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City regulators are cracking down on clubs and restaurants that host live tunes.

Like most business owners in town, Bill Duggan has learned to dread missives from the Department of Consumer and Regulatory Affairs (DCRA), the notoriously fickle agency that enforces most of the District’s business regulations. Duggan is owner of Madam’s Organ, a bar in Adams Morgan that features live music nightly and is surrounded by throngs of activist neighbors—a set of circumstances that yields numerous opportunities for contact with the DCRA.

Last October, Duggan received notice from the agency that Madam’s had been issued a citation for collecting cover charges for live entertainment and would have to pay a sizable fine. Typical D.C., Duggan thought: In 2000, the D.C. Council passed a revision of city liquor laws allowing restaurants and bars to host live entertainment. Duggan was part of a lobbying campaign that pushed for the change.

“At first, I thought that it was an error,” he recalls. “I felt that it was [the work of] somebody who had not been as involved in the [Alcohol Beverage Control (ABC) Board] law rewrite and therefore did not know that this was no longer a violation.”

It was no mistake. Duggan soon learned that the city had issued the ticket with full knowledge of changes to the liquor regulations. “[M]y shock turned to anger as I realized that maybe we screwed up by trusting these people,” he says.

Like parking scofflaws and the homeless, establishments that charge a cover have fallen victim to a concerted city enforcement sweep. According to Gina Douglas, the DCRA’s public-information officer, nine venues have been reprimanded so far this year, including 14th Street-area hot spots such as Diversite, the New Vegas Lounge, and Club U, in addition to Remington’s, on Capitol Hill; Nation, near the Navy Yard; and Madam’s. Most are facing fines between $500 and $1,000 and are awaiting hearings to plead their cases.

The controversy stems from an inconsistency between the city’s liquor laws and its zoning regulations. Prior to the 2000 liquor-law rewrite, the only businesses authorized to charge a cover were categorized as “public halls”—a restrictive regulatory status that required all holders to provide one parking space for every 10 patrons. The revised liquor law appeared to widen the universe of live-music-sponsoring venues, stipulating that establishments other than public halls could host bands. Although the new rules don’t specifically allow these places to charge a cover, Duggan and his peers say the intent was clear: Small-time music venues would no longer be targeted for charging admission fees.

Although the city loosened cover-charging requirements in the liquor law, it never issued conforming changes in the zoning rules, which still state that any business charging a cover must secure a zoning designation as a public hall. So Madam’s is technically violating zoning rules whenever it collects a cover charge.

“They’re not saying we can’t have entertainment,” Duggan adds. “They’re saying you cannot charge for it. So what is it? The city just wants you to have shitty entertainment that will work for free? That’s just a backward position that’s not sensible.”

“We’re a tavern,” Chris Connelly, owner of the Velvet Lounge on U Street, explains. “We derive our income from liquor sales. I use entertainment to make my life and everyone else’s more bearable and also to bring people into the club.” His establishment, a bar-cum-music venue, has thus far escaped DCRA sanctions.

It’s a calculated risk taken by many D.C. watering holes: Each week, a variety of establishments with tavern licenses invite a band in and post a cover-collecting bouncer out front. They do so without ever filing for the requisite public-hall license. (The DCRA was unable to furnish a list of officially licensed public halls by press time.) And by going without the license, these businesses live with the constant fear of getting fined.

So why not just get a public-hall license and keep the DCRA at bay?

Impossible, say club owners. The 10-to-1 patron-to-parking-space ratio might be reasonable for Upper Marlboro, but it won’t fly in cramped corridors such as Adams Morgan and U Street.

“If you apply [for a public-hall license] and you have an inner-city business that does not have on-site parking, then you have an impossible hurdle,” says Duggan. “It’s hard enough to do business here following all the regulations. But when you have regulations that are impossible to follow, it just makes it that much more ridiculous.

The public-hall provisions are like a lot of the myriad restrictions in the city’s liquor law—that is, city inspectors don’t bother with them until neighbors ask them to.

“These laws are there, and when people pressure the city to enforce them, it’s really hard for the city to say no,” argues Connelly. “I don’t think they want to enforce these laws. I think the idea is that the public-hall law clearly should not apply to small places, and that’s why for 10 years it’s been consistently overlooked.”

The problem for Connelly and other club owners is that they do business in neighborhoods recently repopulated by folks who value traditional urban amenities—proximity to work and retail outlets—but aren’t so happy about density’s downside.

“A lot of [clubs] only have nighttime hours, and they end up being open up late,” says Scott Pomeroy, president of the Cardozo Shaw Neighborhood Association. “The general concerns are noise, traffic, trash—your typical nightlife issues that can have an adverse impact on residents and daytime businesses. Some of the places that operate as nightclubs operate fine operations. Others haven’t. And it’s a question of what’s being enforced and what’s not being enforced, and the residents are kind of in the middle of that one.”

And in the new D.C., the cover chargers have a dwindling band of allies in city hall. The political constituency for nightclubs consists primarily of the folks who frequent them, a hefty proportion of whom are from Virginia and Maryland and couldn’t name a single member of the D.C. Council—such as, for example, Ward 2 Councilmember Jack Evans, who reportedly said at a Jan. 29 hearing that nightclubs are no longer appropriate anywhere in the city.

“There are certainly bars in Ward 2 where Jack has gone head-to-head with them, and so you have some bar and restaurant owners saying Jack’s anti-business, which we laugh [at], because you also have residents saying Jack is anti-resident—[that] he supports bars,” Evans spokesperson John Ralls says. “I mean, it’s a case-by-case basis.”

But because it was the council that helped rewrite the liquor law to assist small music venues, many club owners feel betrayed and want action.

“We want the council to pass new law,” says Connelly. “And if they don’t pass new law, we want the council to instruct DCRA and clarify that restaurants should be able to charge a cover. And if the council doesn’t do that, DCRA is unlikely to [change] anything.”

Connelly has drafted two proposals, the first of which would modify the DCRA’s regulations to widen eligibility for public-hall licenses. The second proposal would simply amend the D.C. zoning law’s definition of a restaurant to clarify that it may “charge cover for entertainment.” Both would have the effect of allowing establishments legally defined as restaurants (and, by extension, taverns and nightclubs) to charge a cover without being required to meet the 10-to-1 patron-to-parking-space ratio.

“Then the whole parking problem would go away,” Connelly explains. “It’s our contention that if your primary use as a business is to be a restaurant, tavern, or nightclub, inasmuch as you’re not deriving most of your income from ticket sales, then you’re not really a public hall; you’re still a restaurant.”

Ward 6 Councilmember Sharon Ambrose, chair of the council’s Committee on Consumer and Regulatory Affairs, is reviewing the proposals, according to an Ambrose staffer.

In the meantime, club owners like Connelly and Duggan find ways to get by. At Madam’s, Duggan uses a system that charges customers for sodas at the door ($3 for one, $4 for two, and so on). This allows him to both compensate his performers and avoid citation by the DCRA.

Connelly’s weapon is an exemption from the off-street parking requirement, which the Velvet Lounge qualifies for because it is located in a historic district. He is in the process of obtaining his public-hall license.

Once he gets all the paperwork, Connelly will schedule gigs, place a cover-collecting bouncer at the door, and never worry about unwelcome vists from the DCRA.

“It’s just ridiculous that [D.C.] is supposed to be a residential city, that there shouldn’t be entertainment,” he says. “It’s the capital of the industrialized West—there ought to be some music here.” CP