What happened at the Liquor Board on December 4, 2014.

Mr. Andrew Carter testified that he has worked in the alcoholic beverage industry for ten years. Carter met with the SBNA and agreed to keep the lines of communication open with them. He is TAM-certified through 2017, and two other bartenders at the bar are certified as well. Mr. Carter has lived in Federal Hill for four years; Mr. Selke does not live in Baltimore City. Commissioner Moore asked the two applicants, “are you aware that you’re dressed identically?”

Neither of the applicants lives in Baltimore City, but Mr. Fuller owns real property in his name within the city limits. Mr. Donithan lives in Carroll County but was born and raised in Baltimore City and is familiar with the area. Commissioner Moore pointed out that these two applicants are “absentee owners” and advised them that it will be important that they know what is happening at their establishment. They are proposing to open in a residential neighborhood, and Moore said that the Board “wouldn’t want [the applicants] to have to come back.” Mr. Fuller promised that he would be involved in the bar, noting that he drives by often and owns rental property in the neighborhood.

The commissioners asked how much money has been invested in the restaurant so far. Fine replied that the applicants have spent $309,000 so far, out of a total of $809,000. Mr. Fine submitted a letter of support from Downtown Partnership.

Mr. Alex Fine is the “Baltimore City resident” required by Article 2B and is also Mr. Stanley Fine’s nephew. Alex works for the landlord who owns the property at Power Plant and is a property owner in Baltimore City. Stanley Fine told the Board that his nephew “has more than a passing interest in the success of this restaurant.” Commissioner Moore then pointed out that Alex Fine had signed the application for the new Class B license as a character witness. Moore said that she did not think that someone can attest to their own character. Mr. Stanley Fine told the Board that when Mr. Voltaggio and Ms. Karamouz filled out the new license application, they did not have legal representation and did not know that they needed a Baltimore City property owner on the license. Mr. Alex Fine was added to the application later to fulfill that requirement. Stanley Fine said that he would amend the application by signing it as a character witness on behalf of his nephew.

Commissioner Moore asked how frequently Mr. Cheung would be at the restaurant. Cheung responded that he will spend at least 50% of his time there, primarily at lunchtime. In the evenings, he will go to another restaurant location in Baltimore County, but he will keep an assistant manager on-site. Bernard and Abraham Rosenthal testified that they are part owners of the McHenry Row retail development, with Mark Sapperstein. They are both at the shopping center “virtually every day.” Mr. Bernard Rosenthal is a 1% owner in the restaurant and is an applicant who has been placed on the license to satisfy Article 2B section 10-103(b)(4), which requires that one of the licensees reside in Baltimore City. Kodenski interjected that he disagrees with this provision of the code, and suggested that Baltimore City should adopt the code provision that applies to Baltimore County, which only requires that one applicant live in the State of Maryland. Kodenski said, “I’m a voice crying out in the desert.”

Commissioner Moore noted that Ms. Hecker had proffered that Cuban Revolution had closed six months ago, but Moore knew that it closed almost a year ago, sometime in the winter of 2014. She knew this because she had spoken with the Executive Director of East Baltimore Development Inc. (EBDI) about trying to find a new restaurant tenant for the space. Moore pointed out that the statute requires $200,000 of capital investment, and Atwater’s has only contributed $95,000. She said to Ms. Hecker, “help me understand why this applicant is entitled to piggyback on monies spent by someone other than them, especially when it was at least a year or more ago that those dollars [were] spent.” Ms. Hecker responded that Article 2B requires that there be a capital investment but does not require that the investment be by the applicant. She said that the investment from two years ago had not depreciated to below $200,000.

Commissioner Moore was not satisfied with this explanation. She told Hecker that she understood the statute to require the capital investment by the applicant, especially since Cuban Revolution had a liquor license and presumably had already applied their capital investment dollars to qualify for their restaurant license under the statute. Hecker responded that the majority of the money invested for Cuban Revolution was invested by the landlord, not the tenant.

At this point, Mr. Stanley Fine, a fellow partner at Ms. Hecker’s firm, joined Ms. Hecker. He argued that, because Cuban Revolution failed, they forfeited their assets to the landlord, where normally they would have been able to sell them. He said that Atwater’s is really paying for the capital investment that was previously made through their high rent to the landlord.

Chairman Ward said that to avoid buying a Class B license, Atwater’s is qualifying for a brand new “free” license through a capital investment. Fine responded that the license is not “free” because Atwater’s is paying a hefty rent to their landlord. Ward asked whether commercial rent can be considered an investment. Fine answered that part of the rent is letting a landlord get a return on his investment. He argued to the Board that the $200,000 capital investment minimum has been an economic development tool in Baltimore City. In contrast, if Atwater’s were to open a restaurant in Towson, they would have to spend $200,000-$250,000 to purchase a license. If that became true in Baltimore City, the city would not have the restaurant growth that they currently have. Restauranteurs would prefer to spend money on the restaurant space than on a license.

Commissioner Moore replied that she enjoys going to Atwater’s, and the restaurant is needed in the space, but she did not want to make a decision that sets a bad precedent for other applications. She wants the restaurant to be successful, but they have not satisfied the requirement in the law. Hecker responded that the legislative intent of the section of the Code is to guarantee that applicants are running “a high quality restaurant” and Mr. Atwater has met that intent here. She told the Board that the restaurant is already open (without alcohol service). Mr. Atwater testified that he will not be spending an additional $105,000 to meet the $200,000 minimum anytime soon. Atwater said that his restaurant has the use of $250-$300,000 in high-end kitchen equipment, which is really owned by the landlord.

Ms. Bailey-Hedgepeth then gave copies of some documents in the file to the Commissioners, including letters from the community in opposition to allowing the bar to reopen, a letter from Baltimore City Housing saying that the tavern use of the building had been revoked for discontinuance of the nonconforming use for over one year.

Ms. Witt then submitted a packet of documents, mostly pulled from the Liquor Board’s files. She submitted printouts from the State Department of Assessments and Taxation’s website, showing that the corporate entity associated with the liquor license was forfeited for over three years between 2009 and 2012, which means that the business “646 of Newkirk, Inc.” was unable to do business in its own name between those two dates. She also submitted a series of letters from former Deputy Executive Secretary Jane Schroeder to the licensee; each of the letters noted that the licensee was behind on paying her renewal fees. Witt noted that the 2010 and 2011 licenses for this address were still in the file, in their envelopes, which means that the licensee never retrieved them and never legally opened her business during those two license years. Another letter from Jane Schroeder to an auction company said that the license was not in good standing and that the nonconforming use for the building had probably been lost. Witt also submitted an inspector’s report from Inspector Ed Owens to Acting Executive Secretary Douglas Paige saying that the business had never opened in 2013 after being given permission by the Board to open in January 2013. She submitted a water bill from Baltimore City showing that the water had not been paid for since June 2013 and that the water has been shut off at this property. Finally, she submitted the first page of each renewal application from 2009 to 2013, showing that each one, filled out by the licensee, states that the business has been closed, though each one has a different closure date.

Mr. James Pringle, president of the Greater Greektown Neighborhood Alliance, then testified that the bar has been closed since he moved to the neighborhood, except when they opened without permission in the last week of February 2014. Mr. Hurdle argued that the bar had been given permission to reopen in January 2013, to which Ms. Witt agreed.

Commissioner Moore asked Mr. Hurdle where the licensee, his client, was, and Hurdle responded, “she’s not here.” Moore asked, “when have you last spoken with her?” Hurdle declined to answer that question. Moore stated that it seems to her that if this were an important issue for the licensee, she would come to the hearing.

Mr. Kodenski began by reminding the Board that Ms. Driver’s building had been damaged by a March 8, 2014 fire. Immediately after the fire, Driver wrote to the Board to ask for a hardship extension, and the Board told her to resubmit her request after 180 days. She came back to the Board on August 21 for a hardship extension, which was granted. Her daughter then submitted an application to transfer ownership. Kodenski said that the only issue at the transfer hearing is whether the applicant is fit and proper to have the license transferred. Kodenski said that various community members testified at that time that the license was expired, but the applicant was not aware that this testimony was going to be presented.

Commissioner Moore told Kodenski that she had learned after the hardship extension hearing that there was evidence that had not been presented to the Board. Once she received that evidence, it was “patently obvious [to Moore] that Lil’s Place had not been open for some period of time.” Kodenski replied that the Liquor Board’s inspectors are not there “all the time” and that he had brought people who had been patrons of Lil’s during the time that the inspectors said it was closed. Kodenski objected to Moore’s use of the term “community” to refer to the opposition to the liquor license. Moore replied that Kodenski was wasting his energy.

Ms. Watkins then presented her evidence that she had brought to show that the establishment was open. She told the Board that when the firefighters were putting out the fire next door, they destroyed the windows and doors of Lil’s Place and also destroyed some or all of the liquor. Watkins filed a request for reimbursement from Baltimore City, but the city denied her request. She submitted her application to the BMZA on June 27, 2013 to open a barbershop on the second floor of the building. Chairman Ward pointed out that the issue is whether the bar was open, and the BMZA filing does not show that the bar was open. Watkins then introduced documents that she said were delivery receipts for alcohol. Moore replied that they were not delivery receipts; they were receipts for payment. Watkins said that her mother always paid “cash on delivery” (COD), so they were receipts from deliveries. Watkins said that all the receipts from 2014 were destroyed in the fire. She submitted some other documents from Bond Distributers, a company that distributes Keystone and Steel Reserve beer. At this point, Chairman Ward admonished Mr. Kodenski for not coming in with an organized case. He told Kodenski, “you’re the attorney, you should have this stuff straight.” Watkins continued with her evidence. She submitted a letter form the Maryland State Lottery that the establishment was approved for lottery sales from 2009 to 2013. Watkins finally submitted a police report showing that the building had been burglarized on January 6, 2013, which, Watkins argued, showed that they were “definitely open.” Ward pointed out that a closed bar could have been broken into.

Kodenski then presented witnesses to speak in support of Watkins and Driver. Mr. Glen Scott testified that he is a bricklayer and has lived on the block for eighteen years and was a faithful patron of Lil’s, four or five times a week. He drank Budweiser during the week and Hennessy on the weekends. He testified that the bar was open in 2013 and 2014. Mr. Armando Cadogan owns two properties on the block and would stop in to Lil’s Place in the evenings to pick up rent checks. He doesn’t drink, so he would just get a glass of water. Ms. Savonne Cox testified that she was a patron of the location until the fire in March. She knew that the bar was open continuously until the fire, but she moved away from the neighborhood three years ago. Mr. Thomas Comi testified that he owns a vending machine business and that there was a jukebox at Lil’s Place owned by his company. He submitted a jukebox license that was issued by Baltimore City in December 2013 for $400. Mr. Mark White testified that he used to go to the bar about two times a month and drink Steel Reserve. Mr. James Odom testified next that he used to go to Lil’s every day and drink Remi Martin. On cross-examination, Ms. Adeline Hutchinson from the community association asked if Mr. Odom had ever borrowed any money from Ms. Lil. Odom replied, “no, I’ve lent Lil money.” Mr. Ware testified that Ms. Watkins is his niece and he used to go by two or three times a week to say hello, but he did not drink anything. Ms. Doris Booker testified that she “go back a many year with Ms. Lil.” She used to go to Lil’s and play the lottery, two to three times a week, unti the fire, but she is not from the area.

Ms. Watkins then submitted more evidence. She provided her alcohol education certificate and records of the retail sales taxes paid from 2008-2014. She argued that the community signatures in opposition to her were “forged” because several of the signatures were in the same handwriting. Watkins said that she has been helping her mom at the establishment since 1989, and she is familiar with the operation of the bar. She said that investors have been purchasing properties in the neighborhood lately, to “give folks something to come home to that’s decent.” She said that before the fire, she had tried to get the name of Pulaski Street changed to “Lil.” She argued that their business is not located in the Matthew A Hensen neighborhood association’s boundaries. She also argued, contrary to testimony provided at the last hearing, that she never sees kids in the vicinity of the bar, except maybe in the summertime. Watkins criticized Ms. Hutchinson’s and Dr. Cheatham’s efforts in planting fruit trees, saying that the community needs to get rid of its rats before it plants trees. Chairman Ward asked Ms. Watkins, “are you criticizing someone who is trying to improve their community?” Jones also asked, “am I to understand that because Doc Cheatham is involved, you’re going to hold him accountable for every ill in the community?” Ms. Watkins withdrew her photos of the fruit trees. She argued that all of the properties on the block, except one, are occupied, contrary to Ms. Hutchinson’s testimony from the previous hearing.

Ms. Hutchinson asked Ms. Watkins if she had contacted any community association either before October 23 or since? Ms. Watkins said that she had not, because she doesn’t belong to any community association. Hutchinson asked, if the Board was to rule in Ms. Watkins’ favor, what benefit would the sale of alcohol bring to the community? Ms. Watkins replied that the sale of alcohol is a business and is their livelihood, just like any other business. Watkins said that beer and liquor doesn’t affect the crime rate; guns and drugs affect the crime rate.

Commissioner Moore then questioned Ms. Watkins about the break-in to the property in January 2013. She gave Ms. Watkins a copy of the police report from the breakin to read. Moore pointed out that Ms. Watkins is not mentioned in the report at all. In the report, Ms. Driver apparently told the police officer that she comes to the property to get the mail, every couple days. The police could not process the scene, because the electricity had been cut off. Ms. Watkins admitted that she had not paid the electricity bill. Moore asked, “do you know how long the electricity had been out?” Watkins replied, “I would assume at least 30 days, maybe.” Moore also noted that Ms. Driver could not say what property was stolen, though she thought that some liquor bottles had been taken.

Commissioner Moore asked for any other invoices for other beverages, like the Hennessy that one of the patrons said that he ordered. Watkins responded that she didn’t know that she needed to bring in Hennessy invoices. The last time that Watkins stocked the bar was in 2009, and she had spent $8,000. Many of the bottles that she bought in 2009 are still there. Moore pointed out, then that Ms. Driver paid $0 in sales tax for all of 2013 and for parts of 2011. Moore said that it suggests to her that there was no activity at the bar. Watkins agreed that “there was very little being sold.”

The community members in opposition to the transfer then testified. Ms. Adeline Hutchinson, who had testified in the previous hearing, testified briefly again that the bar hasn’t been open. Ms. Pearl Moulton, who has lived around the corner for thirty-one years, testified that she doesn’t remember the bar being open. She pointed out that Ms. Watkins and her mother have not participated in any neighborhood cleanups or activities. Reverend Keith Bailey, president of Fulton Heights Community Association, testified that he would not like to see the bar reopen, given his problems at other local bars, like the Oxford Tavern. Bailey said that he has known Ms. Driver for years, but he never went into the bar, because he didn’t think it was still open.

Dr. Marvin Cheatham then showed the Commissioners the letter that had been sent from the Liquor Board, which said that the Board expects Ms. Watkins to contact one or more of the community associations before her hearing. He said that none of the three community organizations in the area heard from Ms. Watkins. He went through the factors that the Commissioners are required to consider before they can transfer the ownership of a license that has been closed for over 90 days: public need and desire for the license, number and location of existing licenses, potential commonality or uniqueness of products and services, and the impact on the general health, safety and welfare of the community. He pointed out that the police had installed a blue light camera directly in front of the bar. Dr. Cheatham pointed out that Mr. Kodenski had said that he had witnesses from nearby residents that the bar is open, but only one was actually a neighbor. The rest were family members and friends of the family that owned the business. Cheatham told the Board that six months of not paying taxes seems to substantiate that the bar was not open. He said that the applicants have never made any attempts to contact any of the community association.

Each side made a closing statement to the Commissioners. Ms. Hutchinson told the Board that the business is within the boundaries of her community organization, and there are health consequences to alcohol outlets in her neighborhood. Kodenski said, for his client, that this bar has existed since Prohibition. He pointed out that his witnesses had said that they had been regulars in the bar. He told the Board that Lil’s Place is “not a rock and roll hoochie coo type of place.”

Commissioner Jones affirmed his prior vote and agreed with Ward. He reiterated that he didn’t hear anything bad about Ms. Watkins or her character.

Commissioner Moore also affirmed her prior vote against the bar. There has been no evidence of purchases of any alcohol in 2013. It looks like the last purchase may have been in October 2012. The police report shows that Ms. Lil came to the bar just to get the mail every few days. There was no electricity in the building. Moore believed the inspectors’ reports that they never found the establishment open. Moore said that there was overwhelming evidence that the license was not valid and that the transfer should not take place.