Kasson Council split on potential changes to municipal liquor store

For years, the city of Kasson has had its own municipal liquor store.
But with its longtime manager Cathy Pletta retiring, some on the city council are calling for the city to look at selling the business altogether.
“I think that selling liquor is a private venture and is something that we should let private business handle that demand,” Councilmember Paul Johnson said.
The discussion began at the Oct. 22 council meeting, with City Administrator Tim Ibisch saying the council has been discussing a potential policy shift for turning over profits from the liquor store.
His suggestion was to have 50% of profits go towards the park fund, which he said would show even more the store’s value to the community.
But Johnson argued that it’s likely the best time for them to liquidate the business, saying improvements have been made to the building. He said that there is always a risk when a new manager takes over.
“If we’re ever going to get out of the business of selling alcohol, this is the best time,” he said.
He suggested putting proceeds from selling the business into a fund, with investment interest going towards the park fund.
For example, over the past several years, the liquor store has returned $16,000 in unrestricted funds to the city. Instead of doing that, Johnson said, if the city invested $400,000 in sales proceeds at the current interest rate, it could raise the same amount in interest.
Johnson recognized in past years the store has returned more funds and noted the average including the larger amounts would be $26,000. That would require a $650,000 price tag on the business.
In Johnson’s view, the liquor store is a liability, with strict regulations that have to be followed and the chance the store could make less money than expected or none at all.
Mayor Dan Eggler said one of the things council should consider is keeping at least part of the parking lot in order to have public parking on Main Street.
He also said the council salaries are paid for through the liquor store, so those would have to be factored into the budget, and that interest rates may not stay the same.
“There’s no guarantee in that, either,” Eggler said.
Councilmember Brian Wempner said if a cannabis dispensary comes to Kasson, it could take away from liquor store business. He said he has seen stories of people cutting back on drinking in exchange for cannabis and personally knows some who are doing that.
“I would love to know where people are trading drinking alcohol for smoking or consuming marijuana based products,” Councilmember Mel Ferris said, noting she doesn’t consume any cannabis products. “That statement kind of actually caught me off guard and blew my mind.”
Ibisch said he sees both sides of the argument, and if the store got to the point where it wasn’t financially prudent to continue, he would make that recommendation.
“I don’t think we’re at that point right now,” he said.
Ibisch said instead, it would make sense to look at the numbers in six months and see how it goes under the new management.
However, at Johnson’s request, the city will have an asset-based valuation done for the business.
At the same meeting, the council approved the recommended hire of Matthew Olson as the next liquor store manager.