The owner of Rumrunner's Old Towne Bar & Grill has agreed to sell the liquor license for the embattled downtown bar to a businessman who hopes to transform it into a T.G.I. Friday's.
Rumrunner's owner Basilio Gallo signed a deal on Nov. 27 to sell the alcohol permit and to lease the bar to Anchorage T.G. I. Friday's franchisee Bruce Burnett, said Dan Coffey, a lawyer and former city assemblyman who authored the agreement.
Some Assembly members are planning to try to block the deal, arguing that Rumrunner's has created far too many problems downtown. The business ought to lose its valuable liquor license altogether, they said.
"I don't think we as a city benefit when we allow operators to behave in an irresponsible manner and -- when all is said and done -- cash out and walk away," said downtown Assemblyman Patrick Flynn.
Prosecutors in April charged Rumrunner's owners with assault, evidence tampering and falsifying records. Police say a bouncer, who was working at the bar despite at least three felony convictions, severely beat a handcuffed patron. Since the alleged attack, state regulators have discovered more liquor-law violations at Rumrunner's than at any other bar in Alaska, according to a list compiled by the Alcoholic Beverage Control Board director.
The bar has not yet formally applied for a liquor license transfer. The proposal must be approved by ABC Board and is subject to review by the Assembly.
The new sale agreement calls for Rumrunner's to receive $300,000 in exchange for the liquor license, plus furniture, fixtures and equipment, Coffey said. Under the agreement, Burnett would lease the two-story space at 4th Avenue and E Street with an option to buy.
Coffey argues that allowing Rumrunner's to sell the license -- as opposed to letting it expire and become worthless by early next year -- would be best for downtown. Closing the bar without another business ready to take its place would leave a cavity in downtown commerce, he said.
"I understand why Patrick (Flynn) is unhappy. He has every reason in the world to be unhappy," Coffey said. "This has been a crappy operation and it shouldn't be allowed to continue. No question of that."
But Burnett is an established restaurant owner who has no history of liquor violations at his T.G.I. Friday's in Midtown, he said. A Midtown assemblyman from 2004 to 2010, Coffey is lobbying his former colleagues to stand aside and allow the deal to proceed.
Chairman Ernie Hall said he doesn't think that will happen.
A resolution is in the works that would protest any attempt by Rumrunner's to renew its license.
"We're definitely going to protest it," Hall said. Other downtown businesses have been calling Assembly members over the weekend, arguing that Rumrunner's should not be allowed to sell the license, he said.
"They're saying, 'We're just tired of it and nobody should be able to profit by selling that license," Hall said.
Rumrunner's lawyer Tom Amodio could not immediately be reached for comment Monday.
In a Nov. 30 letter to the ABC Board, Rep. Les Gara and Sen. Johnny Ellis also urged regulators to refuse renewal of the bar's liquor license. Police reported 28 disturbances or assaults in the Rumrunner's area in 2012, the legislators wrote.
"Of those, one involved a weapon and 12 were assaults that were directly related to Rumrunner's business," they wrote. "This kind of conduct makes a recurrence of events like the recent killing in front of Anchorage bar Platinum Jaxx a realistic future possibility."
In a separate letter, Gara and Ellis did not take a position on whether Rumrunner's should be allowed to sell its license.
"At a minimum, we wish to ensure that if a transfer takes place, it is to a business with a clean track record on alcohol violations, and that none of the current Rumrunner's owners have a management or ownership role in the new business," the legislators wrote.
Amodio told the ABC Board in a Sept. 5 meeting that business operations at the bar were expected to improve. A former manager was no longer working there, he said, according to minutes of the meeting. Five days after that meeting, Rumrunner's was served with another novice of violation by the ABC Board, this time accusing an employee of serving alcohol without a valid server card, according to the Board.
The Rumrunner's liquor license expires at the end of the year, said ABC Board Director Shirley Cote. If it is not renewed or transferred by Feb. 28, the bar loses the license.
The deal between Gallo and Burnett, the T.G.I. Friday's franchisee, hinges on regulatory approval, Coffey said.
The two sides agreed to a deal on Nov. 23, the day after Thanksgiving, he said. Coffey typed the paperwork that weekend and the restaurateurs signed the agreement on Tuesday.
The deal calls for Burnett to lease the Rumrunner's space at 415 E St. for $12,000 a month for the first year, after which payments increase to $15,000 a month, Coffey said. Burnett has an option to buy the building and plans to do so, he said.
Coffey said he provided a copy of the agreement to City Hall for review by the Assembly. The Clerk's Office did not respond to repeated requests for a copy of the deal Monday.
Burnett has already contacted T.G.I. Friday's and said he's interested in transforming the bar into the chain's second location in Anchorage, Coffey said. A spokesman for the restaurant chain told the Daily News in November that T.G.I. Friday's doesn't comment on potential locations until a decision has been made.
If the chain doesn't approve of the location, Burnett plans to open a similar "casual dining-style" restaurant in the Rumrunner's space, Coffey said.
Flynn said he is not opposed to T.G.I. Friday's opening downtown, or even in the Rumrunner's location, but said the owners ought to buy their liquor license from a different bar.
Twitter updates: twitter.com/adn_kylehopkins. Call Kyle Hopkins at 257-4334 or email him at khopkins@adn.com.
By KYLE HOPKINS