Patch: How would the City Council's decision to create additional alcohol-serving rules affect you directly?

RN: The effect is, they're trying to set some guidelines for when an establishment is sold, so the buyer and seller and the city can handle each license without a  court fight. If they make it too strict and take property rights away,  no one will sell and we will be stuck with the same late night old operation instead of something new coming in. I don't know what they are going to change. If they make a blanket changes it will affect the whole business community when a place is sold, or if someone asks for a new place, or if someone tries to ask for different hours, but they've always had that and they've always said no. I don't know if that's going to change the rules any.

Patch: The discussion surrounding licensing had been raised earlier this year when a request was made to transfer the use permit to serve alcohol from Il Boccaccio to a Sharkeez establishment. As owner of Sharkeez, can you please summarize your involvement in the case?

RN: What happened in Il Boccaccio is that the owner, Joe [Venezia], [said] the economy was just getting too tough for him, so we were going to be partners … In the case with Il Boccaccio, the city protested against the person-to-person transfer, but they didn't have any grounds to protest and we ended up taking it to court and the city lost the case, because they didn't have grounds. If someone comes in and they don't have grounds to protest, then they're going to lose.

Patch: What about the case do you think encouraged the City Council to discuss a new liquor license policy?

RN: In most cities, if the police decided not to have any policies at all, and someone sold their business, the city can always ask for certain conditions. Nowadays, when someone sells and if they have reasonable conditions, usually the buyer and the seller can come to an agreement. But if the city totally protests the decisions and changes the hours of businesses to some time that is really extreme, it takes value away from the building. It takes value away from the business.

What they did, which has never happened before, is the city blatantly said that we couldn't have a 1:30 a.m. license. As owners, we paid a price for the building. And once the hours of one building changed to 12 a.m., it takes business away when all the other businesses know that the city's cracking down on this. The city said it was going to protest every new license. And they said if that's what they do, that's what they're going to do to everyone else. For some reason they decided to come after us.

The Department of Alcoholic Beverage Control is very hard to win against in court, because ABC goes with the city. You have to have good evidence to win a case. I've never seen a person-to-person protest like this that didn't have any evidence, because no one's ever challenged before, and no one will have to transfer again. With new businesses, if they ever start up, it's a different issue.

Patch: How were the boundaries of a liquor license regulated in the past?

RN: Three years ago, people were operating outside their license. They would stay open later and no one really enforced anything. Then when the city cracked down, now everyone's trying to follow the city, but everybody was doing a pretty good job, and now there isn't as much traffic anymore, because of the economy.

In Hermosa Beach, downtown, they used to call it the entertainment zone back in the 1940s and 1950s. So if you really go down the list, Mermaid has been here since the 1950s; Lighthouse has been here since the 1940s; Sharkeez has been here since the 60s; Patrick Molloys used to be called the Endzone.

The only places that got extra licenses when they probably shouldn't have were places like the Union Cattle Company. You know, that used to be just a brewery. The only other one that did it was the Blue 32, which used to be called the Strawberry Patch. You know, it always had licenses.

Manhattan Beach had more late licenses, but then other businesses took over … usually every city just analyzes every individual transfer on its own.

Patch: Some residents have said that Hermosa Beach turns into a "party town" on the weekends and at night. If the city agrees to establish stricter rules for restaurants serving alcohol, do you think we'll see a quieter Hermosa Beach in the future?

RN: It's not going to make any difference. Hermosa is less of a party town than it has been in the past. Nowadays, it's under more control by the city. It used to be that when you walked down the promenade, you couldn't walk anywhere, because it was so packed.

Unless the city totally took everybody's business hours away, it would affect the economy of the city. Most people stay in Hermosa, because they want something to do at night.

We've brought it up many times. First of all, for the businesses that get busy and there's overflow, there's just too much control by the city. Just the parking tickets [for example], the parking structures that people have to pay for to go to restaurants, the sales tax, and the property tax. That's hundreds of thousands of dollars that no one ever thinks about.

I think I have statistics that say that the city takes in $4 million and it costs them only about $700,000 to $800,000 for all the service in the city. And I think I also have statistics from the police that say that only 10 percent of all the police calls are in downtown and 90 percent of them are in the rest of the city.

Patch: How do you think stricter rules will affect local businesses and the city's economic health?

RN: Like I said before, existing places are going to still be there. They can't take property rights away. And nothing's going to change, because with this bad economy, everyone's working hard to try to get business. No one wants an alcohol-related incident… Business owners, they know if they have lots of fights, they're going to get their CUP [conditional use permit] taken away.

Patch: What major change in liquor licensing rules do you anticipate the city will make?

RN: What they're showing is that they want Hermosa Avenue to close at 11 p.m. on the weekdays, midnight on the weekends and 1 a.m. on the [Pier] Plaza. And that doesn't mean the same thing for existing places like ours. For the rest of the city, they want them to close at 11 p.m and weekends at 10 p.m.

Patch: Why do you think the City Council will vote that way?

RN: Because we made such a stink about the way we were being treated. What happened is that they protested our [license] but let all the others go through, which they didn't need to do but that's the way they handled it. I think because that happened, they wanted to make it standard.

Patch: Why should local residents care about this issue?

RN: The average age of people who live in Hermosa Beach is 36 years old. Most of our citizens are happy with the way most of Hermosa is. There is always a small minority that makes all of the complaints. Most of our citizens are young professionals, single or married  and live here because they like the beach, like Hermosa, some grew up here and went to our schools. Hermosa is  a place where they can socialize. They also know it won't be perfect when you have a beach that attracts thousands of people at all times.  If you want it to be like Palos Verdes or El Segundo, that is not the beach. The beach is different and that is why most of us live here.