LEGAL GUIDE
Written by attorney Michael A. Brower | Jul 31, 2012

Michigan Liquor Licenses: Fuel Pumps & the Meijer Bill

Liquor and Fuel Pumps

It has been said that "Gasoline and liquor do not mix well." While this can be true, fuel pumps are never a complete bar to receipt of an SDM or SDD.

The ease of mixing alcohol and fuel pumps depends largely upon the population of the county and the local government unit.

The General Rule (MCL 436.1541(1))

Unless one of the "exceptions" (below) applies, MCL 436.1541(1) only allows gas station or location with fuel pumps to receive an SDM or SDD license if:

  1. The applicant or licensee is located in a neighborhood shopping center composed of 1 or more commercial establishments organized or operated as a unit which is related in location, size, and type of shop to the trade area that the unit serves, which provides not less than 50,000 square feet of gross leasable retail space, and which provides 5 private off-street parking spaces for each 1,000 square feet of gross leasable retail space. OR
  2. The applicant or licensee maintains a minimum inventory on the premises, excluding alcoholic liquor and motor vehicle fuel, of not less than $250,000, at cost, of those goods and services customarily marketed by approved type businesses AND the site of payment and selection of alcoholic liquor is not less than 50 feet from that point where motor vehicle fuel is dispensed.

Population Based Exceptions --MCL 436.1541(3) & (4) | Rule 436.1129(5) & .1135(5)

For an SDM License (MCL 436.1541(3))

An applicant for an SDM only needs $10,000 in qualifying inventory if:

  1. The LGU population is 3,500 or less and the county population is 31,000 or more
  2. The LGU population is 4,000 or less and the county population is less than 31,000.

According to Rule 436.1129(5), if the township is comprised of 72 square miles or more and has a population of 7,500 or less, the Commission may, in its discretion, issue an SDM to a location with $10,000 in qualifying inventory.

For an SDD License (MCL 436.1541(4))

An applicant for an SDD only needs $12,500 in qualifying inventory if:

  1. The LGU population is 3,500 or less and the county population is 31,000 or more
  2. The LGU population is 4,000 or less and the county population is less than 31,000.

According to Rule 436.1135(5), if the township is comprised of 72 square miles or more and has a population of 7,500 or less, the Commission may, in its discretion, issue an SDD to a location with $12,500 in qualifying inventory.

The Island Exception (MCL 436.1541(2))

If an applicant with motor vehicle fuel pumps is located in a township which (a) is surrounded by water, and (b) has a population of 7,000 persons or less, they can obtain an SDD or SDM with $12,500 in qualifying inventoryanda resolution demonstrating the approval of the township.

Qualifying Inventory

MCL 436.1541 repeatedly references "those goods and services customarily marketed by approved types of businesses." Qualifying inventory is therefore comprised of those types of goods and services sold as a matter of common practice by: a grocery store, a convenience food store, a food specialty store, a meat market, a delicatessen, a patent medicine store, a tobacconist, or a hotel. It is irrelevant if gas stations typically sell a specific type of inventory, because gas stations are not an "approved type business" and may only qualify by satisfying the requirements of MCL 436.1541.

Examples of Qualifying Inventory: Soda pop, tobacco products, cigarette rolling papers, postage stamps, food items, health and beauty items. *We typically use between $140,000 and $200,000 worth of Forever Stamps, as these will increase in value over time.

Examples of Non-Qualifying Inventory: Alcohol, motor vehicle fuel, items sold on consignment (e.g. phone cards), hardware, apparel, sporting goods, automotive parts, jewelry.

**Note: This guide was up-to-date as of July 31st, 2012

Additional resources provided by the author

You can visit the Michigan Liquor Law Network @ www.MichiganLiquorLaw.com for further resources relating to Michigan liquor law. You can also visit www.michiganliquorlaw.wordpress.com for up-to-date information on Michigan liquor law, best practices, and more.

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