Volume 75, Number 38 | February 8 -14 2006

Talking Point

What Lola wanted but didn’t get, no thanks to S.L.A.

By Ed Gold

Elected officials in the city, and particularly those from Manhattan, have got to find a way to fund Article 78 appeals against a State Liquor Authority that repeatedly defies state law in granting liquor licenses in neighborhoods already oversaturated with licensed premises.

The recent decision by Supreme Court Judge Marilyn Shafer, reversing the granting of a license in Soho to Lola, which had proposed a restaurant/lounge on Watts St. with a 22-foot bar and live music seven days a week till 1 a.m., dramatized the authority’s failure to pay any attention to existing statutes under the state’s Alcohol Beverage Control Law.

The S.L.A. had taken the lazy and arrogant position, when the case came before it in 2004, that in effect “whatever Lola wants, Lola gets,” ignoring the law’s 500-foot rule that insists a license must be denied if three or more licensed premises are within 500 feet of the applicant’s location unless there is clear proof that granting such a license is in the “public interest.” In the Lola case, the judge noted, there were 35 licensed premises within 500 feet of Lola’s location!

But in granting the license, the authority, the judge contended in her recent decision, ignored all the evidence presented in the case and accepted everything that Lola claimed at face value. This included denial of a traffic problem leading from the proposed site to the Holland Tunnel, with the applicant claiming that most patrons would arrive on foot or public transportation.

With no factual cards to play, the S.L.A. told the judge that the lawsuit brought by the Soho Alliance lacked standing before the court.

But Judge Shafer spelled out a principle of some consequence, insisting the alliance clearly had standing in her court by virtue of the fact that alliance members lived or worked in the “zone of interest,” in this instance in an obviously oversaturated area.

The judge’s annoyance with the authority’s posture appears to have increased as she wrote her decision.

For example, she was struck by the fact that Community Board 2 had unanimously voted against granting the license, but that the S.L.A. decision not only failed to acknowledge the C.B. 2 position and failed to consult with C.B. 2 as required by law, but also failed to provide any reasons for granting the license.

She added that the authority did not respond to the petitioner’s complaint about traffic congestion or noise pollution due to oversaturation, issues that must be dealt with to determine the community’s public interest.

In her withering summation, Judge Shafer noted: “Nothwithstanding unanimous opposition by Commmunity Board 2; testimony from a traffic expert and an architectural and zoning expert; letters from a state senator, assemblyperson and councilmember; a restaurant review describing the noise at the applicant’s prior restauarant/lounge as deafening; petitions and letters from Soho residents; and photos of traffic jams along Watts St., the granting of a license to Lola is an act not sound in reason and taken without regard to the facts.”
The judge continued: “The fact that the determination” — the S.L.A.’s granting of the license — “lacks any discussion as to how it reconciled the conflicting facts and evidence presented at the 500-foot-rule hearing leads the Court to find that the Authority acted in an arbitrary and capricious manner and that the determination was not rationally based.”

But only the alliance’s Article 78 action at an exhorbitant expense for an essentially working-class neighborhood reversed what amounts to an unlawful decision by the authority, an action the S.L.A. gets away with routinely, since Article 78 lawsuits in liquor license cases are so infrequent.

The alliance, facing substantial trial expenses, is attempting to get compensation from the S.L.A. That would be real justice if the authority had to eat the community’s trial costs, but it may be chancy since some legal opinion holds you can only get compensation from administrative agencies when you can prove personal injury.

As the judge indicated in the Lola case, public officials almost always support the community interest in opposing oversaturation. Elected officials write letters to the S.L.A. supporting community boards or other organized community opposition. Sometimes, they send staff members to the 500-foot-rule hearings.

The authority, as in the Lola case, mostly ignores such protests. On the other hand, on the rare occasions when the community takes its case to court, the judge almost always winds up sounding a lot like Judge Shafer.

But as long as the S.L.A. is run entirely by people with no connection to New York City who rarely see a license request they don’t like, oversaturation will rule the day.

Perhaps a starting point in dealing with what amounts to lawless behavior might begin with a meeting initiated by the Manhattan borough president and include other borough presidents, councilmembers, community board members familiar with the issue and even attorneys who have been active on behalf of community interests.

The aim would be to find a way to help financially in supporting communites faced with oversaturation after an authority decision like the one in Soho. The authority might take a bit more care in the future if it knew Article 78’s might be brought to court more frequently.

Of course, there’s one other action that could help. If we elected a Democratic governor who cared about the quality of life in New York City and made appropriate changes in authority membership, the situation could definitely improve.

Gold is a member of Community Board 2

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