Liquor panel votes to streamline rules for nonprofit events

Commission adopts proposal authored by Maui County Council Member Sugimura

Maui County Council Member Yuki Lei Sugimura testifies Wednesday before the Maui County Liquor Control Commission. Her proposal to eliminate stringent application requirements for one-day nonprofit fundraising events was approved by the commission. “Unfortunately, we had to do this,” she said after the meeting. “Do not criminalize good people; that’s what brought out the hearts and souls of the community. It’s a good result.” The Maui News / CHRIS SUGIDONO photo

Maui County Council Member Yuki Lei Sugimura testifies Wednesday before the Maui County Liquor Control Commission. Her proposal to eliminate stringent application requirements for one-day nonprofit fundraising events was approved by the commission. “Unfortunately, we had to do this,” she said after the meeting. “Do not criminalize good people; that’s what brought out the hearts and souls of the community. It’s a good result.” The Maui News / CHRIS SUGIDONO photo

WAILUKU — The Maui County Liquor Control Commission approved streamlined changes proposed by County Council Member Yuki Lei Sugimura for single-event liquor license applications for nonprofits Wednesday after months of protests and dozens of testifiers at the David K. Trask Jr. Building in Wailuku.

The commission adopted Sugimura’s proposal, as opposed to ones from the Department of Liquor Control. Her amendments eliminated stringent requirements, such as applicants providing personal history statements, background checks and Social Security numbers, and submitting to fingerprinting. The department began enforcing such requirements for single-event license applications around May.

Now, officers, directors, stockholders and any others listed on the permit application will only have to sign to attest that they are at least 21-years-old, not convicted of a felony and have not been pardoned.

“Unfortunately we had to do this,” Sugimura said after the meeting. “Do not criminalize good people; that’s what brought out the hearts and souls of the community. It’s a good result.”

The commission also approved Sugimura’s other proposal that sought to allow Class 10 licenses — which are issued to nonprofits holding events as well as political parties and candidates seeking public office — to serve an unlimited amount of liquor during a set period of time for a fixed price. The exemption allows nonprofits to collect an entrance fee to private events such as wine pairings without having to charge patrons for additional drinks.

Members of the public wait in a crowded meeting room Wednesday at the David K. Trask Building in Wailuku to testify before the Maui County Liquor Control Commission. About 10 nonprofit directors and residents testified, including Nancy LaJoy, executive director of the Pacific Cancer Foundation (speaking at the lectern). The Maui News / CHRIS SUGIDONO photo

Members of the public wait in a crowded meeting room Wednesday at the David K. Trask Building in Wailuku to testify before the Maui County Liquor Control Commission. About 10 nonprofit directors and residents testified, including Nancy LaJoy, executive director of the Pacific Cancer Foundation (speaking at the lectern). The Maui News / CHRIS SUGIDONO photo

Debbie Cabebe, president of the Maui Nonprofit Directors Association, said she was grateful for the community and work done by Sugimura and Peter Horovitz, a board member of several nonprofits and attorney for liquor licensees. Horovitz helped provide his legal expertise for the changes.

“I think that cool minds prevailed, and we can get back to fulfilling our mission,” Cabebe said.

Department of Liquor Control Director Glenn Mukai declined comment after Wednesday’s meeting, saying “not at this time.”

No other liquor departments in the state require stringent background checks that the Maui department enforced on all board members and officers of nonprofits. Department officials had repeatedly cited a 2008 change in state law that they claimed required criminal background checks.

The state Department of the Attorney General told The Maui News in June that counties have the authority to impose the checks, but they are not required to by state law. A letter from Deputy Attorney General Lance Goto to Central Maui Sen. Gil Keith-Agaran last month further explained how the counties have discretion to conduct the background checks.

It is unclear whether the department contacted the AG’s office about clarification of the rules before imposing the stringent requirements.

The commission also began its annual review and evaluation of the performance of Mukai. The director was appointed to his post in May 2016 and has drawn support from commission Chairman Bob Tanaka at a previous meeting, saying that “he’s not doing anything wrong.”

Mayor Alan Arakawa visited the commission behind closed doors to go through the charter-mandated evaluation process. Tanaka said the commission would discuss its evaluation at its meeting next month.

“At that time, we’ll come up with a discussion of our so-called recommendations depending on the responses that we’ve had and we’re going to request from other people,” Tanaka said.

About 10 people testified at Wednesday’s meeting, including former Council Member Don Couch, who now works in the mayor’s office as an executive assistant. Couch said he voted to approve nearly all of the commissioners during his time on the council and put his trust in them.

“I trust that you will do what is right for this community and what is right for the nonprofits,” he said. “They’ve been doing well all these years . . . and I trust that you will give the proper direction to the department on how to deal with these nonprofits.”

One tweak the commission made to Sugimura’s proposal removed the words “other governmental clearances” from the nonprofit’s special licensing requirements. Commissioners and Deputy Corporation Counsel Edward Kushi Jr. expressed concerns that it would cause confusion and may be misinterpreted by applicants.

Horovitz submitted suggestions to clarify the wording and believed it may become an issue going forward. He said that where it “rears its ugly head” is during fundraising events at private homes, which have existed for decades, and the liquor department asks for a certificate of occupancy or other clearances not normally handled by other county departments.

“The proof will be in the pudding on this,” he said. “We’ll have to see how they choose to enforce it.”

Horovitz said he was pleased the commission chose Sugimura’s proposal and noted that it would assist two large upcoming fundraisers. Maui Academy of Performing Arts is hosting its 29th annual Garden Party on Oct. 1 and the Pacific Cancer Foundation is gearing up for its Aloha Kalikimaka Benefit Gala on Nov. 18.

Both events raise a third to a half of the groups’ budgets and cancellations of the events would mean losing programs “without question,” Horovitz said.

“There’s probably more that needs to be done . . . but I think we’re in a much better starting place than we were before,” he said.

In other licensing matters, the commission accepted petitions seeking the extension of hours for sale and service of liquor for manufacturers and wholesalers, as well as hotels and condominium hotels.

Greg Cabanting, Maui branch manager of Anheuser-Busch Sales of Hawaii, proposed the commission extend operations one hour earlier making it 5 a.m. to 9 p.m. Lisa Paulson, executive director of Maui Hotel and Lodging Association, petitioned to remove the two-hour blackout window from 4 to 6 a.m.

Both license categories had been allowed to sell and serve alcohol 24-hours when the commission originally made its controversial rule change in February. Residents and community groups sought to repeal 24-hour liquor sales, disallow the sale and delivery of liquor to private homes or business and return the cap of 12 licenses for hostess bars.

The commission eventually reversed its rule changes in July. However, it is unclear why the hours of operation for manufacturers/wholesalers and hotels were reverted back considering neither were highly debated.

The Maui Beach Hotel gained approval for two dispenser general licenses for its upstairs Rainbow Dining Room and downstairs ballroom. The hotel expected to receive its license by the end of Wednesday.

The 64-year-old hotel has operated under temporary licenses off and on since losing its license for the first time ever in July 2016. About 45 businesses had faced issues with applications last year after Mukai took over the department.

“We’re all very happy and excited to be able to sell liquor again,” hotel attorney Craig Nakamura said.

He added that operator David Huang of D.H. Investment Inc. was “very happy,” and he plans to start a dim sum service.

* Chris Sugidono can be reached at csugidono@mauinews.com.

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