Liquor licenses policies and procedures

• The licensee must follow all state and local laws and ordinances.
• If complaints are received, the Department will generally follow the same procedures that are available in the case of a liquor-licensed premises. A meeting with the detective and mediation are possible results of a complaint and investigation. A show-cause order and hearing about the suspension or revocation of the license is also possible.
• The director can suspend or revoke a license for grounds as outlined in the Denver Revised Municipal Code. If there are grounds alleged to suspend or revoke a license, the director will set a hearing. This will determine if disciplinary action can be taken and what that action will be. (D.R.M.C. Sec. 6-61, 32-22) The hearing will be in a similar manner to that used for a liquor license show-cause hearing.
• If a license is suspended, two notices must be posted at the premises as described in D.R.M.C. Section 6-61(c).
• The director can enter an order for the immediate suspension of a cabaret license. The period will not exceed 15 days if probable cause exists for revocation or suspension of any license. (D.R.M.C. Sec. 32-23) A hearing will be held on such an emergency suspension within 15 days like that for summary suspension of a liquor license.

• A cabaret licensee cannot enlarge, modify, or alter the premises without the approval of the director. Forms to apply for approval are available at the Department of Excise and Licenses.
• Application forms must be filed with the department no fewer than 30 days before the proposed starting date and/or construction date. Some modifications require notification to registered neighborhood organizations for input. Filing this request 30 days before the proposed starting date does not guarantee any request will be approved within that time. No action will be taken until the application is complete.
• The applicant must complete the form, provide a drawing of the current premises and a drawing showing the proposed changes. The applicant must also provide an approved zoning use permit.
• If the director concludes the proposed changes materially or substantially alter the premises or its usage, they will notify the registered neighborhood groups whose boundaries are within 200 feet of the location.
• If the director receives objections from any neighborhood groups or neighbors or if other grounds exist for denial, the director can deny the application. The applicant will be given time to request a hearing.
• If the applicant requests a hearing, the department will schedule one. The applicant must post at the premises the time and date of the hearing for 30 days. It must be in a similar manner to the posting for the new application for 30 days. At the hearing, evidence will be allowed consistent with that allowed in a hearing or modification of a liquor-licensed premises as outlined in Colorado Liquor Enforcement Division Regulation 47-302. This includes evidence about the needs and desires of the neighborhood.
• After the hearing, the hearing officer will submit a written recommended decision to the director. Each party will get 10 days to object. The director will issue a final decision based on the evidence.

Any standard cabaret, dance cabaret, special dance cabaret, or acoustic cabaret licensee who wants to allow patrons younger than 16 years old on the licensed premises when entertainment is being provided can do so. It must be under one of the following conditions set forth in Denver Revised Municipal Code Section 6-34(b): 

• Each patron younger than 16 years old is accompanied by a parent or legal guardian.
• The entertainment is in a room separate from where patrons younger than 16 years old are located for dining.
• When alcohol is not sold or dispensed and is not displayed or exhibited anywhere on the premises.
• When the establishment is not offering any entertainment anywhere on the premises.

Any event center cabaret licensee who wants to allow people younger than 16 years old on the licensed premises can do so. It must be under one of the following conditions set forth in Denver Revised Municipal Code Section 6-34(d): 

• Each patron younger than 16 years old is accompanied by a parent or legal guardian.
• When alcohol is not sold or dispensed and is not displayed or exhibited anywhere on the premises.

An applicant for a new liquor license can request the local licensing authority to approve concurrent review of the application by the state. Such review will be approved when the application documents are complete, such as when the public hearing is set.

There is an extra fee for a concurrent review.

The Department of Excise and Licenses can start investigations related to alleged violations of the state liquor and beer codes and/or local cabaret ordinances and/or department policies and procedures. The department also can take administrative action against a licensee where appropriate.

Investigations

Investigations related to alleged violations of the state liquor and beer codes and/or local cabaret ordinances and/or department policies and procedures can be initiated upon receipt of information that suggests a licensee has engaged in conduct or behavior that violates existing laws and/or policies and procedures. Investigations can be conducted by state liquor enforcement officials or its designated agents, the Denver Police Department or its designated agents, inspectors employed by the Department of Excise and Licenses, or any other representative or agent of the City and County of Denver vested with authority to maintain the health, safety, peace and welfare of citizens.

Founded investigations

If an investigation is founded, the Department of Excise and Licenses will take one of two actions. It will require the licensee to present itself in an “order in.” Or it will file an administrative complaint against the licensee.

Order in

The Department of Excise and Licenses or its designated agent can order a licensee to appear at the Department to discuss alleged violations of the state liquor code and/or violations of local ordinances and/or violations of department policies and procedures. During an order in, the Department provides fair warning about non-compliant conduct. It admonishes a licensee to take corrective action. The Department can require a licensee to agree to correct non-compliant conduct. Otherwise, it is subject to further disciplinary action.

Show-cause complaints

The Department can issue a show-cause order to any licensee who is alleged to have violated any federal, state, or local laws and city ordinances or any regulations or procedures governing the conduct of liquor-licensed establishments. The Department will provide the licensee a copy of a show-cause order. The order will include the basis of the complaint. It will also include notice of the date and time of a hearing. At the hearing, the licensee must show-cause why their license should not be suspended or revoked. The city bears the burden of proof for the basis of the show-cause order. The licensing authority can administer oaths and issue subpoenas. They would require the presence of people and the production of papers, books, and records necessary for any hearing.

A licensee must comply with notice requirements mandated by state law and/or regulations, and/or local ordinances, and/or agency policies and procedures. If a licensee fails to do so, the Department of Excise and Licenses will take further appropriate administrative action.

Public hearing process

Licensees subject to show-cause actions can meet with an assistant city attorney to discuss the complaint and resolve the matter without a hearing. If agreed to by the parties, a proposed stipulation can be submitted to the director of the Department to resolve the matter. The director has discretion to accept or reject a proposed stipulation. If a stipulation is accepted, the director will issue an order to include administrative action taken against the licensee. The Department will provide a copy of the order to the licensee. If a proposed stipulation is rejected, the director will issue an order and have the parties proceed to a hearing.

The director will not accept a proposed stipulation within 72 hours of a hearing date.

When there is a hearing, a hearing officer will issue a recommended decision within 10 days. A copy of the decision will be provided to the licensee. The city’s representative and the licensee will have 10 days to file objections. Once objections, if any, are received, the director will issue a final decision. Any suspension of a license because of a show-cause action will not exceed six months.

Unfounded investigations

The Department of Excise and Licenses will not take administrative action where an investigation is deemed “unfounded." An unfounded investigation exists when there is no basis to proceed with administrative action.

Summary suspensions

According to Colorado Revised Statute, Section 44-3-601(2) and Regulation 47-602, the Department can issue a summary suspension of a license when it has reasonable grounds to believe and determine a licensee is guilty of a deliberate and willful violation of any applicable law or regulation or that the public health, safety or welfare imperatively requires emergency action.

When a license is summarily suspended, the Department will schedule a hearing within 15 days. The city bears the burden of proof on a summary suspension. The licensee can present any evidence in their defense.

After hearing testimony and evidence, a hearing officer will issue a recommended decision. A copy will be provided to the licensee. The assistant city attorney and the licensee each have 10 days to file objections. Once objections, if any, are received, the director will issue a final decision.

There are times when licensees forget to inform the Department of Excise and Licenses of changes in ownership or corporate structure. Each situation will be handled on an individual basis, with these guidelines:

• Failure to inform the local licensing authority is a violation of the Colorado Liquor Code. Generally, the Department will consider filing a show-cause order in these cases. The disposition of a case will depend on several factors, including:
  • Time before the Department was informed.
  • Manner the Department was informed (voluntarily or through investigation).
  • Knowledge or lack thereof of the former and current licensees.
  • Truthfulness of the licensee about the situation.
  • Extent of the change.

• If the violation involves the occupant of the premises is operating without a valid license, all alcohol sales must cease until a temporary permit or a new license is issued. Depending on the circumstances, an invalid license could have to be surrendered and a new application filed, without the availability of a temporary permit.

Colorado statute: Per C.R.S., Section 12-47.1-101 et. Seq., C.R.S., Section 12-60-101 et. Seq., and C.R.S. Sec. 44-3-901(6)(n)(I)

The Colorado Liquor Code prohibits an establishment that has a liquor license from allowing any gambling or the use of any gambling machine or device.

Regulation 47-922 of the Colorado Code of Regulations prohibits a licensee allowing machines or devices normally used for gambling on the premises except as permitted under the Limited Gaming Act. “Gambling device” is defined in C.R.S. Sec. 18-10-102(3) as devices, machines, paraphernalia or equipment used or usable in professional gambling activity.

Gambling devices used/not used for gambling

• The Colorado Liquor Enforcement Division says gambling devices can be on liquor-licensed premises if they are not being used for gambling.
• If they are not used for gambling, they are not considered gambling devices.

The Department of Excise and Licenses agrees and will allow such devices to be on licensed premises in Denver only if they are not used for gambling.

For example, if a nonprofit organization holds a fundraiser and charges an entrance fee and hosts a “Las Vegas” night, all money raised from the use of any gambling device or gambling-like activity must go to the nonprofit. Funds raised cannot go to the participants, such as prizes, drinks, a drawing for a prize, etc.

Profits from gambling machines must go to a nonprofit organization

Any licensee who proposes to allow the type of fundraiser described above must file a statement with the Department from the sponsors of the event. It must state all profits from the use of gambling machines will be contributed to an identified nonprofit organization.

The organization must file proof of its status as a nonprofit with the Department. Proof can be determined by presenting a current certificate of good standing as a nonprofit in Colorado, a letter from the Internal Revenue Service granting nonprofit status to the organization, a letter from the national office of a local chapter outlining the basis of the nonprofit status, or another document deemed adequate by the director.

When the Department receives complaints that allege behavior by a licensee or its patrons causing problems in the neighborhood, the director could consider ordering mediation.

Problems include but are not limited to:

• Inappropriate behavior of the licensed premises' patrons when they leave the establishment
• Noise
• Trash
• Litter
• Parking problems

If the director believes mediation could be useful, they will ask the licensee and the neighbors to take part.

If all parties agree, a hearing officer will be assigned to act as a mediator. The goal is to reach a conclusion that is acceptable to everyone. The agreement could become part of the license, depending on the circumstances.

The Department will allow a liquor-licensed premise to reserve an entire licensed premise for a private party.

Rules

• The opportunity to reserve the premises for up to 10 hours is available to the general public on the same terms without discrimination.
• No group can have a standing reservation for the use of the licensed premises on a weekly or monthly basis. That's because it involves the exercise of the privileges of a club license.
• Licensees can hold a grand opening party once that can be restricted to invited guests.
• Licensees must notify the Department at least three days before the event that the premises have been reserved for a given day or night. The organization reserving the premises must be identified. For example, if the event is on a Friday, the Department must be notified by 5 p.m. Tuesday. The director will consider exceptions to the three-day notification rule for good cause. This could include the late booking of the establishment.
• Licensees must post at least two signs at least three days before the event. It notifies customers the establishment will not be open to the public on the given date. Notification for a Friday night event should begin by 5 p.m. Tuesday. The size and wording of the signs are at the discretion of the licensee. It must be adequate to notify customers the public will not be admitted on a certain day during certain times. One sign must be posted inside the premises. One sign must be posted on the door to the establishment.
• The licensee cannot relinquish control of the licensed premises or the service of alcohol to any other person or entity. The licensee must remain in control of the premises and the alcohol and service during the event. The licensee and their employees are responsible for all conduct during the event. They must follow all requirements of the Colorado liquor and beer codes and the Denver Revised Municipal Code about cabaret licenses if the establishment has one. The licensee must follow all applicable laws.

Under state law, a local licensing authority can deny an application for a tavern or liquor store license if the extra license would add to the undue concentration of liquor licenses in the area. As a result, it would require the use of extra law enforcement resources.

Regulation 47-301 to determine whether undue concentration of liquor licenses exists

In determining whether to deny an application based on undue concentration considerations, the Department of Excise and Licenses follows Regulation 47-301 of the Colorado Liquor Enforcement Division. It says the local licensing authority can consider these factors to determine whether undue concentration exists:

1. Whether the ratio of the number of tavern or retail liquor store licenses within the county where the application has been made to the county population exceeds the ratio of the statewide number of licenses of the same class to the state population.
2. Whether the ratio of the number of tavern or retail liquor store licenses within the census tract or census division where the applicant premises are located to the population of the census tract or division exceeds the ratio of number of licenses of the same class in the county or municipality to the population of the county or municipality where the application has been made.
3. The distance between the applicant premises and the premises of other holders of the same class of license.
4. Published data about the concentration of tavern or retail liquor store licenses and its effect on the need for law enforcement resources.
5. Testimony about the use of law enforcement to enforce state or local law where the applicant premises are located.

Analysis performed

Analysis related to undue concentration will be performed by the Department when an application is submitted. The Department will get statistical crime data from the Department of Safety for the analysis.

The hearing officers or the director will be flexible about the admissibility of evidence. Hearing officers and the director will use discretion on the admissibility of evidence.