Liquor-license requirements have some Uptown establishments practically giving away food
As bars and restaurants proliferate in Uptown, the competition for happy hour business can be stiffer than the drinks.
For less than $5, Figlio's patrons can buy a dinner (mini-burgers or pizza) and drinks in the 3001 Hennepin Ave. S. restaurant's bar area. Elsewhere in Calhoun Square, diners can get a three-course dinner for less than $10 and specialty drinks for less than $5 on a Monday or Tuesday at 101 Blu.
While some restaurateurs say their deals are designed to fill gaps when customer traffic is slow, diners and drinkers can also thank an unlikely source for the bargains: city government.
Several restaurant spokespeople say they strategically sweeten deals to comply with city liquor laws.
Such a deal
A prime example of how city rules influence business strategy is at Tonic of Uptown, 1420 W. Lake St. Since its March opening, Tonic has been popular with the bar crowd -- so popular it has had difficulty complying with its liquor-license requirements.
Tonic's city license stipulates that at least 60 percent of sales must be food -- leaving 40 percent for liquor. (Most establishments outside of downtown are also zoned as such for liquor.) For at least the first few months after they opened, Tonic hasn't sold enough food, say city licensing officials, so they issued citations and fines. Tonic's owners are appealing the sanctions before an administrative law judge.
Despite the court case, Tonic is working to gain compliance by offering an extremely food-driven happy hour. Want to drink with your buddies between 2 p.m. and 7 p.m.? Instead of spending $50 on liquid fun, Tonic will offer you three pizzas, a fennel-lobster dip and a chicken dish for $49…and they'll throw in a $50 bar tab.
"It's to get people to eat the food and try the food, so they know it's a restaurant," said Blois Olson, a Tonic spokesperson.
He said Tonic has had food-driven happy hours all along as part of their business strategy. He also said Tonic's drink prices - approaching $10 in some cases -- go hand-in-hand with balancing food and drink sales. "Higher drink prices are something experts suggest in limiting the alcohol component [of restaurant sales]," Olson said.
Luke Grohovski, a manager at Bar Abilene, 1300 Lagoon Ave., said the western-themed restaurant/bar's happy hour serves two purposes: the more traditional purpose of luring more customers during the slowest hours and secondarily, to boost food sales.
Brad Bridwell, general manager of Old Chicago, 2841 Hennepin Ave. S., said his happy hour does similar double-duty. "It does help [meet the city sales requirements] and it's one of the reasons we have one," Bridwell said. "But we'd have one anyways."
Are deals legal?
The city added food-sales stipulations to liquor licenses in 1983, intending to protect neighborhoods from alcohol-related problems. (Downtown bars are exempt.) The theory is that drinkers who eat will cause less trouble, and a bar forced to sell lots of food is less likely to become a drunken mob scene.
Since profit margins on food are less than on drinks, establishments might not offer food if left to their own devices.
Does offering discount food -- or selling food and giving away the booze -- skirt the law? The city says no.
Assistant City Attorney Steve Heng said that offering special deals to boost sales is legal. "There's no specific language in the ordinance (barring specials) in relation to 60/40," he said.
Heng explained that when the city evaluates license compliance, it audits gross sales, business records and tax returns. He said as long as city licensing staff deems that those records show compliance with the 60/40 food/booze split (or in some cases 70/30), businesses are considered operating up to code.
Still, City Councilmember Dan Niziolek (10th Ward) -- who represents Tonic's area and has criticized the establishment -- said offering extraordinary food deals to meet the food requirement seems duplicitous. "If you're buying food and it translates into a bar tab … it is the sale of alcohol," said Niziolek, who also chairs the Council's Public Safety and Regulatory Services committee.
Not all businesses have to worry about selling enough food. In Uptown, establishments such as Chino Latino, 2916 Hennepin Ave. S., Williams Pub and Peanut Bar, 2911 Hennepin Ave. S. and the Uptown Bar and Cafe, 3018 Hennepin Ave. S. are exempt from the rule because their location had a liquor license before the 1983 code requirement was instituted.
Some businesses say they offer good happy hour deals because of competition, not city rules. Many say their specials are built to draw customers amid the ever-growing number of Uptown bars and restaurants.
Jake Polt, manager of Chaing Mai Thai, 3001 Hennepin Ave. S., said there's a lot of buzz about the 60/40, but different factors drive their specials, such as drawing customers after traditional dinner hours.
Craig Coulter, manager of Calhoun Square's 101 Blu, said his happy hour offerings are driven more by competition.
He said 101 Blu has no problem meeting the city's food-to-liquor ratio -- he estimates average sales are about 70 percent food and 30 percent alcohol. "For us, it's basically to compete with the surrounding bars and restaurants," Coulter said, noting Figlio's competitive specials.
Dain Harrington, bar manager at the Calhoun Square Famous Dave's, said competition is also the prime force. "Within the last six months, it's been very competitive with the happy hour [in Uptown]," he said.
Harrington said Famous Dave's also offers deals to compete with summer. "We want [happy hour customers] to stick around and see the bands," he said. "The weather's nicer and we're trying to lure people."