New E.O. - Whitmer Phases Back Regions 6 & 8, Detroit Casinos can Open at 15%
by Mason Doerr
There has been a lot of false reporting that all bars must shut down on July 31. This is not true. Bars whose gross receipts total 30% or more from non-alcohol sales can remain open for indoor and outdoor service. Bars whose gross receipts total less than 30% from non-alcohol sales can remain open for outdoor service. PLEASE READ ABOUT THE 70/30 DISTINCTION BELOW.
Governor Whitmer today signed Executive Order 2020-160, which phases back regions 6 and 8. These regions will now have to comply with the same rules as the rest of the state.
The executive order also brings private event occupancy in regions 6 & 8 back down to 10 indoors and 50 outdoors (same as the rest of the state). All bar/restaurant businesses in the state must abide by the 50% occupancy restriction.
FROM THE ORDER:
Bars. Food service establishments, as defined in section 1107(t) of the Michigan Food Law, 2000 PA 92, as amended, MCL 289.1107(t), that hold on-premises retailer licenses to sell alcoholic beverages must close for indoor service if they earn more than 70% of their gross receipts from sales of alcoholic beverages.
(a) Food service establishments that are closed for indoor service but open for outdoor service must prohibit patrons from entering the establishment, except to walk through in order to access the outdoor area, to leave the establishment, or to use the restroom.
(b) For purposes of calculating its percentage of gross receipts from sales of alcoholic beverages under section 1, a food service establishment must use:
(1) Gross receipts from 2019; or
(2) If the establishment was not in operation in 2019, gross receipts from the date the establishment opened in 2020.
There has been some confusion about the 70/30 distinction and what exactly constitutes a food service establishment. The required 30% in gross receipts is not limited to food only. Establishments that make 30% or more of their gross receipts from food, lottery, apparel sales, memberships (e.g. mugs, dues), rentals, glassware and any other form of revenue, are able to remain open. Any and all non-alcohol revenue counts.
If you are a bar that sells no food but 15% of your gross receipts are generated from lottery, 10% of your gross receipts are generated from renting rooms and 5% of your gross receipts are generated from mug club membership dues, you can remain open.
The order also allows Detroit casinos to open with a 15% occupancy restriction.
If you have any questions, please don't hesitate to call the MLBA office at 517-374-9611.
- MLBA Staff -
We want to be your number one resource when it comes to remaining open. The hospitality industry is the most regulated industry and we already practice safety and hygiene procedures – we are the most prepared for this reopening. It is our responsibility to keep bars and restaurants clean and virus free. With this pandemic, we must take extra care to make sure we are on top of our game. Please review the recommendations from the CDC and Michigan.gov below for procedures and guidelines to follow with your reopening.
We are all–owner, employee and guest alike—being tested in new ways. We need to be able to come together again, for the sake of being together and moving forward. Welcoming the guest, in the time of COVID-19, will require new thinking, trial-and-error and patience. Once fully open again, hospitality businesses will begin, again, to offer the chance for connection and rest for the weary. These times call for thoughtful, strategic, practical and adaptable approaches to your business. Use these guidelines as a starting point and reach out to colleagues and the wide range of resources available through your professional associations and federal, state and local authorities.