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Farmington council says yes to staying in the municipal liquor business

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news Farmington, 55024

Farmington Minnesota P.O. Box 192 / 312 Oak St. 55024

The city of Farmington will stay in the liquor store business, but where the downtown liquor store will be located still remains to be seen.

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The Farmington City Council covered a number of topics related to the city's participation in the municipal liquor business during a work session Monday. Those conversations will continue, to an extent, over the rest of this week and into the future.

But in that lies the fact that Farmington will stay in the liquor sales industry for the indefinite future. And that's just fine with city administrator David McKnight, who is now overseeing the city's liquor operations.

The city's liquor store operations have moved among several departments over the past decade, and that's far too often as far as McKnight is concerned. Most recently, liquor operations have fallen under the parks and recreation department; before that, it was part of the finance department. The stores will still be managed by Randy Petrofske, but McKnight will now handle things at the administrative level.

"It's not really a natural fit under the department heads, but it's most natural under the city administrator," McKnight said. "It needs to find a permanent home, and this is where it's staying."

Downtown store

Where the downtown liquor store will stay, though, is still under discussion. Earlier this year, council members considered purchasing a building at the corner of Fourth and Oak streets. After receiving negative feedback from residents of the neighborhood, however, they decided to consider other sites.

After that decision, McKnight said, the city received 12 to 14 calls from property owners in the downtown area. At the same time, city staff started looking at some of the property it already owns to see if any of those spaces would be suitable for the downtown store.

That process was put on hold, though, when council members decided to do a study to decide whether the city of Farmington should be in the liquor business at all.

"We stopped (looking for another location) because it was putting the cart before the horse," McKnight said.

A study by the Minnesota Municipal Beverage Association identified several areas where the city could increase its productivity, and, ultimately, increase its sales. The report also provided arguments for staying in the liquor business.

While the MMBA was completing its study, McKnight spoke with Tom Wartman, owner of the building the city leases for its downtown store. The city's lease on that site expires in August, so council will have to decide by then whether they want to stay in that location. Wartman offered to reduce the city's rent from $21 to $20 per square foot to extend the lease for one year. In his memo to the city, Wartman said he may be willing to negotiate a lower price if the city is willing to commit to a longer lease. Council members have previously favored a one-year lease since they are considering a move of the downtown store.

McKnight plans to speak to Wartman again this week to see just what kind of rent the building's owner would offer for a longer lease.

"He's got to look out for himself, I've got to look out for the city's interests. It's typical negotiations," McKnight said.

Over the next few weeks, McKnight will gather the quotes from Wartman and do research on the other sites that were offered up as locations for the downtown store. He will bring that information back to council for consideration at a later date.

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