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Why a City Ordinance Is Threatening Charleston's Cocktail Capital Status

How one of America’s most vibrant bar communities is fighting government regulation.

Charleston's TheDigitel/Flickr

On the day of his 40th birthday party, bartender Craig Nelson skipped his own birthday dinner to attend, inexplicably, a Charleston city council meeting. "I basically got a phone call from another business owner at about 2p.m. on Tuesday saying, 'Hey man, do you know what's going on at city council today?'" says Nelson, who owns Charleston craft cocktail bar Proof. He hadn't heard the news, which was quickly spreading through the local restaurant industry: Charleston's mayor, police chief, and Director of Planning, Preservation and Sustainability had issued a memorandum turning a section of downtown into a recognized "Entertainment District." According to the "Late Night Zoning" ordinance, new bars within that district would be barred from serving alcohol past midnight. The forced midnight closure effectively sheared two hours off the city's 2a.m. last call, affecting the bottom lines of any potential new bar owners.

Nelson missed his birthday dinner, but his presence at the meeting didn't help: The ordinance "flew through" in that May 27 meeting, he says, passing with a 12-1 vote. But the backlash was immediate. The day after the ordinance passed, a Change.org petition collected 800 signatures, arguing the measure would lead to the "loss of Charleston as a premier food and entertainment destination," a designation that local businesses "have worked so hard to build." By early June, several city council members admitted to the Post and Courier that they made a "rush to judgement" in voting yes, and the ordinance was placed on hold.

What's at stake is far more than two extra hours of downtown drinking time.

By September a moratorium was placed on the ordinance, effectively banning new bars for staying open past midnight — through September 2015. Today, city officials, restaurant owners, and other local entrepreneurs are all working together in an attempt to craft the best possible policy.

What's at stake, according to business owners, is far more than two extra hours of downtown drinking time. Charleston is currently sitting at the same crossroads other growing cities have contended with in the past — it's trying to adapt to what "quality of life" means to a new generation that embraces music, arts, dining out, and other elements of what some call the "nighttime economy." According to detractors, the ordinance sends a mixed signal to entrepreneurs and those interested in growing the city on the national stage: That foodies, live music venues, and young professionals are welcome — but only to a point. "The younger, enterprising, creative class is a hard one to attract," says Elliott A. Smith, a local attorney who founded the Business, Art, Culture, and Entertainment League of Charleston, an organization dedicated to encouraging "authentic culture" in Charleston. "Charleston has done it, but it's a delicate ecosystem. The danger [of an ordinance like this] is a chilling effect that does damage to the progress Charleston has made."

Nelson's craft cocktail bar Proof, located on King Street. Photo: Facebook

The Evolution of an Ordinance

In April 2014, a 27-year-old Charleston man died in the Upper King Street nightlife district, after being "sucker punched" during an altercation that happened just before the 2 a.m. last call. The tragic incident was captured on tape, and in his May 22 memorandum, Charleston Mayor Joseph P. Riley, Jr. wrote that downtown Charleston was "close to a tipping point," describing the early-morning bar activity one of the "challenges" facing the city. "Too much of anything can be harmful and we think it is important to do everything we can to make sure we have moderated this level of activity," Riley wrote.

The accompanying zoning ordinance changed the downtown map, overlaying an "Entertainment District" designation on top of the entire stretch of King Street, the Market area, East Bay Street, and Meeting Street. According to the ordinance's wording, food stores, gas stations, and "any other businesses that sell alcoholic beverages" would be "restricted from operating between the hours of midnight and 6a.m." (During that initial May meeting, only one council member voted no: According to ABC4, he did so noting that the city's restaurant association had not been involved.)

Although already-existing bars would be "grandfathered" in and could retain the existing 2a.m. closing time, to many business owners, the ordinance penalized the downtown establishments that had helped revitalize the small South Carolina city (population: 128,000) in the first place. "This stretch of King Street that we're on, 10 years ago, was one of the least-safe places to walk in Charleston," Nelson says. "It was very encouraged for restaurants and bars to come open up here, and it really changed the landscape of everything. Now, it's very vibrant. Their excuse was that they didn't want this to be a dead zone during the day... But we really don't have that problem. All of it was really a load of B.S."

"This stretch of King Street, 10 years ago, was one of the least-safe places to walk in Charleston." — bar owner Charles Nelson

In the ensuing months, as council members publicly questioned the ordinance, Nelson says he attended every single one of the public hearings meant to air citizens' concerns. "I never heard one where they had more than maybe one or two people speak in favor of the ordinance, other than the mayor," Nelson says. "It was always literally 100, 150 people against it."

After briefly entertaining a moratorium that would outright ban any new bars from opening in the Entertainment District for three years, the city's planning commission narrowly approved a compromise of sorts. In September 2014, a city planning commission narrowly voted against the Late-Night Zoning ordinance, instead choosing to institute a one-year moratorium on new bars that could stay open past midnight. The compromise, in Nelson's words, means the city will "put a one-year moratorium on this and study it and come back and take a look at it," he says. "So, that's where we ended up."

An overhead view of King Street. Photo: American Spirit / Shutterstock.com

Lingering Concerns

The most dire bullet has been dodged, but the hospitality industry still has concerns. Existing bars and restaurants might be "grandfathered" in thanks to due process, but Nelson points out that "grandfathered" licenses stay with the property, not with the business owner. In five years, he says, that fact "could give my landlord a serious bargaining chip. I couldn't just move down the street if he decided he wanted to jack up the rent by 20 percent." Neither could other restaurant and bar owners, the majority of whom rent downtown as opposed to owning their buildings. (Eater Charleston editor Erin Perkins somewhat-jokingly predicted that a building's coveted "ancient" liquor license could lead to "bidding wars" over desirable properties.)

"I couldn't just move down the street if [my landlord] decided he wanted to jack up the rent." — Nelson

And rental agreements aren't the only grounds the city could use to argue a business is suddenly non-compliant. "There are multiple circumstances common in the industry that could result in that grandfathering being revoked," Smith says. "Any hiccups that could happen — which anyone in the industry knows, they could be numerous — could be grounds for, 'Now's the time that you actually have to come into compliance with anyone else.'" Rebuilding after a fire, constructing a building addition, and dealing with changes in building ownership could all provide legal grounds for a grandfather clause to be revoked. Smith notes that the issues dealing with "grandfathering" were much more salient to the original, permanent zoning ordinance, and that business owners' concerns about grandfathering are "significantly less" for the one-year moratorium.

But the ordinance could hurt bar owners' bottom lines. Bars and restaurants inside hotels are given an unfair advantage: the wording of the zoning ordinance completely exempts hotel bars (or bars "within a place of accommodations that has 20 or more rooms") from the midnight cutoff. "It absolutely changes the idea of whether or not I would look at downtown versus maybe another section of the city," Nelson says of a proverbial second bar project, which would have to stop pouring at midnight as his guests walked down the street to his hotel-bar competitors. Bar owners unwilling to deal with downtown entirely might opt to open away from Charleston's main drag, which some fear could lead to more drinking-and-driving as bar-goers hop between neighborhoods.

Behind the bar at Proof. Photo: Facebook

What's Next?

Those concerns will be among those considered by the city's 20-member Late Night Activity Committee: with members appointed by the mayor and the city council, it represents a cross-section of Charleston community. Delegates from the food and beverage industry, representatives from local neighborhood associations, business owners, and one prominent downtown pastor are among its members (so is the BACE League's Smith). On February 11, the committee will hold its first "public listening session," encouraging Charleston residents to have intimate conversations with the committee. Members will then present their recommendations to the city council, coupled with what Smith hopes will be data-driven studies. "Let's not take anecdotal information and opinions where we can have actual facts," Smith says of the ideal process, which would require city officials to prove, using statistics and studies, that downtown is indeed at its "tipping point." "That's another thing we're really committed to looking at: What is the traceable effect of any increase in bar activity to actual issues of public concern?"

City officials need to start treating the "nighttime economy" as a legitimate economy.

For a small town with an international reputation as a "foodie" enclave, the measure — whether or not it's extended beyond its current 2015 moratorium — could ultimately prove stifling to new growth. "It's much bigger than bars," Smith says, arguing that city officials must finally start treating the so-called "nighttime economy" as a legitimate economy. Citing an expert from the Responsible Hospitality Institute, Smith stresses "you've got to embrace that if you're going to grow as a relevant city. It's the new economy." In other words, if that desirable future resident or tourist — young, educated, entrepreneurial — sees a city as inhospitable to nightlife, they might bring their business, their ideas, and their potential elsewhere.

Nelson poses a grim but tenable hypothetical. "What happens to the guy who's a sous chef who's just busting his ass for five, six years so that he can go get a place that's in the best part of town?" he asks. "He's worked really hard, he's saved his money — and [when] he wants to go open up his own space, that opportunity's lost."

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