City loosens reins on food-to-booze ratio

An ordinance that capped restaurants from making more than 40 percent of their profit from liquor may be repealed.

Anne Millerbernd

An ordinance to repeal the decades-old rule regulating restaurants’ food-to-alcohol sales ratios moved through a Minneapolis City Council committee on Tuesday — the final step before going to a full council vote.

The Committee on Community Development and Regulatory Services voted to remove an ordinance requiring many eateries to sell about 40 percent liquor and 60 percent food, a decision business owners say will simplify their jobs.

The law, which Ward 3 Councilman Jacob Frey called “archaic,” was implemented in 1983 to discourage excessive partying or alcohol consumption, particularly in less commercial areas. It was also meant to set a distinction between restaurants and bars.

But as the economy has changed and alcohol has grown more expensive, some say the rule — which prohibits businesses from making more than about 40 percent of their revenue from liquor — has become outdated and counterproductive.

“A fairly typical meal will be a burger, a side salad and two beers,” said Frey, who was one of the driving forces behind the initiative. “Just that … and you’ve gone beyond the rule … it just doesn’t work for businesses anymore.”

Instead, the city could place special conditions when granting restaurants liquor licenses or require more alcohol education for servers, Frey said.

Repealing the rule would primarily affect restaurants outside of downtown, including areas like Dinkytown, Stadium Village and the West Bank.

Frey said he’s confident that the full City Council will follow through with the decision and rid Minneapolis of the ordinance permanently at its upcoming meeting.

In recent history, the regulation has been a source of frustration for University-area business owners.

When customers order one or two alcoholic beverages with their meal, which they typically do, said Burrito Loco owner Greg Pillsbury, his restaurant falls out of compliance with the rule.

But many restaurants subject to the rule notice that even when a customer orders only one beer, the balance could be lost.

Craft beers, which are traditionally more expensive than others, have become a staple in many Minneapolis establishments, making it even harder for restaurants to sell enough food to comply.

As a result, Frey said, some businesses serve cheap, low-quality alcohol in an attempt to even the sales out.

Republic owner Matty O’Reilly said though his eatery has not struggled to fall in line with the rule, the price of craft beer makes it seem senseless.

“When it was written, cheeseburgers were $5 and bottles of beer were a dollar,” O’Reilly said, “but now a good beer is $7 and our happy hour tacos are $6.”

Pillsbury said the city has taken time to examine the issue, so it hasn’t been harshly enforced.

“According to the people I’ve talked to, they’re not actively closing people down,” he said, “If they were, [a lot] of people would’ve closed down already.”

The Library Bar and Grill manager Joe Berg said the prospective change would be good for bars, especially because a Surly Brewing taproom set to open just a few miles away wouldn’t have to abide by the ratio rule.