Erik Burgess, Published February 19 2014
Marcus Theatres' liquor push meets liquor board resistanceFARGO – Serving alcohol in one of the city’s major first-run movie theaters might be a tough concept for some here to swallow.
But even if city officials sign off on the plan, a cut rate on the liquor license the theater owner proposed appears to be a total flop.
The city’s liquor board heard a brief presentation Wednesday afternoon from Marcus Theatres, which is considering building a lounge and serving alcohol at the West Acres Cinema.
Darin Hauglie, a Fargo resident who said he’s been sober for more than five years, told the liquor board he’s shocked at how many places in town serve liquor nowadays. He said the Marcus policy to pour drinks into unique frosted cups with logos on them so ushers can spot them easily doesn’t make a difference.
“If underage people want to drink, they’re going to find a way, doesn’t matter what color cup or logo cup or whatever you put the alcoholic drink in,” he said. “As soon as the lights go out, it’s going to be very hard to regulate that in a movie theater.”
The idea also didn’t sit well with Jason Ramstad, general manager of Chub’s Pub, a Fargo bar. Marcus was asking the city for a $90,000 discount on a liquor license that would allow them to serve wine, beer and spirits with a physical bar in the lounge.
“To not treat this issue with a fair market value would be a slap in the face to the people who have been doing this for a lot of years,” Ramstad said.
Liquor board members seemed hesitant to give Marcus a discount on the FA Entertainment liquor license, which normally has an upfront, one-time fee of $100,000.
“To turn around and issue the same license to you and not charge you that fee, boy, if I was the guy that paid that $100,000 to get that license, I would be extremely upset with the city,” City Auditor Steve Sprague said.
City Commissioner Brad Wimmer said he, too, would be “hard-pressed” to agree to a discount.
Marcus now must consider its options, as a company official said earlier this week that the lounge plan at the West Acres site depended on the license fee discount.
The company hasn’t formally applied for a liquor license yet, Sprague said.
Marcus could seek an I License, which allows for beer and wine sales but no spirits. It also requires that 65 percent of sales come from food or other non-alcoholic items. It has an initial fee of $10,000.
There is also an F License, which allows sale of beer, wine and spirits, but it doesn’t allow the license holder to have a physical bar. Liquor must be poured behind-the-scenes and then brought out to customers for table service. That requires at least 50 percent of sales to be on items other than liquor. It only costs $3,000 up front.
Mark Grimes, the director of food and beverage for Marcus Theatres, said he didn’t know which path the Milwaukee-based company would take.
Grimes said they were asking for a discount because the lounge, called a “Take Five Lounge,” wouldn’t have the profitability of a standalone restaurant or bar. It’s more of an amenity to the rest of the theater, he said.
“We’re not trying to create a standalone bar,” he said. “We’re not trying to create a late-night nightmare for the (police) chief.”
Marcus Theatres has “stringent” guidelines for serving alcohol, Grimes said. They only allow two drinks per customer, and customers cannot purchase multiple drinks to bring back to their table for others.
“It’s very similar to a restaurant … it’s very similar to concerts and to bowling alleys,” Grimes said. He offered up Chuck E Cheese as an example: “Where you have kids parties, and they have alcohol.”
Ushers also use night vision goggles during regular checks of auditoriums to make sure alcohol isn’t being consumed by a minor, Grimes said.
Marcus has Take Five Lounges in four other cities – Duluth, Minn., Mequon, Wis., Brookfield, Wis., and three lounges in Omaha, Neb., said Bob Menefee, vice president of marking and communication for Marcus Theatres.
They also have full-service restaurants with alcohol service in Mequon, St. Cloud, Minn., and New Berlin, Wis.
Grimes offered to give Police Chief Keith Ternes a list of police chiefs in those towns where Marcus serves alcohol.
“Knock on wood, we have a stellar reputation to date with no issues at any of our theaters on alcohol compliance,” Grimes said.
Mayor Dennis Walaker said he’s received a slew of input from the public.
“This would be an extremely big change, especially for my grandchildren,” Walaker said. “It’s one thing to have a bar in there, but to allow them to take alcohol out of the bar into the theater, I think that’s a stretch. But that’s just my opinion, and I only have one vote.”
Marcus Theatres hopes to build the lounge as part of a larger, multimillion-dollar renovation of both the West Acres Cinema and Century Cinema. The renovations include upgraded seating in both locations and a new lobby for the Century Cinema.
They hope to complete those upgrades by the end of spring, Menefee said.
City commissioners will have to sign off on whatever position the liquor board takes on the Marcus plan.
Readers can reach Forum reporter Erik Burgess at (701) 241-5518