Brookhaven rolls back disputed alcohol law, more strip clubs possible

Brookhaven has rolled back a controversial law governing nightclubs, weeks after a judge said it was likely discriminatory in requiring some to pay $100,000 for permits.

At the same time, city officials also ended a ban on alcohol sales at strip clubs.

VIDEO: Previous coverage of this issue

The Brookhaven City Council changed its law on Tuesday night in hopes of quashing a federal lawsuit filed earlier this year by the owners of three nightclubs on Buford Highway. The city will no longer require so-called “entertainment venues” to pay $100,000 for a liquor license or prohibit them from selling liquor on Sunday.

But the most controversial change came to the portion of the law regulating “sexually oriented businesses.” Previously, the city prohibited alcohol sales at strip clubs and other adult-oriented places. But the Pink Pony was allowed to sell liquor under a separate agreement it struck with the city in 2014.

When U.S. District Judge Thomas W. Thrash Jr. scolded Brookhaven in July for creating laws that treated similar venues differently, he highlighted the Pink Pony deal as problematic.

The Pink Pony reached the agreement with Brookhaven after it sued the city for attempting to shut down gentlemen’s clubs by refusing to allow venues with nude dancing to sell alcohol.

The agreement said the club could sell drinks until 4 a.m. in exchange for paying a $225,000 annual fee, in addition to the $5,000 for a liquor license. That agreement will expire at the end of 2020.

Earlier this year, the city began requiring other nightclubs to stop pouring alcohol at 2 a.m. and drastically increased the cost of a liquor license to $100,000 this year.

The owners of Medusa Restaurant & Lounge, XS Restaurant and Lounge, and Josephine sued Brookhaven first in state and then federal court, citing the Pink Pony as an example of the city’s uneven application of its new law.

After Thrash’s scolding, Brookhaven required the Pink Pony to follow the same rules as other “entertainment venues,” defined as clubs with DJs playing music, stages and dance floor. That meant no drinks could be served after 2 a.m.

Tuesday’s vote by the Brookhaven City Council removes the higher license fee and a ban on Sunday alcohol sales for all nightclubs. Drinks still cannot be served after 2 a.m.

City officials also decided that the only way the Pink Pony could continue operating legally was to change the law to allow sexually oriented businesses to serve alcohol. Right now, the only such business in Brookhaven is the Pink Pony.

“In an effort to try to accommodate one business, we have thrown wide open the doors until Dec. 31, 2020,” said City Councilwoman Linley Jones, who was the only member to vote “no” on this change.

Between now and then, if another adult business applies for an alcohol license, the city will have to consider it.

Jones said neighboring jurisdictions had cracked down on strip clubs and other adult businesses in recent years, and she worries that Brookhaven will become a haven.

City Manager Christian Sigman said the city hopes the changes approved Tuesday will end the legal challenges.

“It brings it to a close, and businesses can operate under the certainty that the ordinance is a valid ordinance and we can move forward,” he said.

The attorney representing the three nightclubs that sued, Cary Wiggins, said he had not had a chance to review the changes to determine if their concerns have been addressed.

The only public comment council members heard on the issue came from Pink Pony representatives before the vote to change the city’s alcohol policies. They said the changes the club was required to make after Thrash’s July ruling had deep and negative effects.

“My hours have taken a beaten,” executive vice president and chief financial officer Dennis Williams said Tuesday. “We’ve become a victim, and I’m having some financial hardships.”

The changes approved Tuesday included dissolving Brookhaven’s Alcohol Board, which reviewed appeals when liquor licenses were revoked or denied. The city said the logistics of coordinating meeting with board members and attorneys was difficult and will now move to a hearing officer model in which a single person will make these decisions.

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