A judge’s ruling denying a liquor license to a late-night Five Points college bar could affect at least 1,000 bars across South Carolina, a study by the University of South Carolina shows.
The study “Need for Statutory Clarity” added that denial of a liquor license to the Five Points Roost for failing to sell enough food to qualify for a liquor license also could cost the state more than 7,000 jobs and $10 million a year in tax revenue if those 1,000 or so bars were forced to close.
Those numbers could rise, said Robin DiPietro, director of USC’s International Institute of Foodservice Research and Education, which conducted the study.
“It depends on how (the S.C. Department of Revenue) enforces the law, and the bars’ willingness or ability to comply,” she said.
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South Carolina does not allow “bars” per se. It requires that all establishments qualify as “restaurants” to sell liquor by the drink.
However, DiPietro’s team found 1,022 establishments that identified themselves on the 2012 U.S. Census as “bars” or “nightclubs.” The researchers assumed, DiPietro said, that the establishments self-identified themselves as bars because they sell less food than alcohol.
And even more of South Carolina’s 16,000 or more establishments who identified themselves as restaurants also could not qualify, she said, although most of them — especially fast-food restaurants — don’t sell alcohol.
“And since 2012, the economy has improved,” DiPietro said. “So I think there are a lot more people who have opened bars and nightclubs.”
The difference between a bar and a restaurant is at the heart of a test of S.C.’s liquor laws that is playing out in the capital city, but could affect every corner of the state, especially in tourist and business destinations like Myrtle Beach, Charleston and Greenville.
According to state law, an establishment is eligible to receive a liquor-by-the-drink license only if it is “primarily and substantially engaged in the preparation and service of meals.”
Previous court rulings, including the April decision by S.C. administrative law Judge Deborah Durden, have said that 5 or 10 percent of sales is not enough to qualify for a license. “Primarily” is argued by some as more than 50 percent of all sales.
Neighbors in the Five Points area are challenging The Roost and its sister establishment Rooftop Bar in an attempt to limit the number of late-night college bars that cater to mainly USC students, many of whom are underage and using fake IDs.
They claim the availability of cheap liquor at these establishments, most of which do not open until 10 pm. or so, result in high levels of public drunkenness, violence and lewd behavior in the district and, in turn, their neighborhoods.
But Joe McCullough, attorney for the Greater Columbia Restaurant Association, called Judge Durden’s ruling, if upheld on appeal and enforced as 50 percent of sales, “apocalyptic.”
“The restaurants are going to have to take a real hard look in the mirror,” he said, adding that commercial districts like Myrtle Beach’s Ocean Boulevard, Charleston’s King Street and Greenville’s Main Street could be filled with empty storefronts.
But neither state law nor the legal precedents set a definite percentage of food to liquor.
The S.C Restaurant and Lodging Association’s board, which commissioned DiPietro’s study, urged the Department of Revenue to halt any increased enforcement.
The board “respectfully requests that appropriate enforcement officials delay enforcing that ruling until other avenues of appeal — such as legal, legislative and/or regulatory relief — especially focusing on a clarification of what exactly constitutes ‘normal mealtimes’ and the word ‘primarily’, are exhausted,” it said in a release to The State.
Dick Harpootlian, the Columbia attorney who represents the Five Points neighbors, called the study “squishy at best.”
“The monetary impact in an $8 billion (state general fund budget) is not enough justification (to halt enforcement) in our neighborhood, which has a higher level of drunkenness and lawlessness than anywhere in the state,” he said. “These arguments are an attempt to sidestep the issue.
“These students are not going down to Five Points to have a midnight snack,” Harpootlian added. “They are looking to drink as much liquor as they can, and these guys are accommodating them.”