If Jonesborough passes LBTD, why can't Elizabethton?

By Thomas Wilson
STAR STAFF
twilson@starhq.com

   After three failed attempts, Jonesborough citizens narrowly passed a referendum to permit restaurants to serve liquor-by-the-drink in the November 5, 2002 town election.
   Tennessee's oldest now ranks as the newest Northeast Tennessee municipality where citizens have approved allowing restaurants to serve mixed drinks to customers -- a phenomenon that has spread across the state.
   "There are more cities that have passed liquor-by-the-drink than have passed retail package stores," said Jackie Ailey, administrative secretary with the Alcoholic Beverage Commission (ABC) office in Knoxville. Approval and regulation of liquor-by-the-drink and package store licensing falls to the Commission.
   Johnson City voters approved the existence of liquor stores, or package stores, by referendum in 1967. Voters approved liquor-by-the-drink in 1980. The referendum was appealed to the Tennessee Supreme Court, which effectively ratified the referendum in favor of Johnson City in 1982.
   Despite popular belief, municipal governments have no say-so in forming or enacting any referendum allowing citizens to vote for a liquor-by-the-drink measure. That responsibility lies strictly with citizens who may submit a petition to their county's election commission requesting a referendum for support of liquor sales be placed on the next city or county election ballot.
   "The local government has a role -- formal, informal or otherwise -- in the process or referendum," said Charles Stahl, city manager of Elizabethton. "If it is approved by the voters, the city government does have a role in the enforcement of under age drinking laws and in making sure such establishments are properly zoned."
   According to state law, a petition must bear the signature of at least 10 percent of registered voters in the county or municipality who voted in the most recent gubernatorial election.
   Passing a liquor-by-the-drink referendum does not have to extend to package stores. A referendum may be worded specifically to include only liquor-by-the-drink restaurants but exclude the creation of liquor stores.
   Ailey said once a referendum is passed, the ABC Nashville office must receive certified election results before the Commission officials can release information for a liquor-by-the-drink application.
   "It can take up to 30 days from when they submit their completed application until their license is approved," she said.
   Liquor-by-the-drink applications are reviewed by the executive director and issued out of the beverage commission's Nashville office. The volume for liquor-by-the-drink applications ran much higher than for package stores, she added.
   As of Monday, 2,001 liquor-by-the-drink licenses were active in Tennessee, Ailey said.
   Stahl said the city was aware that the Ruby Tuesday restaurant chain was in an expansion mode a few years. Even though the city did not have liquor-by-the-drink, the city sent them a packet of information about our town and made them aware of land for development, he said.
   "It provides an opportunity to some restaurants for additional revenue," said Stahl of serving mixed drinks. "It may inspire some chain restaurants to locate in town that have liquor sales as a component of their business."
   Ruby Tuesday will open a second Johnson City location off State of Franklin Road near East Tennessee State University next month. The Maryville-based company named for the Rolling Stones song typically operates full bars as a component of their restaurants. However, a Ruby Tuesday representative said that several critical factors influencing the company's new development included a household income, a market's population density, local industrial growth and motorist traffic.
   "First, we want them to be in states and regions where we have successful restaurants," said Angie Heig, concept and communications administrator for Ruby Tuesday's corporate office in Maryville. "The industrial growth is coupled with retail growth."
   Heig added that while the ability to serve alcohol was a big plus, it was not the overriding factor in the company's decision to locate in a community.
   "Typically, that is not one of the things we take into consideration," said Heig. "Granted, we like to be able to do that but it is not a determining factor. I'm sure it will weigh on the decision, but I'm not sure how heavily it will weigh."
   The Commission has no jurisdiction over the serving/dispensing of beer and/or the issuance of beer permits. Local municipalities or counties regulate matters regarding beer sales. The Commission's law enforcement branch is tasked with the primary responsibility of enforcing the state's liquor laws.
   The Elizabethton Beverage Board issues and regulates permits to serve beer and wine. Presently, 33 establishments in Elizabethton hold licenses to serve beer and wine for consumption either at their location or to carry away.
   The Carter County Beer Board -- a committee under the county commission -- governs the issuance of licenses to sell beer in the county.
   An on-premise permit falls primarily to restaurants and private social clubs such as the Elks or Moose who serve beer for consumption at their facilities. An off-premises permit pertains to convenience stores and supermarkets that sell beer as a retail.
   Stahl said the question was how quickly restaurants would proliferate if a liquor-by-the-drink measure was approved.
   "In Johnson City, I think it is fair to say the number of restaurants developed over a number of years," said Stahl, who was that city's first budget director during the mid-1980s. "In Bristol, Tenn., it has not been as consistent over the past 19 years."