photo by: City of Lawrence

The Lawrence City Commission discusses a request from John Brown's Underground as part of its meeting Nov. 15, 2022.

A request for a change to city code from a business that has struggled to comply with the city’s limit on downtown alcohol sales sparked a larger conversation at City Hall on Tuesday.

John Brown’s Underground, which since its opening in 2014 at 7 E. Seventh St. has on multiple occasions failed to meet the city’s requirement that it derive no more than 45% of its sales from alcohol, requested an amendment to city code that would allow the percentage to be 90% under certain conditions. The alcohol sales requirement, which dates back to 1994, was put in place with the goal of preserving the retail character of downtown and preventing it from becoming a bar district.

Some commissioners expressed concern about the change proposed by John Brown’s, especially given the city’s ongoing process to update the entirety of its development code, which would include the code for downtown. Ultimately, there were not enough commissioners in favor of approving the amendment, and the commission instead voted 5-0 to defer the amendment and asked city staff to bring back a proposal for a possible moratorium on the alcohol sales limit that would apply to John Brown’s and other existing businesses in the same situation until the city completes the code update.

photo by: Rochelle Valverde

The entrance of John Brown’s Underground, 7 E. Seventh St., is pictured on Aug. 4, 2022.

Commissioner Brad Finkeldei, the chair of the committee working on the development code update, said that the goal of the 1994 code remained important and would be a consideration for the committee as the city works to implement the Downtown Master Plan, which includes a recommendation to redevelop the city-owned parking lots downtown.

“We clearly want to keep a balance in downtown of retailers and others,” Finkeldei said.

The current code requires new downtown drinking establishment licensees to make no more than 45% of their sales from alcohol. The businesses with bar use that already existed in 1994 became “grandfathered,” and 23 businesses are allowed to maintain a bar use even if ownership changes hands. The amendment proposed that businesses less than 3,000 square feet be allowed to apply for a special use permit to derive up to 90% of sales from alcohol. Special use permits must be reviewed by the Planning Commission and approved by the City Commission, which can place further restrictions on the permit.

The commission previously approved a temporary extension of John Brown’s drinking establishment license that has allowed the business to keep operating, even though it did not adhere to the alcohol sales limits, to allow time for the amendment to be considered.

The commission heard from downtown businesses for and against the amendment.

Scott Elliott and Dante Colombo proposed the amendment. Elliott, the owner and founder of John Brown’s, did not address commissioners. Colombo, John Brown’s manager, said he was born and raised in Lawrence and that the point of the amendment was to protect the intent of the 1994 code, but allow for the “small, experienced-focused” drinking establishments, such as John Brown’s, that have arisen across the country in recent years.

“Our goal in proposing this variance was to strengthen the intent of the 1994 code in protecting the integrity of downtown, to continue the work that that ordinance began,” Colombo said.

The commission also heard from Mary Holt, the owner of Henry’s Upstairs on Eighth Street, who said that the code was outdated and that she supported the amendment. Holt said her understanding was that the code was put in place to prevent downtown from being overrun with bars and becoming like Aggieville in Manhattan. She said that she did not want to see that either, and that the smaller bars, such as Henry’s and John Brown’s, were not over-serving customers or contributing to that type of environment.

Jennifer McKnight, the owner of Arizona Trading Co., said that the code has been successful in preserving a retail-oriented downtown that many communities have lost because it is easier to make a profit with alcohol sales than retail sales. Jim Bateman, who owns the Yarn Barn with his wife, Susan, said a lot of downtown businesses are 2,500 square feet, and the possibility of filling vacant storefronts downtown with drinking establishments would make it more difficult for those vacancies to be replaced with retail. Bateman said his point was not against John Brown’s, but that he thought changing the code required a broader discussion.

“It does need to be addressed,” Bateman said. “My primary concern is that looking and making the suggested change here to satisfy one request is perhaps missing an opportunity to look at the bigger picture.”

Vice Mayor Lisa Larsen said matters such as square footage and whether 90% was the appropriate limit for alcohol sales deserved more consideration and public input, and that discussion should be had as part of the code update. Larsen suggested instead that the commission allow John Brown’s to operate on a temporary license until the code is decided.

“I think those are the questions that I can envision as part of the code rewrite and the general public would at that point be able to make comment on and help form the code as it’s rewritten,” Larsen said. “So to do this interim step I think it’s a little bit shortsighted.”

Commissioners Amber Sellers and Bart Littlejohn initially questioned whether the amendment might be able to function as a “stopgap” measure, though Sellers said she was unsure and did have concerns that the amendment could potentially create additional community impact. Littlejohn said he thought the special use permit process would allow the commission to have more oversight while allowing a business that was “thriving and well known” to continue to operate. In response, Mayor Courtney Shipley said the alcohol sales limit “was very intentionally created,” and that the point was that there would be businesses that would not be able to be successful under the parameters. Shipley said the change should be considered as part of the development code update.

“I would try, if I can, to convince us all to have faith in the process,” Shipley said.

If the city were to approve some kind of moratorium on the 45% rule, it would apply to other downtown businesses, not just John Brown’s. The commission requested that the topic come back for discussion in December, which would be before John Brown’s temporary license expires. The development code update began in August and is expected to take two years.