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Liquor License Issue Hurts Keg & Case Viability

An overhead shot of Keg and Case when it opened in 2018.

Keeping the customers flowing into St. Paul’s Keg and Case Market will require a change in state law. Craig Cohen, owner and developer of the popular West End food hall, is working with St. Paul City Council Member Rebecca Noecker and St. Paul’s legislative delegation on special legislation. If signed into law, the legislation would allow patrons visiting the food hall to purchase an alcoholic beverage and move around the food hall or consume it on the patio area facing West 7th Street.

The inability to stroll the food hall and its patio with a drink is an obstacle to the hall’s success and long-term viability, said Cohen. “It’s really hurting us,” he said. “It draws a lot of complaints.”

On-sale licenses are issued to a specific business. Getting liquor service onto a deck or patio can require an additional city license, for extension of liquor service, and a license cannot be shared.

For many years St. Paul had an adjoining restaurant and a strip joint, the Manor and Casey’s, with a shared on-sale liquor license. It was considered a grandfathered-in anomaly and wouldn’t be allowed today. The Manor and Casey’s were torn down to make way for redevelopment in the Shepard-Davern neighborhood almost 20 years ago.

Today’s food halls have the challenge of several places to eat and typically fewer on-sale liquor licenses. Buy liquor in one place and you cannot take it to drink with your meal at another establishment. Cohen said that is a stumbling block for Keg and Case, and for other food halls. 

North Loop Galley, a Minneapolis Warehouse District food hall that serves as an incubator space for up-and-coming restaurants, has a liquor license that covers its entire space. But that took special legislation tied to its address.

Noecker, who is working on special legislation with Cohen and the St. Paul Department of Safety and Inspections (DSI), said she’d like to see citywide approval for food halls to allow liquor to be consumed throughout the premises. 

City Council members see the proposed change as part of their ongoing effort to modernize antiquated liquor regulations. Until just a few years ago, St. Paul had a per-ward cap on on-sale liquor licenses. Rather than change the city’s charter, the City Council pushed through changes to allow restaurants with foodservice to have liquor licenses.

That still didn’t help Cohen, who had to go through the process of seeking a commercial development district designation to allow liquor licenses for proposed bars at Keg and Case. Originally set up to create entertainment districts, they are more often used for a specific location if a ward doesn’t have liquor licenses available.

“The city has been great to work with, but the existing laws can be cumbersome for a food hall like ours,” Cohen said. “If we’re going to be successful in the long term, we need flexibility.”

In the meantime, Cohen and the food hall’s Clutch Brewing Company are working on plans to add a second-level deck on the building’s rear side. It will span part of the current parking lot. The deck plans are currently undergoing review by the St. Paul Heritage Preservation Commission (HPC), and already have a recommendation of approval from city staff. A public hearing will be held this spring. If all goes as planned, construction will start this spring.

The HPC is involved because Keg and Case is in the former Jacob Schmidt brewery complex, a historic district. The district allowed the various building developers to seek historic tax credits and other assistance to redevelop the iconic brewery. But designation require the additional step of HPC review. 

A second plan for Keg and Case is to enhance a public space along West 7th Street. The patio area has featured a merry-go-round, farmer’s market and other outdoor activities. Cohen is seeking to add a bandshell to the patio, and is applying for city assistance through the Neighborhood Sales tax Revitalization (STAR) Program. 

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