Agenda Packets - 2010/03/08 - Laserfiche WebLink

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Mounds View City Council January 25, 2010 Regular Meeting Page 6 paid or will not reapply for a liquor license. Mr. Moritko provided an explanation of his small, 1 5%, operating margin, the impact of a second minimum wage increase, and loss as due to 2 increased sales fees. He stated he has spoken with Clerk-Administrator Ericson on a regular 3 basis. He stated they still need to work on signage and parking so people know they are not too 4 busy and can accommodate more customers. He stated they have eliminated some staff and 5 managers, are doing more with less, and heading in the right direction. 6 7 With regard to Council Member Stigney’s suggestion, Mr. Moritko stated he has been working 8 with US Bank to modify his loan but it is a 12-week process and will take more time. He stated 9 if it were approved, it would free up funds to pay property taxes. He explained the other thing 10 that would help is a “tip credit” in Minnesota, noting 39 other states have such a credit. 11 12 Council Member Mueller reviewed the number of Moe’s employees and impact in 2009 from a 13 second minimum wage increase. Mr. Moritko stated Moe’s rises above the threshold and had to 14 adopt the Federal minimum wage that was raised to $7.25, an additional 50 cents per hour, and 15 that resulted in an impact of $45,000 in additional wages. In addition, there was a $178,000 16 decrease in sales from 2008 to 2009, equaling lost revenues of $200,000. 17 18 Council Member Mueller noted Moe’s is current with State sales tax and applauded his decision 19 to make that payment. She stated support for the Council to work with Moe’s to get through this 20 difficult period and not “tie their hands” by restricting the liquor license. 21 22 Council Member Stigney stated he supports Mr. Moritko trying to buy time to recover from the 23 economic crunch. He asked about payment for the first half of 2010 taxes that are due in May. 24 Mr. Moritko stated he wanted to discuss first the delinquency since it was connected to his liquor 25 license application. Mr. Moritko stated the loan they were approved for could be used to cover 26 the first half of 2010 taxes. 27 28 Council Member Stigney asked about the City’s ability to suspend or revoke a liquor license for 29 nonpayment of State or local property taxes. He noted if that option is removed, a liquor 30 business could continue to operate without paying taxes and asked if staff had contacted the 31 League of Minnesota Cities for an opinion. Assistant Clerk-Administrator Crane stated she 32 received information from five local cities and all require the business to be up-to-date with 33 payments for city bills such as water, but none addresses payment of property taxes. She stated 34 she is still gathering information. 35 36 Council Member Stigney stated he hopes Mr. Moritko is successful. Mr. Moritko thanked the 37 Council and noted if a grocery store is behind in taxes the City would probably not stop their 38 ability to buying groceries. 39 40 Council Member Mueller stated Mr. Moritko has done well to keep City staff updated and urged 41 him to continue that practice. She expressed concern for missed payments and hopes his finance 42 plan works out. 43 44 Mayor Flaherty stated this he is exasperated about the entire issue, noting Mr. Moritko has 45