For the first time in Fargo's history, the City Commission will have a drawing Monday to award a liquor license, city Auditor Steve Sprague said.
The city's Liquor Control Board on Wednesday forwarded to the Commission two applications for a Class Z license, which doesn't require food sales or limit the types of alcohol that can be sold.
The city created four Class Z licenses in February 2005, and only one isn't being used. Another license will be added when the city's population reaches 100,000.
City ordinance requires the Commission to have a drawing if there are more qualified applicants than licenses available.
The board voted 3-2 to forward both applications.
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Police Chief Keith Ternes and City Commissioner Tim Mahoney cast the "no" votes, saying they believed the application by Daniel J. Kraft, Blair Thoreson and Arman Vardazarian was invalid because Kraft was withdrawing from the partnership.
Ternes had recommended the application be denied because of Kraft's arrest history. Thoreson and Ron Iverson, who would manage the proposed Dublin House bar in the Osgood Farms area, said they didn't become aware of Kraft's history until Friday.
Ternes said he felt bad for the other partners, "but I think to be fair to everybody involved, we've got to take the applications on their face."
Dan Labernik, the other applicant for the Class Z license, also said he didn't agree with the process, adding he was contacted two weeks ago about his background check. Labernik, owner of Labby's Grill & Bar on 19th Avenue North, said he would use the Class Z license for Labby's and transfer his Class FA license to a new business.
Sprague, Mayor Dennis Walaker and Assistant City Attorney Garylle Stewart voted to forward both applications, provided the city receives a letter from Kraft by noon today confirming his withdrawal from the partnership.
"It seems like we're in a bit of a pickle or a quandary here, where one way or the other we're going to have an applicant who's not happy with the city," Sprague said.
The Class Z license has an initial issuance fee of $105,000 and an annual fee of $1,700.
The license to be awarded Monday was previously held by Shanna Lee, who had planned a sports bar on 45th Street South. The City Commission gave Lee until Dec. 31, 2006, to start construction on the bar or lose the license.
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Readers can reach Forum reporter Mike Nowatzki at (701) 241-5528
