Why We Have $15 Burgers: The Mission's Liquor License Ban

Supervisor David Campos addressing a room full of fellow stuck-in-the-muds (Photo/Mission Local)

Why is it important to have more alcohol?” asked a man who brought his young daughter to the meeting. “Why not have healthier foods?”

We’re being flooded with alcohol. How will this change improve public health?”

“With all the gentrification, we’re just opening the door to more boutique, high-end places. My Brownies don’t go to Bi-Rite.

I don’t feel like I’m at a point where I can make changes to the legislation,” [Supervisor David Campos] said. “There remains the question, should anything change?”

These were the concerns brought up at a recent community meeting regarding calls to lift some of the confines in the Mission's and La Lengua's ban on new liquor licenses (as known as the “Mission Alcohol Special Use District”). Sounds bad, right? Lifting restrictios means more gentrification. Less room for healthier foods. Increasing damage to our public health. Why would we ever consider loosening up restrictions on bringing liquor licenses into the Mission?

And people in favor of keeping our strict moratorium in place have a point.  After all, a funny thing has happened since the 1996 ban went into effect: 200 new businesses have been permitted to sell liquor in the neighborhood.  That shouldn't be surprising to anyone—in the past couple of years alone, Pica Pica, Mission Cheese, Grub, Mosto, Tacolicious, West of Pecos, and Wo Hing General Store have opened with booze to sell in locations on Valencia previously not permitted to do so.

But therein lies the problem. In the 18 years the ban has been in place, 195 restaurants have received licenses (39 of which have full liquor licenses), but only two bars and three grocery stores have.  In other words, 97.5% of new liquor licenses in the Mission are being gobbled up by predominately fancy, high-end restaurants catering to people from outside the neighborhood who can afford a premium for dinner.

If we really care about “gentrification” and “healthier foods” and The Public Good, shouldn't we be making it easier, not harder, for new, innovative, cheap, diverse establishments to open?

The reason you mostly see high-end restaurants opening is a due to a tangled web of bureaucracy, inflated costs, and bad public policy.

When the ban went into effect, restaurants were not deemed to be the problem—corner stores and seedy bars were.  Back then, the Mission was 'overrun' with violent drunks and vagabonds who subsisted on a diet of corner store malt liquor and cheap vodka.  The thinking was that with a ban on new liquor licenses and license transfers in place, corner stores and bars would go away as their owners moved on and the Mission, in effect, would become less “saturated” by liquor.  Since full-service restaurants (defined as restaurants that see more than 50% of their income come from food sales) and commercial grocery stores (think Safeway and Whole Foods) were not the problem, they were exempt from the ban.

Of course, this has had the unintended effect of accelerating the influx of high-end businesses with “concepts” and “trained mixologists” and increasing the homogeneity of our nightlife.

Because of the excessively limited scope of what types of businesses are allowed in the neighborhood, existing and aspiring business owners alike are burdened with getting the law changed. First in 2000, when the Brava Theater wanted to serve beer and wine, an amendment was made to exempt non-profit theaters from the ban. More recently, the Roxie Theatre successfully lobbied to get non-profit single-screen cinemas exempt (even after getting the legislation passed, they've still been forced to wait over a year to get their license approved). Then Mission Bowling Club lobbied to have bowling alleys exempt. Now Supervsior Campos is working with Alamo Drafthouse and Local Mission Market to have commercial multiplex movie theaters and small, organic grocery stores allowed in the neighborhood.

This is a downright insane way to tackle local policy. Instead of freeing our creative minds to open up new businesses such as breweries, bowling alleys, and concert venues, we've limited our pool of potential new business owners to those deep-pocketed entrepreneurs that can afford to navigate our city's turbulent political process.

What's worse is the effect this nonsense is having on the existing businesses. Valencia Whole Foods has been fighting for a license for the last ten years, to little avail. If the small grocery was allowed to sell liquor, they could be able to afford to stay open later. However, has chosen to prevent this on the grounds that Valencia Whole Foods isn't a full-sized grocery. The owners of Shotwell's would certainly love to serve gin and tonics (and we're certain their customers would love that too), but they are forbidden to upgrade to a full bar because they don't sell food. And the very inner-Mission corner stores that the ban was designed to make go away? Because the ban forbids the sale and transfer of licenses within the Mission, owners of corners stores remain open because there is no way for them to “cash out” and sell their license to a new grocery store or similar establishment.

Supporters of the ban claim that any respectable business, be it an organic grocery store, bowling alley, or venue should be able to survive without a liquor license.  But realistically speaking, many restaurants need liquor licenses in order to stay competitive, fully serve their clientele, and make enough profit to stay afloat.  Similarily, Local Mission Market and Valencia Whole Foods believe licenses are necessary to become more viable small, local grocery stores that can compete with the likes of Bi-Rite, Trader Joes, and Whole Foods.

Beyond the grocery store and bowling alley hullabaloo, the supporters of this failed legislation want to keep it in place to curb the menace of today: gentrification—big scary gentrification! In their twisted train of thought, restricting new licenses in the Mission will protect the vibe of the neighborhood. But, in reality, the very opposite is happening.

The only way to open a new bar in the neighborhood is to acquire an existing bar, either through evicting the bar by refusing to renew its lease (as was the case with Kink.com taking over Ace Cafe on 14th and Mission) or buying a bar outright (such as Dr. Teeth did to Bissap Baobab). Often, this comes at the expense of Latino establishments—in the past year alone, El Rincon and El Mexicano were gobbled up by 'Hipster Joints'.

Moreover, because selling a license to a new business in the Mission is seen as a riskier investment, as the ban makes it easier for SFPD and ABC to regulate new businesses with licenses (see the mandated limited hours of Mission Cheese, West of Pecos, and Dear Mom), licenses are sold for a highly inflated price to neighborhood businesses.  Existing Mission bars and restaurants with licenses are flipped on the market for exorbitant prices for the exact same reason.

Effectually, cheaper restaurants that want to serve alcohol can no longer afford to open in the Mission and we're left with restaurants that only cater to a wealthier crowd. After all, they need to recoup their investment.

Supposedly, Campos is in favor creating a taxpayer-funded program to fiscally sponsor Latino entrepreneurs who wish to open an business with a liquor license in an effort to combat these rising costs. Essentially, he's admitting there is a problem with the current system. So why not fix the problem, rather than allocate funds for people of particular ethnicities to navigate the bureaucratic chaos?

It's this kind of thinking that forces our business leaders to spend valuable months and fiscal resources schmoozing City Hall into amending a law, rather than opening a new business. Instead of serving customers, pouring beer at an independent movie, having people bowl, or opening a grocery store, this legislation is forcing businesses to squander valuable time maneuvering around bad policy. And after spending tens of thousands of unnecessary dollars just to start the business, is anyone really surprised that new restaurants are charging $15 for a hamburger?

(If you're interested in seeing this bad legislation go away, Campos is hosting another meeting to debate the matter Wed., June 13th at the Mission Cultural Center for Latino Arts [2868 Mission at 25th] Plaza Adelante [2301 Mission at 19th])

Comments (21)

Thanks for the informative, if ridiculous, explanation. What frustrates me most is that when I used to drink, the fact that a place didn’t serve alcohol or only had beer/wine was simply shot down as a proposed place to go among my friends. There was no, “well lets go there anyway because [insert other things the place had to offer] here.” I assume that’s the same attitude many Mission residents share. And all it take is one individual – if we have a group of 6 people for dinner and your restaurant had no good veg options, our whole group is going to go elsewhere, even if only one of us is vegetarian. Same theory applies to booze. So it’s just frustrating that the city’s response is “they shouldn’t need a liquor license.” Ugh. And as for the “healthy” BS, just because an establishment has a bar, doesn’t force you to drink there. You an still enjoy the food/bowling/etc. that the profits from liquor sales serve to subsidize.

Terrific post.

So this law was enacted to reduce the apparently then-inebriated state of the Mission, but is now acting as a defense against gentrification? I’m reminded of a 70’s SNL sketch - “it’s a dessert topping *and* a floor wax.”

And boy, I’ve never heard a more obvious instance of the false dilemma than - “Why is it important to have more alcohol?” asked a man who brought his young daughter to the meeting. “Why not have healthier foods?”

I have no problem with affirmitive action for college admissions and such, but for small business subsidies? That just seems like plain ol’ racism.

Great post. I guess this means you are running for supervisor? You have my vote. Campos is ineffective.

Surprisingly well thought out post.

I am a liquor man myself, but when I lived in the Lower Haight, I couldn’t help but notice that fights only seemed to break out at the one place with a full liquor license. Love the stuff, but it’s not without it’s problems.

The old county song “I Like Beer” explains it well.

This post is very confusing. I want to agree with you because I think the ban is unnecessary but I can’t quite follow your logic that it causes gentrification.

If we really care about “gentrification” and “healthier foods” and The Public Good, shouldn’t we be making it easier, not harder, for new, innovative, cheap, diverse establishments to open?

Why are we to assume that this would be an outcome of lifting the moratorium? Cheap is a function of a lot of factors, including rent and investments that need to be recouped. And if they could sell liquor, wouldn’t their clientele be the same gentrifiers?

And the very inner-Mission corner stores that the ban was designed to impact? Many of their owners would like to sell their licenses to new businesses and close up shop, but the ban makes such a sale illegal, so they stay open as no avenue to cash out exists.

This is also confusing. This is the point of the legislation…. to harm these guys who were selling booze to drunks. But let’s say the ban is lifted. What goes in to replace them? It’s going to be businesses that make the mission better than ever, right?

Similarily, Local Mission Market and Valencia Whole Foods believe licenses are necessary to become more viable small, local grocery stores that can compete with the likes of Bi-Rite, Trader Joes, and Whole Foods.

If you can’t beat ‘em join em?

In their twisted train of thought, restricting new licenses in the Mission will protect the vibe of the neighborhood. But, in reality, the very opposite is happening.
So true. Very true. But lifting ban won’t stop it, it will only accelerate it. Now should the ban even be part of the discussion of gentrification? No. Of course not. But pretending that war equals peace that only lifting ban can save us from gentrification is to commit the same sin of bad faith.

Effectually, cheaper restaurants that want to serve alcohol can no longer afford to open in the Mission and we’re left with restaurants that only cater to a wealthier crowd. After all, they need to recoup their investment.

Does this really exist? Are there business people who lay down their time and money open a place and only want to make a little bit of money, when you can sell a burger a $15 and a pizza for $20+? Why? Why leave money on the table? Isn’t it more realistic to think that people will open bars that charge $15 for cocktails until kids who code drupal no longer want to go there and buy them?

So why not fix the problem, rather than allocate funds for people of particular ethnicities to navigate the bureaucratic chaos?
This is a good question. And the answer is probably depressing, and I’m glad you wrote this because this is no kind of solution. It is a kind of reverse apartheid.

The moratorium exists. It is not making anyone healthier. It is also not making anyone unhealthier. But most of all what it is definitely not doing is creating, or stopping, or accelerating the gentrification that is occurring in the mission. The italicized opinions quoted for keeping it in place are no better than the ones you came up with to remove it.

Hi there! I’ve been here 20 years, too. And my read of this piece is that the ban was put in place to deal with chronically poorly operated corner stores (why don’t we call them bodegas in SF?). That made sense (maybe) when that’s what liquor licences in the Mission were for. Now, they’re for different things. Among other things, some folks want liquor licenses available for small groceries, to make them more viable. As Kevin points out, booze is a profit center that makes it possible to run a business when your rents are in the tens of thousands.

Let’s use Valencia Whole Foods as an example of the ban’s overbreadth. Yeah, they’re getting by, I don’t fear for their existence. But if you think letting them sell booze will hurt the neighborhood, I’m very interested in learning *how* you think that will happen. The law was created (my take, anyhow) to limit the number of places (usually below residences, as you suggest) where people would get their Night Train and loiter. Do you think Valencia Whole Foods is going to become a party spot for boisterous inebriants keeping up the residents of 21st and Valencia? I don’t. The corner store *directly across the street* hasn’t created that problem. Policy decisions are always, to some extent, guesses. We think X will happen if we do Y. But we have to approach these guesses in good faith, because, really, we can posit *anything*. “We need the ban to prevent an invasion from Mars” is something you could say, but you would have trouble explaining why.

A more rational approach to licensing would be to examine on a case-by-case basis, evaluating prospective pros and cons. By the way, that’s how it happens in almost every other city and town in the state. Someone applies for a license, voices are heard, and a decision is made. Not categorically, but specifically.

Getting back to VWF and the shop across the street, I wonder if a little competition might actually *help* some folks (evil drinkers like me, yes). It might keep our booze bills down, letting us spend more at, I don’t know, Back to the Picture? That would be good, right?

If the problem is with liquor stores, why not make liquor stores “not permitted” or “conditional uses”in the commercial corridors of the Mission?

There’s this idea that the Mission’s natural fate is to become the next large nightlife/entertainment district. I don’t want that to happen. This is a mixed use neighborhood with commercial entities, like bars and restaurants, that sit side by side with households- places where people live. It has always been thus.

What the what? You totally contradict yourself here. Do you really have no sense of the history of the Mission beyond your twenty-year blinders? The Mission WAS a large nightlife/entertainment district for 100 years. Heard of the Miracle Mile? And I assume you’ve noticed all those empty theaters? The Mission had mixed-use before anyone knew what it was. We’ve just been missing the larger commercial entities since the 1960s.

From 1860 on, the very existence of the Mission as a neighborhood developed around a vibrant commercial and entertainment core. This core coming back from a 50 year long vacation. It obviously won’t be theater row this time around, so the question is how we develop it while preserving the character that caused us all to move here, and hopefully keeping it affordable for everyone.

those evil businesses you can’t stand pay the taxes so that the people living in the neighborhood get services like fire, police, DPW and so on.

Neighborhoods change over the years, nothing stays the same. If we went by your logic, the Mission should be an “Irish Only” neighborhood, since after all they were there “first.” Sound stupid? It is, as is this idea that we can control change with a myriad of conflicting laws that in the end just hurt honest people and don’t really do any long term good. But that’s the SF Way now!

Dude. Where are the blurry photos of bathroom walls. What happened?
oh wrong blog.

This is the fucking Economist of Mission blogs. In a great way.

Effing great post! Also, “Economist of Mission blogs” is the comment of the day.

If it was easier to obtain a liquor license and open a restaurant or bar, then every new bar wouldn’t have to be polished and full of reclaimed wood from a Marin County barn. We could have more DIY spaces without fancy cocktails or a committed twitter presence a full year before they’ll eventually open. Is there a bar in the Mission of which you haven’t heard? How many places can you see music in this neighborhood? That’s directly related to the availability of liquor licenses.

At least you can still be shot dead on 16th and Guerrero, like last night. I love greedy landlords and corrupt city politicians. They’re so good at crafting utopia for their financial prey.

While I agree that the liquor license ban is outdated and should be lifted, I have a hard time believing that we would see the price of hamburgers fall if lifted. It’s true that the businesses who have to lobby or pay inflated prices for their licenses have incurred more debt, but it’s also true that they have customers who are willing to pay $15 for a burger.

The reality is that there is a whole lot of new money in the neighborhood, much of it possessed by a younger demographic who want to eat things that are labeled “artisan” and who flip the fuck out whenever Mark Zuckerberg shows up somewhere. Also, as anyone who has tried to find an apartment lately can attest, rents are out of control. I’m sure that the owners of these restaurants have taken into account: 1. At what prices they can still net a profit after rent, payroll, taxes, costs of ingredients, etc. 2. At what prices will people still buy their food.

Bottom line: If everyone refuses to pay $15 for a burger then the restaurants will be forced to adjust their prices or close up shop if it’s not sustainable to reduce the costs. Lift the liquor license ban, but don’t expect the neighborhood to fill up with more affordable options. Sorry if I went on a tangent, I enjoy the discussion and appreciate the thoughtfulness of the post. And I like hamburgers.

Yeah, the idea that the problem of hard-to-get (and/or transfer) liquor licenses has anything at all to do with the obscenity that is $15 hamburgers is absolutely farcical.

Run, Kevin, Run! Seriously, you’ll have my vote. That was one astute essay.

the governing should not pick winners whether giving twitter special tax breaks, doling out indulgences to favored bars, or running a lottery to add condos.

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