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SC bar will close amid new pressure that businesses must sell food to serve liquor

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Cover 3 Five Points Columbia (copy)

Cover 3 is one of two bars in Columbia's Five Points that was facing a court challenge to its liquor license renewal. The bar owners decided to withdraw their application and close the bar on Aug. 31. John A. Carlos II/Special to The Post and Courier

COLUMBIA — A bar in Columbia's nightlife district popular with college students will close later this year after the owner decided to withdraw his application for a liquor license renewal under pressure from residents in the surrounding neighborhoods.

Part of the protest was that Five Points bar Cover 3 did not serve enough food, an argument that could impact bars statewide if it continues to gain ground. 

On the second day of an administrative law court hearing Friday, attorneys representing Cover 3 and local residents protesting the bar's liquor license renewal announced they had reached an agreement for the bar to close Aug. 31. 

Ken Allen, an attorney representing Cover 3 owner Max Manillo, said the bar's managers determined that continuing to press their case would not be worth it.

"It's a small place, it doesn't make much money," Allen said. "If they lose this case, they're out of business. If they win this case, they're looking at a long expensive appeal. So they decided it's best to just wind it down over the summer and close it up."

The decision came after Chris Kenney, an attorney who works for state Sen. Dick Harpootlian's law firm that is representing neighborhood leaders, began making the case Thursday that Cover 3's minimal food sales and marketing toward college students should prevent the bar from being allowed to continue serving liquor.

The S.C. Constitution says businesses must “engage primarily and substantially in the preparation and serving of meals” to receive a liquor license, but state laws do not include a set percentage of food sales.

Calculations by Cover 3's manager found that just 0.07 percent of the bar's revenue over the past few years has come from food sales. That's not enough, says the Department of Revenue, which oversees liquor licensing, to satisfy the state restaurant requirements.

The University of South Carolina also was protesting the bar's liquor license renewal. Dean of Students Marc Shook testified that two students who had been hospitalized due to alcohol in the past two years said they bought their last drink from Cover 3. 

Tom Gottshall, president of the neighborhood association for nearby University Hill, said the outcome for Cover 3 should serve as a warning to dozens of other other bars in the Five Points area.

"All these places are under scrutiny," Gottshall said. "The business model of serving underage students is not going to be tolerated."

Another liquor license protest hearing is upcoming for Five Points' most well-known bar, Group Therapy, owned by former USC star quarterback Steve Taneyhill and the namesake of Hootie & the Blowfish's upcoming concert tour.

"If Group Therapy loses its license, that means Five Points is headed for destruction," said House Minority Leader Todd Rutherford, whose district includes parts of Five Points and whose brother owns a restaurant in the entertainment hub.

Harpootlian, who lives near Five Points, ran for office last year because of failed efforts to curb rowdiness in Five Points at night. He has begun protesting liquor licenses in the district populated with bars that cater to the 35,000 students on the USC campus.

Harpootlian said another Five Points bar, The Horseshoe, chose to close earlier this year to avoid a costly liquor license protest. His firm also represented protesters of a liquor license for Five Points Roost, which lost a court appeal last year after a judge ruled food accounting for 10 percent of total sales was not enough to keep selling booze.

Critics say the former state Democratic Party chairman is acting like a bully to small businesses.

"He has become a crime boss who's destroying the fabric of Five Points," Rutherford said. 

Rutherford said bars are following the letter of law — having seats for at least 40 customers, kitchen equipment and menus. 

"They are fighting for their licenses and hiring lawyers — all for doing the right things," Rutherford said. "This is all because of one person's interpretation of law."

Follow Jamie Lovegrove on Twitter @jslovegrove.

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