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After a yearlong legal dispute to allow alcohol at the franchised Taco Bell Cantina location at 534 State St., the city of Madison and the fast food restaurant have agreed to settle

The masses who think outside the bun could soon be able to enjoy a cold beer with their Crunchwrap Supremes following a tentative agreement between the city of Madison and Taco Bell.

After a yearlong legal dispute to allow alcohol at the franchised Taco Bell Cantina location at 534 State St., the parties have agreed to settle. This could mean that within 15 days of the City Council approving the agreement, the downtown Taco Bell would be issued an alcohol license to serve beer and wine.

The hotly contested issue faced several votes on the City Council floor and a veto from former mayor Paul Soglin. It even inspired one resident to consider running for mayor.

How did the city get to this point?

In September 2017, Taco Bell announced it would open between 300 and 350 Taco Bell Cantina locations that would sell beer, wine, sangria and alcoholic slushies. Madison’s City Council approved a beer and wine license for the State Street location in December 2017.

The license would have allowed the Taco Bell Cantina to serve wine and beer until 10 p.m., Sunday through Thursday each week, and until 11 p.m. on Fridays and Saturdays. The applicant originally requested a full liquor license and the ability to serve alcohol later.

Soglin vetoed the license Dec. 12, 2017, saying that allowing the Taco Bell to serve alcohol would have “little public value.” He raised mounting concerns over downtown alcohol density and police department pressures.

The City Council attempted to overturn Soglin’s veto twice but failed. In April 2018, the franchise owners sued the city over the alcohol license.  

At the end of December 2018, the court ruled in Taco Bell’s favor and ordered the city to issue the license. However, in January of this year, the city filed a notice of appeal with the Wisconsin Court of Appeals. That litigation is still pending.

Why did the franchise owners sue the city?

In a complaint filed April 13, 2018 in Dane County Circuit Court, Bell Great Lakes, LLC alleged that the city's denial of the alcohol license was "unlawful and discriminatory" when considering the city's prior restaurant liquor license approvals and current policy.

The complaint highlighted that the city approved a liquor license to Chen's Dumpling House, located across the street from Taco Bell Cantina at 505 State Street, three weeks after the city denied a license for Taco Bell.   

"There was no meaningful or material difference between (Bell Great Lakes') application and the applications the City earlier and later approved," the complaint states. "The disparate treatment is arbitrary, unlawful, and unfair." 

Bell Great Lakes also operates 475 Applebee’s Neighborhood Bar and Grill locations in several states and have been operating full service restaurants, including liquor, beer and wine, since 2001. The group also operates over 400 Panera and Taco Bell locations.  

A representative did not respond Monday to requests for comment.

What is the proposed settlement agreement?

Mayor Satya Rhodes-Conway and Alds. Mike Verveer, District 4, and Patrick Heck, District 2, have signed on to a resolution that would resolve the litigation “without further cost and uncertainty” through a settlement agreement.  

"What I’ve said before and still maintain is that it is not appropriate for us to deal with the issue of liquor licenses on a one-off veto basis," Rhodes-Conway said. "We need to work on a policy that is comprehensive. No matter how I personally feel about Taco Bell having a liquor license, they deserve to be treated like any other applicant." 

Rhodes-Conway said the city is looking at a more comprehensive approach to alcohol license density and should look at supporting non-alcohol uses downtown.  

The resolution is on the City Council’s meeting agenda Tuesday for introduction only. If approved by the City Council, the city would issue the State Street Taco Bell Cantina a beer and wine license within 15 days.

Flynn Restaurant Group, the parent company of Bell Great Lakes, said in a statement it was pleased with the tentative agreement and look forward to securing final approval. 

"As the owner and operator of 1,245 restaurants across the country including over 450 Applebee’s locations – all with full-service liquor licenses – Flynn Restaurant Group has an outstanding reputation of owning and operating safe, orderly and compliant concepts nationwide and we pride ourselves on responsible service," the statement said. 

The license would allow Taco Bell to serve beer and alcohol until 10 p.m. Sunday through Thursday and no later than 11 p.m. on Friday and Saturday. Food must be available at all times and establishment staff are required to discourage loitering, according to conditions of the license.  

The city’s Alcohol License Review Committee is scheduled to take up the settlement agreement May 15. A decision from the City Council is expected May 21.  

Why would the city want to pursue a settlement agreement?

The city wants to avoid the possibility of Court of Appeals decision with statewide precedential value that could limit the authority of issuing future liquor licenses, according to the resolution.

“If we were to get a negative decision there that was published, it would be statewide precedent and it might limit the discretion of the city and other cities around the state in terms of issuing liquor licenses,” City Attorney Michael May said. “That’s a risk I would prefer to avoid.”

May said the city can seek to vacate the negative Circuit Court ruling and that Taco Bell will support that decision. After that, the city would move to dismiss the litigation.  

Verveer said attorneys for Taco Bell approached the city prior to the spring election April 2. The downtown alder said he and the former mayor backed the settlement because of the precedent concerns raised by May.  

Verveer has long supported an alcohol license for the State Street Taco Bell Cantina due in part to the concessions the operators made, like ending alcohol sales well before bar time.

“With Taco Bell’s immediate concession to drop the request for hard liquor, but moreover their willingness to limit alcohol sales into the night ... it seems like it was a bit of a no-brainer,” Verveer said.

Ald. Patrick Heck, District 2, represents the block where Taco Bell is located. Heck said he agreed with former District 2 alder Ledell Zellers that the license should have been granted originally.

“(The operators) seem like they’re concerned about being good citizens on State Street,” Heck said.

So, can I get a Twisted Freeze at the State Street Taco Bell?

No. You will not be able to pair your Cheesy Gordita Crunch with a tequila-, rum- or vodka-spiked slushie because the license only allows beer and wine.

The establishment’s flagship Taco Bell Cantina in Las Vegas boasts eight different kinds of alcoholic slushies, including the Mountain Dew Baja Blast Freeze, and shareable appetizers.

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