Ask the Experts: Social Zones & What You Need to Know
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Q: What is a Social District and can I be included in a Social District?
A: Social Districts are “zones” approved by the municipality and the MLCC to allow consumption of alcohol in Social Districts.
On July 1, 2020, Governor Whitmer signed House Bill 5781 into law creating the Social District Permit. Social Districts have played a part in the revitalizations of downtowns and have enabled bars, restaurants, hotels, and their customers to gain some sense of normalcy by enabling people to gather outdoors safely.
In order for a Social District to be set up there are steps which must be taken by the local jurisdiction, the Michigan Liquor Control Commission (“MLCC”) and the bars, restaurants or hotels.
The Municipality
The governing body of the municipality, such as a City Council, must designate the area which will be the Social District. The Social District must include a “Commons Area” in which the patrons of qualified licensees may consume alcohol in the Commons Area. The municipality must:
The Michigan Liquor Control Commission
The Management Plan submitted by the municipality will be reviewed by the MLCC. If the Management Plan meets the requirements of the law, the request for the Social District will be placed on an agenda at a regularly scheduled licensing meeting to be approved by the MLCC Commissioners.
A: Social Districts are “zones” approved by the municipality and the MLCC to allow consumption of alcohol in Social Districts.
On July 1, 2020, Governor Whitmer signed House Bill 5781 into law creating the Social District Permit. Social Districts have played a part in the revitalizations of downtowns and have enabled bars, restaurants, hotels, and their customers to gain some sense of normalcy by enabling people to gather outdoors safely.
In order for a Social District to be set up there are steps which must be taken by the local jurisdiction, the Michigan Liquor Control Commission (“MLCC”) and the bars, restaurants or hotels.
The Municipality
The governing body of the municipality, such as a City Council, must designate the area which will be the Social District. The Social District must include a “Commons Area” in which the patrons of qualified licensees may consume alcohol in the Commons Area. The municipality must:
- Define and clearly mark the Commons Area with signs.
- Show that at least two (2) qualified licensees must have their licensed premises contiguous to a Commons Area for the area to qualify to be part of a Social District.
- Establish a Management Plan, which includes the hours of operation, for the Social District.
- Maintain the Social District in a manner that protects the health and safety of the community.
The Michigan Liquor Control Commission
The Management Plan submitted by the municipality will be reviewed by the MLCC. If the Management Plan meets the requirements of the law, the request for the Social District will be placed on an agenda at a regularly scheduled licensing meeting to be approved by the MLCC Commissioners.
Social District Permits
In order for a bar, restaurant or hotel (“Licensee”) to be able to sell alcohol to be consumed in the Social District, it must obtain a Social District Permit from the MLCC.
The Social District Permit is obtained as follows:
Requirements and Restrictions for the Sale and Service of Alcohol in Social Districts
The municipality and the Licensee’s with Social District Permits must follow the following rules:
Joint Effort Between the Municipality, the Licensee, and the Customer
Social Districts work only if the municipality, the licensees and the customers work together to follow the law and to maintain an atmosphere which is fun but safe.
Social Districts are Here to Stay
The Social District law does not have a sunset provision like, for example, the “Cocktails to Go” legislation which sunsets in 2025. The communities who have been out front with the development and operation of Social Districts have had amazing results. The benefit to the Licensees is immense, especially in the summer months. Safety, collaboration and compliance are keys to success!
In order for a bar, restaurant or hotel (“Licensee”) to be able to sell alcohol to be consumed in the Social District, it must obtain a Social District Permit from the MLCC.
The Social District Permit is obtained as follows:
- The Licensee must first obtain a resolution of approval from the municipality in the form provided by the MLCC.
- The Licensee then applies to the MLCC for the Social District Permit. The application is short and straightforward. The Licensee is required to pay an inspection fee of $70 and a permit fee of $250.
- Applications for Social District Permits are reviewed by the MLCC and approved at a regularly scheduled MLCC licensing meeting.
- Like any other permit, the Licensee must qualify. The MLCC will consider violation history.
Requirements and Restrictions for the Sale and Service of Alcohol in Social Districts
The municipality and the Licensee’s with Social District Permits must follow the following rules:
- The Licensee may sell alcoholic beverages for on-premises consumption on its own licensed premises, only. But then, customers may remove the alcoholic beverages from the licensed premises to be consumed in the Commons Area. A licensee must not sell alcoholic beverages in the Commons Area.
- The Commons Area is not considered a part of any Licensee’s licensed premises. Even so, the Licensee must make every effort to ensure that it does not sell alcoholic beverages to a minor or an intoxicated person.
- Any alcoholic beverages sold to customers for consumption in the Commons Area by Social District Permittees must comply with certain rules, such as serving containers with logos which do not exceed 16 ounces.
- Dancing and entertainment is allowed in a Social District as long as it complies with local ordinance.
Joint Effort Between the Municipality, the Licensee, and the Customer
Social Districts work only if the municipality, the licensees and the customers work together to follow the law and to maintain an atmosphere which is fun but safe.
- Alcoholic beverages to be consumed in a Commons Area must not be transported to other licensed establishments or outside of the Commons Area.
- Local law enforcement, and MLCC enforcement officers have jurisdiction to enforce the rules of the Social District.
Social Districts are Here to Stay
The Social District law does not have a sunset provision like, for example, the “Cocktails to Go” legislation which sunsets in 2025. The communities who have been out front with the development and operation of Social Districts have had amazing results. The benefit to the Licensees is immense, especially in the summer months. Safety, collaboration and compliance are keys to success!