Have you ever seen Bourbon Street in New Orleans at night? There are people out on the streets, drinking and having fun. The same is true for Frenchman Street in their Jazz District. People are buying drinks from one bar, restaurant, or hotel, and taking them out in the street or in designated drinking zones. This is an example of a social alcohol consumption district; now Michigan cities have them too. Social Consumption Districts passed into State law as a result of the COVID-19 pandemic and have bolstered the Restaurant and Hospitality Industries across the state since.
The open consumption of alcohol is a criminal misdemeanor pursuant to State of Michigan law. Most municipalities have the same prohibition. But not when consumers are within a social consumption district.
State Law & Social District Zones
The Michigan legislature passed House Bill No. 5781 during the pandemic which was effective in July 2020. A social district can be created when a municipality designates an area, usually a downtown area, where liquor licensees are contiguous to the common areas of the social district. Each licensee can be granted a social district permit which would allow for the sale of alcohol to customers who may then consume the alcohol in the common areas of the social district. Often times the district would include a park or similar pedestrian gathering place where, for example, they could enjoy live music or other entertainment.
The common areas of the district do not have to be restricted to those over the age of 21.
Alcohol sold to customers for consumption in the common area must use a non-glass container that prominently displays the licensees’ trade name or logo, a logo that is unique to the common area and that is no larger than 16 ounces.
At least two liquor licensees must be in the district. And before applying to the MLCC, a municipal permit must first be obtained.
This is the Michigan LCC Social District Application and the application fee is $250.00
Cities with Social District Zones
Downtown Northville has closed off a downtown street to vehicular traffic and has many bars, restaurants and even a local ice cream store whom are participating in their social district. It includes a park with a stage and tables specifically for congregation. It definitely appears that this will be a fun place to be during the upcoming summer months.
These cities have them as well which include the cities of Royal Oak, Clawson, Ferndale, and many more across Oakland, Wayne, and Macomb Counties!
Community Survey from Wayne County
Wayne County Economic Development published a community survey in August of 2022, which can be reviewed here. In total 26 communities were surveyed with a response rate of 77%. The report indicates that Spring and Summer of 2021 was the most popular time for municipalities to open social districts, and that most cities are considering expanding the boundaries to include more businesses. A social district requires a minimum of two eligible and licensed businesses to get started.
More than half of the communities surveyed have more businesses interested in becoming involved with the social district. The number one benefit is business retention and attraction, with increased consumer traffic, and quality of life following closely behind. A quote from the report states, “Improved pedestrian traffic and general positive feedback from businesses and residents.” Overall 100% of those surveyed suggested the would recommend another municipality establishing a social consumption district.
Unlike the “Cocktails To-Go” legislation that has an expiration date of 2025, Social Districts are here to stay. The benefits to licensed businesses within social districts has been immense. As the summer months are just around the corner, outdoor seating, and pedestrian travel will increase and owning a business within a social district will increase the establishment’s potential profitability. Social Districts work well when the municipality, the licensees and the customers work together to follow the law and to maintain an atmosphere which is fun but safe.
How to get Your City to Adopt a Social District Ordinance – Municipal Lobbying
Are you a restaurant or bar owner in a downtown area who would like to have a social consumption district? How do you convince a city, like Birmingham, to adopt the necessary ordinance? First, check with the city council or township board to see if they have discussed the idea. Their meeting minutes can be found on their website and can usually be searched by key words. Then, reach out to the council or board members individually. Perhaps speak to planning commission members or the zoning board members. They have probably thought about it and the ones that are in support of it will likely give you good advice about how to make it happen.
A business owner has influence in the city in which they operate, but only if you ask. Ask the city clerk to place the issue as an agenda item on the council meeting’s agenda. Speak to the township attorney for their opinion. Communicating and being involved in local government is how to get things done and every business owner should do it. You would be surprised how much can be accomplished. Municipal lobbying is a service that our firm can do for clients as well.
As municipalities issue new licensees it is beneficial to consider whether or not there is a social district within the area and how that could benefit a hospitality establishment. To find out more about municipalities influence on liquor licenses read our article here.
Conclusion
The State of Michigan has passed legislation that opens the door for alcoholic beverage consumption in municipalities with social districts. Social Districts have become increasingly popular and many cities are adopting and acquiring social district areas. As a response to the pandemic new legislation has provided the restaurant and hospitality industries revival by offering establishments the ability to serve patrons with “Cocktails To-Go” and increased revenue potential for businesses within social districts. The response from Michiganders and municipalities has been extraordinary, with social districts here to stay, consult The Law Offices of Barton Morris to discuss how we can provide legal services for you and your business.
The Law Offices of Barton Morris would enjoy the opportunity to get to know you, your business, and the goals you have for your establishment. We have experience working with multiple municipalities in the area and our dedicated and professional attorneys have helped businesses obtain liquor licenses, mitigated MLCC violations, and established employee training programs. Schedule a Free Consultation with our Principal Attorney Barton Morris for your licensed hospitality business. Whether you’re interested in municipal lobbying services or are seeking guidance regarding licenses for your business, our team can help.
