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2025.02.04 Work Session Packet 4141 Douglas Drive North • Crystal, Minnesota 55422-1696 Tel: (763) 531-1000 • Fax: (763) 531-1188 • www.crystalmn.gov Posted: Jan. 31, 2025 City Council Work Session Agenda Tuesday, Feb. 4, 2025 6:30 p.m. Conference Room A Pursuant to due call and notice given in the manner prescribed by Section 3.01 of the City Charter, the work session of the Crystal City Council was held on Tuesday, Feb. 4, 2025, at ______ p.m. in conference room A at city hall, 4141 Douglas Dr. N., Crystal, MN and via Zoom. If the agenda items are not completed in time for the city council meeting at 7 p.m., the work session will be continued and resumed immediately following the city council meeting. The public may attend the meeting via Zoom by connecting to it through one of the methods identified on the City Council Meeting Schedule for Tuesday, Feb. 4, 2025. I. Attendance Council members Staff ____ Kamish ____ Bell ____ Kiser ____ Tierney ____ Onesirosan ____ Therres ____ Budziszewski ____ Elholm ____ Cummings ____ Larson ____ Deshler ____ Revering ____ Eidbo ____ Hubbard ____ Struve ____ Sutter ____ Serres II. Agenda The purpose of the work session is to discuss the following agenda items: 1. Preview of upcoming proposed amendments to the Unified Development Code. 2. Constituent issues.* 3. New business.* 4. Announcements.* 5. Alcohol/tobacco licensing/compliance violations process. 6. Franchise fees. III. Adjournment The work session adjourned at ______ p.m. * Denotes no documentation included in the packet. Auxiliary aids are available upon request to individuals with disabilities by calling the city clerk at (763) 531-1145 at least 96 hours in advance. TTY users may call Minnesota Relay at 711 or 1-800-627-3529. REVIEW UDC AMENDMENTS PAGE 1 OF 4 __________________________________________________________________________ FROM: Dan Olson, City Planner TO: Adam R. Bell, City Manager (for February 4 meeting) DATE: January 29, 2025 RE: Preview of upcoming proposed amendments to the Unified Development Code __________________________________________________________________________ A. BACKGROUND Staff is requesting that the City Council preview proposed amendments to the unified development code (UDC). The proposed amendments include policy changes on five issues, as well as corrections or clarifications, brought about by things we learned while administering the UDC’s requirements. The amendments are proposed to be undertaken in two phases, as described in the table below and later in the staff report. Phase 1 Amendments (Spring 2025) Phase 2 Amendments (Fall 2025) 1. Amendments based on the outcome of the discussion of the five policy changes. 2. Clarification and correction amendments 1. Revisit the ordinance amendments adopted by City Council in Sept. 2022 and subject to a referendum petition in Oct. 2022. In response to the petition, City Council repealed these amendments on Nov. 15, 2022. B. PROPOSED POLICY CHANGES Staff has identified the following five issues involving a change of policy that will require additional discussion. City council may also provide direction to the Planning Commission to make further amendments beyond these five issues. COUNCIL STAFF REPORT Preview of UDC amendments REVIEW UDC AMENDMENTS PAGE 2 OF 4 1. Create a neighborhood commercial district. a. Create a neighborhood commercial zoning district. Council has expressed interest in a new commercial district for those commercial properties near residential uses, but outside of the city’s main commercial area at West Broadway and 56th Avenue N. (Bass Lake Rd.). b. Amend higher density residential (R-3) zoning district. The R-3 district includes non-residential uses. Since these uses would have a similar impact on adjacent residential uses, these amendments would be reviewed for consistency with the proposed neighborhood commercial district. c. Development standards for zoning districts. Development standards would be added to the two commercial districts: a. Listing the permitted, conditional, accessory and temporary uses. b. Hours of operation. c. Increased setbacks from residential properties. d. Design standards such as building location, height, size, massing, or exterior materials. 2. Reduce minimum lot width and area for two-family dwellings. To provide more housing opportunities, staff proposes to reduce the minimum lot width for a two-family dwelling in the R-1 district from 80’ to 75’, and to reduce the minimum lot area from 10,000 to 9,000 sq. ft. 3. Modify parking requirements. a. Eliminate or modify minimum and/or maximum number of parking spaces. ➢ Some cities, including Minneapolis, St. Paul and Duluth, have eliminated minimum required parking to let the market determine how much parking is needed, while still requiring a maximum number of spaces. ➢ Staff has not found a city similar to Crystal (first tier suburb fully built out in the immediate post World War II period) that has eliminated minimums, but staff will continue to search for comparable cities for the Planning Commission work session. b. Delete the requirement for covered parking for one-and-two family residential. ➢ Currently a single or two-family dwelling is required to have two parking spaces per unit, one of which must be enclosed in a garage. ➢ To reduce housing costs for new construction, the proposed amendment would eliminate the need for a garage but still require that each unit have two parking spaces. Builders would most likely still construct a garage. ➢ Existing homes with an attached garage could repurpose that garage for productive living space, such as a rec room or ADU. REVIEW UDC AMENDMENTS PAGE 3 OF 4 4. Allow ADUs in additional housing types. a. Single-family attached and two-family dwellings. ➢ Currently, only single-family detached dwellings may have an ADU. ➢ Staff proposes that properties with one-family attached dwellings and two- family dwellings (duplexes) also be allowed have one ADU with similar requirements as single-family homes. ➢ Example 1: An existing side-by-side duplex with a walkout basement would be able to have an ADU in the basement, meaning there could be a total of three dwelling units on the property. ➢ Example 2: An attached single-family dwelling could build a detached ADU in the back yard. 5. Eliminate requirement for private recreational uses in Planned Developments. a. For a Planned Development (PD) rezoning, the UDC requires the creation of private recreational uses within the PD, but this requirement may be waived by City Council if deemed unnecessary or redundant. b. City Council has expressed an interest in removing or amending this requirement if it’s not something commonly enforced. C. CLARIFICATIONS AND CORRECTIONS The majority of proposed UDC amendments would not be policy changes , but instead clarifications and corrections to existing requirements. The following are the most noteworthy amendments: 1. Subdivision regulations. Clarify that a subdivision review by the city only includes Common Interest Community (CIC) plats that divide the land into two or more lots (not merely a division of ownership). 2. Detached garages. The amendment reorganizes requirements for detached garages and carports. 3. Clarify tree removal/replacement requirements. The amendment clarifies the process for determining which trees need to be replaced if removed and which trees can be removed without replacement. 4. Driveway and parking lot paver requirements. The city allows pavers for driveways and parking lots, but the UDC does not currently have any standards for approval. This amendment would add those standards. D. PHASE TWO AMENDMENTS The second phase of amendments would revisit the amendments adopted by the City Council in Sept. 2022, and then repealed in Nov. 2022 by City Council in response to a referendum petition. The following are the amendments that would be considered in Fall 2025: REVIEW UDC AMENDMENTS PAGE 4 OF 4 a. Definition and requirements for alleys b. Definition of lot c. Definition of lot width d. Definition and requirements for nonconforming lot e. Definition of street f. Definition of through lot g. Definition of rear lot line h. Requirements for lot arrangement i. Street frontage and access requirements j. Requirements for rounding up or down of dimensions and calculations E. REQUESTED ACTION No Council action is requested at this time. The following is the proposed schedule for considering the first phase of amendments: March 10 Planning Commission discuss amendments April 14 Planning Commission public hearing May 6 Council considers first reading of ordinance May 20 Council considers second reading and adoption May 29 Summary of ordinance published June 28 Effective date of ordinance CITY COUNCIL STAFF REPORT Licensing and compliance checks DATE: Jan. 30, 2025 FROM: City Manager Adam R. Bell Police Chief Stephanie Revering City Clerk Chrissy Serres TO: Mayor and City Council RE: Licensing/compliance checks Background The city council requested a work session about licensing and compliance check processes. City ordinances and state laws regulate establishments that sell alcohol and tobacco. When businesses are granted a license, licensees have a responsibility to ensure compliance with existing ordinances and laws. I. Overview of alcohol and tobacco license process When the city receives an inquiry regarding a new liquor or tobacco establishment, staff provides the prospective business owner with information related to city reviews, permits, licensing or other approvals that may be needed for the proposed business. Additionally, the city clerk typically meets with the business owner to review the license applications, fees, city ordinances and timing related to processing the license. a. Requirements for licenses: i. Alcohol licensing requirements are outlined in chapters 10 and 12 of the City Code (Attachment A). ii. Retail tobacco licensing requirements are outlined in chapters 10 and 11, section 1105, of the City Code (Attachment B). b. Steps to issue licenses: i. Upon receipt of a complete application, the city clerk reviews the information, and the police department conducts a background check. ii. Alcohol licenses: 1. Upon approval of the background check, the city clerk coordinates with the applicant their availability to attend a city council meeting public hearing. The city clerk publishes proper notice in the official newspaper at least 10 days before the meeting. The notice is also posted on the city website and social media (NextDoor). 2. After council approval of the license, the city clerk forwards the license applications to the state for approval. 3. After the city receives notice of approval from the state, staff notifies the applicant and processes and mails the city license certificate. However, before issuance, staff verifies if any additional follow up is needed with other departments (e.g., building, health, fire). iii. Retail tobacco licenses: 1. Upon approval of the background check, staff adds the licensee to the list of license applications for city council approval. A public hearing is not required for retail tobacco licenses. 2. After council approval of the license, staff notifies the applicant and processes and mails the city license certificate. Before issuance, staff verifies if any additional follow up is needed with other departments (e.g., building, health, fire). The above reflects a seamless licensing process from start to finish; however, that is rarely the case. Staff time can vary depending upon a variety of factors such as specific business license requirements and other circumstances that may arise throughout the process. Additional staff time is also required to manage compliance checks, enforcement action, maintain accurate records, and provide extra assistance to non-compliant licensees. The city clerk, police department, city attorney and finance department may be included in any of the above regulation and management of liquor licenses. II. Overview of compliance check process a. Police department process: i. When the police department conducts compliance checks, the process is: 1. An adult minor, under 21, enters a licensed establishment to purchase either an alcohol or tobacco product. 2. The adult minor will use their own ID that clearly states they are underage for the purchase of either alcohol or tobacco. 3. Once the compliance check is complete; the establishment is notified that they either passed or failed. ii. A failed compliance check is forwarded to the prosecuting attorney to go through the judicial process. iii. Violations do not appear before the council until after the criminal process is complete, and the employee/business is found guilty. In the event a business is found to have engaged in an illegal sale or committed a violation of state law, City Code Sections 1105.13 and 1200.35 provide for civil penalties to be imposed on tobacco and liquor licensees, respectively. b. Administration department process: iv. When the police department notifies the city clerk of a business that did not pass the compliance check, the process is: 1. The city clerk prepares and mails a notice of violation via certified mail to the business at least 10 days before the city council meeting. The notice of violation is also emailed to the licensee. 2. The city clerk reviews records for any previous violations and prepares a staff report to the city council recommending maximum penalties. v. Liquor and tobacco licensees are subject to penalties of increasing severity for multiple violations. The city council has historically requested owners to appear before the council to address the allegations and impose consequences. Attachment C outlines the license violation hearing procedures during the council meeting. III. On-site smoking “loophole”. Staff often receives inquiries about if the city allows/licenses hookah lounges. Hookah lounges are not permitted by state law (Minnesota Clean Indoor Air Act). However, state law does give cities the option to allow sampling of products that are for sale in a retail tobacco product shop. In the City of Crystal, retail tobacco product shops require a retail tobacco license from the city. Important notes: • The city's licensing ordinance does not currently prohibit sampling in retail tobacco product shops. Therefore, a sampling area is allowed by the city at this time, provided that it complies with Minn. Stat. 144.4167, Subd. 4. • The city could change its licensing ordinance at any time in the future to prohibit sampling. Because this would be a licensing provision, not zoning, there would be no lawful nonconforming use rights created by the existence of a sampling area prior to a licensing ordinance change. If the licensing ordinance were changed to prohibit sampling, then existing retail tobacco product shops would have to cease the sampling activity. The public is advised to keep this fact in mind when making any decision about leasing or purchasing real estate for a retail tobacco product shop in the City of Crystal. The city's retail tobacco license requires businesses to operate in accordance with https://www.health.state.mn.us/communities/environment/air/mciaa/tobacco.html, including but not limited to the following: • The shop must have an entrance door opening directly to the outside. • More than 90% of the shop’s gross revenue must be from the sale of tobacco, tobacco- related devices and electronic delivery devices. • The tobacco shop cannot be a tobacco department or section of an individual business with a liquor, food or restaurant license. As the city council will be considering alcohol and tobacco license violations at an upcoming meeting, we thought the city council should review these processes at its Feb. 4 work session. Attachments: A. City Code chapters 10 and 12. B. City Code chapters 10 and 11, section 1105. C. License violation procedures for Council. 563003v4CR225-464 2019 Crystal City Code 1000.01 CHAPTER X LICENSES AND PERMITS; GENERAL PROCEDURES Section 1000 – General licensing provisions 1000.01. Purpose. By the enactment of this section, the city council intends to establish a uniform system for the issuance, denial, revocation, suspension, and renewal of business licenses required by this Crystal city code. The specific provisions for each business license are contained in chapter XI. 1000.03. Businesses requiring a license. The following businesses, as defined in Crystal city code, chapter XI, are subject to this section, the applicable subsection in Crystal city code, and require a license issued by the city. Business Bond Insur- ance Tax Return Site Inspec- tion Back- ground Investi- gation Public Hearing Record- keeping/ Reports Limited Hours Regu- lated by Sub- section Consumer Fireworks X 1100 Tobacco X 1105 Peddlers/ Solicitors X X 1110 Tree Trimming X X 1115 Secondhand Dealers X X X X 1120 Pawnbrokers X X X X X 1125 Lawful Gambling X X X 1130 Adult Establishments X X X X 1135 Therapeutic Massage X X X X 1140 Alcohol licensing is addressed in Crystal city code, chapter XII, but is also subject to this chapter. 1000.05. Fees. The fees for the various licenses are adopted by city council resolution from time to time and are set out in Crystal city code, appendix IV. An application is not complete, and shall not be processed, until the required fees have been submitted to the city. 1000.07. Application of chapter; conflicts. The provision of this section shall apply to all city licenses. Other provisions related to specific licenses are intended to supplement the provisions in this section, unless they conflict with the provisions of this section in which case the provisions related to the specific licenses shall prevail. 563003v4CR225-464 2019 Crystal City Code 1000.09 1000.09. Licenses required. It is unlawful to engage in a trade, profession, business, or privilege in the city for which a license is required by any provision of this Crystal city code without first obtaining a license from the city in the manner provided in Crystal city code, chapters X and XI, and any other applicable provisions. 1000.11. License application. Subd. 1. Contents. Application for all new licenses and renewals shall be made to the city clerk upon forms provided by the city and shall include all information requested in such forms. Any application submitted on the incorrect form or that is incomplete shall be rejected and shall not be processed. The city manager is authorized to determine if an application is complete and, if not, what additional information is required to make it complete. Unless the applicable application form indicates otherwise, every new application must provide the information as required in this subdivision. (a) If the applicant is a natural person: (1) The name, description, date of birth, street address, phone number, and email address of applicant; (2) Whether the applicant is a citizen of the United States or resident alien; (3) Whether the applicant has ever used or has been known by a name other than the applicant’s name, and if so, any other names used and information concerning dates and places used; (4) The street address at which the applicant has lived during the preceding ten years; (5) Whether the applicant has ever been convicted of a felony, crime, or violation of any ordinance other than a traffic ordinance. If so, the applicant must furnish information as to the time, place, and offense of all such convictions; (6) The applicant’s current personal financial statement and true copies of the applicant’s federal and state tax returns for the two years prior to application; (7) The type, name, and location of every business or occupation in which the applicant has been engaged during the preceding five years and the names and addresses of the applicant’s employers and partners, if any, for the proceeding five years; (8) The name of the business if it is to be conducted under a designation, name, or style other than the name of the applicant and a certified copy of the certificate as required by Minnesota Statutes, section 333.01; and 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 1(a)(9) (9) If the applicant does not manage the business, the name of the managers or other persons in charge of the business and all information concerning each of them required in (a)(1)-(5) of this subdivision. (b) If the applicant is a partnership: (1) The names and addresses of all general and limited partners and all information concerning each general partner required in (a)(1)-(5) of this subdivision; (2) The names of the managing partners and the interest of each partner in the licensed business; (3) A true copy of the partnership agreement shall be submitted with the application. If the partnership is required to file a certificate as to a trade name pursuant to Minnesota Statutes, section 333.01, a certified copy of such certificate must be attached to the application; (4) A true copy of the federal and state tax returns for the partnership for the two years prior to application; and (5) If the applicant does not manage the business, the name of the managers or other persons in charge of the business and all information concerning each of them required in (a)(1)-(5) of this subdivision. (c) If the applicant is a corporation or other organization: (1) The name of the corporation or business form, and if incorporated, the state of incorporation; (2) A true copy of the Certificate of Incorporation, Articles of Incorporation or Association Agreement, and By-laws shall be attached to the application. If the applicant is a foreign corporation, a Certificate of Authority issued pursuant to Minnesota Statutes, section 303.06, must be attached. Any proposed change in either the articles or the by-laws of the corporation must be reported to the city clerk 14 days prior to the date such change is to be adopted by the corporation. In the case of a corporate application the application must also describe fully the relationship of the corporation to any other corporation including the name, business address, state of incorporation, names of stockholders, directors and officers thereof as provided hereafter, but in the case of publicly held corporations the city manager may accept disclosure documents required by the Securities and Exchange Commission of the United States of America in lieu of such information; 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 1(c)(3) (3) The name of the managers or other persons in charge of the business and all information concerning each manager, proprietor, or agent required in (a)(1)-(5) of this subdivision; and (4) A list of all persons who control or own an interest in excess of five percent in such organization or business form or who are officers of the corporation or business form and all information concerning said persons required in (a)(1)-(5) of this subdivision. This subdivision 1(c) shall not apply to a corporation whose stock is publicly traded on a stock exchange and is applying for a license to be owned and operated by it. (d) For all applicants: (1) Whether the applicant holds a business license from any other governmental unit; (2) Whether the applicant has previously been denied, or had revoked or suspended, a business license from any other governmental unit; (3) The location and legal description of the business premises to be licensed; (4) If the applicant does not own the business premises, a true and complete copy of the executed lease; (5) Whether all real estate and personal property taxes that are due and payable for the premises to be licensed have been paid, and if not paid, the years and amounts that are unpaid; (6) Whenever the application is for premises either planned or under construction or undergoing substantial alteration, the application must be accompanied by a set of preliminary plans showing the design of the proposed premises to be licensed; (7) The applicant’s social security number or individual taxpayer identification number, and Minnesota business identification number, as applicable; and (8) Such other information as the city council or issuing authority may choose to require. 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 2 Subd. 2. Managers. When a licensee places a manager in charge of a business, or if the named manager in charge of a licensed business changes, the licensee must complete and submit the appropriate documentation required for managers in subdivision 1 of this subsection within 14 days and if a background investigation of the manager is required, the licensee must pay an amount equal to the cost of the investigation, as contained in Crystal city code, appendix IV, to ensure compliance with this section. Subd. 3. Application execution. All applications for a license must be signed and certified by the following: (1) If the applicant is a natural person by such person; or (2) If the applicant is a corporation, by an officer thereof; if that of a partnership, by one of the general partners; and if that of an unincorporated association, by the manager or managing officer thereof. Subd. 4. False statements. It is unlawful to knowingly make a false statement in a license application. In addition to all other penalties, the license may be subsequently revoked by the city council for a violation of this subdivision. 1000.13. Payment of fees. Subd. 1. Included with application. The fees required for a license, license renewal, or investigation, as provided in Crystal city code, appendix IV, must be paid at the office of the city clerk at the time of application. Unless otherwise expressly provided by this Crystal city code, a license fee may not be prorated for a portion of a year. License fees are not refundable regardless of whether the application is approved, denied, or withdrawn. Subd. 2. Renewals; late fees. In the event that a license renewal fee is not paid prior to the expiration of the corresponding license, the following late fees shall apply: (a) One to seven days after expiration, a penalty in the amount of 25% of the license fee; (b) Eight to 30 days after expiration, a penalty in the amount of 50% of the license fee; and (c) After 30 days, the license shall be deemed expired and the business or activity for which the license is required must cease and a new license for such activity will not be considered until the licensee reapplies and appears before the city council. Failure to cease operations of the business or activity after said 30 days shall constitute a misdemeanor. 563003v4CR225-464 2019 Crystal City Code 1000.13, Subd. 3 Subd. 3. Late payment of the license fee with penalty no bar to prosecution for operating without a license. The late payment of the license fee along with the penalty set forth herein is no bar to any prosecution by the city for operating any licensed trade, business, profession, activity, or privilege within the city without a license therefor. 1000.15. Bonds; insurance. Any bonds required by this Crystal city code must be executed by two sureties, or a surety company, shall be subject to the approval of the city manager, and must be in at least the amount required in Crystal city code, appendix IV. Where policies of insurance are required, the policies must provide the types and amounts of coverage required by this Crystal city code and must be in a form acceptable to the city attorney. When commercial general liability coverage is required, the policy shall name the city as an additional insured. Satisfactory evidence of coverage by bonds and/or insurance, when required, must be filed with the city clerk before a license can be issued. 1000.17. Persons or locations ineligible for city license. In addition to any other license-specific ineligibilities contained in this Crystal city code, a city license for a business or activity will not be issued to any of the following: (a) A person not a citizen of the United States or a resident alien; (b) A person under 18 years of age; (c) A person who within five years of the license application date had a similar license revoked by any other jurisdiction; (d) A person whom the city council determines not to be of sufficient good moral character and repute; (e) When the city council determines, after investigation, that issuance or renewal of the license would adversely affect the public health, safety or welfare; (f) A person that is prohibited by federal, state, or other local law, ordinance, or other regulation from holding a license; (g) Where operation of the licensed premises would violate any applicable zoning ordinances; or (h) If taxes, assessments or other financial claims of the city or the state of Minnesota on the licensee’s business premises are delinquent and unpaid. 563003v4CR225-464 2019 Crystal City Code 1000.19 1000.19. Investigations. If a background investigation is expressly required prior to the issuance of a license, the application will be referred to the chief of police for a computerized criminal history, as authorized by Crystal city code, section 311. Every individual or person having any beneficial interest in the license, and the manager of the business, must be investigated. The chief must report the findings and comments to the city manager who must order or conduct such additional investigations as the city manager deems necessary or as the city council directs. 1000.21. Approval or denial of licenses. Upon the receipt of a complete application, payment of fees, and completion of any requisite investigations, a license will be either approved or denied in accordance with the provisions of this Crystal city code. If the city determines the applicant and the place proposed for the business are eligible for a license, then the city will issue the license. The city council shall make the final decision on whether to issue a license, but the city manager is authorized to issue a provisional license if the city manager determines the applicant is eligible for the license and that it is impractical to delay the issuance of the license to the next city council meeting. An applicant issued a provisional license may undertake the business activity authorized by the provisional license with the understanding, and conditioned on, the city council approving the application. If the city council subsequently denies the application, the provisional license ends and all related business activities must cease. 1000.23. License certificates; term. License certificates will include the date of issuance, the activity licensed, and the term of the license. Unless expressly provided elsewhere, the term of each licensing period begins on January 1 and ends on December 31 of each year. 1000.25. Exhibition of license certificate. A licensee shall display its license on the licensed business premises in a conspicuous place and shall present the license certificate upon request of any police officer or authorized representative of the city. If any licensed services are authorized to be provided off of the licensed business premises, the licensee shall have in possession a copy of the licensee when providing such off-site services. 1000.27. Transfer of license. A license will be issued to the particular applicant and only for the business premises as described in the application. Unless otherwise expressly authorized by this Crystal city code, a license issued by the city is not transferable from person to person or from premises to premises. If the licensee is a partnership or a corporation, a change in the identity of any partner or holder of more than five percent of the issued and outstanding stock of the corporation will be deemed a transfer of the license. 1000.29. Renewal of license. License renewals are issued in the same manner and subject to the same conditions as original licenses. Renewal applications and fees shall be submitted at least 30 days prior to expiration. Licensees are responsible for renewing their licenses in accordance with this Crystal city code in order to prevent a lapse in licensure. A licensee shall be ineligible to renew a license if the licensee has failed to pay an administrative penalty imposed by the city council related to the licensed activity. 1000.31. Revocation; denial; suspension. In addition to any other provision in this Crystal city code, a city-issued license may be denied, suspended, or revoked by the city council for any of the following causes: 563003v4CR225-464 2019 Crystal City Code 1000.31(a) (a) Fraud, misrepresentation, bribery, or incorrect statement contained in the application for license, or made in carrying on the licensed activity; (b) Conviction of any felony or of any crime related to the licensed activity; (c) Conducting a licensed activity in such manner as to constitute a breach of the peace, or a threat to the health, safety and welfare of the public, or a disturbance of the peace or comfort of the residents of the city, upon recommendation of appropriate city officials; (d) Expiration or cancellation of any required bond or insurance policy, or failure to notify the city within a reasonable time of changes in the terms of the required insurance or carriers; (e) Actions that are unauthorized or otherwise beyond the scope of the license granted; (f) Violation of any federal, state or local regulation or provision; (g) Failure to continuously comply with all conditions required as part of the license; (h) Failure to comply with the applicable zoning code; or (i) Failure to pay an administrative penalty imposed by the city council. 1000.33. Hearing. A license may not be suspended or revoked until after a hearing is granted to the licensee. The hearing shall be held before the city council upon due notice to the licensee, either personally served or mailed at least five days in advance, stating the time and place of such hearing, together with a statement of the alleged violations to be the cause for the revocation or suspension of the license. At the hearing, the licensee shall have an opportunity to be heard by the city council regarding the allegations. The city council shall determine whether to suspend or revoke the license and shall provide the licensee written notice of its decision. If the city council suspends or revokes the license, all licensed activities shall cease immediately and the license shall otherwise comply with the requirements in the city council’s written decision. 1000.35. Reissuance. Once a license has been revoked, an application for a new license from the same applicant or for the same business premises shall not be submitted for at least 12 months from the date of revocation unless the city council approves an earlier submission. 1000.37. Inspections of licensed premises. The police department, health authority, or any other appropriate city official may enter upon the premises where any licensed activity is being conducted for the purpose of inspection, at any reasonable hour, without a warrant, to determine compliance with this Crystal city code and any conditions placed on the license. 563003v4CR225-464 2019 Crystal City Code 1000.39 1000.39. Financial responsibility. Prior to the issuance of a license the applicant must file with the city clerk satisfactory evidence of financial responsibility. Satisfactory evidence of financial responsibility shall be shown by a certification under oath that the property taxes, public utility bills, and all state and federal taxes or other governmental obligations or claims concerning the business entity applying for the license are current, and that no notice of delinquency or default has been issued, or if any of the financial obligations stated in this subsection are delinquent or in default, that any such delinquency or default is subject to a payment plan or other agreement approved by the applicable governmental entity. The certification shall be signed by an individual applicant or all individual owners and/or shareholders of the business entity. Operation of a business licensed by the city without having updated evidence on file with the city of the financial responsibility required by this subsection is grounds for revocation or suspension of the license. 1000.41. Violations. Any violation of the licensing provisions contained in Crystal city code, chapters X or XI shall be deemed a misdemeanor. Additionally, if a licensee or an employee of a licensee is found to have violated any applicable licensing provisions, the city council may impose an administrative penalty on the licensee. Notwithstanding any presumptive penalties that are expressly provided in this Crystal city code or in Crystal city code, appendix IV, the city council shall have the discretion to impose penalties that are appropriate in their judgment unless they would otherwise conflict with any statutory requirements or limits. 563003v4CR225-464 2019 Crystal City Code 1005.01 Section 1005 – General permit procedures 1005.01. Purpose. By the enactment of this section, the city council intends to establish a uniform system for the issuance of permits for all activities for which permits are required. 1005.03. Fees. The fees for the various permits are adopted by city council resolution from time to time and are set out in Crystal city code, appendix IV. 1005.05. Application of chapter; conflicts. The provision of this section shall apply to all city permits. Other provisions related to specific permits are intended to supplement the provisions in this section, unless they conflict with the provisions of this section in which case the provisions related to the specific permits shall prevail. 1005.07. Permits required. It is unlawful to engage in any activity or privilege in the city for which a permit is required by any provision of this Crystal city code without first obtaining a permit from the city in the manner provided in this section. 1005.09. Application for permit. Application for a permit is made to the city clerk on forms furnished by the city. The application must contain information as to location, nature, extent and costs of the proposed structure, work, installation, or other purposes, and other information which the building inspector or other duly authorized persons may require under this Crystal city code. The application must contain a declaration that the facts and representations therein made are true and correct, which statement must be subscribed to by the person or persons, or officers or agents of a corporation, applying for said permit. If the applicant is seeking two or more licenses at the same time, the information required of the applicant in the application forms may be combined to avoid duplication, provided all of the information required by the application is provided. 1005.11. Granting of permits. Upon payment to the city by the applicant of the required fee for any permits, and upon approval of the appropriate inspector, the permit will be issued, except where city council approval is expressly required, in which case the inspector is authorized to issue such permit only after approval is granted by the city council. 1005.13. Payment of fee. Subd. 1. Payment. The permit fee and other fees and charges set forth in Crystal city code, Crystal city code, appendix IV must be collected by the city before the issuance of any permits, and the city clerk, building inspector, or other persons duly authorized to issue such permit for which the fee is required shall not issue a permit until such fee has been paid. Subd. 2. Increased fee. If a person begins work of any kind for which a city permit is required without first having secured said permit, that person must, when subsequently securing such permit, pay twice the fee prescribed for such permit and is further subject to the penalty provisions of this Crystal city code. 563003v4CR225-464 2019 Crystal City Code Chapter X Modification Index Amended subsection Amending ordinance Chapter X (Delete all and replaced) 2018-05 1000.15 2019-03, Sec. 1 1000.19 2019-03, Sec. 2 1000.39 2019-03, Sec. 3 1005.29 2011-5 Repealed subsection Repealing ordinance 1005.15 2019-03, Sec. 4 562973v4CR225-464 2019 Crystal City Code 1200.01 CHAPTER XII SALE, CONSUMPTION AND DISPLAY OF LIQUOR AND BEER Section 1200 - Intoxicating liquor 1200.01. Adoption of state law. Subd. 1. State law. The provisions of Minnesota Statutes, chapter 340A and Minnesota Rules, chapter 7515, with reference to the definition of terms, conditions of operation, restrictions on consumption, provisions relating to sales, hours of sale, and all other matters pertaining to the retail sale, distribution, and consumption of intoxicating liquor, wine, and 3.2 percent malt liquor, are hereby adopted by reference and are made a part of this Crystal city code, chapter XII as if set out in full. It is the intention of the city council that all future amendments to such statutes and rules are hereby adopted by reference and are incorporated herein. Subd. 2. Additional restrictions. The city council is authorized by the provisions of Minnesota Statutes, section 340A.509 to impose, and has imposed in this section, additional restrictions on the sale and possession of alcoholic beverages within its limits beyond those contained in Minnesota Statutes, chapter 340A. 1200.03. Definitions. For the purpose of this section, the terms defined in this subsection have the meaning given. These definitions are in addition to the definitions contained in Minnesota Statutes, section 340A.101, which are adopted by reference and incorporated herein. Subd. 1. Commissioner. “Commissioner” means the commissioner of public safety, except as otherwise provided in Minnesota Statutes, chapter 340A. Subd. 2. Liquor. “Liquor” means both intoxicating liquor and 3.2 percent liquor. Subd. 3. Operating Manager. “Operating manager” or “manager” means the person responsible for overseeing the daily operations of the establishment and for compliance with state and local laws. Subd. 4. Premises. “Premises” or “licensed premises” means the compact and contiguous area of a building or structure approved as part of a liquor license that constitutes the licensed establishment and in which the sale of liquor may occur in accordance with Crystal city code, chapter XII. Premises may include those outdoor areas, such as porches, decks, and patios, that are immediately adjacent to a licensed on-sale establishment, if such outdoor areas are approved at the time of licensing as being part of the licensed premises. 562973v4CR225-464 2019 Crystal City Code 1200.03, Subd. 5 Subd. 5. Restaurant. “Restaurant” means an eating facility, other than a hotel, under the control of a single proprietor or manager, where meals are regularly prepared on the premises, where full waitress/waiter table service is provided, where a customer orders food from printed menus and where the main food course is served and consumed while seated at a single location. To be a restaurant as defined by this subsection, an establishment shall have a license from the state as required by Minnesota Statutes, section 157.16 and meet the definition of a “small establishment,” “medium establishment,” or “large establishment” as those terms are defined in Minnesota Statutes, section 157.16, subdivision 3(d). An establishment which serves prepackaged food that receives heat treatment and is served in the package or frozen pizza that is heated and served, shall not be considered to be a restaurant for purposes of this section unless it meets the definitions of a “small establishment,” “medium establishment,” or “large establishment.” Subd. 6. Smoking Area. “Smoking area” means a designated compact and contiguous exterior area connected to a licensed premises approved by the city as part of issuing a liquor license in which patrons may smoke and are permitted to consume intoxicating liquor previously purchased and/or delivered to the patron in the licensed premises. 1200.05. License required. It is unlawful to sell liquor or keep it for sale without first obtaining a license therefor from the city and complying with all applicable laws, rules, and regulations of the state of Minnesota and the city. The sale of liquor may only occur within the premises approved by the city as part of the license. Sales in an outdoor area may only occur if specifically authorized in the license or if the city approves the outdoor area as part of the premises for the licensed establishment. Liquor sales in an approved outdoor area may only occur incidental to the sale of food and only during such times as food service is available. A licensed premises shall not be expanded except upon the issuance of a new license. 1200.07. Types of licenses; fees. Subd. 1. License classifications. The city council may issue the following types of liquor licenses: 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1 License Type Statutory Reference Mandatory Accompanying License Associated License Types Commissioner Approval Required1 On-sale, full liquor 340A.404, subd. 1 Retailer's (Buyer's) Card 4 Caterer’s permit 340A.404, subd. 122 On-sale Sunday On-sale 2 a.m. Smoking Area Consumption and display permits (annual) On-sale club 340A.101, subd. 7 340A.404, subd. 1 Retailer's (Buyer's) Card 4 On-sale Sunday On-sale 2 a.m. Smoking Area X Smoking Area MN Clean Indoor Air Act/Freedom to Breathe On-sale liquor establishments, if they wish to have one Currently on-sale club On-sale 2.am. 340A.504, subd. 7 On-sale, full liquor On-sale club On-sale wine On-sale 3.2 percent malt liquor On-sale microdistillery X On-sale microdistillery cocktail room 340A.22, subd. 2 Manufacturer’s microdistillers license 340A.22 On-sale Sunday On-sale 2 a.m. Off-sale microdistillery 1 Pursuant to Minn. R. 7515.0440. 2 Caterer’s permits are issued by the commissioner. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1 Off-sale microdistillery 340A.22, subd. 4 Manufacturer’s microdistiller’s license 340A.22 On-sale micro distillery cocktail room X On-sale brewer taproom 340A.26 Manufacturer’s license 340A.301 Off-sale, small brewer On-sale Sunday On-sale 2 a.m. Off-sale growler Off-sale 340A.405 Retailer's (Buyer's) Card 4 X Off-sale 3.2 percent malt liquor 340A.403, subds. 1 and 3(b); 340A.411; and 340A.301, subds. 1 and 8(a) Retailer's (Buyer's) Card 4 Off-sale brew pub (Growlers) 340A.24 Brew pub 340A.301, subd. 6(d) On-sale brew pub X On-sale brew pub 340A.24 Brew pub 340A.301, subd. 6(d) On-sale intoxicating liquor – or – On-sale 3.2 percent malt liquor On-sale Sunday On-sale 2 a.m. Off-sale brew pub Off-sale small brewer (Growlers) 340A.28 Manufacturer’s license 340A.301, subd. 6, clauses (c), (i), or (j)3 X 3 Small brewers are limited to those brewers who hold a manufacturer’s license pursuant to Minnesota Statutes, section 340A.301, subdivision 6, clauses (c), (i), or (j). 4 Retailers Buyer Cards are issued by the commissioner pursuant to Minn. Rules, part 7515.0210, subpart 3. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1 On-sale wine 340A.404, subd. 5 Retailer's (Buyer's) Card 4 On-sale 3.2 percent malt liquor X On-sale 3.2 percent malt liquor 340A.403, subds. 1 and 3; 340A.411, subd. 1; and 340A.301, subd. 8(a) Retailer's (Buyer's) Card 4 On-sale wine On-sale wine and 3.2 percent malt liquor 340A.404, subd. 5 340A.403, subds. 1 and 3; 340A.411, subd. 1; and 340A.301, subd. 8(a) Retailer's (Buyer's) Card 4 X Culinary Class 340A.4041 On-sale Sunday sales 340A.504, subd. 3 On-sale, full liquor On-sale club On-sale wine On-sale 3.2 percent malt liquor On-sale microdistillery Consumption and display permit (annual) 340A.414 Can Temporary on-sale intoxicating liquor 340A.404, subd. 10 (a) X Temporary on- sale wine 340A.404, subd. 10(a) 340A.410, subd. (c) X Temporary on- sale microdistillery 340A.404, subd. 10 (c). Retailer's (Buyer's) Card 4 X 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1 Temporary on- sale small brewer 340A.404, subd. 10 (c). X Temporary on- sale 3.2 percent malt liquor 340A.403, subd. 2 Temporary Consumption and display permit 340A.414, subd. 9 X Community center authorization 340A.404, subd. 4(a) On-sale intoxicating liquor license Community festival authorization 340A.404, subd. 4(b) On-sale intoxicating liquor license Temporary Wine/beer in parks (for a “social event” with park rental permit Temporary Wine/beer in parks (for a “special event” with special event permit 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(a) (a) On-sale intoxicating liquor license. On-sale intoxicating liquor licenses shall be granted only to hotels, clubs and restaurants. Such license shall be issued to clubs and congressionally chartered veterans’ organizations if they have been in existence for at least three years and liquor sales will only be to members and bona fide guests of such club or organization. (b) Off-sale intoxicating liquor license. Off-sale intoxicating liquor licenses may be issued to an exclusive liquor store, and shall permit off-sale of intoxicating liquor and 3.2 percent malt liquor. (c) On-sale wine licenses. Wine licenses may be issued, with the approval of the commissioner, only to restaurants having facilities for seating at least 25 people at one time for the sale of wine not exceeding 24 percent alcohol by volume. A rabbi, priest or minister of a church or other established religious organization may import wine exclusively for sacramental purposes as provided in Minnesota Statutes, section 340A.316. (d) On-sale 3.2 percent malt liquor license. On-sale 3.2 percent malt liquor licenses may be issued to clubs, restaurants, and hotels for the sale of 3.2 percent malt liquor, provided that no manufacturer or wholesaler of such 3.2 percent malt beverage shall have any ownership, in whole or in part, in the business of any licensee holding an on-sale 3.2 percent malt liquor license. Such license shall permit the licensee to sell 3.2 percent malt liquor for consumption on the premises of the licensee as set forth in such license. (e) Off-sale 3.2 percent malt liquor license. Off-sale 3.2 percent malt liquor licenses may be issued to general foodstores and drugstores, and shall permit the sale of 3.2 percent malt liquor at retail, in the original package, for consumption off the premises only. (f) On-sale Sunday liquor license. On-sale Sunday liquor licenses may be issued as provided in subdivision 2 of this subsection. (g) Temporary on-sale 3.2 malt liquor license. Temporary on-sale 3.2 percent malt liquor licenses may be issued to clubs or charitable, religious or nonprofit organizations which have been in existence for three years. The license may authorize the on-sale of 3.2 percent malt liquor for consumption on a specific premises for the period established in the temporary license, which shall not exceed any applicable limit imposed in Minnesota Statutes, chapter 340A. Licenses issued under this section are subject to all laws and ordinances governing the sale of intoxicating liquor. The city may limit the number of temporary licenses issued in a year to any one organization or for any one location. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(h) (h) Temporary on-sale intoxicating liquor license. Temporary on-sale intoxicating liquor licenses may be issued to clubs, charitable, religious or other nonprofit organizations which have been in existence for at least three years, or to a state-registered political committee, in connection with a social event within the city and sponsored by the licensee. The city shall not issue more than three temporary licenses to any one organization or location during a calendar year, and each such license is limited to not more than four consecutive days. The license may authorize sales on the premises other than that owned or permanently occupied by the licensee. The license may provide that the licensee may contract for intoxicating liquor catering services with the holder of a full year on-sale intoxicating liquor license issued by any municipality. The licenses are subject to the terms, including a license fee, imposed by the issuing municipality. Licenses issued under this section are subject to all laws and ordinances governing the sale of intoxicating liquor, except that those laws and ordinances which, by their nature, are not applicable. A license approved by the city council under this section shall not be valid until it is approved by the commissioner. The city may limit the number of temporary licenses issued in a year to any one organization or for any one location. (i) On-sale club license. Club licenses may be issued to clubs as provided in Minnesota Statutes, section 340A.404, subdivision 1. No license shall be issued or renewed to a club which discriminates against members or applicants for membership, or guests of members, on the basis of race. (j) Brew pub off-sale malt liquor license. A brew pub off-sale malt liquor license may be issued to a brewer who holds an on-sale intoxicating liquor or 3.2 percent malt liquor license issued by the city for a restaurant operated in the place of manufacture, as provided in Minnesota Statutes, section 340A.24, subject to the following conditions: (1) The malt liquor sold off-sale must be produced and packaged on the licensed premises. (2) Off-sale of malt liquor shall be limited to the legal hours for off-sale pursuant to this section, except an establishment that holds a brewer off-sale malt liquor license may sell malt liquor off-sale between the hours of 8:00 a.m. and 10:00 p.m. on Sundays. (3) The malt liquor sold off-sale must be removed from the licensed premises before the applicable off-sale closing time pursuant to this section. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(j)(4) (4) The malt liquor sold off-sale shall be packaged in 64-ounce containers commonly known as “growlers” or in 750 milliliter bottles and shall have the following requirements for packaging: (i) The containers or bottles shall bear a twist type closure, cork, stopper, or plug; (ii) At the time of sale, a paper or plastic adhesive band, strip or sleeve shall be applied to the container or bottle, and extend over the top of the twist type closure, cork, stopper or plug forming a seal that must be broken upon opening of the container or bottle; (iii) The adhesive band, strip or sleeve shall bear the name and address of the brewer/licensee selling the malt liquor; and (iv) The containers or bottles shall be identified as malt liquor, contain the name of the malt liquor, bear the name and address of the brewer/licensee selling the malt liquor, and the contents in the container or bottle packaged as required herein shall be considered intoxicating liquor unless the alcoholic content is labeled as otherwise in accordance with the provisions of Minnesota Rules, part 7515.1100. (5) The retail sales for a brewer/licensee at on-sale or off-sale under this section may not exceed 3,500 barrels per year, provided that off-sales may not total more than 50 percent of the brewer/licensee’s production or 500 barrels, whichever is less. (6) A brewer operating a brewpub may hold or have an interest in other retail on-sale licenses, but may not have an ownership interest in whole or in part, or be an officer, director, agent or employee of, any other manufacturer, brewer, importer, or wholesaler or be an affiliate thereof, whether the affiliation is corporate or by management, direction or control. Notwithstanding this prohibition, a brewer licensed under this provision may be an affiliate or subsidiary company of a brewer licensed in Minnesota or elsewhere if that brewer’s only manufacture of malt liquor is: (i) As a brew pub as defined herein and limited to the regulations of a brewpub by this chapter; (ii) Manufactured in another state for consumption exclusively in a restaurant located in the place of manufacture or brewing; or 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(j)(6)(iii) (iii) Manufactured in another state for consumption primarily in a restaurant located in or immediately adjacent to the place of manufacture, if the brewer was licensed subject to the regulations herein on January 1, 1995. (k) Small brewer off-sale malt liquor license. A brewer who has a license from the commissioner to brew 20,000 barrels of malt liquor per year may be issued a license by the city for off-sale of malt liquor as provided in Minnesota Statutes, section 340A.28 and subject to the following conditions: (1) The malt liquor sold off-sale must be produced and packaged on the licensed premises; (2) Off-sale of malt liquor shall be limited to the legal hours for off-sale pursuant to this section, except an establishment that holds a brewer off-sale malt liquor license may sell malt liquor off-sale between the hours of 8:00 a.m. and 10:00 p.m. on Sundays; (3) The malt liquor sold off-sale must be removed from the licensed premises before the applicable off-sale closing time pursuant to this section; and (4) The malt liquor sold off-sale shall be packaged in 64-ounce containers commonly known as “growlers” or in 750 milliliter bottles and shall have the following requirements for packaging: (i) The containers or bottles shall bear a twist type closure, cork, stopper or plug; (ii) At the time of sale, a paper or plastic adhesive band, strip or sleeve shall be applied to the container or bottle and extend over the top of the twist type closure, cork, stopper or plug forming a seal that must be broken upon opening of the container or bottle; (iii) The adhesive band, strip or sleeve shall bear the name and address of the brewer/licensee selling the malt liquor; and The containers or bottles shall be identified as malt liquor, contain the name of the malt liquor, bear the name and address of the brewer/licensee selling the malt liquor, and the contents in the container packaged or bottled as required herein shall be considered intoxicating liquor unless the alcoholic content is labeled as otherwise in accordance with the provisions of Minnesota Rules, part 7515.1100. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(l) (l) Brewer taproom license. A brewer who has a license from the commissioner to brew up to 20,000 barrels of malt liquor per year may be issued a license by the city for on-sale of malt liquor as provided in Minnesota Statutes, section 340A.26 subject to the following conditions: (1) The malt liquor sold on-sale for consumption must be produced by the brewer on the licensed premises; (2) No other beverages containing alcohol may be sold or consumed on the licensed premises; (3) A brewer may only have one taproom license; (4) A restaurant is allowed at a brewery with a taproom license; and (5) On-sale of malt liquor shall be limited to the legal hours for on-sale pursuant to this section except an establishment that holds a brewer taproom license may sell malt liquor produced by the brewer on the licensed premises on-sale for consumption between the hours of 10:00 a.m. on Sundays and 2:00 a.m. on Mondays. (m) Culinary class limited on-sale intoxicating license. Culinary class limited on-sale intoxicating licenses may be issued to a business establishment not otherwise eligible for an on-sale intoxicating liquor license and that, as part of its business, conducts culinary or cooking classes for which payment is made by each participant or advance reservation required. The license authorizes the licensee to furnish to each participant in each class, at no additional cost to the participant, up to a maximum of six ounces of wine or 12 ounces of intoxicating malt liquor, during and as part of the class, for consumption on the licensed premises only. All provisions of this chapter that apply to on-sale intoxicating liquor licenses, other than provisions inconsistent with this subsection, apply to licenses issued under this subsection, except that the requirements related to liability insurance shall not apply. (n) Microdistillery cocktail room license. A microdistillery cocktail room license may be issued to the holder of a microdistillery license issued under Minnesota Statutes, section 340A.22, subject to the following conditions: (1) A microdistillery cocktail room license authorizes the on-sale of distilled liquor produced by the distiller for consumption on the premises of or adjacent to one distillery location owned by the distiller; 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(n)(2) (2) The city shall, within ten days of the issuance of a microdistillery cocktail room license inform the commissioner of the licensee’s name and address and trade name, and the effective date and expiration date of the license. The city shall also inform the commissioner of a license transfer, cancellation, suspension, or revocation during the license period; (3) At least 50 percent of the annual production of the microdistillery must be processed and distilled on the premises; (4) A microdistillery cocktail room may sell on-sale on Sundays during the hours the on-sale of liquor is allowed under this section; (5) No single entity may hold both a microdistillery cocktail room and taproom license, and a cocktail room and taproom may not be co-located; and (6) A restaurant is allowed at a microdistillery with a cocktail room license. (o) Microdistillery off-sale license. A microdistillery off-sale license may be issued to the holder of a microdistillery license issued under Minnesota Statutes, section 340A.22 subject to the following conditions: (1) The license permits the sale of one 375 milliliter bottle per customer per day of product manufactured on site; (2) Off-sale shall be limited to the legal hours for off-sale; (3) At least 50 percent of the annual production of the microdistillery is processed and distilled on the licensed premises; and (4) No brand may be sold at the microdistillery unless it is available for distribution to by wholesalers. (p) Outdoor areas and smoking areas. (1) The city may approve an outdoor area as constituting part of the licensed premises for an on-sale establishment. The outdoor area must be described by the licensee in the license application. The sale of liquor within any outdoor area approved as part of the licensed premises may only occur in accordance with the license, only if such sales are incidental to the sale of food, and only during such times as food service is available. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 1(p)(2) (2) The city may approve a smoking area as part of an on-sale license to allow a smoking area in which patrons are permitted to consume intoxicating liquor previously purchased and/or delivered to the patron in the licensed premises. Approval of a smoking area must be requested as part of the license application. Intoxicating liquor, food, or non-intoxicating beverages may not be served or delivered to patrons in the smoking area by employees of licensee. (3) The city shall not approve an outdoor area to be part of a licensed premises, or approve a smoking area, unless the applicant provides a site plan showing the area and demonstrates that the following items are identified or described, and are adequately addressed: (i) Fencing or screening; (ii) Controlled access (entrance/exit obtained from inside building; emergency exit provision); (iii) Underage access prevention; (iv) Size and type of area (dimensions; patio/deck/fenced area); (v) Rubbish control; (vi) Security and supervision; (vii) Lighting and illumination; and (viii) Compliance with all applicable zoning, building, and fire codes. In addition to issuing each of these license types, the city council may also issue any lawful combination thereof. The city council may issue any number of licenses, subject to the limits contained in Minnesota Statutes, chapter 340A. A licensee under this section may also sell, as an incident to the sale of intoxicating liquors, food, tobacco products, 3.2% malt beverages, and soft drinks, if otherwise permitted and licensed to do so, as required. Subd. 2. On-sale Sunday sales licenses. On-sale Sunday sales license may only be issued in accordance with this subdivision. A restaurant, club, or hotel is only eligible for an on-sale Sunday sales license if it has facilities for serving not less than 30 guests at one time and holds an on-sale intoxicating liquor license. Such license shall permit the sale of liquor to be consumed on the premises in accordance with, and during the hours allowed by, Minnesota Statutes, section 340A.504 and other applicable law. No on-sale Sunday license is needed for an on-sale wine license. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 2(a) (a) Restaurant. (1) An on-sale Sunday sales license may be issued to a restaurant, as defined under Crystal city code, subsection 1200.03, holding one of the following licenses: (i) On-sale liquor, full liquor; (ii) On-sale microdistillery; (iii) On-sale brew pub; or (iv) On-sale brewer taproom. (2) In order for a restaurant to be eligible for an on-sale Sunday sales license under this section, it shall meet the criteria contained in Minnesota Statutes, section 340A.504, subdivision 3, and it shall also meet the following criteria at all times where intoxicating liquors are offered for on-sale Sunday sales: (i) The establishment must conform to the requirements of Minnesota Statutes, sections 144.411 through 144.417, and the Minnesota clean indoor air act; and (ii) Holders of on-sale brew pub and on-sale brewer taproom licenses are authorized to conduct on-sale business on Sundays if they hold a Sunday sales license. Malt liquor in growlers only may be sold by brew pubs, brewer taprooms, and small brewers at off-sale on Sundays between the hours of 8:00 a.m. on Sunday and 2:00 a.m. on Monday, if approved by the city council. (b) Club. An on-sale Sunday sales license may be issued to a club, as defined in Minnesota Statutes, section 340A.101, subdivision 7, holding an on-sale club license. (c) Hotel. An on-sale Sunday sales license may be issued to a hotel, as defined in Minnesota Statutes, section 340A.101, subdivision 13, holding an on-sale intoxicating liquor license. (d) 3.2 percent establishment. An on-sale Sunday sales license may be issued to an establishment holding an on-sale 3.2 percent malt liquor license to authorize the sale of 3.2 percent malt liquor on Sundays. 562973v4CR225-464 2019 Crystal City Code 1200.07, Subd. 3 Subd. 3. Restaurant license. The establishment must be licensed as a restaurant under this code and conform to the provisions of Crystal city code, chapter VI. Subd. 4. Food service. Food service in the establishment must be provided continuously during operating hours as permitted by this Crystal city code. Subd. 5. Food preparation. The food preparation area of the establishment must be capable of preparing and serving full meals. At least one cook and one dishwasher must be on duty during hours of operation. Subd. 6. On-sale of 3.2% malt liquor and wine. The holder of an on-sale wine license issued pursuant to this section must concurrently hold an on-sale 3.2% malt liquor license to sell 3.2% malt liquors at on-sale. The holder of an on-sale wine license who is also the holder of an on-sale 3.2% malt liquor license may sell intoxicating malt liquors at on-sale without an additional license. Subd. 7. Intoxicating liquor license holder sale of 3.2% malt liquor and wine. Holders of an on- sale, full liquor license may sell 3.2% malt liquors and wine at on-sale without further license. Subd. 8. License fees. Fees for licenses issued pursuant to this section are set by Crystal city code, appendix IV. Fees are charged for the license year as provided in Crystal city code, subsection 1200.17. The acceptance by the city of any partial portion of payment shall not constitute a waiver on the part of the city of the whole license fee which must be paid in full prior to issuance of a license. The city shall reduce the off-sale intoxicating liquor license fee by $100 for a licensee that demonstrates it has an underage sales prevention program meeting the criteria in Minnesota Statutes, section 340A.408, subdivision 3(c). Before increasing an intoxicating liquor license fee, the city council will hold a public hearing on the proposed increase and the city shall provide at least 30 days written notice of the hearing to holders of intoxicating liquor licenses within the city. Subd. 9. Temporary on-sale licenses. All temporary on-sale licenses issued by the city, including temporary on-sale licenses for the sale of 3.2% malt liquor, shall be subject to the restrictions included in Minnesota Statutes, section 340A.410, subdivision 10. 1200.09. License procedure. Subd. 1. Application. An applicant for a liquor license from the city must file with the city clerk a written application in the form prescribed by the city. Each license application shall contain, at a minimum, the information required in Crystal city code, subsection 1000.11. Subd. 2. Qualifications of applicant. A license may not be issued to a person unless they meet all of the requirements of Minnesota Rules, part 7515.0410. A false material statement made in the application is grounds for revocation of the license. Subd. 3. Operating manager. When a licensee places an operating manager in charge of a business, or if the named operating manager(s) in charge of a licensed business changes, the licensee must complete and submit the appropriate application within 14 days. The application must include all appropriate information required in this subsection. 562973v4CR225-464 2019 Crystal City Code 1200.09, Subd. 3(a) (a) Upon completion of an investigation of a new operating manager, the licensee must pay an amount equal to the cost of the investigation to assure compliance with this chapter. If the investigation process is conducted solely within the state of Minnesota, the fee shall be $500.00. If the investigation is conducted outside the state of Minnesota, the issuing authority may recover the actual investigation costs not exceeding $10,000.00. Subd. 4. Application execution. All applications for a license under this chapter must be signed and certified by the applicant. If the application is that of a natural person, it must be signed and certified by such person; if that of a corporation, by an officer thereof; if that of a partnership, by one of the general partners; and if that of an unincorporated association, by the operating manager or managing officer thereof. 1200.11. Insurance required. Prior to the issuance of a license the applicant must file with the city clerk satisfactory evidence of adequate insurance coverage which also must meet the conditions specified in Minnesota Statutes, section 340A.409. The licensee must provide evidence of coverage in the form of a certificate of insurance complying with the most recent edition of the applicable ACORD forms (or similar insurance service organization forms), as approved by the city manager or designee. The licensee shall notify and identify the city to its insurance carrier(s) and require its insurance carrier(s) to provide the statutory cancellation notice if the policy is cancelled, not renewed or materially changed. Failure to maintain the insurance required by this subdivision is grounds for revocation or suspension of the license. 1200.13. Investigation of license applicants. Subd. 1. Preliminary background and financial investigation. On an initial application for a license and, in the sound discretion of the city manager that it is in the public interest to do so, on an application for renewal of a license, the city shall conduct a preliminary background and financial investigation of the applicant or it may contract with the Commissioner for the investigation. The applicant shall pay with the application an investigation fee of $500 which shall be in addition to any license fee. If the cost of the preliminary investigation is less than $500, the unused balance shall be returned to the applicant. The results of the preliminary investigation shall be sent to the Commissioner if the application is for an on-sale intoxicating liquor license or an on-sale wine license. Subd. 2. Comprehensive background and financial investigation. If the results of a preliminary investigation warrant, in the sound discretion of the city council, a comprehensive background and financial investigation, the city may either conduct the investigation itself or contract with the commissioner for the investigation. The investigation fee for this comprehensive background and financial investigation to be paid by the applicant shall be $500, less any amount paid for the initial investigation if the investigation is to be conducted within the state, and $10,000, less any amount paid for the initial investigation, if the investigation is required outside the state. The unused balance of the fee shall be returned to the applicant whether or not the application is denied. The fee shall be paid in advance of any investigation and the amount actually expended on the investigation shall not be refundable in the event the application is denied. 562973v4CR225-464 2019 Crystal City Code 1200.15 1200.15. Burden of proof; misrepresentations. In the event that the applicant for a license, or a holder of an existing license, fails to make complete and accurate disclosure to the city council, city manager, or chief, or any officer of the city so designated by them, or fails to promptly produce books, records, leases or subleases or to promptly correct any deficiency in the operation or management of the premises as requested, then such refusal or non-compliance may be sufficient grounds for denial of the new license, revocation or suspension of an existing license or refusal to renew an existing license, pursuant to Crystal city code, subsection 1000.31 and other applicable law. 1200.17. License year. Pro rata licenses may be issued to new licensees for a partial year pursuant to the terms of this subsection. Licenses issued between July 1 and December 31 of a year shall be charged the full license fee. Licenses issued between January 1 and June 30 shall be charged one-half of the full license fee. Liquor licenses expire on the 30th day of June of each year. The city council may in its discretion provide by resolution for an increase in the amount of liability insurance required over the minimum required by Minnesota Statutes, section 340A.409. Liquor licenses commence on July 1 of each year, except that pro rata licenses shall become effective upon the date issued by the city council. In accordance with Minnesota Statutes, section 340A.414, subdivision 4, consumption and display permits expire on March 31 of each year. 1200.19. Renewal reports. A licensee must furnish the city clerk the following information not later than 60 days prior to renewal of each retail liquor license: (a) The name or names of all persons owning or having an interest in the licensed business including their age, occupation, residence and place of business; and (b) A list of all other liquor businesses by name and address that are located in the state of Minnesota in which such person listed in paragraph (a) of this subsection have an interest, and state the extent of such interest. 1200.21. License revocation; improperly issues licenses. A license issued to a person not entitled to receive the same under this section or any law of the state of Minnesota, including licenses which are issued based upon misrepresentations made by the applicant, shall be revoked by the city council at any time after ten days’ notice and public hearing in accordance with Crystal city code, chapter X. 1200.23. Corporations and partnerships holding licenses. Subd. 1. Stock transfers. A corporate retail liquor licensee must report within 14 days to the city clerk prior to each and any proposed change of legal ownership or beneficial interest in any of said corporate shares of stock if such transfer affects five percent or more of the capital stock or interest of said corporation or partnership. The report must be in writing and list all stockholders or partners, their age, occupation, their residence address, the number of shares held by each, whether individually or for the benefit of others. The report must include all powers of attorney for proxies granted that relate to the voting of the corporate shares of stock. The city council may approve or disapprove each such proposed transfer or assignment. 562973v4CR225-464 2019 Crystal City Code 1200.23, Subd. 2 Subd. 2. Change of control. Any change in the legal ownership or beneficial interest in the shares of stock that results in a change of ownership or change of control of the corporation or partnership is hereby declared to be a transfer of a liquor license that is prohibited by this section and prior approval of the city council is required. A new application, new investigation, new license fee, and new processing are required. A change of partners will be deemed to be a new person requiring a new application, new investigation, new license fee, and a new processing. The city council will consider and vote on the matter of the change of ownership or control of the licensee as though an outsider were desiring to take out a new license. The failure to obtain such prior approval of the city council or to produce books or other records in compliance with this section is grounds for automatic revocation of the corporate liquor license after notice and a public hearing. Subd. 3. Corporation books. The city council or any officer of the city so designated by it may at any reasonable hour examine the stock, transfer records, minute books and all other business records of the corporate licensee as may appear necessary. This right is especially provided to disclose the extent of the interest of any and all persons in the licensed corporation or partnership, the ownership and voting of shares of stock of the corporation or partnership, and to determine whether or not any change of the legal ownership of, or beneficial interest in certain shares of stock by itself or together with other transfers of shares of stock has directly or indirectly resulted in a multiple ownership or in a change of control of the licensed business. Particular scrutiny must be given to proxy voting and powers of attorney to vote stock shares. Subd. 4. Corporate stockholder. The sale or transfer of shares of voting stock by the corporate licensee to another corporation is prohibited. Subd. 5. Corporation information. In the case of publicly held corporations the city manager may accept disclosure documents required by the Securities and Exchange Commission of the United States of America in lieu of or as supplemental to information required of a corporation under any provision of this section. Subd. 6. Application to partnerships. The terms of this section shall apply to all legally recognized forms of partnerships to the same extent and in the same manner as they apply to any legally recognized corporation. 1200.25. Submissions to commissioner of public safety. The city clerk shall provide all necessary information to the commissioner of the department of public safety as required by Minnesota Statutes, chapter 340A and Minnesota Rules, chapter 7515. 1200.27. Multiple ownership. No person shall be issued any combination of licenses authorized under this section unless such combination of licenses is authorized under Minnesota Statutes, chapter 340A. 1200.29. License transfer; posting. Liquor licenses are non-transferable. Licenses must be posted in a conspicuous place in the premises for which they are issued in accordance with Crystal city code, section 1000.27. 1200.31. License refunds. A liquor licensee may apply to the city council for a pro-rata refund of the license fee paid in the following cases: 562973v4CR225-464 2019 Crystal City Code 1200.31(a) (a) The licensed premises of the business are destroyed by fire or other catastrophe; (b) The licensee ceases business because of death or serious illness; or (c) The business ceases to be lawful for a reason other than a license revocation. The city council shall, in its sole discretion, determine whether such a refund is appropriate, and if so, in what amount. 1200.33. Consumption and display permits. Subd. 1. Permit required. No business establishment or club which does not hold an on-sale intoxicating liquor license may directly or indirectly allow the consumption and display of alcoholic beverages or knowingly serve any liquid for the purpose of mixing with intoxicating liquor without first having obtained a permit from the commissioner. Rental of a public facility does not make the city or the facility a “business establishment” for purposes of this section. The city council must consent to all permits issued by the commissioner pursuant to Minnesota Statutes, section 340A.414, subdivision 5. Subd. 2. Additional fees. There is imposed upon holders of permits issued pursuant to Minnesota Statutes, section 340A.414 an additional fee of $300 per annum. The fee must be paid to the city finance director on or before March 31 of each year and a receipt given thereof, provided, however, upon commencement of a new permit period under the state permit, if a portion of the year has elapsed when payment is made, a pro rata fee may be paid but no such pro rata fee may be less than $150. In computing the fee, an unexpired fraction of a month is counted as one month. The receipt must be posted in some conspicuous place upon the premises alongside the state permit. Subd. 3. Inspections. A business establishment or club issued a permit shall be open for inspection pursuant to Minnesota Statutes, section 340A.414, subdivision 7. Subd. 4. Hours of consumption and display. The hours of consumption and display of intoxicating liquor are those specified in section and Minnesota Statutes, section 340A.414. 1200.35. Conditions of license; penalties. Subd. 1. Conditions of license. The failure of a licensee to meet any one of the conditions of the license specified below shall result in the application of penalties as provided in this subsection. (a) Within 90 days after employment, every person selling or serving liquor in an establishment which has an on-sale license shall receive training regarding the selling or serving of liquor to customers. The training shall be provided by an organization approved by the city council. Proof of training shall be provided by the licensee. 562973v4CR225-464 2019 Crystal City Code 1200.35, Subd. 1(b) (b) Every licensee is responsible for the conduct of the place of business and the conditions of sobriety and order in it. The act of any employee on the licensed premises is deemed the act of the licensee as well, and the licensee shall be liable for all penalties provided by this Crystal city code and the law equally with the employee. (c) Every licensee shall allow any peace officer, health officer, city employee, or any other person designated by the city council to conduct compliance checks and to otherwise enter, inspect, and search the premises of the licensee during business hours and after business hours during the time when customers remain on the premises without a warrant. (d) No on-sale establishment shall display or sell liquor to the public during hours when the sale of liquor is prohibited. (e) Compliance with financial responsibility requirements of state law and of this Crystal city code is a continuing condition of any license. (f) Compliance with all laws, rules, and regulations related to the retail sale of intoxicating liquors, including the provisions of Minnesota Statutes, chapters 297F and 340A, Minnesota Rules, chapter 7515, and the Crystal city code. Subd. 2. Penalties. (a) Misdemeanors. A person who violates this section is guilty of a misdemeanor unless otherwise provided by law. (b) Presumptive revocation. The city council may revoke a license, following, notice and an opportunity to be heard, on the first violation for the following types of offenses: (1) Commission of a felony by licensee or an employee of licensee related to the licensed activity authorized by this chapter and Minnesota Statutes, chapter 340A. (2) The sale of alcoholic beverages on the licensed premises while a license is under suspension or revocation. (c) Administrative civil penalties. If a licensee or an employee of a licensee is found to have violated any of the provisions of state law or this section, the city council may impose an administrative penalty, including a civil fine and/or suspension of the license, in such amounts and for such periods as set out Crystal city code, appendix IV. 562973v4CR225-464 2019 Crystal City Code 1200.35, Subd. 3 Subd. 3. Presumptions regarding administrative penalties. The administrative penalties described in subdivision 2 of this subsection and set out in Crystal city code, appendix IV are the presumed sanctions for the violations indicated. In the event of any license suspension imposed under this section, the city council may select which days a suspension will be served. Notwithstanding any of the provisions contained herein, a license may be revoked for any violation of this section when in the judgment of the city council it is appropriate to do so. The city council may impose lesser penalties under subdivision 2 of this subsection when in the judgment of the city council it is appropriate to do so. Other mandatory requirements may be made of the establishment including, but not limited to, meetings with the police department staff to present a plan of action to assure any observed problems will not continue, mandatory education sessions with crime prevention staff, or other actions that the city council deems appropriate. 1200.37. Hours of sale. Subd. 1. Statutory. The hours of operation and days of sale shall be those set by Minnesota Statutes, section 340A.504, including sales after 1:00 a.m. pursuant to a permit issued by the commissioner, except that the city council may, by resolution or ordinance, provide for more restrictive hours than state law allows. Subd. 2. Consumption prohibited. No person shall consume, nor shall any on-sale licensee permit any consumption of, intoxicating liquor or 3.2 percent malt liquor upon an on-sale licensed premises more than 30 minutes after the time within which intoxicating liquors may be sold. Subd. 3. Display. No on-sale licensee shall permit any glass, bottle, or other container containing intoxicating liquor or 3.2 percent malt liquor to remain upon any table, bar, stool, or other place where customers are served, more than 30 minutes after the time within which intoxicating liquors may be sold. Subd. 4. Vacate premises. No person, other than the licensee and any employee, shall remain on the on-sale licensed premises more than 30 minutes after the time within which intoxicating liquors may be sold. Subd. 5. Penalty. Any violation of this subsection may be grounds for revocation or suspension of the license subject to the terms of this section. 1200.39. Licenses in prohibited locations. No license shall be issued under this section in any place which is prohibited under Minnesota Statutes, section 340A.412, subdivision 3. 1200.41. Temporary on-sale licenses. The city council may issue temporary on-sale licenses for the on- sale of intoxicating liquor to clubs, or charitable, religious or other non-profit organizations in the manner and subject to the conditions specified in Minnesota Statutes, section 340A.404, subdivision 10. The fee for a temporary on-sale license shall be in an amount as provided in Crystal city code, appendix IV. 562973v4CR225-464 2019 Crystal City Code 1200.43 1200.43. Social host liability. Subd. 1. Purpose and findings. The city council intends to discourage underage possession and consumption of alcoholic beverages, even if done within the confines of a private residence, and intends to hold persons criminally responsible who host events or gatherings where persons under 21 years of age possess or consume alcoholic beverages regardless of whether the person hosting the event or gathering supplied the alcohol. The city council finds that: (a) Events and gatherings held on private or public property where alcoholic beverages are possessed or consumed by persons under the age of 21 are harmful to those persons and constitute a potential threat to public health requiring prevention or abatement; (b) Prohibiting underage consumption acts to protect underage persons, as well as the general public, from injuries related to alcohol consumption, such as alcohol overdose or alcohol- related traffic collisions; (c) Alcohol is an addictive drug which, if used irresponsibly, could have drastic effects on those who use it as well as those who are affected by the actions of an irresponsible user; (d) Often, events or gatherings involving underage possession and consumption of alcoholic beverages occur outside the presence of parents. However, there are times when the parent(s) is/are present and, condone the activity, and in some circumstances provide the alcoholic beverages; (e) Even though giving or furnishing alcoholic beverages to an underage person is a crime, it is difficult to prove, and an ordinance is necessary to help further combat underage consumption of alcoholic beverages; and (f) A deterrent effect will be created by holding a person criminally responsible for hosting an event or gathering where underage possession or consumption of alcoholic beverages occurs. Subd. 2. Authority. This subsection is enacted pursuant to Minnesota Statutes, sections 145A.05, subdivision 1 and 340A.509. Subd. 3. Definitions. For purposes of this subsection, the following terms have the meanings given them in this subdivision. (a) Alcohol. “Alcohol” means ethyl alcohol, hydrated oxide of ethyl, or spirits of wine, whiskey, rum, brandy, gin, or any other distilled spirits including dilutions and mixtures thereof from whatever source or by whatever process produced. 562973v4CR225-464 2019 Crystal City Code 1200.43, Subd. 3(b) (b) Alcoholic beverage. “Alcoholic beverage” means alcohol, spirits, liquor, wine, beer, and every liquid or solid containing alcohol, spirits, wine, or beer, and which contains one-half of one percent or more of alcohol by volume and which is fit for beverage purposes either alone or when diluted, mixed, or combined with other substances. (c) Event or gathering. “Event or gathering” means any group of three or more persons who have assembled or gathered together for a social occasion or other activity. (d) Host. “Host” means to aid, conduct, allow, entertain, organize, supervise, control, or permit a gathering or event. (e) Parent. “Parent” means any person having legal custody of a juvenile: (1) As natural, adoptive parent, or step-parent; (2) As a legal guardian; or (3) As a person to whom legal custody has been given by order of the court. (f) Person. “Person” means any individual, partnership, co-partnership, corporation, or any association of one or more individuals. (g) Residence or premises. “Residence” or “premises” means any home, yard, farm, field, land, apartment, condominium, hotel or motel room, or other dwelling unit, or a hall or meeting room, park, or any other place of assembly, public or private, whether occupied on a temporary or permanent basis, whether occupied as a dwelling or specifically for a party or other social function, and whether owned, leased, rented, or used with or without permission or compensation. (h) Underage person. “Underage person” is an individual under 21 years of age. Subd. 4. Prohibited acts. (a) It is unlawful for any person to host an event or gathering, at any residence, premises, or on any other private or public property, where alcoholic beverages are present, when the person knows or reasonably should know that an underage person will consume or possess alcoholic beverages, unless the person takes reasonable steps to prevent the possession or consumption by the underage person. A person who hosts an event or gathering does not have to be present at the event or gathering to be criminally responsible. (b) A person is criminally responsible for violating subdivision 4(a) of this subsection if the person intentionally aids, advises, hires, counsels, or conspires with or otherwise procures another to commit the prohibited act. 562973v4CR225-464 2019 Crystal City Code 1200.43, Subd. 5 Subd. 5. Exceptions. This subsection does not apply to the following: (a) Conduct solely between an underage person and their parents while present in the parent’s household; (b) Legally-protected religious observances; (c) Retail intoxicating liquor or 3.2 percent malt liquor licensees, or bottle club permit holders who are regulated by Minnesota Statutes, section 340A.503, subdivision 1(a)(1); or (d) Situations where underage persons are lawfully in possession of alcoholic beverages during the course and scope of employment. Subd. 6. Penalty. A violation of this subsection is a misdemeanor. 1200.45. Community center on-sale authorization. Subd. 1. Authorization. Pursuant to Minnesota Statutes, section 340A.404, subdivision 4(a), the city council may authorize the holder of a retail on-sale intoxicating liquor license issued by the city or by an adjacent municipality (referred to in this subsection as the “licensee”) to dispense intoxicating liquor off-premises at the Crystal community center. Upon such authorization, the licensee may dispense intoxicating liquor at any authorized convention, banquet, conference, meeting, or social affair conducted on the premises of the Crystal community center. The person or organization who is authorized by the city to hold the event at the Crystal community center may engage a licensee to dispense intoxicating liquor at the event, but only to persons attending the event. No intoxicating liquor may be distributed to any person attending or participating in a youth amateur athletic event held at the Crystal community center for persons 18 years of age or younger. Subd. 2. Requirements. Licensees authorized to dispense intoxicating liquor in the Crystal community center shall comply with the requirements imposed upon on-sale intoxicating liquor licensees within the city including, but not limited to, insurance requirements and all policies established by the city for the Crystal community center. Any insurance certificate provided to the city by a licensee shall name the city as an additional insured, and shall state that off-premises coverage is included. Subd. 3. Application; expiration. Licensees seeking authorization to dispense intoxicating liquor in the Crystal community center shall make application to the city manager. The requested authorization shall be presented to the city council for a decision. To defray the costs of processing the application, licensees shall submit with their application the application fee as set from time to time by the city as set forth in Crystal city code, appendix IV or as may be incorporated into the rental permit fee for the Crystal community center. Unless renewed, authorization to dispense intoxicating liquor at the Crystal community center shall expire at the time on-sale intoxicating liquor licenses expire. 562973v4CR225-464 2019 Crystal City Code 1200.47 1200.47. Community festival on-sale authorization. Subd. 1. Authorization. Pursuant to Minnesota Statutes, section 340A.404, subdivision 4(b), the city council may authorize the holder of a retail on-sale intoxicating liquor license issued by the city to dispense intoxicating liquor off premises at a community festival occurring in a park or right-of-way within the city. No authorization shall be issued under this subsection unless: (a) The city has issued a special event permit for the community festival; (b) The authorization specifies the area in which the intoxicating liquor must be dispensed and consumed; and (c) The licensee demonstrates that it has liquor liability insurance as required by Minnesota Statutes, section 340A.409 and Crystal city code, subsection 1200.11 to cover the community festival. Subd. 2. Requirements. A licensee authorized to dispense intoxicating liquor at the festival shall comply with the requirements imposed upon the on-sale intoxicating liquor license issued to the licensee. The licensee shall comply with all applicable provisions of this Crystal city code related to use of public property and any conditions and restrictions placed on the special event permit issued for the community festival. Intoxicating liquor may only be dispensed and consumed in the specific areas identified in the city council’s authorization. Any insurance certificate provided to the city by a licensee for sales at the community festival shall name the city as an additional insured and indicate that off-premises coverage is included. Subd. 3. Application; expiration. Licensees seeking authorization to dispense intoxicating liquor at a community festival shall make application to the city manager. The requested authorization shall be presented to the city council for a decision. To defray the costs of processing the application, licensees shall submit with their application the application fee as set from time to time by the city as set forth in Crystal city code, appendix IV or as may be incorporated into the required permit. The authorization to dispense intoxicating liquor at the community festival shall expire at the ending time of the community festival as specified in the special event permit. 1200.49. Entertainment in licensed premises. Subd. 1. Definitions. For purposes of this subsection, the terms defined in this subdivision have the meanings given them. (a) “License” means any license issued pursuant to Crystal city code, chapter XII. (b) “Licensed premises” means the compact and contiguous area of real property for which a license is issued. 562973v4CR225-464 2019 Crystal City Code 1200.49, Subd. 1(c) (c) “Nudity” means the showing of the post-pubertal human male or female genitals, pubic area, or buttocks with less than a fully-opaque covering, or the showing of a post-pubertal female breast with less than a fully-opaque covering of any portion thereof below a point immediately above the top of the areola, or the covered human male genitals in a discernibly turgid state. For the purposes of this definition, the female breast is considered uncovered if the nipple only or the nipple and the areola are uncovered. (d) “Sadomasochistic abuse” means scenes involving a person or persons, any of whom are nude, clad in undergarments or in sexually revealing costumes, and who are engaged in activities involving the flagellation, torture, fettering, or binding or other physical restraint of any such persons, in an apparent act of sexual stimulation or gratification. (e) “Sexual conduct” means acts of masturbation, sexual intercourse, or any touching of the genitals, pubic areas, or buttocks of the human male or female, or the breasts of the female, whether alone or between members of the same or opposite sex or between humans and animals in an act of apparent sexual stimulation or gratification. Subd. 2. Prohibited acts. (a) The city council finds that it is in the best interests of the public health, safety, and general welfare of the people of the city that nudity is prohibited as provided in this section on the premises of any establishment licensed under this Crystal city code. This is to protect and assist the owners, operators, and employees of the establishment, as well as patrons and the public in general, from harm stemming from the physical immediacy and combination of alcohol, nudity, and sex. The city council especially intends to prevent any subliminal endorsement of sexual harassment or activities likely to lead to the possibility of various criminal conduct, including prostitution, sexual assault, human trafficking, and disorderly conduct. The city council also finds that the prohibition of nudity on the premises of any establishment licensed under this Crystal city code, as set forth in this section, reflects the prevailing community standards of the city. (b) It is unlawful for any licensee to do any of the following: (i) To permit or allow any person or persons on the licensed premises when the person does not have his or her buttocks, anus, breasts, and genitals covered with a non- transparent material; or (ii) To permit or allow any entertainment or service involving any nudity, sadomasochistic abuse, or sexual conduct in such licensed establishment. (c) It is unlawful for any person to be on the licensed premises when the person does not have his or her buttocks, anus, breasts, and genitals covered with a non-transparent material. (d) A violation of this section is a misdemeanor punishable as provided by law, and is justification for revocation or suspension of any liquor, wine, or 3.2 percent malt liquor license or any other license issued under this Crystal city code or the imposition of a civil penalty under this section. 563003v4CR225-464 2019 Crystal City Code 1000.01 CHAPTER X LICENSES AND PERMITS; GENERAL PROCEDURES Section 1000 – General licensing provisions 1000.01. Purpose. By the enactment of this section, the city council intends to establish a uniform system for the issuance, denial, revocation, suspension, and renewal of business licenses required by this Crystal city code. The specific provisions for each business license are contained in chapter XI. 1000.03. Businesses requiring a license. The following businesses, as defined in Crystal city code, chapter XI, are subject to this section, the applicable subsection in Crystal city code, and require a license issued by the city. Business Bond Insur- ance Tax Return Site Inspec- tion Back- ground Investi- gation Public Hearing Record- keeping/ Reports Limited Hours Regu- lated by Sub- section Consumer Fireworks X 1100 Tobacco X 1105 Peddlers/ Solicitors X X 1110 Tree Trimming X X 1115 Secondhand Dealers X X X X 1120 Pawnbrokers X X X X X 1125 Lawful Gambling X X X 1130 Adult Establishments X X X X 1135 Therapeutic Massage X X X X 1140 Alcohol licensing is addressed in Crystal city code, chapter XII, but is also subject to this chapter. 1000.05. Fees. The fees for the various licenses are adopted by city council resolution from time to time and are set out in Crystal city code, appendix IV. An application is not complete, and shall not be processed, until the required fees have been submitted to the city. 1000.07. Application of chapter; conflicts. The provision of this section shall apply to all city licenses. Other provisions related to specific licenses are intended to supplement the provisions in this section, unless they conflict with the provisions of this section in which case the provisions related to the specific licenses shall prevail. 563003v4CR225-464 2019 Crystal City Code 1000.09 1000.09. Licenses required. It is unlawful to engage in a trade, profession, business, or privilege in the city for which a license is required by any provision of this Crystal city code without first obtaining a license from the city in the manner provided in Crystal city code, chapters X and XI, and any other applicable provisions. 1000.11. License application. Subd. 1. Contents. Application for all new licenses and renewals shall be made to the city clerk upon forms provided by the city and shall include all information requested in such forms. Any application submitted on the incorrect form or that is incomplete shall be rejected and shall not be processed. The city manager is authorized to determine if an application is complete and, if not, what additional information is required to make it complete. Unless the applicable application form indicates otherwise, every new application must provide the information as required in this subdivision. (a) If the applicant is a natural person: (1) The name, description, date of birth, street address, phone number, and email address of applicant; (2) Whether the applicant is a citizen of the United States or resident alien; (3) Whether the applicant has ever used or has been known by a name other than the applicant’s name, and if so, any other names used and information concerning dates and places used; (4) The street address at which the applicant has lived during the preceding ten years; (5) Whether the applicant has ever been convicted of a felony, crime, or violation of any ordinance other than a traffic ordinance. If so, the applicant must furnish information as to the time, place, and offense of all such convictions; (6) The applicant’s current personal financial statement and true copies of the applicant’s federal and state tax returns for the two years prior to application; (7) The type, name, and location of every business or occupation in which the applicant has been engaged during the preceding five years and the names and addresses of the applicant’s employers and partners, if any, for the proceeding five years; (8) The name of the business if it is to be conducted under a designation, name, or style other than the name of the applicant and a certified copy of the certificate as required by Minnesota Statutes, section 333.01; and 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 1(a)(9) (9) If the applicant does not manage the business, the name of the managers or other persons in charge of the business and all information concerning each of them required in (a)(1)-(5) of this subdivision. (b) If the applicant is a partnership: (1) The names and addresses of all general and limited partners and all information concerning each general partner required in (a)(1)-(5) of this subdivision; (2) The names of the managing partners and the interest of each partner in the licensed business; (3) A true copy of the partnership agreement shall be submitted with the application. If the partnership is required to file a certificate as to a trade name pursuant to Minnesota Statutes, section 333.01, a certified copy of such certificate must be attached to the application; (4) A true copy of the federal and state tax returns for the partnership for the two years prior to application; and (5) If the applicant does not manage the business, the name of the managers or other persons in charge of the business and all information concerning each of them required in (a)(1)-(5) of this subdivision. (c) If the applicant is a corporation or other organization: (1) The name of the corporation or business form, and if incorporated, the state of incorporation; (2) A true copy of the Certificate of Incorporation, Articles of Incorporation or Association Agreement, and By-laws shall be attached to the application. If the applicant is a foreign corporation, a Certificate of Authority issued pursuant to Minnesota Statutes, section 303.06, must be attached. Any proposed change in either the articles or the by-laws of the corporation must be reported to the city clerk 14 days prior to the date such change is to be adopted by the corporation. In the case of a corporate application the application must also describe fully the relationship of the corporation to any other corporation including the name, business address, state of incorporation, names of stockholders, directors and officers thereof as provided hereafter, but in the case of publicly held corporations the city manager may accept disclosure documents required by the Securities and Exchange Commission of the United States of America in lieu of such information; 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 1(c)(3) (3) The name of the managers or other persons in charge of the business and all information concerning each manager, proprietor, or agent required in (a)(1)-(5) of this subdivision; and (4) A list of all persons who control or own an interest in excess of five percent in such organization or business form or who are officers of the corporation or business form and all information concerning said persons required in (a)(1)-(5) of this subdivision. This subdivision 1(c) shall not apply to a corporation whose stock is publicly traded on a stock exchange and is applying for a license to be owned and operated by it. (d) For all applicants: (1) Whether the applicant holds a business license from any other governmental unit; (2) Whether the applicant has previously been denied, or had revoked or suspended, a business license from any other governmental unit; (3) The location and legal description of the business premises to be licensed; (4) If the applicant does not own the business premises, a true and complete copy of the executed lease; (5) Whether all real estate and personal property taxes that are due and payable for the premises to be licensed have been paid, and if not paid, the years and amounts that are unpaid; (6) Whenever the application is for premises either planned or under construction or undergoing substantial alteration, the application must be accompanied by a set of preliminary plans showing the design of the proposed premises to be licensed; (7) The applicant’s social security number or individual taxpayer identification number, and Minnesota business identification number, as applicable; and (8) Such other information as the city council or issuing authority may choose to require. 563003v4CR225-464 2019 Crystal City Code 1000.11, Subd. 2 Subd. 2. Managers. When a licensee places a manager in charge of a business, or if the named manager in charge of a licensed business changes, the licensee must complete and submit the appropriate documentation required for managers in subdivision 1 of this subsection within 14 days and if a background investigation of the manager is required, the licensee must pay an amount equal to the cost of the investigation, as contained in Crystal city code, appendix IV, to ensure compliance with this section. Subd. 3. Application execution. All applications for a license must be signed and certified by the following: (1) If the applicant is a natural person by such person; or (2) If the applicant is a corporation, by an officer thereof; if that of a partnership, by one of the general partners; and if that of an unincorporated association, by the manager or managing officer thereof. Subd. 4. False statements. It is unlawful to knowingly make a false statement in a license application. In addition to all other penalties, the license may be subsequently revoked by the city council for a violation of this subdivision. 1000.13. Payment of fees. Subd. 1. Included with application. The fees required for a license, license renewal, or investigation, as provided in Crystal city code, appendix IV, must be paid at the office of the city clerk at the time of application. Unless otherwise expressly provided by this Crystal city code, a license fee may not be prorated for a portion of a year. License fees are not refundable regardless of whether the application is approved, denied, or withdrawn. Subd. 2. Renewals; late fees. In the event that a license renewal fee is not paid prior to the expiration of the corresponding license, the following late fees shall apply: (a) One to seven days after expiration, a penalty in the amount of 25% of the license fee; (b) Eight to 30 days after expiration, a penalty in the amount of 50% of the license fee; and (c) After 30 days, the license shall be deemed expired and the business or activity for which the license is required must cease and a new license for such activity will not be considered until the licensee reapplies and appears before the city council. Failure to cease operations of the business or activity after said 30 days shall constitute a misdemeanor. 563003v4CR225-464 2019 Crystal City Code 1000.13, Subd. 3 Subd. 3. Late payment of the license fee with penalty no bar to prosecution for operating without a license. The late payment of the license fee along with the penalty set forth herein is no bar to any prosecution by the city for operating any licensed trade, business, profession, activity, or privilege within the city without a license therefor. 1000.15. Bonds; insurance. Any bonds required by this Crystal city code must be executed by two sureties, or a surety company, shall be subject to the approval of the city manager, and must be in at least the amount required in Crystal city code, appendix IV. Where policies of insurance are required, the policies must provide the types and amounts of coverage required by this Crystal city code and must be in a form acceptable to the city attorney. When commercial general liability coverage is required, the policy shall name the city as an additional insured. Satisfactory evidence of coverage by bonds and/or insurance, when required, must be filed with the city clerk before a license can be issued. 1000.17. Persons or locations ineligible for city license. In addition to any other license-specific ineligibilities contained in this Crystal city code, a city license for a business or activity will not be issued to any of the following: (a) A person not a citizen of the United States or a resident alien; (b) A person under 18 years of age; (c) A person who within five years of the license application date had a similar license revoked by any other jurisdiction; (d) A person whom the city council determines not to be of sufficient good moral character and repute; (e) When the city council determines, after investigation, that issuance or renewal of the license would adversely affect the public health, safety or welfare; (f) A person that is prohibited by federal, state, or other local law, ordinance, or other regulation from holding a license; (g) Where operation of the licensed premises would violate any applicable zoning ordinances; or (h) If taxes, assessments or other financial claims of the city or the state of Minnesota on the licensee’s business premises are delinquent and unpaid. 563003v4CR225-464 2019 Crystal City Code 1000.19 1000.19. Investigations. If a background investigation is expressly required prior to the issuance of a license, the application will be referred to the chief of police for a computerized criminal history, as authorized by Crystal city code, section 311. Every individual or person having any beneficial interest in the license, and the manager of the business, must be investigated. The chief must report the findings and comments to the city manager who must order or conduct such additional investigations as the city manager deems necessary or as the city council directs. 1000.21. Approval or denial of licenses. Upon the receipt of a complete application, payment of fees, and completion of any requisite investigations, a license will be either approved or denied in accordance with the provisions of this Crystal city code. If the city determines the applicant and the place proposed for the business are eligible for a license, then the city will issue the license. The city council shall make the final decision on whether to issue a license, but the city manager is authorized to issue a provisional license if the city manager determines the applicant is eligible for the license and that it is impractical to delay the issuance of the license to the next city council meeting. An applicant issued a provisional license may undertake the business activity authorized by the provisional license with the understanding, and conditioned on, the city council approving the application. If the city council subsequently denies the application, the provisional license ends and all related business activities must cease. 1000.23. License certificates; term. License certificates will include the date of issuance, the activity licensed, and the term of the license. Unless expressly provided elsewhere, the term of each licensing period begins on January 1 and ends on December 31 of each year. 1000.25. Exhibition of license certificate. A licensee shall display its license on the licensed business premises in a conspicuous place and shall present the license certificate upon request of any police officer or authorized representative of the city. If any licensed services are authorized to be provided off of the licensed business premises, the licensee shall have in possession a copy of the licensee when providing such off-site services. 1000.27. Transfer of license. A license will be issued to the particular applicant and only for the business premises as described in the application. Unless otherwise expressly authorized by this Crystal city code, a license issued by the city is not transferable from person to person or from premises to premises. If the licensee is a partnership or a corporation, a change in the identity of any partner or holder of more than five percent of the issued and outstanding stock of the corporation will be deemed a transfer of the license. 1000.29. Renewal of license. License renewals are issued in the same manner and subject to the same conditions as original licenses. Renewal applications and fees shall be submitted at least 30 days prior to expiration. Licensees are responsible for renewing their licenses in accordance with this Crystal city code in order to prevent a lapse in licensure. A licensee shall be ineligible to renew a license if the licensee has failed to pay an administrative penalty imposed by the city council related to the licensed activity. 1000.31. Revocation; denial; suspension. In addition to any other provision in this Crystal city code, a city-issued license may be denied, suspended, or revoked by the city council for any of the following causes: 563003v4CR225-464 2019 Crystal City Code 1000.31(a) (a) Fraud, misrepresentation, bribery, or incorrect statement contained in the application for license, or made in carrying on the licensed activity; (b) Conviction of any felony or of any crime related to the licensed activity; (c) Conducting a licensed activity in such manner as to constitute a breach of the peace, or a threat to the health, safety and welfare of the public, or a disturbance of the peace or comfort of the residents of the city, upon recommendation of appropriate city officials; (d) Expiration or cancellation of any required bond or insurance policy, or failure to notify the city within a reasonable time of changes in the terms of the required insurance or carriers; (e) Actions that are unauthorized or otherwise beyond the scope of the license granted; (f) Violation of any federal, state or local regulation or provision; (g) Failure to continuously comply with all conditions required as part of the license; (h) Failure to comply with the applicable zoning code; or (i) Failure to pay an administrative penalty imposed by the city council. 1000.33. Hearing. A license may not be suspended or revoked until after a hearing is granted to the licensee. The hearing shall be held before the city council upon due notice to the licensee, either personally served or mailed at least five days in advance, stating the time and place of such hearing, together with a statement of the alleged violations to be the cause for the revocation or suspension of the license. At the hearing, the licensee shall have an opportunity to be heard by the city council regarding the allegations. The city council shall determine whether to suspend or revoke the license and shall provide the licensee written notice of its decision. If the city council suspends or revokes the license, all licensed activities shall cease immediately and the license shall otherwise comply with the requirements in the city council’s written decision. 1000.35. Reissuance. Once a license has been revoked, an application for a new license from the same applicant or for the same business premises shall not be submitted for at least 12 months from the date of revocation unless the city council approves an earlier submission. 1000.37. Inspections of licensed premises. The police department, health authority, or any other appropriate city official may enter upon the premises where any licensed activity is being conducted for the purpose of inspection, at any reasonable hour, without a warrant, to determine compliance with this Crystal city code and any conditions placed on the license. 563003v4CR225-464 2019 Crystal City Code 1000.39 1000.39. Financial responsibility. Prior to the issuance of a license the applicant must file with the city clerk satisfactory evidence of financial responsibility. Satisfactory evidence of financial responsibility shall be shown by a certification under oath that the property taxes, public utility bills, and all state and federal taxes or other governmental obligations or claims concerning the business entity applying for the license are current, and that no notice of delinquency or default has been issued, or if any of the financial obligations stated in this subsection are delinquent or in default, that any such delinquency or default is subject to a payment plan or other agreement approved by the applicable governmental entity. The certification shall be signed by an individual applicant or all individual owners and/or shareholders of the business entity. Operation of a business licensed by the city without having updated evidence on file with the city of the financial responsibility required by this subsection is grounds for revocation or suspension of the license. 1000.41. Violations. Any violation of the licensing provisions contained in Crystal city code, chapters X or XI shall be deemed a misdemeanor. Additionally, if a licensee or an employee of a licensee is found to have violated any applicable licensing provisions, the city council may impose an administrative penalty on the licensee. Notwithstanding any presumptive penalties that are expressly provided in this Crystal city code or in Crystal city code, appendix IV, the city council shall have the discretion to impose penalties that are appropriate in their judgment unless they would otherwise conflict with any statutory requirements or limits. 563003v4CR225-464 2019 Crystal City Code 1005.01 Section 1005 – General permit procedures 1005.01. Purpose. By the enactment of this section, the city council intends to establish a uniform system for the issuance of permits for all activities for which permits are required. 1005.03. Fees. The fees for the various permits are adopted by city council resolution from time to time and are set out in Crystal city code, appendix IV. 1005.05. Application of chapter; conflicts. The provision of this section shall apply to all city permits. Other provisions related to specific permits are intended to supplement the provisions in this section, unless they conflict with the provisions of this section in which case the provisions related to the specific permits shall prevail. 1005.07. Permits required. It is unlawful to engage in any activity or privilege in the city for which a permit is required by any provision of this Crystal city code without first obtaining a permit from the city in the manner provided in this section. 1005.09. Application for permit. Application for a permit is made to the city clerk on forms furnished by the city. The application must contain information as to location, nature, extent and costs of the proposed structure, work, installation, or other purposes, and other information which the building inspector or other duly authorized persons may require under this Crystal city code. The application must contain a declaration that the facts and representations therein made are true and correct, which statement must be subscribed to by the person or persons, or officers or agents of a corporation, applying for said permit. If the applicant is seeking two or more licenses at the same time, the information required of the applicant in the application forms may be combined to avoid duplication, provided all of the information required by the application is provided. 1005.11. Granting of permits. Upon payment to the city by the applicant of the required fee for any permits, and upon approval of the appropriate inspector, the permit will be issued, except where city council approval is expressly required, in which case the inspector is authorized to issue such permit only after approval is granted by the city council. 1005.13. Payment of fee. Subd. 1. Payment. The permit fee and other fees and charges set forth in Crystal city code, Crystal city code, appendix IV must be collected by the city before the issuance of any permits, and the city clerk, building inspector, or other persons duly authorized to issue such permit for which the fee is required shall not issue a permit until such fee has been paid. Subd. 2. Increased fee. If a person begins work of any kind for which a city permit is required without first having secured said permit, that person must, when subsequently securing such permit, pay twice the fee prescribed for such permit and is further subject to the penalty provisions of this Crystal city code. 563003v4CR225-464 2019 Crystal City Code Chapter X Modification Index Amended subsection Amending ordinance Chapter X (Delete all and replaced) 2018-05 1000.15 2019-03, Sec. 1 1000.19 2019-03, Sec. 2 1000.39 2019-03, Sec. 3 1005.29 2011-5 Repealed subsection Repealing ordinance 1005.15 2019-03, Sec. 4 CR225-464-562949.v5 2019 Crystal City Code 1105.01 Section 1105 – Tobacco and related products 1105.01. Definitions. For the purposes of this section, the terms defined in this subsection have the meanings given them. Subd. 1. Covered products. “Covered products” means tobacco, tobacco-related device, electronic delivery device, or nicotine or lobelia delivery product as those terms are defined in this subsection. Subd. 2. Electronic delivery device. "Electronic delivery device" means any product containing or delivering nicotine, lobelia, or any other substance, whether natural or synthetic, intended for human consumption through inhalation of aerosol or vapor from the product. Electronic delivery devices includes, but is not limited to, devices manufactured, marketed, or sold as electronic cigarettes, electronic cigars, electronic pipe, vape pens, modes, tank systems, or under any other product name or descriptor. Electronic delivery device includes any component part of a product, whether or not marketed or sold separately. Electronic delivery device excludes drugs, devices, or combination products, as those terms are defined in the Federal Food, Drug, and Cosmetic Act, that are authorized for sale by the United States Food and Drug Administration. Subd. 3. Moveable place of business. “Moveable place of business” means any form of business operated out of a truck, van, automobile or other type of vehicle or transportable shelter and not a fixed- address storefront or other permanent type of structure authorized for sales transactions. Subd. 4. Nicotine or lobelia delivery device. “Nicotine or lobelia delivery device” means any product containing or delivering nicotine or lobelia intended for human consumption, or any part of such a product, that is not tobacco as defined in this subsection, not including any product that has been approved or certified by the United States Food and Drug Administration for sale as a tobacco-cessation product, as a tobacco-dependence product, or for other medical purposes, and is marketed and sold for such an approved purpose. Subd. 5. Sale. “Sale” means any transfer of goods for money, trade, barter or other consideration. Subd. 6. Tobacco. "Tobacco" means cigarettes and any product containing, made, or derived from tobacco that is intended for human consumption, whether chewed, smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by any other means, or any component, part, or accessory of a tobacco product including, but not limited to the following: cigars; cheroots; stogies; perique; granulated, plug cut, crimp cut, ready rubbed, and other smoking tobacco; snuff; snuff flour; cavendish; plug and twist tobacco; fine cut and other chewing tobaccos; shorts; refuse scraps, clippings, cuttings and sweepings of tobacco; and other kinds and forms of tobacco. Tobacco excludes drugs, devices, or combination products, as those terms are defined in the Federal Food, Drug, and Cosmetic Act, that are authorized for sale by the United States Food and Drug Administration. CR225-464-562949.v5 2019 Crystal City Code 1105.01, Subd. 7 Subd. 7. Tobacco-related devices. "Tobacco-related devices" means cigarette papers or pipes for smoking or other devices intentionally designed or intended to be used in a manner which enables the chewing, sniffing, smoking, or inhalation of aerosol or vapor of tobacco or tobacco products. Tobacco- related devices include components of tobacco-related devices which may be marketed or sold separately. Subd. 8. Vending machine. “Vending machine” means any mechanical, electric or electronic, or other type of device that dispenses tobacco, tobacco products, or tobacco-related devices upon the insertion of money, tokens or other form of payment directly into the machine by the person seeking to purchase the covered product. 1105.03. General rule. It is unlawful to buy for retail sale, sell at retail, or otherwise dispose for consideration covered products without a tobacco license issued by the city. 1105.05. Investigations. A background investigation of all interested individuals, including managers, is required and shall be conducted pursuant to Crystal city code, subsection 1000.19 prior to the issuance of a license or license renewal. 1105.07. Ineligibility. In addition to the provisions contained in Crystal city code, subsection 1000.17, the city council may deny a license to a person who within the past five years has been convicted of any violation of a federal, state, or local law, ordinance provision, or other regulation relating to tobacco, tobacco products, tobacco-related devices, electronic delivery device or nicotine or lobelia delivery devices. 1105.09. Specified location. A license under this section will not be issued for a movable place of business. The license is issued only for the covered products at a specific place of business. 1105.11. Prohibited sales and use. Subd. 1. Unlawful sale. It is unlawful to sell, offer for sale or deliver tobacco, tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery devices to a person under the age of 21 years. Subd. 2. Use by persons under 21. It is unlawful for any person under the age of 21 years to purchase, possess, or consume tobacco, tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery devices. Subd. 3. Vending machines. The sale of tobacco, tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery devices by vending machines is prohibited. Subd. 4. Individual packages. It is unlawful to offer for sale or to sell cigarettes packaged in units smaller than a carton containing ten packages, or single packages of smokeless tobacco in open displays that are accessible to the public without the intervention of a store employee. CR225-464-562949.v5 2019 Crystal City Code 1105.13 1105.13. Administrative civil penalties. Subd. 1. Individuals. A person who sells, gives or otherwise furnishes a covered product to a person under the age of 21 years is subject to an administrative penalty identified in Crystal city code, appendix IV, after the individual has received notice, served personally or by mail, of the alleged violation and been provided an opportunity for a hearing. Subd. 2. Licensee. If a licensee or an employee of a licensee is found to have sold, given or otherwise furnished a covered product to a person under the age of 21 years, or committed a violation of Minnesota Statutes, chapter 297F, the city council shall impose administrative penalties on the licensee as provided in Crystal city code, appendix IV. Prior to imposing an administrative penalty the city shall provide the licensee written notice of the alleged violation and provide an opportunity for the licensee to be heard by the city council. Subd. 3. Defense. It is an affirmative defense to a charge of selling, giving or otherwise furnishing a covered product to a person under the age of 21 years in violation of this section that the licensee or individual making the sale relied in good faith upon proof of age as described in Minnesota Statutes, section 340A.503, subdivision 6. Subd. 4. Education and training. In addition to or in lieu of any other penalty imposed under this section, any person under the age of 21 years who purchases, possesses, or consumes a covered product shall attend an educational seminar approved by the chief of police regarding the legal and medical implications of using a covered product. Subd. 5. Presumptions regarding administrative penalties. Though the administrative penalties described in this subsection are presumed, in no event shall the amount of any fine or period of suspension be less than the amounts and periods required in Minnesota Statutes, section 461.12, subdivisions 2 and 3. Other mandatory requirements may be made of the business including, but not limited to, meetings with law enforcement to present a plan of action to ensure the problem will not continue, mandatory education sessions with crime prevention staff, or other actions the city council may deem appropriate. 1105.15. Compliance monitoring. Subd. 1. Compliance checks. As required by Minnesota Statutes, section 461.12, subdivision 5, the police department shall at least once a year perform compliance checks at each location licensed under this section to sell a covered product. License applicants may be informed of this policy at the time of license application and renewal. Violators of this section may be subject to more frequent compliance monitoring than non-violating licensees. The police department may annually report to the city council the results of said compliance checks. CR225-464-562949.v5 2019 Crystal City Code 1105.15, Subd. 2 Subd. 2. Exemption. A person no younger than 17 nor older than 20 may be enlisted by the police department to assist in the compliance checks. If the person is under the age of 18, no such person may conduct compliance checks unless the police department obtains written consent from the person’s parent or guardian and the person must at all times act only under the direct supervision of a law enforcement officer, an employee of the licensing department, or in conjunction with an in-house program that has been pre-approved by the police department. A person who purchases or attempts to purchase tobacco while acting in this capacity is exempt from any penalties related to said purchase or attempt to purchase. Subd. 3. Additional checks. If a licensee or employee of a licensee is guilty of a second violation within the 24-month period since the initial violation, the police department must conduct at least one compliance check at that licensed premises within the time remaining in that 24-month period. 1105.17. Signage and age verification required. Subd. 1. Signage. At each location where tobacco, tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery products are sold, the licensee shall display a sign in plain view to provide public notice that selling any of these products to any person under the age of 21 is illegal and subject to penalties. The notice shall be placed in a conspicuous location in the licensed establishment and shall be readily visible to any person who is purchasing or attempting to purchase these products. The sign shall provide notice that all persons responsible for selling these products must verify, by means of photographic identification containing the bearer’s date of birth, the age of any person under 30 years of age. Subd. 2. Age verification. At each location where tobacco, tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery products are sold, the licensee shall verify, by means of government-issued photographic identification containing the bearer’s date of birth, that the purchaser or person attempting to make the purchase is at least 21 years of age. Verification is not required if the purchaser or person attempting to make the purchase is 30 years of age or older. It shall not constitute a defense to a violation of this subdivision that the person appeared to be 30 years of age or older. 1 LIQUOR LICENSE VIOLATION HEARING PROCEDURES July 2022 All parts in bold are an action or statement for the Mayor or Council Members. All other text is for information only. NO YES CONTINUE TO NEXT PAGE Take Up Matter. Mayor identifies agenda: “Agenda item _____ is next dealing with a liquor license at _________. This matter requires the council to consider and provide an opportunity for a hearing regarding the potential imposition of administrative civil penalties for an alleged violation of Section 1200.35 of the Crystal Code.” Staff Report. Mayor calls for a report by staff. “We will now hear the staff report.” Report will include: Staff provides report addressing the facts of the violation. Crystal Police Department representative provides additional testimony, if required. Questions of staff. After the staff report, Mayor calls for questions for staff and staff responds. “Does anyone have questions of staff or the Police Department representative?” Council is given an opportunity to ask staff questions and staff answers questions based on information submitted by the individual or licensee. Inquire as to Hearing. “I will now ask the individual and/or licensee to come to the podium.” “You have the option to request a formal hearing or you may waive a formal hearing and instead offer testimony in mitigation of the potential penalties the Council may impose. Do you wish to request a formal hearing?” 2 NO to Hearing YES to Hearing CONTINUE TO NEXT PAGE Give individual or licensee an opportunity to be heard. “You have declined a formal hearing. Do you have any comments you would like to give to the Council as potential mitigating factors as we decide the potential penalties to impose?” Allow Council to ask questions of individual/licensee. “Does the Council have any questions for the individual/licensee?” Allow Council to ask questions of staff. “After hearing from the individual/licensee, does the Council have any further questions of staff?” Mayor opens the hearing: “You have requested a formal hearing, so at this time, I will open the public hearing. You are welcome to provide testimony to the Council as well as any documents regarding the incident(s) you would like to offer.” Allow Council to ask questions of individual/licensee. “Does the Council have any questions for the individual/licensee?” Mayor calls for other public testimony. “At this time the Council will hear from anyone present that would like to address the Council regarding this issue.” Mayor closes the public hearing. “At this time we will close the public hearing.” Council Discussion. Council discusses the facts from the information presented. 3 Staff Recommendation. “I will now ask staff to present its recommendation regarding penalties.” Staff presents recommendation. Options under the City Code/Appendix IV include: • First violation: a civil fine in an amount up to $750 and license suspension for a period of one day. • Second violation within two years of the first violation: a civil fine in an amount of $1,500 and suspension of license for a period of three days. • Third violation within three years of the second violation: a civil fine in the amount of $2,000 and suspension of license for a period of 10 days. • Fourth violation within three years of the third violation: revocation of license. • Early revocation: The Council may revoke a license without having to wait for a fourth violation if it determines revocation is appropriate under the circumstances. There is a presumption the license will be revoked if there is a commission of a felony related to the licensed activity or if there is an illegal sale by an employee while the license is under suspension or revocation. Decision. Mayor: “I will now ask for a motion on this matter.” Council Member: “I make a motion that based on the staff report, including the findings contained therein, and the other information presented regarding this matter, that a penalty of ____________ be imposed in this case.” 1 TOBACCO LICENSE VIOLATION HEARING PROCEDURES July 2022 All parts in bold are an action or statement for the Mayor or Council Members. All other text is for information only. NO YES CONTINUE TO NEXT PAGE Take Up Matter. Mayor identifies agenda: “Agenda item _____ is next dealing with a tobacco license at _________. This matter requires the council to consider and provide an opportunity for a hearing regarding the potential imposition of administrative civil penalties for an alleged violation of Section 1105 of the Crystal Code.” Staff Report. Mayor calls for a report by staff. “We will now hear the staff report.” Report will include: Staff provides report addressing the facts of the violation. Crystal Police Department representative provides additional testimony, if required. Questions of staff. After the staff report, Mayor calls for questions for staff and staff responds. “Does anyone have questions of staff or the Police Department representative?” Council is given an opportunity to ask staff questions and staff answers questions based on information submitted by the individual or licensee. Inquire as to Hearing. “I will now ask the individual and/or licensee to come to the podium.” “You have the option to request a formal hearing or you may waive a formal hearing and instead offer testimony in mitigation of the potential penalties the Council may impose. Do you wish to request a formal hearing?” 2 NO to Hearing YES to Hearing CONTINUE TO NEXT PAGE Give individual or licensee an opportunity to be heard. “You have declined a formal hearing. Do you have any comments you would like to give to the Council as potential mitigating factors as we decide the potential penalties to impose?” Allow Council to ask questions of individual/licensee. “Does the Council have any questions for the individual/licensee?” Allow Council to ask questions of staff. “After hearing from the individual/licensee, does the Council have any further questions of staff?” Mayor opens the hearing: “You have requested a formal hearing so at this time I will open the public hearing. You are welcome to provide testimony to the Council as well as any documents regarding the incident(s) you would like to offer.” Allow Council to ask questions of individual/licensee. “Does the Council have any questions for the individual/licensee?” Mayor calls for other public testimony. “At this time the Council will hear from anyone present that would like to address the Council regarding this issue.” Mayor closes the public hearing. “At this time we will close the public hearing.” Council Discussion. Council discusses the facts from the information presented. 3 Staff Recommendation. “I will now ask staff to present its recommendation regarding penalties.” Staff presents recommendation. Options under the City Code/Appendix IV include (statutory minimum penalties are also shown): • First violation: a civil fine in an amount between $300 - $750 and license suspension for a period of one day. (Statutory: $300) • Second violation within 36 months after the first violation: a civil fine in an amount between $600 - $1,500 and suspension of license for a period of 5 days. (Statutory: $600) • Third violation within 36 months after the first violation: a civil fine in the amount between $1,000 - $2,000 and suspension of license for a period of 7 days. (Statutory: $1,000 plus at least 7 days suspension) • Fourth violation within 48 months after the first violation: revocation of license. (Statutory: none) • Early Revocation: The Council may revoke a license without having to wait for a fourth violation if it determines revocation is appropriate under the circumstances. There is a presumption the license will be revoked if there is a commission of a felony related to the licensed activity or if there is an illegal sale by an employee while the license is under suspension or revocation. Decision. Mayor: “I will now ask for a motion on this matter.” Council Member: “I make a motion that based on the staff report, including the findings contained therein, and the other information presented regarding this matter, that a penalty of ____________ be imposed in this case.” Memorandum DATE: January 30, 2025 TO: Mayor and City Council FROM: City Manager Adam R. Bell SUBJECT: Franchise Fees Discussion ____________________________________________________________________ BACKGROUND: As the City of Crystal continues to address critical infrastructure and financial needs, franchise fees present an opportunity to generate consistent, dedicated revenue. Many cities in Minnesota utilize franchise fees as a funding tool to support essential services and capital improvements without increasing property taxes. During previous budget discussions, franchise fees have been mentioned several times. In recent history, Crystal has not imposed franchise fees. Of note, Crystal is one of the only cities in the area that currently does not utilize franchise fees. These types of fees are viewed by some as a “hidden tax” as they are imposed as part of a monthly utility bill. By foregoing this revenue source, Crystal has opted to collect this typical revenue as part of the property tax levy, which results in a higher tax levy for providing the same services and infrastructure improvements. As a result of the budget discussions, the Council has asked that the city look at and discuss franchise fees. Under Minnesota Statute §216B.36, cities can establish franchise agreements with utility companies if the utility companies use the public rights-of-way to deliver service. These franchise agreements allow utility companies to use public property adjacent to roadways. Under the statute, cities may also determine the amount of the fees, or franchise fees, charged for this use of the rights-of-way. Once the city and utility companies establish a franchise fee agreement, they typically pass franchise fees on to their customers, which appear as a line item on billing for a "city fee." The utility companies collect the fee and remit payment directly to the city. Estimated Revenue Impact: Preliminary estimates suggest that implementing franchise fees at a residential rate of $4 per utility account per month could generate approximately $1-1.2 million annually. These figures are based on the City of New Hope’s current franchise fees. This amount would vary depending on the number and type of customers billed. These funds would be earmarked specifically for infrastructure improvements and general fund stabilization, ensuring transparency and accountability. If the Council chooses to pursue franchise fees, staff recommends the implementation of franchise fees on electric and gas utilities to fund the following priorities: • Park Improvements: Addressing aging park facilities, upgrading playground equipment, and enhancing green spaces. • Street Improvements: Providing additional funding for road maintenance, repaving, and sidewalk enhancements to improve safety and mobility. • General Fund Replenishment: Strengthening the city’s financial position by restoring fund balance reserves to ensure long-term fiscal sustainability. As the council is aware, current projections include several years of higher tax levies to appropriately fund capital expense needs, increases costs, and replenishing the general fund balance. As an additional revenue source, franchise fees will provide the city with the ability to increase revenue; however, given the current financial status of the city, staff does not recommend completely off-setting the amount of franchise fee revenue with a reduction of the projected levy amounts until the fund balance target is reached. If the council wishes to utilize franchise fees to reduce the property tax levy, this reduction should be done over time. As discussed in earlier work sessions, there have also been projects and initiatives that will require additional funding beyond what the current long-term plan includes. Franchise fees will not simply replace property tax revenue immediately, but over time, it will allow the city much more flexibility to ease the long-term property tax burden. Franchise fees are a relatively steady source of revenue that can provide for long-term plan expenditures, but they are not a quick and easy method of fixing any immediate financial pressures. 2024 Franchise Fees – Revenue collected from Other Adjacent Cities Brooklyn Park - $6,240,000 Golden Valley - $1,500,000 New Hope - $1,248,000 Robbinsdale - $1,080,187 Brooklyn Center - $750,000 Process for implementation: Under Minnesota law, a city must follow several steps to impose a franchise fee on utility companies operating within its jurisdiction. The key requirements include: 1. Franchise Agreement or Ordinance: o A city must have a valid franchise agreement with the utility provider or enact an ordinance authorizing the franchise fee. Crystal currently is working on a renewal agreement with CenterPoint Energy. o If an agreement already exists, it must allow for the imposition of franchise fees, or it may need to be amended. The previous and current proposed agreement provides for franchise fees. 2. Legal Authority (Minn. Stat. § 216B.36): o Minnesota Statutes § 216B.36 grants cities the power to impose franchise fees on public utilities for the use of public rights-of-way. o Fees must be "reasonable" and related to the city's costs or other policy objectives. 3. Public Notification and Hearings: o While a public hearing is not explicitly required under state law, cities often conduct hearings or public engagement sessions to ensure transparency and address stakeholder concerns. As a matter of promoting transparency, staff recommends that the city conduct this in a open and public manner. 4. Ordinance Adoption: o The city council must adopt a franchise fee ordinance specifying the fee amount, the entities subject to the fee, and how the revenue will be used. This ordinance will need to be drafted and adopted. Unlike regular ordinances, franchise ordinances are not codified and the utility company is required to sign the ordinance in addition to the city. o The ordinance must be published as required by city charter or statutory procedures. 5. Notice to Utilities: o Cities must formally notify the affected utility companies about the franchise fee and provide details on implementation. We would work with the utilities to determine the proper fee amount based on the desired revenue target that the council determines. Implementation by the utility typically takes between 30-90 days. o Utilities typically collect the fee from customers and then remit it to the city. 6. Reporting and Compliance: o Cities must track revenue generated from franchise fees and ensure funds are used according to the stated purpose in the ordinance. Proposed Next Steps: To proceed, staff recommends the following actions: • Conduct another work session to review potential fee structures and anticipated revenue impacts. • Engage with residents and stakeholders to provide information and gather feedback. • Draft and introduce an ordinance for City Council consideration. This would include working with the utility companies. • Schedule a public hearing and final vote on adoption. Conclusion: The implementation of franchise fees offers a strategic, sustainable approach to funding essential city needs while minimizing the burden on property taxpayers. Because this would be a major shift in the city’s revenue source philosophy, transparency is critical. Staff seeks City Council direction on whether to move forward with this initiative. REQUESTED ACTION: Provide feedback on the proposed franchise fee implementation and if desired authorize staff to proceed with further analysis and next steps as outlined.