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Adams Morgan Liquor Moratorium Expires in 2014; Whether to Extend Yet Again Embroiled in Controversy

Accompanying images can be viewed in the current issue PDF

By Anthony L. Harvey

With the current prohibition on the granting by the District’s alcohol regulating authorities of new liquor licenses for restaurants, bars and taverns, and nightclubs in the popular nighttime entertainment district of Adams Morgan set to expire on April 14, 2014, the marshaling of forces favoring and opposing the extension of this prohibition has quickened throughout the community in both fervor and magnitude.

While the eloquence and passion of these forces has not diminished, positions have seemingly hardened since this prohibition was first established in August, 2000, with the publication of proposed rulemaking by the DC Alcoholic Beverage Control Board (ABC Board) creating the Adams Morgan Moratorium Zone, an area that extends approximately 1,400 feet in all directions from the intersection of 18th Street and Belmont Road.

Prohibited were any new liquor licenses being granted other than those for hotels and for restaurants serving only beer or wine. A circular map illustrating this 1,400-foot zone accompanied the publication of this rulemaking announcement, which capped lengthy ANC, civic and community business groups deliberation, and ABC Board hearing processes.

This moratorium was extended for three years in 2005 with further exceptions for new restaurants serving beer, wine, and liquor and an exemption for off-premise-consuming establishments such as grocery and package stores.

In 2008, the ABC Board responded to a joint petition from the Adams Morgan ANC, the Kalorama Citizens Association (KCA), and the Reed-Cooke Neighborhood Association (RCNA) to further extend the moratorium for another five years, to establish a cap of 10 for the number of taverns and one of zero for nightclubs, and to remove the exemption of new restaurant licenses from the 2005 amended moratorium. (See, “Adams Morgan Liquor License Moratorium Up for Renewal; Proponents Seek 5-Year Extension, Additional Restrictions,” InTowner April 2008 issue PDF page 1; http://tinyurl.com/oy7369z.)

Action on the Petition by the ABC Board and Current Moratorium Order

The Board granted, in its entirety, this petition of the applicants, noting in its official Notice of Final Rule Making dated January 22, 2009, that since there were already more than 10 taverns in the moratorium zone, no new tavern licenses — establishments not having food serving requirements other than those in their respective cooperative (formerly known as “voluntary”) agreements — would be eligible for issuance until the number of taverns was less than 10. Quoting from the published order, the ABC Board further stipulated:

“[That] while the Board decided to grant the moratorium request of [the applicants] in its entirety, the Board recognizes that the requested moratorium is only a partial solution to the current issues that exist due to the significant over concentration of on-premises establishments in the Adams Morgan Moratorium Zone. As such it is important for the petitioners, licensees, residents, and other stakeholders to work together in exploring other possible solutions to alleviate this problem. During this five year moratorium period, the Board believes that there are three additional issues worth examining. First, it might be helpful to explore whether having a lower cap of on-premises establishments in the Adams Morgan Moratorium Zone, primarily restaurants, would be helpful in an effort to start reducing the current number of on-premise establishments that exist rather than simply maintaining the status quo.”

The second and third issues enumerated by the Board deal with other statutory and regulatory issues in response to a neighborhood initiated or Board initiated alcohol licensing moratorium: peace, order, and quiet, and parking, pedestrian, and vehicular safety.

Thus, the extension of this moratorium, either in its existing or in an amended version, is the issue the Board will have to resolve early next Spring — either to extend the moratorium or to allow it to expire on April 14, 2014.

Proponents of its extension, both resident individuals and citizen associations, argue that the moratorium has prevented the existing problems caused by too many over-serving bars and restaurants from getting worse, and that the failure of the Alcoholic Beverage Regulation Administration (ABRA) to enforce either the food service requirements on restaurants and those taverns with food serving provisions in their cooperative agreements or of the District’s regulations on noise and the agreements between licensees and the community of provisions prohibiting noise from emanating outside an establishment compounds these problems of over-concentration and lax enforcement.

Denis James, KCA president who, working with the ANC and RCNA, spearheaded the preparation of the joint 2008 petition that created the current moratorium, is adamant in his belief, as are many others who spoke at a recent ANC-sponsored community forum on the issue, that the moratorium has not only kept problems from getting worse but that vacant storefronts have allowed for such new establishments as the successful Starbucks at Columbia and Adams Mill Roads and the bakery and barber shop on 18th Street. The KCA has already passed a resolution endorsing the continuation, at a minimum, of the existing moratorium with its current 58 restaurant liquor licenses — eight of which are in safekeeping — and it further authorized its president to work with other community associations on coordinated efforts to secure such a continuation.

Concurrently, the RCNA passed a resolution presented to the forum by one of its board members, Benedicte Auburn, which endorses the continuance of the moratorium, adding such “whereas” clauses as:

“. . . although there are no night club licenses within the Adams Morgan Moratorium Zone, many restaurants or taverns operate much like night clubs, particularly on

Friday and Saturday nights leading to disturbances of peace, order, and quiet and attracting numerous visitors to the neighborhood, many of whom drive and put pressure on available residential parking, and

“. . . many of the problems in Adams Morgan are caused by patrons from outside of the neighborhood who come to our ABC establishments, and [by] non-patrons, causing noise, loitering, criminal activity, issues with pedestrian safety, and take away limited and valuable parking spaces in Adams Morgan from residents.”

The resolution also noted that “RCNA is aware that there are currently 15 taverns within [the moratorium zone] and that numerous violent incidents have occurred over the years at [such] establishments.” In a final clause, the association adopted the following: “Be it further resolved, RCNA seeks no further issuance of Entertainment Endorsements in the [moratorium zone.]”

Opponents of the moratorium, led by the Adams Morgan Business Improvement District (BID), organized a strong presence for the October ANC community forum, with both of the BID’s co-presidents, together with its vice president and several of its board members, speaking in strenuous opposition to any continuance of the moratorium, asserting that through efforts of the BID, its board, and its executive director and staff, the problems identified by the ABC Board in its 2009 order have been alleviated to such an extent that except for the need for additional nightlife establishments to promote competition among existing Adams Morgan restaurants and taverns, and in order to strengthen the community’s competitive advantages with the new entertainment venues flourishing in the mid-city neighborhoods of the 14th and U Streets, NW and H Street, NE areas, the crisis necessitating the current moratorium is over.

Indeed, argued BID board member Bill Thomas, proprietor of Bourbon and Jack Rose, the existing moratorium simply created an incubator for bad behavior among problem licensees in Adams Morgan who did not have to face the competition that would have occurred had there been no moratorium in existence.

Carlos Lumpuy, a 53-year resident of Champlain Street and a well-known property developer and presence in the community, electrified the packed forum attendees with a thundering pronouncement that priorities one through 10 in the moratorium zone should be public safety, and that the BID should get out of such as the trash pick-up business and focus on attracting new businesses to Adams Morgan.

Al Jirikowic, BID board member and proprietor of Chief Ike’s Mambo Room, on behalf of the Lanier Citizens Association, announced his and his association’s emphatic opposition to the continuance of the moratorium, his strong support for any efforts that might be underway to attract fine dining, white table cloth restaurants to Adams Morgan, and his recommendation for an increase to the existing regulatory cap of no more than 10 taverns, proposing in its place a cap of 15. There are currently 14 active taverns, with a 15th license in safekeeping and a 16th licensed tavern outside the eastern boundary of the moratorium zone just past Columbia and Ontario Roads. Jirikowic had no real response to ANC commissioner questions of how the new restaurants might be attracted. “Do you have a plan? asked Commissioner Marty Davis, to which Jirikowic suggested more restaurant liquor licenses, while when Commissioner Wilson Reynolds asked Jirikowic how he reconciled elegant restaurants with more taverns, he had no answer.

Long-time Adams Morgan property owner and BID co-president Stephen Greenleigh, in reflecting on his experiences in trying to attract non-food retail tenants to his Adams Morgan properties — all of which eventually failed, he said, except “for a tattoo parlor because of its proximity and spillover from ABC establishments — offered the observation in his prepared statement that “under the circumstances it would seem that promoting the development of a night-life economy for Adams Morgan and the other entertainment areas ought to be a priority for DC because of its ability to add tax revenue and create much needed jobs.”

Greenleigh, along with his counterpart BID co-president Constantine Stavropoulos, proprietor of Tryst and the Diner, presented the ANC commissioners with a policy position paper prepared on contract to the BID by Ed Lazere, Executive Director of the DC Fiscal Policy Institute, purporting to be “an analysis of issues related to the Adams Morgan liquor license moratorium.”

A far reaching document, and one already being cited by moratorium opponents as well as by ABC licensees seeking to withdraw from their cooperative agreements with the community, Lazere’s policy arguments contain the assertions that the existing moratorium has had no direct impact on any improvement in peace, order, and quiet in Adams Morgan — those improvements having been brought by the BID — and reports his finding “that liquor license moratoriums are a blunt instrument  [being what] some Adams Morgan observers call a sledgehammer to kill a fly.” Moreover, according to Lazere, these moratoriums “may have negative impacts on the vitality of a community.” Thus, he contends, “Eliminating or scaling back the Adams Morgan moratorium could diminish the unanticipated negative results but should be coupled with other innovations to directly impact the problems mentioned by petitioners.” Continuing, Lazere asserts, “There are ways that a change in the moratorium to allow more liquor licenses could be accomplished to mitigate the likelihood of these results, while improving the chances for Adams Morgan to thrive.”

Lazere’s “key findings” are the following four assertions:

(1) “Moratoriums distort the market and create barriers to a dynamic and growing economy,” here Lazere presumes that all prospective new businesses in Adams Morgan would need liquor licenses and since in a moratorium zone these licenses must be purchased from existing license holders — and many of these holders have been known to charge up to $80,000 for a single license;

(2 ) “Moratoriums push economic development to non-moratorium areas”;

(3) After speaking with residents of Dupont Circle and other neighborhoods in the city, Lazere asserts that “the Impact of DC’s moratoriums has led to opposition to new moratorium areas” and a reconsideration of existing moratoriums in neighborhoods that already have one; and

(4) “Adams Morgan is marked by notable commercial vacancies and low rates of commercial growth — i.e., not enough new liquor licensed bars and restaurants for the competition that will drive out the bad actors [and] that both the number of commercial properties and their value are growing far more slowly in Adams Morgan than other places.”

With respect to Lazare’s item #4, his table of comparisons shows the big difference being primarily between Adams Morgan and the redeveloping U Street corridor, an area that has experienced an explosive burst of gentrification and a concomitant spectacular rise in real estate property values.

Lazare concludes his paper with “new circumstances and neighborhood changes since 2008.” The first two of these range from the reopening of Champlain Street under the overpass of the Marie Reed Learning Center to the removal of dumpsters that sat beneath that overpass, thus allowing police cruisers to patrol the area.

The second of his stated “new circumstances and neighborhood changes” is headlined “ANC1C mandate on sidewalk cafés sizes to allow extra walking area” in which Lazare discourses on the technical aspects of sidewalk and pedestrian walkway size and how the sidewalk is divided among curbing, tree box area, pedestrian walkway, (and now bulb-outs for pedestrian safety) and prospective sidewalk café size — all of this within public space –- and how these elements reduce by two feet the amount of space all other Washington commercial districts can provide sidewalk cafés and is thus a further disincentive to restaurants considering a decision to locate in Adams Morgan.

Further mentioned is the lack of an “anchor” business such as a hotel for Adams Morgan. Not mentioned, however, is the Fiscal Policy Institute’s endorsement, at a critical stage, in support of the passage of a $46 million property tax abatement for the Adams Morgan Historic Hotel.

Upon receipt of the Fiscal Policy Institute’s document by board members of the BID at its most recent monthly meeting, non-voting members of the board were dismissed and the Institute’s document was reportedly discussed by the voting members in a closed session. Following that discussion, the board voted unanimously, by a vote of 13-0, to adopt a resolution in opposition to an extension of the moratorium, incorporating in the resolution’s resolve clauses the findings asserted in the Fiscal Policy Institute document. And, at the Adams Morgan Advisory Neighborhood Commission’s October community forum devoted solely to the moratorium issue, copies of the Institute’s document were hand-delivered to the eight ANC commissioners, all of whom were present. No copies were distributed to the public.

At the subsequent ANC’s November 6th meeting, where the Commission’s intention of voting on a moratorium resolution had been announced the week before on the Adams Morgan listserve and where the nature of two competing resolutions on the matter was described, after almost three hours of community comment and Commission deliberation, a surprise motion was made to postpone any formal decision on any alcohol license moratorium resolution. By a vote of five to two, the motion was passed and the Commission chair announced that the matter would be decided at the ANC’s next  meeting on Wednesday, December 4th.