ITEM 2.2ITEM 2_2
TPC3601 Thurston Avenue N, Suite 100
Anoka, MN 55303
Phone: 763.231 .5840
Facsimile: 763.427.0520
TPC@PlanningCo.com
MEMORANDUM
TO: Otsego Planning Commission
FROM: Daniel Licht, AICP
DATE: 26 October 2015
RE: Otsego — Zoning Ordinance; Brewpubs/Tap Rooms
TPC FILE: 101.01
BACKGROUND
City staff has initiated a review of Zoning Ordinance for allowance of brewpubs, tap
rooms, small breweries and similar uses within Otsego based on increased interest in
such businesses within the Twin Cities Metropolitan Area and the response of other
cities to accommodate these uses within commercial and industrial zoning districts. The
City Council Administrative Subcommittee had an initial discussion of the issue at their
meeting on 7 October 2015 and directed City staff to proceed with drafting amendments
to the Zoning Ordinance. A public hearing to consider amendment of the Zoning
Ordinance has been noticed for the Planning Commission meeting on 2 November
2015 at 7:OOPM.
Exhibits:
A. Draft amendment
ANALYSIS
Uses. Brewpubs, breweries, micro -distilleries, distilleries and wineries are all regulated
under Minnesota Statues 340A as to the volume of beverages that may be produced by
the facilities and sold on or off-site of the premises. An on -sale, off -sale or special
purpose liquor license would need to be obtained for any of these businesses to operate
within the City, which would be coordinated through the City Clerk. Minnesota Statutes
has allowed for brewpubs to have a liquor license for sale of alcoholic beverages
produced and consumed on site as the business also sold food the same as a
restaurant. Minnesota Statues 340A were amended in 2011 to allow breweries to have
on-site tap rooms and off -sale products. Distilleries are currently not allowed to have
on- or off -sale liquor, except for sampling in limited amounts, but have been included in
the proposed amendment in anticipation of possible future amendments to Minnesota
Statutes.
Licensing. The proposed amendment also includes revision of Chapter 7, Section 3 of
the City Code to include "clubrooms", "brewpubs" and "taprooms" in the listing of
available intoxicating liquor licenses. The availability of these licenses also requires
amendment of the Fee Schedule to include the cost of processing these licenses, which
would be the same as required for an intoxicating liquor license. Processing of
clubroom, brewpub and taproom licenses are all coordinated by the City Clerk with the
State of Minnesota.
Definitions. City staff proposes to define these facilities based on the existing
definitions outlined by State Statute for consistency and common understanding of the
uses being regulated both by the State and City through the Zoning Ordinance and City
Code:
BREW ON PREMISES: A facility that provides the ingredients and equipment for
a customer to use to brew malt liquor at the store. Alcoholic beverages may not
be sold or otherwise provided to customers of a brew on premises store, unless
the owner of the brew on premises store holds the appropriate liquor license.
Customers using the brew on premises store must be of the minimum age
required to purchase intoxicating liquor. Malt liquor brewed by a customer in the
store must not be sold and must be used by the customer solely for personal or
family use.
■ BREWERY: A facility that produces beer, ale or other beverages made from malt
by fermentation and containing not less than one-half of one percent alcohol by
volume.
■ BREWERY, SMALL: A brewery that produces not more than twenty thousand
(20,000) barrels of malt liquor in a calendar year as established by Minnesota
Statutes, as may be amended.
■ BREWPUB: A small brewery with a restaurant use operated on the same
premises as the brewery.
■ DISTILLERY: A facility that produces ethyl alcohol, hydrated oxide of ethyl,
sprits of wine, whiskey, rum, brandy, gin, or other distilled spirits, including all
dilutions and mixtures thereof for non -industrial use.
■ FARM WINERY: A winery operated by the owner of a Minnesota farm producing
table, sparkling or fortified wines from grapes, grape juice, other fruit bases or
honey with a majority of the ingredients produced on the premises.
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® MICRODISTILLERY: A distillery producing premium, distilled spirits in total
quantity not to exceed forty thousand (40,000) proof gallons in a calendar year as
established by Minnesota Statutes, as may be amended.
TAPROOM: An area for the on -sale consumption of malt liquor produced by the
brewer for consumption on the premises of a brewery or an abutting property in
common ownership of the brewer, which may include sales of malt liquor
produced and packaged at the brewery for off -premises consumption as allowed
by Minnesota Statutes, as may be amended.
TASTING ROOM: An area for the on -sale consumption of distilled spirits or
wine produced on the premises of or abutting a winery or distillery and in
common ownership to the producer, which may include sales of beverages
produced and packaged at the winery or distillery for off -premises consumption
as may be allowed by Minnesota Statutes, as may be amended.
Zoning Districts. City staff proposes to make allowance for uses combining the
production of alcoholic beverages with on -sale and off -sale activities as either an interim
permitted or conditional use in the following zoning districts:
Farm wineries would be allowed within the A-2 District as an interim use in anticipation
that the property may at some point be included within the sewer districts and
developed for urban land uses. R -C Districts are intended to be permanent rural areas
so farm wineries are listed as conditional uses in this district. In both the A-2 District
and R -C District, there is also the need to ensure that a farm winery use will have
adequate access in terms of public streets and other City infrastructure needed to
support a use with a commercial element in a rural area.
The B-2 and B-3 Districts allow a broad range of retail and service commercial
businesses, which provides a desirable character and destination -type location that may
be attractive to these businesses. Allowance of Brew on Premises stores and
brewpubs within these districts as permitted uses is consistent with the intent of these
zoning districts and would be compatible with other permitted uses in the same district.
Small breweries with tap rooms and micro -distilleries with tasting rooms, with production
and sales limited by Minnesota Statutes, are proposed to be allowed as conditional
uses in the B-2, B-3 Districts given their more industrial nature, but with an inherent
commercial attraction. The conditional use process will allow the City to review the
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A-2 R -C B-2
B-3
B -W
B -C
1-1
1-2
1-3
Farm winery with tasting room
I C
Brew on Premises
P
P
Brewpub
P
P
Small Breweries w/ tap room
C
C
P
P
C
C
C
Micro Distilleries w/ tasting room
C
C
P
P
C
C
C
Breweries
C
C
P
P
P
Distilleries
C
C
P
P
P
Farm wineries would be allowed within the A-2 District as an interim use in anticipation
that the property may at some point be included within the sewer districts and
developed for urban land uses. R -C Districts are intended to be permanent rural areas
so farm wineries are listed as conditional uses in this district. In both the A-2 District
and R -C District, there is also the need to ensure that a farm winery use will have
adequate access in terms of public streets and other City infrastructure needed to
support a use with a commercial element in a rural area.
The B-2 and B-3 Districts allow a broad range of retail and service commercial
businesses, which provides a desirable character and destination -type location that may
be attractive to these businesses. Allowance of Brew on Premises stores and
brewpubs within these districts as permitted uses is consistent with the intent of these
zoning districts and would be compatible with other permitted uses in the same district.
Small breweries with tap rooms and micro -distilleries with tasting rooms, with production
and sales limited by Minnesota Statutes, are proposed to be allowed as conditional
uses in the B-2, B-3 Districts given their more industrial nature, but with an inherent
commercial attraction. The conditional use process will allow the City to review the
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location of a proposed small brewery or micro -distillery to ensure compatibility with
existing and proposed surrounding land uses, adequate access, and adequate
infrastructure to serve such uses.
A small brewery with a taproom or a micro -distillery with a tasting room are proposed to
be allowed as permitted uses in the B -W and B -C District based on the transitional
nature of these Districts between commercial and industrial areas. Breweries and
distilleries with production not limited by Minnesota Statutes would be allowed as a
conditional use with the B -C District based on the other lower intensity uses allowed in
this zoning district and the need to consider compatibility and infrastructure capacity for
a proposed location.
Finally, breweries, small breweries, distilleries and micro -distilleries would be allowed as
permitted uses in the 1-1, 1-2, and 1-3 Districts based on their industrial character. Only
incorporation of an accessory tap room or tasting room as part of the brewery or
distillery, respectively, would be require processing of a conditional use permit. The
more commercial character of the taproom and tasting rooms necessitate the
conditional use permit process to ensure compatibility of the use at a proposed location,
from the perspective of introducing a retail/service business within an industrial area.
Breweries and Distilleries would be allowed within the 1-1 and 1-2 Districts as permitted
uses given that they are essentially production and distribution facilities consistent with
other industrial uses allowed as permitted uses in these districts, and related taprooms
or tasting rooms would be allowed as conditional uses.
Performance Standards. Allowance of the various alcoholic beverage production and
retail service businesses would be subject to the performance standards of the district in
which they are located to include, but not limited to, lot requirements and setbacks,
screening and landscaping, signs, exterior building materials and the like. City staff is
proposing to amend the off-street parking requirements in Section 20-21-9 of the Zoning
Ordinance to include brewpubs, taprooms and tasting rooms within the category of
restaurant uses. The off-street parking requirement for the production element of the
business would be considered under the standard applicable for manufacturing or
warehouse uses already established in Section 20-21-9 of the Zoning Ordinance.
RECOMMENDATION
City staff recommends approval of the proposed ordinance amendment t in the form
attached hereto to proactively allow for emerging businesses involving brewery and
distillery uses within the City.
M
POSSIBLE MOTIONS
A. Motion to approve an ordinance amending the City Code to allow for farm
wineries, brewpubs, microbreweries, breweries, micro -distilleries, distilleries,
taprooms and tasking rooms as allowed uses within various zoning districts.
B. Motion to table for further discussion.
C. Lori Johnson, City Administrator
Tami Loff, City Clerk
Andy MacArthur, City Attorney
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ORDINANCE NO. 2015 -XX
CITY OF OTSEGO
WRIGHT COUNTY, MINNESOTA
AN ORDINANCE AMENDING THE OTSEGO CITY CODE INCLUDING THE
ZONING ORDINANCE.
THE CITY COUNCIL OF THE CITY OF OTSEGO, MINNESOTA ORDAINS:
Section 1. Section 2-4-2.A.1 of the City Code (Fee Schedule — Liquor
License) is hereby amended to add the following provisions:
n Small -Brewer, Off -Sale: $150.00
o Brewpub License: $150.00
P. Taproom License: $150.00
Section 2. Section 7-3-2 of the City Code (Intoxicating Liquor) is
hereby amended to add the following provisions:
E. Small Brewer, Off -Sale. Off -sale licenses for small breweries shall be
issued only in accordance with Minnesota Statutes 340A.28
F. Brewpub License. Brewpub licenses shall be issued only in accordance
with Minnesota statutes 340A.301.
G Taproom License. Taproom licenses shall be issued only in accordance
with Minnesota statutes 340A.301.
€Fi. Use of City Owned Facilities. The City may authorize the holder of a
regular on -sale intoxicating liquor license issued by the City or by an
adjacent City to dispense intoxicating liquor at any convention, banquet,
conference, meeting or social affair conducted on the premises of a
sports, convention or cultural facility owned by the City or its
instrumentalities having independent policy making and appropriating
authority. For purposes of this Section, the said premises specifically
includes, but is not limited to, the City Hall and its associated community
center. The licensee must be engaged to dispense intoxicating liquor at
an event held by a person or organization permitted to use the premises
and may dispense intoxicating liquor only to persons attending the event.
In no case shall any licensee dispense intoxicating liquor to any person
attending or participating in an amateur athletic event held on the
premises.
Section 3. Section 20-2-2 of the Zoning Ordinance (Definitions) is
hereby amended to add following definitions:
Brew on Premises: A facility that provides the ingredients and equipment for a
customer to use to brew malt liquor at the store. Alcoholic beverages may not be
sold or otherwise provided to customers of a brew on premises store, unless the
owner of the brew on premises store holds the appropriate liquor license.
Customers using the brew on premises store must be of the minimum age
required to purchase intoxicating liquor. Malt liquor brewed by a customer in the
store must not be sold and must be used by the customer solely for personal or
family use.
Brewery: A facility that produces beer, ale or other beverages made from malt
by fermentation and containing not less than one-half of one percent alcohol by
volume.
Brewery, Small: A brewery that produces not more than twenty thousand
(20,000) barrels of malt liquor in a calendar year as regulated by Minnesota
Statues, as may be amended.
Brewpub: A small brewery with a restaurant use operated on the same
premises as the brewery.
Distillery: A facility that produces ethyl alcohol, hydrated oxide of ethyl, sprits of
wine, whiskey, rum, brandy, gin, or other distilled spirits, including all dilutions
and mixtures thereof for non -industrial use.
Farm Winery: A winery operated by the owner of a Minnesota farm producing
table, sparkling or fortified wines from grapes, grape juice, other fruit bases or
honey with a majority of the ingredients produced on the premises.
Micro -distillery: A distillery producing premium, distilled spirits in total quantity
not to exceed forty thousand (40,000) proof gallons in a calendar year as
regulated by Minnesota Statues, as may be amended.
Taproom: An area for the on -sale consumption of malt liquor produced by the
brewer for consumption on the premises of a brewery or an abutting property in
common ownership of the brewer, which may include sales of malt liquor
produced and packaged at the brewery for off -premises consumption as allowed
PA
by Minnesota Statutes, as may be amended.
Tasting Room: An area for the on -sale consumption of distilled spirits or wine
produced on the premises of or abutting a winery or distillery and in common
ownership to the producer, which may include sales of beverages produced and
packaged at the winery or distillery for off -premises consumption as may be
allowed by Minnesota Statutes as may be amended.
Section 4. Section 20-21-9.V of the Zoning Ordinance (Off -Street
Parking Requirements — Minimum Spaces Required) is hereby amended to
modify the following existing requirement:
V. Restaurants, Cafes, Private Clubs Serving Food and/or Drinks, Bars, On -
Sale Nightclubs, Brewpubs, Taprooms, Tasting Rooms: At least one (1)
space for each forty (40) square feet of gross floor area of dining and bar
area and one (1) space for each eighty (80) square feet of kitchen area.
Section 5. Section 20-52-3 of the Zoning Ordinance (A-2 District -
Interim Uses) is hereby amended to add the following provisions:
D. Farm wineries with tasting rooms.
Section 6. Section 20-60-5 of the Zoning Ordinance (R -C District -
Conditional Uses) is hereby amended to add the following provisions:
I. Farm wineries with tasting rooms.
Section 7. Section 20-76-2 of the Zoning Ordinance (B-2 District -
Permitted Uses) is hereby amended to add the following provisions:
R. Brew on premises.
S. Brewpub.
Section 8. Section 20-76-6 of the Zoning Ordinance (B-2 District -
Conditional Uses) is hereby amended to add the following provisions:
J. Micro -distilleries with tasting rooms.
K. Small breweries with tap rooms.
Section 9. Section 11-77-3 of the Zoning Ordinance (B-3 District
Permitted Uses) is hereby amended to add the following provisions:
W. Brew on premises.
WW. Brewpub.
Section 10. Section 11-77-6 of the City Code (B-3 District - Conditional
Uses) is hereby amended to add the following provisions:
I Micro -distilleries with tasting rooms.
J Small breweries with tap rooms.
Section 11. Section 11-78-3 of the Zoning Ordinance (B -W District
Permitted Uses) is hereby amended to add the following provisions:
O Micro -distilleries with or without tasting rooms.
P Small Breweries with or without Tap Rooms.
Section 12. Section 11-78-6 of the Zoning Ordinance (B -W District
Conditional Uses) is hereby amended to add the following provisions:
F Breweries and small breweries with or without taprooms.
G Distilleries and micro -distilleries with or without tasting rooms.
Section 13. Section 11-79-2 of the Zoning Ordinance (B -C District
Permitted Uses) is hereby amended to add the following provisions:
J Micro -distilleries with or without tasting rooms.
K Small Breweries with or without Tap Rooms.
Section 14. Section 11-7-6 of the Zoning Ordinance (B -C District
Conditional Uses) is hereby amended to add the following provisions:
F Breweries and small breweries with or without taprooms.
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G Distilleries and micro -distilleries with or without tasting rooms.
Section 15. Section 20-85-2 of the Zoning Ordinance (1-1 District -
Permitted Uses) is hereby amended to add the following provisions:
H. Breweries and small breweries.
I. Distilleries and micro -distilleries.
Section 16. Section 20-85-6 of the Zoning Ordinance (1-1 District -
Conditional Uses) is hereby amended to add the following provisions:
G. Taprooms accessory to a brewery or small brewery.
H. Tasting rooms accessory to a distillery or micro -
Section 17. Section 20-86-3 of the Zoning Ordinance (1-2 District -
Permitted Uses) is hereby amended to add the following provisions:
J. Breweries and small breweries.
K. Distilleries and micro -distilleries.
Section 18. Section 11-86-7 of the Zoning Ordinance (1-2 District -
Conditional Uses) is hereby amended to add the following provisions:
K. Taprooms accessory to a_brewery or small brewery.
L. Tasting rooms accessory to a distillery or micro -
Section 19. Section 20-86-2 of the Zoning Ordinance (1-2 District -
Permitted Uses) is hereby amended to add the following provisions:
H. Breweries and small breweries.
I. Distilleries and micro -distilleries.
Section 20. Section 11-86-6 of the Zoning Ordinance (1-2 District -
Conditional Uses) is hereby amended to add the following provisions:
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G. Taprooms accessory to a brewery or small brewery.
H. Tasting rooms accessory to a distillery or micro -distillery.
Section 21. This ordinance shall be effective immediately upon its
passage and publication.
MOTION BY:
SECOND BY:
ALL IN FAVOR:
THOSE OPPOSED:
ADOPTED by the City Council of the City of Otsego this day of
, 2015.
CITY OF OTSEGO
BY:
Jessica L. Stockamp, Mayor
ATTEST:
Tami Loff, City Clerk