Jeremy Papasso / Staff Photographer
Jeremy Papasso / Staff Photographer
The shuttering of the Pop-Up Bar this summer wasn’t just the apparent end of a long line of night clubs at that spot. The bar also surrendered its rare Boulder tavern liquor license, which have proven hard to come by over the years.
“It’s a coveted license in Boulder, and it is very difficult to get,” said Mike Laszlo, a Boulder attorney who specializes in liquor law and helps businesses through the application process.
A tavern license allows an establishment to serve beer, wine and hard alcohol without needing to make a certain percentage of its profits from food sales like the more common hotel/restaurant license, though a tavern is required to have snacks and sandwich-type food available for sale.
But in Boulder a tavern license has historically been much harder to obtain from the city’s Beverage Licensing Authority. There are only 16 in the city, compared to more than 120 hotel/restaurant licenses. And because the licenses are attached to addresses and not businesses, a property that can obtain one becomes more valuable.
“We’ll often do a restaurant or a bar sale, and a big part of the sale will be the liquor license,” Laszlo said.
In fact, a tavern liquor license is so valuable that when Tulagi on University Hill closed in the early 2000s, the neighboring Fox Theatre bought the business and paid off its $18,000 tax debt so it could obtain possession of its tavern license.
“We managed,” AEG’s Don Strasburg said of the Fox’s previous license that required it to serve food. “But we’re better music operators than restaurateurs.”
The owners of the building that house the Walrus Saloon recently successfully renewed its tavern license even though the bar closed in May because the application process to obtain a new tavern license is much harder than just transferring the license to a new owner.
So even though plans were announced for a food station to move into the Pop-Up spot, retaining its tavern license would have probably made the property more valuable and given it more flexibility.
But the Pop-Up Bar agreed to surrender the license after police say a University of Colorado student was found dead in Boulder Creek the morning after getting drunk at the bar.
Considering the circumstances under which the license was revoked and due to the history of the clubs in that spot and the amount of bars already in downtown, Laszlo said it is unlikely that address will ever get a new tavern license.
“They surrendered the license, so it’s over,” Laszlo said. “They would have to re-apply for a tavern license, and it is very hard to get one on that Pearl Street Mall corridor.”
‘They have to answer for those sins’
Cook said that applicants for a tavern license have to conduct a needs and desires survey of the local residents and businesses, but added that for tavern licenses the licensing authority also does an undue concentration study that examines the amount of tavern licenses in the area the applicant is hoping to open in.
“That’s an additional basis for denial,” Cook said.
Of the 16 tavern locations in Boulder, half of them are in the downtown area: The Pearl Street Pub, The Bitter Bar, the Sundown Saloon, Press Play, Amante’s Walnut location, Nitro, Boulder Theater, and the address that formerly housed the Walrus Saloon.
Laszlo said that means that the surveys along with saturation studies are much bigger obstacles in that area.
“Their concern with tavern licenses in that area is that they think you’re going to go for the money grab,” Laszlo said. “They’re worried you will be pumping drinks out and not paying attention because that’s good, quick, fast cash. That’s what they go on, and they’re right to do that because it is easy money.”
He said he has only had one liquor license application turned down in his 10 years doing liquor law, and it was for a tavern license on Pearl Street.
“The Beverage Licensing Authority, they made a determination that they did not want a license at that location,” Laszlo said. “It was frustrating for me, and frustrating for the client, but they just did not want another license in that area.”
Cook said that each tavern license application is considered on its own merits, and that the license members don’t try to have businesses conform to some sort of master plan for how they want the licenses to be spread.
“I think the beverage licensing authority looks at them as they would any other application,” Cook said. “Members as an overall board are obligated to act on testimony and evidence in front of them.”
But Laszlo said that the saturation studies, community surveys and police testimony mean new applicants looking to open on Pearl Street still have to deal with the stigma that other bars have created.
“They have to answer for those sins, and right or wrong, answer for them,” Laszlo said. “Even if the owner changes, the community still says, ‘Well, that location attracts the young folks who drink irresponsibly regardless of who is there.’ It’s a shame, because I believe many tavern license owners try so hard to be responsible.”
‘Far more intensive’
Laszlo said that Denver and Boulder are two of the stricter cities in the state in terms of getting tavern licenses.
“In my experience, it is far more intensive than anywhere else in the state, but I understand why,” Laszlo said. “It’s a college community with a growing business community trying to balance that with a residential population. But our national clients sometimes will not do business in Boulder and Denver due to the licensing.”
Because of that, Laszlo said he asks clients if they really need a tavern license. A hotel/restaurant license requires that the establishment make at least 25% of its profits from the sale of foods, and must offer full meals. While it might seem like a lot, Laszlo said any business with a full kitchen should be able to meet the number pretty easily.
“Why do you want a tavern license? Can we accomplish what you want to do with a hotel/restaurant license, which is far easier to obtain and certainly doesn’t come with the scrutiny?” Laszlo said. “We can sometimes make the decision we can operate with a hotel/restaurant license.”
While the tavern license might give the property added value, Cook said the city prefers businesses that can meet the food requirement go for a hotel/restaurant license.
“It’s really our design for the tavern licenses to be ‘bar’ bar licenses,” Cook said. “It’s designed for those licensees whose business is primarily the sale and service of alcohol.”
But for certain businesses, a tavern license is necessary for the owner’s vision. Lou Bush had already opened up a bar in Estes Park Called The Barrel in 2015, and when he looked to open a second location in Boulder in 2016, he wanted to keep that same model. While that centered on beer and some wine, it also included being able to serve hard liquor and mixed drinks.
“Yes we are a beer garden, but if you aren’t a craft beer person or just don’t feel like a beer, we don’t want you to feel left out,” Bush said.
So for Bush, going for a different type of license wasn’t really an option, and he is not sure if he would have opened in Boulder had he gotten denied.
“I honestly don’t know,” Rush said. “I don’t know if it would have fit with our business plan. If we wanted to serve liquor, we would have had to have a full kitchen, and we don’t have a ton of professional kitchen experience. We are beer people and bartenders. We wanted to focus on what we wanted to do.”
Strasburg said that, for concert venues, tavern licenses are the only ones that really make sense. While the state offers more specialized licenses for everything from race tracks to art shows and bed and breakfasts, there isn’t one for music venues.
“Live entertainment is a unique type of environment that probably doesn’t have a true home in Boulder liquor license provisions,” Strasburg said. “In my experience, it’s challenging to operate a world-class concert experience and a restaurant.”
‘Just be honest, and don’t shoot from the hip’
Luckily, Rush was able to get his tavern license, and opened on the Twenty Ninth Street mall in 2016. He said while the process was a little harder in Boulder than in Estes Park, he said he didn’t find it unreasonable.
“Just be honest, and don’t shoot from the hip,” Rush said.
Laszlo said it’s possible more businesses like Rush’s will apply for tavern licenses in places outside of the downtown area. The ones that currently have tavern licenses off Pearl Street are Amante’s Bsaeline and Broadway locations, the Fox Theatre, Bluff Street Bar and Billiards, The Barrel, the Rayback Collective and the Bustop, which is set to close.
But even the Rayback, the beer and food truck park 28th and Valmont Road, faced some concern from neighbors when it applied for its liquor license.
“It’s critical not just to show the BLA that you’re going to comply and be a responsible vendor, but make it a point to be a responsible member of the community especially with limited food service,” Laszlo said. “From a legal perspective, your liability for over service and under-age drinking increases when you are running a bar.”
But aside from the application process, Laszlo thinks that the lack of tavern licenses in the city is as much an economic decision as one based on the application process, especially downtown.
“I don’t know that the tavern model from a financial perspective makes much sense on Pearl Street,” Laszlo said. “I don’t know how many people can make it coming in, in 2018. Places like the Pub or Sundown, they have a great following, because they have been there forever and have a customer base. But if you or I opened up a bar, we wouldn’t have that.”
Added Laszlo: “It’s expensive to do business in Boulder. My successful clients have a business plan focused on monetizing their space as many hours a day as they can. It’s pretty simple, 24/7, how can I best monetize these square feet? And it’s not a bar. You have to sell a ton of alcohol to make a bar profitable.”
Cook also said she believes the licensing numbers are a reflection of community desires and not just the application process.
“The city of Boulder is a restaurant town, and we are very focused on quality restaurants,” Cook said. “We have more restaurants than we do bona-fide bars, and that’s the reason for the license numbers.”
Mitchell Byars: twitter.com/mitchellbyars