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Sunday, May 29, 2016

Council cancels City beer and wine license

Tuesday, March 10, 2009

Public Hearing for $8.9 million Budget is March 10

The continuing saga of the City of Cherokee's Community Center beer and wine license came to an abrupt halt at the Feb. 24 City Council meeting, with the Council voting 5-0 to cancel the license.

A misinterpretation of the Iowa Alcohol Beverages Division regulations by City Administrator Don Eikmeier had postponed action on the matter for several weeks, as Eikmeier looked into the situation.

The main confusion, according to Eikmeier, stemmed from the fact that he had originally interpreted the term "liquor" to include all alcoholic beverages, including beer and wine. However, under Iowa law, "liquor" only means spirits (the hard stuff), and beer and wine are not included in that definition.

The City originally acquired a beer and wine permit for the Community Center a few years ago to better compete with other similar area facilities who had liquor licenses for rental events such as family reunions, wedding receptions, class reunions, etc.

The City also has transferred its license in the past to various community events and organizations, before local bar owners questioned the practice as unfair competition.

Eiekmeier's investigation into the matter revealed that beer and wine can be brought into, and consumed in the Community Center (and Yacht Club) by hosts (renters) and guests, without the City needing to maintain a beer and wine license.

However, beer and wine cannot be sold at either the Community Center or Yacht Club unless the host hires a caterer with a beer and wine license. Presently, liquor (spirits) cannot be brought into,or consumed, or sold, at either the Community Center or Yacht Club.

Even though the City has now canceled its beer and wine license, persons or organizations renting the Community Center or Yacht Club can bring beer and wine on the premises, or they may hire a caterer with a beer and wine license to sell beer and wine to guests of legal age.

By canceling the license, the City eliminates the annual cost of the license ($468), and the DRAM Shop insurance coverage ($750 per year).

According to the City's insurance carrier, should an incident happen at the Community Center or Yacht Club as a result of beer and wine consumption, the rental agreement will specifically "hold harmless" the City from any liability. Furthermore, should the City be named in a lawsuit anyway, the City's "General Liability Policy" will provide coverage up to $2 million per occurrence.

The Council also determined that the application process for future renters of the Community Center or Yacht Club will reveal if there is going to be beer and wine involved in an event, which would increase the rental fee.

The Council also set the Public Hearing for the 2009-2010 Budget for 7 p.m. March 10. The proposed Budget totals $8.9 million, compared to last fiscal year's $8.4 million. Debt service add-ons were targeted as the reason for the $500,000 additional in the newly proposed Budget.

The Council also deferred action Tuesday of awarding the bid for the Ultra-Violet WWTP Project at the City's sewer plant.

The Cherokee Municipal Wastewater Ultraviolet Project is a Department of Natural Resources (DNR) mandate that consists of installing ultraviolet lighting systems that sterilizes bacteria and renders it harmless.

That project targeting the municipal wastewater treatment plant carries an engineer's estimate of $198,370, which would be paid for by the City. Wastewater Treatment Plant Superintendent Steve Casey told the Council that money has been set aside in a fund to pay for that portion of the Ultraviolet Project.

The second phase of the project includes the Industrial Wastewater Treatment Plant that falls under the auspices of Tyson Foods. That $178,248 project as estimated by engineers, will be funded by Tyson Foods.

However, bids came in well over the engineer's estimates and representatives of Fox Engineering of Ames attended Tuesday's Council meeting to explain the cost over-runs.

Grundman Hicks Construction of Cherokee was low bidder for the work with a bid of $443,000 for both projects ($233,920 municipal, $209,080 industrial), exceeding by approximately $65,000 the engineer's total estimate of $376,618.

Fox told the Council that the project review during the bidding process by the IDNR required an automatic by-pass system when the disinfection unit is not operating, and that the cost ($12,000) was not included in the original estimate.

Fox also reported that their structural engineer found an error in the unit price for backfill and concrete that totaled $10,000 for the municipal plant, and $5,000 for the industrial plant ($15,000 total).

Extras not required regarding the electrical and control pricing would cut from $6,000 to $9,000 off the bid.

Finally, a method for removal of the disinfection module, including a rail and hoist system, was included in the original estimate at a cost of $18,200. Normal operation requires removal and replacement of the module at least once a year. If that system is cut from the bid, the City would need to hire a crane or backhoe to come to the site twice a year to provide this function. The Council decided to choose that option and save the $18,200, the sum of these five change orders totaling the estimated $65,000 in cost over-runs.

Fox will now negotiate the changes with Grundman-Hicks and the awarding of the bid was tabled until the March 10 Council meeting.

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