City not moving forward with new liquor store
BEMIDJI – A third city-operated liquor store is not in Bemidji’s near future.
During a Monday work session, the council took a split vote on two motions: one to stick with the two stores the city currently operates and another motion to discuss adding a third liquor store.
Although Ward 5 Councilor Nancy Erickson was absent during both votes due to a prior engagement, she seconded Ward 2 Councilor Roger Hellquist’s original motion to stay with two stores. Had she been present, the council would have rendered a more decisive vote against adding a third liquor store.
But even with the split vote, the city won’t be going ahead with a third liquor store at this time.
“It’s not based on the offer before us…it’s based on what I see as good business sense,” Hellquist said in explaining his motion. “We have a good profitable setup the way we are right now.”
The offer before the council came from Pace Development LLC, which is planning major changes to the Westridge Shopping Center and Marketplace Foods. The city would have leased part of the east end of the Marketplace building for the store.
Ward 3 Councilor Ron Johnson, who offered a motion later in the discussion to discuss adding a third store that also rendered a tie vote, said the city needs to continue to compete with liquor stores outside of Bemidji.
“One of the reasons that we’re looking at that area out there by the Target and by the Walmart is because of the people who are there every day who never get into our city far enough to see our north store, and certainly not far enough to see our south store,” Johnson said. “I look at this as expanding our market.”
Hellquist countered, stating “this market isn’t going to magically expand where we all of a sudden get so much more.”
“You’ve got a finite pie” he added.
Similarly, Erickson said she had concerns about diluting sales at the two stores the city currently operates.
“This business that we’re in…is supposed to be making the highest profit it can,” Erickson said. “To make any changes at this point, we can begin reducing our dollar-for-dollar profit.” At-large Councilor Jim Thompson and Ward 4 Councilor Reed Olson joined Hellquist in voting to stick with two liquor stores.
Mayor Rita Albrecht said the existing north store “is not a location that gives us a competitive advantage.” She, along with Johnson and Ward 1 Councilor Michael Meehlhause voted to continue discussing the prospect of a third liquor store.
“It’s 40 years old, it has poor access, there’s really no room to expand,” Albrecht said of the current north liquor store, located at 504 Paul Bunyan Drive NW. “It has actually outgrown the current sales level that that store supports right now.”
She suggested that the city may have three liquor stores for a few years, but eventually transition out of the current north store.
“I’m suggesting that I’m not sure we need three liquor stores, but I do think we need to think very long and hard about how long the liquor store we have on the north side now will serve the purposes and sustain the sales we have,” Albrecht said.
The proposed lease with Pace would’ve allowed the city to opt out after three years if sales at the new store didn’t reach $1.2 million annually or if sales at all three stores didn’t increase by at least $1 million. City manager John Chattin wrote in a memo to the council that the annual lease for the Marketplace location would be $61,250 with $200,000 in upfront costs.
“If the council decides that we should have a third liquor store…I think this is our best option,” Chattin said Monday. “But that’s moot if the council is not interested in a third liquor store.”
John Meyers, president of Pace Development, said after the meeting they will “continue looking at the options as we move forward with redevelopment at the center.”
Earlier in the meeting, the council unanimously agreed to enter into a joint powers agreement with the Minnesota Department of Commerce to facilitate requests for proposals to a firm to do an energy assessment for the city.