Good-bye, 50/50 rule? Shift in East Lansing alcohol policy expected

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Sarah Horton

Guests eat on the patio in front of The Peanut Barrel on Grand River Avenue.

A local alcohol policy known as the 50/50 ordinance could be repealed as early as this spring, according to East Lansing Mayor Mark Meadows.

The 50/50 ordinance is one of several alcohol policies that attempts to balance alcohol business practices in East Lansing. The nearly 35-year-old ordinance requires most local restaurants and bars to cap alcohol revenue at 50 percent of total sales and provide quarterly reports to assure compliance.

“I remember when we first discussed it back in the mid ’80s, late ’80s, none of us were happy about it,” said Joe Bell, owner of The Peanut Barrel, a local restaurant and bar on Grand River Avenue.

The Peanut Barrel is one of four restaurants currently exempt from the ordinance due to its grandfathered status. Exemption only applies to restaurants and bars that were in operation before the 50/50 rule became effective. Until recently, grandfathered businesses had to stay in their original location to retain this privilege.

“Last year, we took steps to change that to permit exempt bars and restaurants to move within the downtown area and not lose their exemption from the 50/50 rule,” said Meadows. “And now we’re talking about removing the 50/50 rule.”

This is not the first time the rule has undergone scrutiny. The Downtown Development Authority advised eliminating the 50/50 ordinance in 2016 and last March, the relevance of the ordinance was reevaluated during a City Council Discussion. Councilmember Ruth Beier was among those who outspokenly questioned the longstanding rule.

“We have the power, as a Council, to not approve liquor licenses for new bars if we don’t want to,” said Beier. “We can just say, ‘We have enough of those, we don’t need any more.’ So we don’t really need the 50/50 rule on top of that. I would like to see it completely repealed.”

According to Beier, the rule is “insubstantial” when it comes to the natural power of the market, but its underlying goal remains the same.

“What the council was trying to do then and what the council would still like to see today is when somebody wants to invest in a new business in East Lansing that it not be another bar,” said Beier.

While the food-to-alcohol ratio is significant at a local level in East Lansing, it does not always factor in at a licensing level.

“From our perspective, it’s not exactly an issue whether they be selling more alcohol versus food or not,” said Casey Haapapuro, who works for the Michigan Liquor Control Commission. “There are certain types of licenses in which you need to have a certain amount of food sold to make it the same type of license, but traditionally they’re both going to be Class C licenses, whether it’s a bar or a restaurant.”

Many businesses in downtown East Lansing seek to regulate alcohol business practices in their own way through the Responsible Hospitality Council.

The RHC, formed in 1998, holds monthly meetings in which members of the community discuss alcohol in relation to restaurant practice. According to the council’s website, the RHC seeks to encourage “the responsible promotion and service of alcohol.”

HopCat, a local restaurant and bar in the downtown area, has been a member of the RHC since it came to East Lansing. Chris Knape, the vice president of marketing for HopCat, said it was important for HopCat to support local alcohol policies and recognize the alcohol responsibilities that apply to college towns. According to Knape, HopCat has never had an issue meeting the 50/50 rule.

Sarah Horton

Guests eat in front of The Peanut Barrel.

“We’ve been really successful at keeping a good balance in East Lansing of food and alcohol sales,” said Knape. “You know, we want to encourage if there are going to be other places that open, we believe that other places should have a strong food program because it’s a responsible way to serve alcohol. It serves a broader community than just a community that’s there to drink alcohol.”

Bell said that The Peanut Barrel, even as a grandfathered business, also falls within the 50/50 mark. Bell said he has never talked to anyone who failed to meet the requirements to the point that they had to face corrective measures from the city.

According to Meadows, failure to meet the 50/50 rule has not been a recurring issue.

“During my prior time on the council, you know it seems like this issue came up once but I don’t remember who it involved,” said Meadows.

According to Meadows, repealing the 50/50 ordinance would not do away with measures to prevent bar overpopulation but it would eliminate the need for quarterly reports and encourage economic redevelopment and location mobility in downtown East Lansing.

“We just haven’t looked at the complete details of any change we might make to it,” said Meadows. “But I think that the Council is pretty set on probably removing the provision that requires 50 percent of your sales to be food and 50 percent of your sales to be alcohol.”