Appellate panel: City justified in denying Walmart River North liquor license over crime fears

By Scott Holland | Jul 21, 2015

Walmart’s hopes to get a Chicago liquor license for its River North Walmart Express store suffered a major setback last week as a state appellate panel said the city was justified in denying the license over concerns allowing the retailer to sell alcohol could contribute to increased crime in the area.

At issue is a package goods liquor license for the Walmart store at 225 W. Chicago Ave. The city’s Local Liquor Control Commission initially denied the license. The License Appeal Commission upheld the denial, but a circuit court reversed that decision. On July 17, the Illinois First District Appellate Court vacated the judge’s reversal, meaning the License Appeal Commission’s denial stands.

Gregory Steadman, a liquor commission member, wrote a Nov. 14, 2011, letter denying Walmart’s application based on a city code provision the liquor commissioner can reject “an application … if the issuance of such license would tend to create a law enforcement problem.”

During Walmart’s appeal to the License Appeal Commission, Ald. Brendan Reilly, whose 42nd Ward includes the Walmart store, testified about the store’s proximity to two methadone clinics and a YMCA single-room-occupancy residential facility. Further, Ken Angarone, a 31-year veteran Chicago police officer who has commanded within that police district for two years, testified “the Chicago Police Department regularly deals with incidents involving robbery, public urination, panhandling and loitering in the area near the Walmart.”

Angarone further said the three-block stretch where the store sits “drains an inordinate amount of police resources when compared to the entire 18th Police District and that it is ‘entirely possible’ that the situation would only get worse if a liquor license were issued for the Walmart.”

From Jan. 1 to Sept. 2, 2011, documents indicate there were 374 police service calls in the immediate area that resulted in 270 documented incidents and 16 arrests — none of which involved a crime related to alcohol. Angarone raised no issue with Walmart’s business practices.

On Oct. 19, 2012, the License Appeal Commission formally upheld the license denial, finding the city had established the potential of a law enforcement problem. Walmart requested a rehearing and cited a 2009 case, Vino Fino Liquors v. License Appeal Commission, which the retailer said established the law enforcement problem clause could only be used if the applicant had a history of violating liquor laws or laws in general.

The Appeal Commission rejected that argument and on Feb. 11, 2013, affirmed its 2012 decision. Yet on May 22, 2014, the circuit court overturned that ruling, and found the city had not satisfied the law enforcement problems clause. The city appealed instantly.

The appellate court’s July 17 unpublished order cited its own ruling from earlier this year in a similar dispute over a liquor license between the city and convenience store Move N Pick: “Simply put, denial of a liquor license on the basis that its issuance would tend to create a law enforcement problem is not restricted to circumstances in which the applicant has a prior history of disobeying liquor laws or the law in general.”

It also noted the circuit court ruled on the Walmart appeal months before the Move N Pick appellate decision. Further, it stipulated the actual review was of the administrative agency, not the circuit. Finding sufficient evidence to support the commission’s initial denial, primarily based on Aragone’s testimony to the Appeal Commission, the appellate court effectively upheld that decision.

Specifically, the city code “does not require a finding that the issuance of the license would contribute to an increase of crime before it could be denied. Nor does it require a finding that the issuance will lead to law enforcement problems. The ordinance only requires a finding that the issuance of the license would ‘tend’ to create a law enforcement problem.”

Justice Thomas E. Hoffman wrote the majority opinion. Justices Shelvin L.M. Hall and Bertina E. Lampkin concurred.

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