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Village Liquors appeals to the state for liquor license

December 14, 2011

SOUTH KINGSTOWN – It’s round three in the fight for a fifth Class A liquor license in town.

Last Tuesday, Dec. 6, the owner of Village Liquors, a proposed 1,742 square foot wine boutique at South County Commons petitioned the state Department of Business Regulation liquor administrator for relief from its denial of a Class A liquor license. John Pagliarini, attorney and husband for the wine shop owner Susan Pagliarini of East Greenwich cited indiscretion, improper amendment procedures and notification.

At its Nov. 28 meeting, the South Kingstown Town Council voted not to increase the number of liquor store licenses from four to five and denied Village Liquor’s application for a Class A license.

It was the second time the council blunted Pagliarini’s attempts to break into the local liquor store business. Earlier on April 25, John Pagliarini petitioned the town to expand its number of licenses from four to five after news broke that the town was eligible for a new license according to 2010 Census results and state law. The census revealed South Kingstown’s population had increased from 27,921 in 2000 to 30,639 in 2010. State law allows one liquor store for every 6,000 residents.

Rather than increase the number of licenses, the town council voted unanimously to amend town rules to have a maximum of four Class A licenses, citing competition as their main concern.

Village Liquors, however, pushed forward, receiving approval from the Planning and Zoning Boards and the Economic Development Committee, where Pagliarini said no public members spoke against their proposal.
The matter came before the town council again two weeks ago on Nov. 28. After much debate, where attorneys for the four current liquor stores, Patsy’s Package Store, Geaber’s Liquors, Sweeney’s Wine and Spirits and Wakefield Liquors pleaded that a new store would add detrimental competition to their businesses in this difficult economy, the town council voted again to not increase the number of licenses.
Village Liquors has not given up its fight and is asking the state to overrule the town’s decision and grant it the town’s fifth retail license.

The town council reviewed the litigation at a closed executive session Monday night.

“We maintain that the claim doesn’t have merit, because I don’t believe any legislative body can be compelled to create a fifth liquor license,” Town Solicitor Michael Ursillo said. “I disagree with the allegations in the complaint as set forth by the petitioner.”

A representative from the Department of Business Regulation (DBR) said the department will look at the facts and circumstances in the case to determine whether there is relevant material evidence to make sure the Town Council did not act arbitrarily conspicous.

“The cities and towns have pretty broad discretion. W give deference to their authority,” the DBR representative said.

He said the department often sees many appeal from businesses for Class B liquor licenses, but Class A appeals are less frequent. The most recent case concerned a Barrington business seeking a Class A license that was resolved between the business owner and the town without litigation.

In the appeal, Pagliarini said the town council did not have authority to keep the number of licenses at four. He states according to Rhode Island General Law 3-5-15, that “the town council are for that purpose constituted license commissioners and as evidenced by their title on the retail liquor license application, the proper licensing authority in South Kingstown is the Board of Licensing Commissioners.”

However, Pagliarini claims that the town council did not convene as the Board of Licensing Commissioners and thus losing authority to act on an application specific to the board.

“Contrary to the established laws and rules governing liquor licenses, the appeal statutes, rules and procedures applicable to town council actions such as 48-hour meeting postings and its legislative immunity would apply to liquor applications, causing chaos amongst liquor licenses,” Pagliarini said.

Pagliarini explains that the distinction is important since the town council and the board, although are made up by the same members, have different notification procedures. The town council requires 48 hours notice, while the board requires 30 days before discussing an increase in liquor licenses. At the April 25 and Nov. 28 meetings, 48 hour notices were given as standard procedure for the town council, not the board of licensing commissioners.

Pagliarini argues that the board ignored its role as an agent of the State Liquor Commission and failed to properly conduct its business.
“As a result of failing to formally vote to fix a maximum number of Class A liquor licenses, a fifth license existed,” Pagliarini said when his wife applied for the license in April and when she submitted a completed application with the town’s Board of Licensing Commissioners in August.

He states that the April 25 town council amendment to set the maximum number of licenses at four failed and that the town’s liquor license rules and regulations continue to be “Class A-4, not to exceed 1 per 6,000 residents.”

Village Liquors also claims the Board, acting as the town council, “abused its discretionary powers by failing to give any substantial reason beyond ‘competition’ in denying its application.”

Pagliarini said the state General Assembly defines competition for Class A liquor stores by limiting the number of licenses based on population and on a minimum distance of 200-feet between stores. But, Village Liquors at the South County Commons would not be within 200-feet of any of the four current stores, the closest being about 1.12 miles.
“The Board cannot use competition as a valid basis for denial,” Pagliarini said.

Right after denying Village Liquor’s Class A license though, the town council approved a 24th Class B victualler liquor license for Dragon Palace Restaurant at 733 Kingstown Road. The application was similarly opposed by the owners of the four Asian restaurants, Chen’s Restaurant, Kabuki, China Garden and Shogun Restaurant, who cited close proximity and competition as concerns like the four liquor store owners.

“Stating ‘competition was not grounds for denying the [Class B] license, the Board voted 5-0 to grant that license,” the petition reads. “The arbitrary application of ‘competition’ to deny petitioner’s application reflects upon a thinly veiled attempt to stymie out-of-town applicants in favor of protecting existing Class A licensees, in violation of state law and constitutional due process requirements.”

The last charge against the town in the petition alleges that the town council made its April 25 decision to amend the rules governing Class R liquor licenses to four maximum knowing that Village Liquors had already sent a development plan review to the planning department.

Pagliarini states that Village Liquor’s application triggered panic amongst town staff and the amendment specifically targeted Village Liquors to derail its application. He stated that no other application was pending at the time, further indicating that Village Liquors was a specific target to the revised rule.

“This act served the sole purpose of impairing petitioner’s rights to the lawfully available Class A Retail liquor license,” the petition states.

Southern Rhode Island Newspapers
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