Town of Natick - Board of Selectmen Minutes 8/12/02

Attorney Brian Levey, representing Westborough Beverage Corporation, thanked the Board for scheduling the special session. He presented the Board with a coy of an August 12th certificate of good standing to show that Westborough Beverage Corp was a corporation of good standing. To demonstrate Sam’s Club’s commitment to the community, Mr. Levey advised that he brought with him another store manager, Jason Pelham, the regional liquor buyer out of Rhode Island Mike Pascone, the regional manager out of New Hampshire Tom Patterson, and the proposed manager Derick Stryer.

When asked by Mr. Ball if he had taken a Tips course, Derick Stryer responded that he had acquired a TAM certification, had taken a liquor assessment test, and an AIM course. He explained that TAM was from a merchandising point of view and the liquor assessment was from the business aspect and required knowledge of fake ID’s and selling to underage minors. AIM was similar and touched on the fake ID’s and knowing what ID’s to take. Ms. Challis confirmed that AIM was one of the programs established by the Board as acceptable under the education training policy.

Mr. Stryer continued that he went through a 12-week training program and touched upon each area of the business in pretty detailed aspects. He was the senior merchandising manager and included in that was the liquor department. He noted that he took responsibility for coordinating the AIM classes at the store as a whole on an ongoing basis, and he acquired a BA in retail marketing and management.

Mr. McKinley noted Mr. Stryer’s use of the word ‘member’ and asked him to explain. Mr. Stryer responded that members of Sam’s Club purchase from the liquor department but someone does not have to be a member. From time-to-time they ask people as a tracking system. Mr. McKinley questioned if it was Mr. Stryer’s understanding that anyone from the general public over 21 can purchase alcohol at Sam’s, and Mr. Stryer confirmed that as being correct.

Mr. McKinley requested an opinion from Mr. DeLuca as to what administratively needs to be done to move forward. Mr. DeLuca explained that presently there was an absence of a licensed manager on the premises of Sam’s Club and the Board took action last Monday in response to that existing situation. Should the Board take action to approve the appointment of a manager and change in officers & directors that information would be submitted to the ABCC seeking their approval of the change proposed by the applicant. The Board would await the decision of the ABCC in response to that request for approval. The procedure with the ABCC was to do the background checks they felt appropriate and necessary to give their approval and check with the Department of Revenue to determine that the corporation was in good

Mr. DeLuca continued that with due diligence the ABCC would report back to the Board on whether they approved the change. Only then may the Board issue the license. The mechanical operation of the issuance of the license depended on the speed in which the information can be transmitted to the ABCC and the ABCC can do its job. He had been informed by the ABCC counsel that it was possible to turn it around in one week if Sam’s was in good tax standing and everything was in order. Any approval tonight was subject to ABCC action and the issuance of the license cannot occur until after the Commission submits their approval.

Mr. Levey noted that he heard Town Counsel say that the ABCC counsel was stating that the ABCC could perform a background investigation, hold a hearing and accomplish everything in one week. That may be theoretically true but he (Mr. Levey) didn’t think that would happen. It would probably be several weeks. Mr. Levey pointed out that there was already a license issued to Sam’s to sell alcohol and tonight they were only requesting a change of manager. The Board had testimony that Mr. Stryer had the background and training and there were others who were certified and trained. The public safety aspect was covered. There was no public safety issue. It was a matter of getting the ABCC to sign off, and he hoped that the Board was not heading toward continuing the suspension. He hoped approval of the manager by Natick was sufficient to give the Board the comfort to allow Sam’s to run the department and not have to wait for the ABCC to do the paperwork before allowing Sam’s to reopen the gates.

Mr. Ball inquired as to how long Sam’s had been operating without a manager. Mr. Levey responded that all along Sam’s has had a manager who was qualified to run the store and trained by the Commonwealth of Massachusetts. What was missing was the seal of approval by the Town and the State and Sam’s was in the process of doing that. Mr. O’Brien

was approved by the Selectmen and it was sent to the ABCC. There was a period of time where that application was pending because of a lack of clean up of a tax issue. It was pending for so long that in the interim Mr. O’Brien left the store and Sam’s came forward with a new manager. Although technically Sam’s didn’t have someone approved by the Board and by ABCC, they have someone who was trained and qualified by the Commonwealth.

In follow-up Mr. Ball inquired as to when Mr. O’Brien left the employ of the company and was told by Mr. Levey that it was within the last six months, but he didn’t know the exact date. Mr. Ball questioned why the Board was now finding itself in the position of having to call a special meeting to respond to a request to lift a suspension and operate without approval of the ABCC. If Mr. O’Brien left six months ago, why was the application delayed?

Mr. Levey responded that he was not sure when Mr. O’Brien left. The tax issue held up things at the ABCC and it got kicked back by the ABCC because the tax issue was not resolved. Even the statute that governs the area provides a 30-day period to get a new manager approved. Within approximately 30 days, Sam’s got the application into the state and came to the Selectmen. The Board scheduled a hearing for the manager change, but there was a misunderstanding about when Mr. Stryer was going to be here. He (Mr. Stryer) thought he could be here either of two dates. He wasn’t here on the first date and the Board took action to set up a hearing from which there was a motion to suspend.

Mr. McKinley pointed out that the document of good standing submitted by Mr. Levey didn’t stipulate any clean resolution with the Department of Revenue. Mr. Levey responded that he had been careful not to say that. He just wanted to show that Westborough Beverage was a valid Massachusetts corporation.

Mr. Hughes commented that as a practical matter when the Board approves a change in manager, generally the old manager was gone and the new manager was operating the business while waiting approval from the ABCC. Mr. DeLuca stated that he could see that happening although ideally it would be a seamless transition. The statute envisions that application for a new manager would be made while the existing manager

was there as opposed to making the change and then seeking approval. Mr. DeLuca referred to Section 15 that no such license shall be granted to an applicant until approved by the Commission. That suggested that it occurred after the ABCC gave its approval – that’s when the license was issued by the Selectmen’s office.

Mr. Hughes questioned if the grant of the license and the approval of the manager were different events. The license was granted to Westborough Beverage and the Board suspended operation of the license because they didn’t have an approved general manager and wasn’t that the distinction. Mr. DeLuca responded that it could be, adding that the statute speaks to the issuance of the license. There was no formal language for the transfer of one manager to another, and he thought it was reasonable to assume that the license stays in effect but the approval was not effected until there was approval from the ABCC.

Mr. Ciccariello recalled that in the past there had been other groups that have come before the Board for a change in manager where the manager had left and the Board approved a new manager. It was contingent upon being approved by the ABCC. If the Board approved the manager tonight, the Board would not be doing something that hadn’t been done in the past.

Mr. McKinley felt that the distinction in the argument was that this was not transferring from one approved manager to a potential manager, but from no manager to a potential one. Mr. DeLuca agreed and noted that since January 2002 there has been no manager on the premises approved by the ABCC. During that time, while there might have been a qualified manager, they haven’t met the requirements of the statute.

Mr. DeLuca responded that the Board had suspended the license through today. The suspension was the subject of a different hearing. Tonight was a separate proceeding to determine whether Sam’s had a qualified candidate. If there were a non-approval, the suspension would remain in effect until there was a qualified manager on the premises. It would be irresponsible to vacate the suspension knowing there was no qualified manager of the premises.

Mr. McKinley asked if Mr. DeLuca were advising against lifting the suspension until the ABCC ruled. Mr. DeLuca’s response was, ‘not exactly’. He noted that Mr. Ball had asked what happened if the manager wasn’t approved. Mr. Ball, however, noted that he had asked the opposite. If the Board did approve, what were the options and the answer was nothing happened automatically.

Mr. Hughes believed that the suspension under the statute was over tonight no matter what the Board did. The question was if the Board approved Mr. Stryer, would the Board allow Sam’s to operate pending approval from the ABCC. He was hearing from Mr. DeLuca that it was not automatic and would behoove the Board to make clear the action that was expected. Mr. DeLuca felt that that was a reasonable conclusion to make. The suspension exhausts. Certain action was anticipated for tonight and then the question for the Board, assuming there was affirmative action on the application, was what happens with respect to their ability to operate. The Board could continue a form of suspension or provide a determination that there be no operation in the period of time it takes the ABCC to give their approval or advise that they may operate in the interim period while approval pending with the ABCC. The Board could mark it up for a hearing in 1-2 months to determine the status of the matter and if it does not move forward, the Board could hold a hearing on modification, suspension, etc.

Mr. Levey told the Board that Sam’s would have no objection to the Board scheduling a 30-day continuation of the hearing. That would keep their feet to the fire to get ABCC approval. He believed the letter that went out had the suspension being over today and he was not hearing an argument in terms of a public safety argument that tipped against allowing them to open. What was being talking about was paperwork and he requested that the Board approve Mr. Stryer and allow Sam’s to open the store and scheduling a hearing thirty days hence.

In discussion of the motion, Mr. McKinley stated his support of the motion, noting that following last week’s hearing, his intention tonight was to clear all paperwork and allow Sam’s to restore operation with a follow-up hearing in 30 days. If Sam’s didn’t have ABCC approval in 30 days, he would move to put the suspension back in place. He asked that the 30 day hearing be scheduled for the meeting of September 9th.

A motion was made by Mr. Hughes, seconded by Mr. McKinley, to schedule a hearing for September 23rd with the understanding that if the license was granted before then (with ABCC approval), there wouldn’t be a need for the hearing. The motion passed on a 4-1-0 vote. Mr. McKinley, Mr. Stern, Mr. Ciccariello, Mr. Hughes voted in favor of the motion. Mr. Ball was opposed.

requirements of the state statute. He felt the Board had a degree of partnership with the ABCC and for the Board to say OK we are removing the suspension and allowing Sam’s to operate in absence of ABCC approval, seemed to send a message that said the Board doesn’t care what the ABCC says. Thirty days was Mr. Levey’s request and 30 days was September 9th and he would not like to extend that any further.