Escafé is a popular place to get a drink, a place a group of people out on the town might choose for a nightcap later in the evening. “It’s an end-up place,” says owner Todd Howard. And that has the restaurant in trouble with the Virginia Department of Alcoholic Beverage Control.
That’s because to get a license to sell mixed drinks in Virginia, a restaurant must have no more than 55 percent of its sales from booze and at least 45 percent from food. Restaurants can sell all the beer and wine they want because those alcoholic beverages don’t figure into the ratio.
As for bars, forget about it. Virginia has been steadfastly anti-saloon since, well, Prohibition. It wasn’t legal to order a mixed drink in the state until 1968.
“By definition, you can’t have bars in the commonwealth,” says Howard. “You have to fight very hard to get those food dollars anyway you can.” At the same time, restaurant owners don’t want to overprice their food or underprice drinks. Some, says Howard, go so far as to manipulate their sales numbers to comply with the ratio.
Because Escafé did not meet the food minimum last year, it’s facing a 30-day suspension of its license and a $2,500 fine. “You can imagine what it would do,” says Howard. “I don’t know how patient my creditors would be. And coming up with $2,500 would be tough.”
A bill in the General Assembly could save establishments like Escafé or The Box, the popular watering hole on Second Street Southeast that closed in 2014 because its alcohol sales were too high. Delegate Scott Taylor’s HB219 would reduce the food ratio to 25 percent. The Virginia Beach Republican has called the ratio “antiquated” and “anti-competitive.”
Yet as common sense as the bill might sound to those not from the teetotaling Bible Belt, House Minority Leader David Toscano says, “I doubt this will pass.”
Nor does he think Virginia is moving toward allowing bars. “I think that decision was made a long time ago. I think people like the idea that if you go somewhere and have a drink, there should be some element of food available.”
He says the rationale behind not having bars is there’s less “disorder” than what’s found in other states.
However, Toscano says, “I’m sad Escafé is being threatened with that suspension. I will look into that.”
Restaurants can’t force their customers to order eats with their drinks, says Howard. When the Supreme Court ruled on gay marriage June 26, people flocked to Escafé. “Where else are you going to celebrate but at the gay bar?” asks Howard. “It’s not like I can say, ‘I hope you’ll buy food.’ That night was an incredible bar-heavy night that sort of blew my ratio that month.”
Rapture owner Mike Rodi sees HB219 as part of an overall attempt to put Virginia’s alcohol laws into something “resembling, not the 21st century, but the second half to the 20th century. The laws are rooted in Prohibition values. I do think it needs an overhaul.”
Rodi says he has no problem meeting the ratio, but he understands the problem it presents for some restaurant owners. “How do you force someone to eat or say, ‘I can’t sell you a drink because it will put me over my ratio?’”
Rapture had its own skirmish with the ABC in 2014 when an agent cited it with “ceases to qualify as a restaurant.” Rodi says he doesn’t know where that came from because even if the dining room is closed, food is still available. He had to pay $500, and sees such enforcement as “a way to harass businesses.”
He notes the investment he’s made in a quality kitchen staff, equipment and ingredients. “It’s insulting for the ABC to come in and say, ‘You’re not a restaurant,’” he says. “Why? Because my hood isn’t working one day?”
Rodi thinks the entire ABC regulation book needs an overhaul. He points to a law that regulates “how much of a nipple can be exposed.” Says Rodi, “Obviously the code is caught up in moral issues. There are safety issues, there are business issues. Let’s get down to what are actual issues instead of weird moral issues from the 1930s.”
Howard finds it ironic that the ABC boasted record profits in 2015—and yet wants to penalize a business that sells too much alcohol. The food/alcohol ratio was last changed in 1980. “The 35-year marker is important to note,” he says. “Many things have changed since then in public attitudes and social attitudes.”
Howard recounts what one person said when he described his current travails with the ABC: “You tell that board Governor McAuliffe is pro-business and Virginia is pro-business. Suspending your license is anti-business.”
On January 12, Howard appealed the suspension to the ABC Board, which has 30 days to decide what to do.