Jill Schramm/MDN Anthony Barrette speaks to the Minot City Council Monday on potential changes to the ordinance to eliminate liquor license caps.

Some local liquor license holders indicated they are leery of a plan to remove the City of Minot’s license cap, which Minot City Council members agreed Monday to explore.

The council voted to contract with a consulting law firm, Ohnstad Twichell, West Fargo, to provide advice in navigating the process of eliminating the license cap. The current ordinance limits the number of retail liquor licenses to one per 1,500 population. The city added four licenses to set the new cap at 32 in 2021. The city has various license categories and not all have caps.

The liquor license caps, which make licenses harder to get, create an enormous value for those licenses. In 2021, the council determined licenses were selling for $75,000 to $190,000. License holder Jon Lakoduk, who advised the council against cap removal, said his license is for sale for $500,000.

License holder Anthony Barrette said he would expect the city to compensate existing license holders for that asset if the cap is removed.

“That’s going to be a substantial amount the city is going to have to pay, and I don’t think the taxpayers are going to be real happy about that,” he said.

Council member Paul Pitner, who chairs a city committee reviewing the liquor ordinances for revisions, said the committee voted 3-1 to remove the cap. He said eliminating the cap restriction is a pro-growth and pro-investment decision, but the committee wants to investigate the legal options available to make that happen, given the value of existing licenses. The committee doesn’t want to continue to pursue that avenue if the council is not in support and ultimately will not approve cap elimination, he said.

Because of the extensive research that would be required, the request was for the council to contract with outside legal help to assist the city attorney’s office. City Attorney Stefanie Stalheim said the city needs a defensible ordinance that doesn’t rob license holders of their investments, which would be considered an unlawful taking of private property.

“I don’t think there’s going to be an appetite in our community to buy out those licenses,” council member Lisa Olson said. Olson was the dissenter in the 6-1 vote to contract an outside attorney.

Sherry McGlaughlin, another license holder, said most license holders haven’t been aware of the committee’s interest in pursuing cap removal and there likely will be pushback as the plan goes forward.

The city had considered cap removal in a previous alcohol ordinance revision in 2016 and decided not to adopt that change at that time.