What happened at the Liquor Board on January 8, 2015.

Commissioner Moore noted that the last inspection of the location was on December 19, 2013, and, at that time, it was operating. She asked Mr. Kodenski if the license was still in use through 2014, to his knowledge. Kodenski replied that the mini mart has been in continuous operation, but he was not sure whether the liquor license was being used, because he was only representing the buyer, not the seller of the license. (The seller of the license was not present at the hearing.) Moore asked, “what evidence is there that the license is still valid?” Kodenski told Moore to ask Executive Secretary Michelle Bailey-Hedgepeth if she had any information. Ms. Bailey-Hedgepeth told the Commissioners that the license was renewed on time in 2014, and that the renewal application was submitted on March 28. The renewal application stated that the license was in operation, but there has been no inspection since the end of 2013.

Chairman Ward stated that he would be creating a new regulation that will require licensees on both sides of transfers to be present at hearings. He asked his fellow Commissioners whether the lack of the selling licensee would be enough for them to deny the transfer. Moore replied that before there can be a transfer hearing, they must first know whether the license is valid. If the Board does not have any information about the validity of the license, she was not comfortable moving forward. She admitted that the license probably is being used, but paying for a renewal is not enough. She also said that there is no evidence that the applicant is not qualified to be a licensee, and it is helpful that the Medfield association is supportive of the transfer, but “it is of no moment if the license is not valid.”

Also, the fact that a licensee submitted a renewal application and fee on time is not compelling evidence that the license is in use.

Commissioner Moore asked for the capital investment breakdown, excluding costs for the building, since the Board cannot consider them for the purposes of qualifying under the statute. Ms. Carter responded that she didn’t have exact figures, but it would likely be in excess of $5 million. The televisions in the rooms alone cost more than $500,000.

Commissioner Moore asked the applicants how they differ from McDonalds and Burger King and whether they would be considered “fast food.” Mr. Randy Garutti answered that Shake Shack is not fast food; they have always used a fine dining ethos and have brought chefs in from four-star restaurants. They use all natural ingredients and cook food to order. He said that they plan to work with local bakeries to provide mix-ins for frozen custard. He explained that Shake Shack has been called the “anti-chain chain.” Moore said that she asked because she had read in the Baltimore Business Journal that Shake Shack was fast food, and the law says that a license cannot be given to a fast food restaurant.

Commissioner Moore also asked about the pecuniary interest of each applicant in the business. On the application, none of the applicants stated that they had a financial interest in the LLC that would attach to the license. Mr. Randy Garutti said that he has an interest in the parent entity which is the 100% owner of the to-be-licensed subsidiary entity.

Commissioner Moore asked whether the license was currently in operation. The current licensee, Joseph Libercci, testified that the license was in use and has been in consistent use for 32 years.

Violation of Rule 4.01(a): Minors – October 24, 2014 – At approximately 11:30 PM Officer entered the establishment and observed an individual consuming alcohol in the form of a “Corona Extra” bottle of beer who was later identified as someone who was 18 years of age. This individual admitted to the Officer that he was allowed to purchase the bottle of beer from the establishment, after his identification – which indicated he was 18 years old – had been checked.

Violation of Rule 4.01(a): Minors – November 20, 2014 – At approximately 9:47 PM the Baltimore Police Department conducted an underage alcohol investigation at the establishment. A police cadet, who was under the age of 21, entered the establishment and purchased a 12oz bottle of “Coors Light” for $4.00 from the bartender. At no time did the bartender ask for the age of the police cadet. Baltimore police were contacted and entered the establishment and informed the bartender that he had just served a minor.

Violation of Rule 4.18: Illegal Conduct – October 24, 2014 – At approximately 11:30 PM Officer entered the establishment and later identified an underage patron that was consuming alcohol. The patron informed the Officer that after he showed his identification to the assistant manager, which indicated that the patron was only 18 years old, he was given a blue wristband that indicated he was 21 years old and could purchase alcohol. He later told the Officer that he used the wristband and purchase alcohol.

Having heard the statement of the facts, Chairman Ward began to move into the decision phase of the hearing, when Councilwoman Mary Pat Clarke asked if she could be heard on the matter.

Councilwoman Clarke submitted letters from the Charles Village Civic Association and from her office, explaining the troubles that the community has had with Maxie’s. She told the Board that she came to the hearing to recommend that the establishment’s license be suspended through the end of the spring semester at Johns Hopkins, which would be June 1, 2015. She also asked that Maxie’s be required to enter into a Memorandum of Understanding with the Charles Village Civic Association and agree to amend their license to include restrictions that they would negotiate with the community. Clarke said that Maxie’s is one of two establishments that Loyola College is most concerned about, with respect to underage drinking. Clarke had received many complaints from neighbors, who hear herds of young people coming out of Maxie’s and out onto the street at closing time. There are already three fraternity houses in this block. Clarke said that she would rather trade in the $8,000 in fines for additional suspended weeks so that Maxie’s “can get themselves together” and “prepare themselves to … resurrect themselves as a good venue.” She clarified that they could be open to serve pizza during the suspension but not alcohol.

Chairman Ward told Councilwoman Clarke that shen he was appointed as the Chairman of the Liquor Board, he came to a situation that was “somewhat… permissive.” Licensees knew that they would get a fine for underage drinking but not a closure. From the beginning, Ward said that his fellow Commissioners started issuing suspensions to licensees as a warning. When the Commissioners find out that the warning hasn’t worked, then the licensees come back for a more serious result. Ward noted that the Board had recently had one prior case (Bosphorus) involving underage Loyola student drinking in which the Board closed the establishment for one month. Ward also said that Maxie’s has had two prior violations for underage drinking in 2012.

Clarke reiterated that Maxie’s has not agreed to enter into any agreement with the community to improve their operations. Sandy Sparks, President of the Charles Village Civic Association, told the Board that CVCA would be very interested in working on an agreement with Maxie’s. She said that the organization has been very successful with other MOUs at other liquor establishments. Mr. Boozer told the Board that he had not had the chance to discuss the possibility of an MOU with his clients.

Commissioner Moore said that she believed that the so-called plea agreement imposed serious penalties. The fact that the Board agreed on the penalty before the hearing “does not take away from the seriousness of what happened here.” She told the licensees that the most egregious act was that a Maxie’s employee told underage students to hide from the police in the bathroom. Moore said that the impact on the community is not small and the impact carries over to communities around Loyola University when the students head home. She reminded the licensees that the license will be up for renewal in the spring, and the community could protest the renewal of the license. She told Boozer that “it would behoove [his] clients to quiet concerns and operate within the law.” She reminded Boozer, to borrow Chairman Ward’s phrase, that “a license is a privilege, not a right,” and the licensees “are so close to losing that privilege.”

Chairman Ward told Councilwoman Clarke that his agency had been making many changes lately; they have “been putting first class people on deck. You’re gong to find that the word is out among the licensees of the City, [that] a warning is a warning.”

Clarke acknowledged that the Board had improved lately. However, she said, “this [‘plea agreement’] was a done deal before we walked in. We didn’t know when we came and basically it was done. We would ask that that not happen again.” She pointed out that the licensees had not made any plans to improve their operations to avoid future violations and community impact. She told the Board that the community should be included in any dealmaking, and that the Board needs to correct the way that communities are contacted. She pointed to the ten police officers who were present for the hearing and said to the Commissioners, “look at all these officers! This is about … one shift of Northern District police officers spending their time in a bar instead of in our neighborhoods, which is ridiculous.”

A penalty for a violation of the law should take into account (among other things) the community’s experience with a licensee. If a licensee is usually a responsible operator, sympathetic to community complaints and easy to work with, then s/he likely deserves a lighter penalty for a violation than a licensee who constantly breaks the law and thumbs his nose at his neighbors. The community and their representatives must be involved in negotiating these deals if the LB is going to continue with this process.

Violation of Rule 4.18: Illegal Conduct – November 2, 2014 – At 2:11 AM Officers observed that establishment was open and operating past its restricted hours. Current Class “D” license, as established by Art. 2B, § 6-401, restricts open and operating period of establishment until 1:00AM.

When the case was recalled, Thomas Akras, Deputy Executive Secretary of the Liquor Board, presented the Board’s case against the licensee. The licensee, through her attorney, Paul Schuman, admitted the violation. Akras explained that Baltimore City Police Lieutenant Colburn was called to the block where the bar was located because there was a 911 call complaining of loud noise. He noticed that the bar was open after their required closing time of 1:00am, so he knocked on the door to go inside. After a long period of knocking, someone let Colburn inside, and he saw seventeen people sitting at the bar. Colburn told the manager to clear the patrons from the establishment, and the bar was closed.

Paul Schuman, the licensee’s attorney, told the Board that the seventeen people inside were her family members. Commissioner Moore replied that it doesn’t matter if they’re family members or not, if they’re in the bar, consuming alcohol after 1:00am. Schuman responded that he was told that the seventeen people were cleaning up the bar, not drinking. Ward pointed out that his client had already admitted responsibility for the violations in this case. He told Mr. Schuman that people in the alcoholic beverages industry should know that they need to be completely closed for business when their liquor license ends.

Mr. Schuman submitted Articles of Revival for his client’s LLC, two alcohol awareness certificates, and two letters of recommendation from community members. The licensee could not speak English, so Mr. Akras helped translate her brief testimony about the origin of the letters.

Violation of Rule 4.01(a): Minors — October 25, 2014 – At approximately 1:00 AM the Baltimore Police Department in conjunction with the Loyola Police Department conducted an underage alcohol investigation at the establishment. Upon entering the establishment officers observed approximately 125 individuals in the bar. Officers were able to identify 105 of those individuals as Loyola students, who were under the age of 18, and who admitted being served and consuming alcohol from the establishment.

Violation of Rule 4.01(a): Minors – December 4, 2014 –While conducting an underage alcohol investigation, Baltimore Police Officers observed four (4) individuals, who they suspected as being underage, enter the establishment at approximately 10:00 PM. Approximately 45 minutes later officers entered the establishment and were able to identify the 4 individuals who they suspected as being underage seated in the bar. All four had alcoholic drinks either in front of them or in their hands. All admitted to being students at Loyola University, all admitted and showed proof of being underage, and all admitted having purchased and consumed alcoholic beverages at the establishment.