Selectmen Question Proposed Liquor License Transfer to Star Market

Photo: The Loading Dock’s Fuad Mukarker (left center, arms folded) before the Belmont Board of Selectmen Monday. 

At a meeting that grew more impassioned as the night wore on, the owner of a Belmont business came before the Belmont Board of Selectmen on Monday evening, Sept. 19, seeking its approval of a deal that could change the face of alcohol licensing in Belmont for years to come.

Before the three-member board was the unlikely pairing of Fuad Mukarker, the owner of the popular dining location The Loading Dock on Brighton Street and the regional supermarket heavyweight, Star Market, which Mukarker is hoping to transfer his business’ full-liquor license for $400,000 in “compensation.” 

Bringing hundreds of signatures and approximately 40 supporters to make passionate pleas allow their “friend and neighbor” to bank nearly half a million dollars for the license the town provided him almost 18 months ago, the selectmen were noticeably wary of possibly creating a precedent of rubber stamping a deal that disregards what the three said is the all-important application process.

“This is not about [Mukarker],” said Mark Paolillo, Selectmen chair who said the board would attempt to help him continue operating the Mediterannian-theme cafe that has received excellent reviews in local media. ‘This is about the applicant [Star Market].” 

The town established retail “to provide a license to local business such as the Loading Dock” and not to provide “Star Market with 2,000 sq.-ft. of alcohol sales.” 

“So I’m uncomfortable with the transfer,” said Paolillo. “I’m leaning to deny this.” 

That did not sit well with some members of the public.

“Can we help out an average small time guy. Can we do the right thing here?” said Stephen Kerins, of Sandrick Road and Precinct 8 Town Meeting member. 

After another resident had suggested the board was unfairly targeting the store/cafe, Paolillo lashed out uncharacteristically to the citizen. (He would later apologize via a Facebook posting to the resident.)

While the transfer of a license is a standard business practice across the Commonwealth – last month the Selectmen approved one to the new owner of Vintages in Belmont Center – the issue is the location and who benefits from the transaction.

Full alcohol licenses are coveted by merchants as only two are set aside for retail/store operations in Belmont. The number was purposely limited in an attempt to discourage large retail liquor stores coming to Belmont. 

The selectmen said the intention of past town meetings which approved the lifting of the 140-year ban on alcohol in the late 1990s was to use the licenses approved by the state legislature to “create economic diversity in vulnerable communities and not to establish package stores in Belmont,” said Paolillo. 

The last time a new license was presented in 2014, Mukarker beat out applications from Waltham-based D&L Liquors and the Craft Beer Cellar of Belmont Center to sell beer, wine and spirits at his store, The Loading Dock, which the Belmont resident transformed from a White Hen Pantry franchise and later an independent convenience store.

Star Market’s attorney Joseph Hanley, a partner at Boston-based McDermott, Quilty & Miller, noted that it is “common custom” for the owner of the license to be “compensated” for the purchase and sale of his license. 

“This happens in towns and cities in the Commonwealth routinely,” said Hanley.
 
Hanley said his review of Belmont’s 2014 Home Rule petition that provided for full alcohol licensing indicated no prohibition on transfers which the could have included two years ago but did not.
 
“We are here to provide economic and community development in the town of Belmont,” said Hanley, noting several times that Star Market has been a fixture in town for a quarter century and is about to undergo a $2.4 million renovation in which the transfer is an essential component.
 
Handley said with this investment into the store, “customers will come to expect a certain amount of amenities, and the alcohol license is critical to that [economic development] and folks who live in this town,” said Hanley.
 
Handley said the Belmont store has an experience manager in Steve Duran who ran the Cambridge store which has a thriving retail liquor operation. Additionally, the four current Star locations in Massachusetts – in Cambridge, Franklin and two in Boston – has been cited by the state’s alcohol control board just once in a decade for a violation of sales to minors.
 
With this transfer, the area of alcohol sales will triple from 700 to 20,000 sq.-ft. (although Handley believes the actual square footage to be utilized is far less) and move from a fledgling business area along Brighton Road to Waverley Square, a highly-traveled location in Belmont.
 
Asked why Star did not apply for a license in 2014, Duran said the company was limited to four licenses in Massachusetts due to state statute protecting small liquor retailers from large entities that have greater pricing advantages. That ceiling has been raised recently, allowing the corporation to pursue these licenses.

A $400,000 lifeline

While the transfer would be a great addition to a newly remodeled store, the transaction would be a lifeline for Mukarker, who indicated Monday that he needs the $400,000 to “keep the Loading Dock afloat” as the turns around his operation into a full-time restaurant.
 
Mukarker told the board “I loved this license from day one” and always wanted to keep it. But due to money spent on the building and other expenses, the former banker who became the owner of White Hen Pantry that once stood on the site needed some way to increase sales at the cafe. 
 
Determining that serving beer and wine with meals would meet his cash flow issue, Mukarker applied to the town for a beer and wine “pour” license that he could use at his expanding restaurant. 
 
But according to Mukarker, just days before his “pour” application was to be presented before the Selectmen earlier this year, his attorney was told by Belmont’s Town Counsel George Hall about “an absurd law” from 1964 preventing retail owners to have both a retail and pour license in the same establishment. (Selectman Jim Williams would later say that calling a state law “absurd” “is a silly one. It’s on the books, and we don’t do things that violate the law.”)
 
Hall, who attended Monday’s meeting, told the Selectmen a state’s high court ruling of a Cambridge case confirmed the law’s intent preventing such a dual arrangement.

When he heard  the decision, Mukarker said the full liquor license “was like hot lava in my hand; I wanted to get rid of it.”

Mukarker proceeded to reach out to both Foodies – the supermarket slated for a 2017 opening in Belmont Center – and D&L, which the selectmen rejected two years ago, but could not come up with a deal. With limited options before him, Mukarker received a call from Star Market. 

Later in the meeting, Mukarker said the transfer “is a crucial thing” and any delay in the conveyance “has a lot of bad implications for the business.”

While for Mukarker, Star and the residents in the audience, the license transfer is a win-win-win for the Loading Dock, the local supermarket, and fans of great meals, the implications of signing off on the deal looks dicier from the other side of the conference table, according to the Selectmen.

One issue that troubled the selectmen was when Hanley told Selectman Sami Baghdady that a list of restrictions placed on the license in 2014 preventing the sale of tobacco products and lottery tickets at the location “do not transfer automatically … with the license.” Hanley attempted to placate the board by saying lottery sales and tobacco products would be sold far from the alcohol area.

Paolillo told Hanley the restrictions have “always been a condition that we have taken in consideration on rewarding all license.” 

“Very consistent.”

“I understand your point of not transferring, but if you have watched our public hearings, we have been very consistent with this board in rewarding licenses,” said Paolillo. 

Hanley countered by saying that Star would follow each of the standard conditions the selectmen placed on the all-liquor license presented to Foodies including a detailed alcohol sales plan and a ban on the sale of kegs, single bottles and flashing neon lights.

But when it came to lottery and tobacco, “we would ask for, after 25 years, a little bit of flexibility with respect to the current restrictions,” said Hanley. Later, Dolan said the store would drop cigarettes from the store with the transfer. 

Mukarker said he understands Star’s reluctance to accept the limitations, saying he lost “over 50 percent” of his customers by giving up his lottery and tobacco businesses, a comment Paolillo found wanting of sympathy. 

“You’re saying that we put a burden on you when we granted you this license? That was a huge benefit to you,” said Paolillo.

“If I knew what was going to happen [accepting the license], I would have not even applied for [the all-liquor license],” said Mukarker.

To those who spoke – overwhelmingly for the transfer and in support of Mukarker – any delay in allowing the transaction to take place was threatening the livelihood of a local family and denying the public an opportunity to purchase alcohol in a convenient location.

“This is a no-brainer,” said Erin Lubien of Unity Avenue. “There are things we do in Belmont that are just difficult for business owners. They are families who live here … who employ our people here. You have to do this,” she said to loud applause. 

But it appeared a majority of selectmen were unwilling to OK the transfer without further discussion and input from more residents and businesses.

“We need to continue the hearing and talk to Star Market some more,” said Williams. 

Mukarker’s attorney Thomas Orlandi informed the board of his client’s displeasure for not voting immediately to approve the transfer, noting “you are elected officials” not to ignore the people in the gallery and the numerous signatures in support.

“We also represent the entire community,” said Paolillo. 

After Williams had explained the delay, Orlandi said that considerable amount of money had been spent by Star Market on architectural designs while Mukarker needs the transfer funds to continue his business. 

“How can you rely on the transfer [funds] when it hasn’t been approved?” wondered Williams. “I think as a matter of business practice, you should not rely on an approval unless you have it.”  

As Orlandi and Williams bickered, the public began chiming in and the meeting came close to resembling a cable news debate. Paolillo then stepped forward to tell everyone to “calm down.”

With everything that needed to be said, the Selectmen scheduled an additional meeting on Oct. 3 to finalize a decision on the possible transfer. 

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Comments

  1. Jon says

    I think it’s worth pointing out that BOTH the owner of the Loading Dock and the BOS both have very good points. However, both are also wrong on two important counts:

    1) If the owner of the loading dock was really prepared to buy a second “pour” license and KEEP the original sales license, it’s really hard to believe he absolutely needs the $400k to keep afloat. He should be willing to accept the town buying back the license.

    2) If the town government wanted the licenses to go to a small business, and not be resold to a huge conglomerate, they should’ve thought of that beforehand. There are ways to ensure that the license could not be sold to an establishment above a certain size, Now, of course, we have the typical situation of the Belmont town government rushing to react to a problem entirely caused by their inability to think proactively and anticipate problems ahead of time.

    The bottom line, however, is that if the town has the legal right to stop this, what is best for the TOWN is that they probably should block the sale, and just IMMEDIATELY offer to buy back the Loading Dock’s sales license and issue a pour license. While I empathize with the Loading Dock’s owner (who is a great guy) it’s just not fair that the town’s due process in issuing licenses be completely usurped just because our town government made the mistake of not putting the proper limitations on licenses. Not to mention the potential for the town to get $400k for schools and infrastructure.

    At the end of the day, is it really right that the town’s ability to choose who gets a license, and it’s ability to collect money for those licenses, be thrown away just to give one person a lot of money? To do otherwise would put one person ahead of the entire town.

    The right thing to do is to make sure the Loading Dock gets the license it needs immediately, with reasonable compensation, so that they can succeed. We can then decide as a town if we want a huge liquor store.

    I know it feels nice to talk about helping out a local business, but we also need to think about the needs of all the people living here, not just one business. There are opportunity costs to consider; this isn’t just about the guy who owns the Loading Dock, even if we all like him immensely and appreciate his business.

  2. Mark says

    In response to Mr Heller. No one is making him give up the license. he is giving it up on his own. If he is not making it financially on the retail side then transfer the license to the eating establishment. I am sure Star Market is making plenty of money in this town or they would not be here. Star Market is willing to give up the Lottery and tobacco because they know they will make a killing on beer and wine. This is in no way their effort to create a more pleasurable shopping experience. Since when does anyone in this town give a bleep about local business anyway? Tell that to the man who bought the property on Pleasant St and tried to turn a run down garage into a Dunkins or the man that bought the former One Stop Market and wanted to make a nice botique hotel

  3. Phillip Heller says

    Perhaps my understanding is incorrect, but it’s worth adding some detail.

    Mr. Mukarker intended to apply for both a retail sales license for the convenience side of the store, and later, a pour license for the restaurant. He and his counsel had the understanding that the licenses must be held by two different legal entities, and he subsequently went to the effort to establish that second entity.

    The law that Mr Mukarker called “absurd” essentially says that the same ultimate controlling authority cannot hold the two licenses. I winced at his word selection too, thinking he probably meant “obscure”. But, given his situation, I can sympathize with his characterization.

    Prior to this legal conundrum, Mr. Mukarker had taken a sizable loan for his business, secured by the retail license he was awarded. As I understand from his explanation in the town meeting, if he is to dispose of that license, his loan will come due. He further explained that the repayment of the loan, fees, and taxes will amount to more than the consideration he would receive from Star Market for transfer of the license.

    I get that the spirit of the licensing decision is to promote economic growth and diversity. But should this transfer not be approved, what are the consequences? The future of the Loading Dock and its employees is unclear, Star Market may choose to invest their $2.4 million elsewhere, and Mr. Mukarker may be left with a financial situation that haunts him for decades.

  4. T.j. Rolland says

    Many reasons against this transfer. Please.dont be shy! Speak up ( even a short message is useful)) to the Selectmen at :selectmen@belmont-ma.gov.

  5. A. Belmont Resident says

    This sounds a lot like the private selling of a liquor license, and that smacks of corruption. The license should be returned to the town, and Star should apply on its own merits. That would be the most fair solution.

  6. RJB says

    I do not understand how a license that the town received $4000 for can be transferred to someone else for 100x’s the amount of money. If Mr.Murkaker wants to return his license to the town as he no longer wants to use it that’s fine – the town can give him his $4000 back. If it has a value of $400,000 I suggest it be the Town of Belmont that receives that money and open up a process to license another entity for $400,ooo. The town could certainly use it.

  7. Tom says

    Seems like the owner of the former White Hen played his cards wrong. The license was granted at that location,, I am sure there was all kinds of pleading for it at the time. If you have to feed a business 400k then its probably not viable in the first place.

  8. Madeliene Marino says

    Hi,
    I believe that Star Market Manager, Steve Duran, stated that Star Market would
    agree not to sell either lottery tickets or tobacco products in order to obtain the
    transfer of the full liquor license from Fuard Mukarker. This costly concession by
    Star Market at nearly the end of the Selectmen’s Meeting was met with loud
    clapping and cheers from the audience.

    To me, the Star Market has been a treasured anchor store in Waverley Square for
    more than 25 years. When the Star Market was first built, it transformed the entire
    Waverley Square area and led to further development. Can anyone imagine Waverley
    Square without the Star Market? Well, guess what, stores close every day if their sales
    go down. Why should the Star Market be denied the opportunity to offer their customers
    a chance to purchase alcohol while shopping for groceries, when Foodies, a new grocery
    store in town, was easily granted a beer and wine license? Customers will flock to Foodies
    because they offer a different shopping experience. Within a short time, hopefully, Foodies
    will become an anchor store for Belmont Center. I believe that it will. There is a place and a
    need for both of these great “supermarket chains” to operate in Belmont on equal footing
    for the benefit of all Belmont residents. I do not believe that anyone would ever think
    that either of these stores resembles in any way the look of a “package store,”

    Star Market is planning on spending 2.4 million dollars on a complete interior renovation of
    their 33,000 sq. foot store in Waverley Square, that they hope will include a 2,000 sq. foot
    section for the sale of alcohol. While “The Loading Dock” presently only has a 700 sq. foot
    space for the sale of alcohol., that limit was only placed on the store because of its overall
    sq. footage, as well as for the fact that space was needed for the restaurant and for food preparation.

    It is important to note that in 2014 when Fuad Mukarker was awarded the full liquor license, D&L Liquors (also known as Dions), a “liquor chain” (with some stores that actually look like “package stores”) also applied for the full liquor license. D&L Liquors that could easily sell liquor for lower prices than any other liquor store in town, planned on using the majority of the sq. footage in the former “One Stop Market” with only a small portion of the sq. footage to be used for bread/cheese and other specialty food displays. In the beginning, D&L Liquors appeared to have the best chance of obtaining the full liquor license. In the end, D&L Liquors was not denied the license because it was a “chain store,” or because some of its stores look like “package stores,” or because it would use a lot more than 700 sq. feet of space for the sale of alcohol, instead it was denied the license due to a large opposition from neighbors, a nearby church, and a nearby preschool because it would be a “liquor store” with insufficient parking and increased traffic during peak traffic hours.

    To end this letter, I have to say that it was quite a tribute to Fuad Mukarker that so many of his loyal customers attended the Selectmen’s Meeting to speak on his behalf and to support him in
    trying to save “The Loading Dock” from closing. It says a lot about him as a person that so many
    people care that deeply about him. I have never seen anything quite like the passion and deep concern that these good people demonstrated as they tried to seek what they felt was a win- win solution for both Mr. Mukarker, a Belmont resident with a wife and 3 children, and the Star Market. Many of the people present spoke of how the Star Market in Waverley Square has been a good neighbor for more than 25 years by contributing to the food pantry and other charitable causes, as well as hiring special needs employees and employing a number of employees that are paid good wages and benefits.

    The payment of “compensation” between parties in a liquor license transaction is done on
    a regular basis throughout the state and complies with state liquor laws. So, there is nothing unusual about this request. The transfer of the full liquor license from Mr Mukarker to the Star Market for $400,000 in “compensation” would infuse the necessary funds to allow “The Loading Dock” to stay open and provide the Star Market with the full liquor license for their Waverley Square store that they seek. Therefore, both neighborhood stores would benefit from this transaction. With the offer to drop the sale of both lottery tickets and tobacco products, Steve Duran, Star Market Manager in Waverley Square, granted to the Selectmen the concession they requested.

    What else is left? I would think a fair and just resolution would be the appropriate outcome.

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