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On Monday, August 11, three Superior city councilors comprising  the License and Fees committee gave the go ahead for a liquor license for the new Super One located in Superior’s East End along East 2nd St; also known as Highway 2/53. The license will permit a liquor
store adjacent to the grocery store if it is approved by the full Superior city council on August 19. The meeting was often contentious with perhaps 20 speakers urging passage or denial of the license. Most of the supporters were Super One executives and their attorneys. The opposition was led by Walter “Pudge” Haugen,  owner of the nearby Pudge’s Bar. Haugen’s chief complaint is that the local business community had been promised, repeatedly, by Mayor Bruce Hagen and Super One that there would be no bar, lounge or liquor store in the new Super One plaza.

Background

The project is being pushed by Miner’s Inc., the Hermantown based parent company of dozens of Super One grocery stores in a five state region, plus, a handful of grocery stores with other names such as Woodland Marketplace or Country Market. A recent push into the liquor store business by Miner’s triggered the current controversy.

 Liquor laws in the region are an odd mishmash of regulations, with a variety of implications. In Superior, it is required that you have a bar and lounge in order to have a liquor store, a law clearly designed decades ago to protect local shopkeepers from competition from grocery stores. The bar and lounge “poison pill” has been equally effective at keeping liquor off the shelves of the newer big box stores such as Target and Wal-Mart. Hudson, Wisconsin has a similar protection regulations. The State of Minnesota specifies that no company may have more than one per municipality.

Until now, that is. Miner’s apparently has decided the reward was worth the aggravation of operating a bar and lounge, and built a space for a bar, lounge and liquor store into their new flagship store in Superior. The space is about 9000 square feet, with about a third of the space designated for the bar.  

Understandably, those who oppose the Super One liquor store are other liquor stores in Superior, and the pubs in the immediate neighborhood. For all the brave talk of welcoming competition, in reality, most business owners suspect they already have enough competition before Goliath walks into the room.

More unusual, perhaps, is the outspoken public stance Mayor Bruce Hagen has taken on the issue. Although Hagen admits that Super One’s previous promises to not enter the liquor business were mostly verbal (apparently an earlier non-compete that Super One signed with the former Old Town has since expired) he still believes they should honor their prior statements.
Tobey Marcovich of Superior, an attorney for Super One, pointed out to the committee Monday that the city council should have been aware of the possibility of a liquor store when Miner’s architect John Geissler mentioned a liquor store among many other possibilities, on December 18th, 2012, before the council.

One of the other Super One executives spoke to the committee, happily reassuring them that although there had been initial skepticism when a Miner’s liquor store was planned in conjunction with a County Market grocery store in International Falls, once it opened everything settled down and there were no more complaints. More on that later.  

Unhappy neighbors

Walter “Pudge” and Sara Haugen explained their view of the dispute to The Reader.  The Haugens first realized something was going on a Sunday morning in March of 2011. “A gentleman who looked very much like an accountant walked through our bar.” Sara Haugen stated. “I asked if he wanted anything?” He said no, and walked into both the men’s and women’s bathrooms and out the back door, he came back in and said thank you, got in his car and drove away.

Sara Haugen elaborated: “Later, there was a meeting that Bruce (Hagen) initiated to take place at our (Pudge’s) bar, and we gathered all the East End Business District, and Miners came in and let us know that they were intending to build a flagship Super One in the area.”
“Super One held several meetings, asking the community to help them facilitate getting people on board and selling homes that were on the site. One meeting at the Old Town had a very nice spread of appetizers and they showing pictures of what the new front façade of Super One would look like facing East Second Street and they’re all excited about this and how things are going to impact them.” Sara Haugen continued, “But every meeting we asked them - are you building a bar and lounge and a liquor store in the building? The answer was always no, we are not entertaining that idea.“

Walter Haugen believes that most of the East End business community had been told by Super One executives and Mayor Hagen that they were not putting a liquor store or bar and lounge on the property. She recalled Cindy Schaeffer from the East End Café, Linda Hofman from the Old Town Bar and Restaurant, Corey Gatzke from the Office Bar, Mike Dodge from East End Tavern, Daniel Carlson from Carlson Flooring, Roger Lundquist from East End Hardware all attending these meetings.

Super One asked the Haugens to swap land. Haugen’s land ended up being just about where Super One’s loading dock needed to be, they gave the Haugens land adjoining their property, plus a cash equalizer. Wanting to be good neighbors, the Haugens agreed. Immediately upon closing the deal in March of 2013, Super One’s realtor John Forcier, formerly of the Atwater Group, let it slip that Super One was indeed putting a liquor store on the property.

Sara Haugen added “I surely wouldn’t have made the land swap, in essence tricked into trading land to a competitor; and also we wouldn’t probably have been so supportive of this project if we would’ve known that a bar was part of the deal. We were told all the way along at all the meetings that they have no intention of having a bar or liquor store. I feel that we were deceived.”
“I’m not against free enterprise, I’m against people not telling the truth.’
Walter “Pudge” Haugen at Mondays’s meeting

“I honestly don’t think they will harm my business;” Mike Dodge, owner of Dodgies East End Tavern told The Reader. “But, because I was at one of the early meetings and was promised they (Super One) would not have a bar and lounge, if I had a vote I would say no.”
Upon reflection, though, he said that nearly 15 people that used to live in the neighborhood and walk to his bar no longer frequent his establishment because they had to move for the project. 22 homes were demolished to make room for the new Super One complex.

Alan Jacques,  owner of Belknap Liquor Store, and the Belknap Plaza.  “I expect to lose business to the new proposed Super One liquor store. Superior is too small of a pie to divide up.”

Kim Moore, sister of The Office Bar owner Corey Gatske, told The Reader that her brother is upset because the mayor and Super One promised there would be no bar when they asked for the communities support.

Concerns have been raised in the community that the future of Keyport Liquor Store and Lounge could be in jeopardy if Super One enters the liquor business in Superior. Keyport leases their building from the Miners at Super One’s other Superior location at 1900 Belknap. Mark Casper, owner of Keyport, told The Reader that he has been assured by Super One that they will be willing to extend his lease.

Steve Ledin, attorney for Jim Bolin of Presidents Bar & Liquor store sent a letter to the city councilors addressing existing Wisconsin law that establishes legal precedents for the denial of liquor license. He goes on to say (in part):

“There are compelling reasons to deny Super One’s liquor license application:

• The unwritten gentleman’s agreement that Super One would not apply for a liquor license when Super One requested the support of the business owners that would be negatively affected now.

• The detrimental effect on the existing and long-standing East End establishments granting a license love a small positive impact for Super One but a large negative impact on the existing establishments.”

Still Happy in International Falls?

Two business owners stood up to the County Market expansion that would include a liquor store on premise. The Reader first called the number for International Discount Liquor and spoke with Ty Stolp, the business partner of Phil Paulbeck, the stores owner. Stolp stated that they were no longer a liquor store and that they had moved on to other endeavors.  Stolp recommended talking to Jim Leinum, the owner of Jug Liquor, but also said that “without a doubt” the County Market affected the business. Given that it is no longer a liquor store, that seems to be a safe assessment.  When asked if the County Market Liquor had affected his business, Leinum replied, “of course it has…these people own many stores all across the country. It’s pretty hard for small local merchants to compete against a giant grocery chain.” Leinum stated that his former competitor International Discount Liquor was bought out. “Miners bought him out, he was right across the parking lot,” said Leinum. Miners Inc. owns the Country Market located at the International Mall.
Mayor Hagen Speaks Out

Superior mayor Bruce Hagen told The Reader that he was involved in negotiations with the Super One executives from the very early stages.  Hagen agreed to help upgrade the site’s infrastructure, by upgrading 22nd and 23rd Avenues East, build a turn lane, and install new traffic signals. Hagen also helped facilitate moving 22 families out so the site could be expanded; and to help rally community support. In return, Super One agreed to widen the alley behind East Fifth Street to accommodate angle parking and a more attractive approach should the Fifth Street merchants choose to fix up their rear approach; and that Super One would not have a bar or liquor store in the building. “Neither of those ended up happening.” Hagen stated. Hagen went on to say that Bruce Anderson (Super One corporate attorney), Greg Borash (Super One Chief Financial Officer), and John Krenke were all involved in these negotiations, and now, Hagen said, “they don’t quite remember”.
Concerned, Hagen later talked to Super One owner Jim Miner, Jr; who said “things have changed”. Hagen told The Reader that he “doubts if that is true”, noting that at the same time Super One was publically agreeing not to put a liquor store in East End, they were at work adding liquor stores everywhere else.
Hagen believes Super One should honor their verbal commitments, “My word is my bond.”
The Reader asked Hagen if he would have supported the Super One project if they had admitted in the early stages an intention to build a bar and liquor store? Hagen replied “Probably not. No, I want to protect the local businesses.”

Other City Voices

Jason Serck is the planning director for the City of Superior. He told The Reader that the city put just under $1 million into the Super One project. About $250,000 of which was for improved stoplights and the rest was for improving 22nd and 23rd Ave. East. Serck’s perspective is that both of the roads did need to be rebuilt, but that these particular streets wouldn’t have been prioritized were it not for the Super One project. The stoplight signals were a great enough need that that likely would have been done anyway.
Jack Sweeney is a Superior city councilor who represents the East End District most affected by the controversy.  As an alternate, he was one of the three councilors on the licensing and fees committee which unanimously approved Super One’s liquor permit application.

Sweeney told The Reader that he made an attempt to meet with the managers or owners of all of the East End area businesses, and that he succeeded in reaching 80 or 90 percent of them, and that most of them overwhelmingly said it (the Super One plaza) would be neutral or beneficial to their business. Sweeney said he doesn’t want to stand against progress.

Yes, We Have No Grandmas

Councilor Dan Olson, apparently not a supporter of Super One, addressed the License and Fees committee; asking if this would “create a new tax base?” Olson also stated that Super One had a backup plan, “at the end of the day they could make it into a Grandma’s Bar and Grill”.  The Reader has since discovered that is not accurate. According to Brian Daugherty (Grandma’s President) Grandma’s simply asked for a site map a couple of years ago and negotiations have never really progressed beyond information gathering.

Challenging New Math

Although Super One’s liquor permit was recommended by the License and Fees committee; it may have a greater challenge when voted on by the full council on August 19th. A simple majority of the whole, or six of the ten councilors must approve the permit, but at least two councilors intend to abstain citing possible conflict, which according to Hagen, means that six of the possible eight votes would have to be in favor of Super One’s application. If the matter fails, it can be brought back only by a former negative voting councilor. The meeting is in room 201 of the Government Center in Superior at 6:30 p.m.
At Mondays License and Fees meeting, Super One’s Patrick Miner declined comment, as he “was not part of the discussion.” Super One has not otherwise responded to The Reader’s requests for comment by deadline.

Both the Keyport and Hammond liquor stores in Superior are regular advertisers in The Reader. Super One is a key distribution partner.

Paul Whyte assisted in this story.