Boulder cracks down on liquor licenses with undercover stings, leading to more suspensions

The City of Boulder has intensified its enforcement of liquor laws by deploying undercover underage volunteers to test whether employees at liquor stores, restaurants and bars are checking IDs. This effort has led to a recent increase in liquor license suspensions, a consequence that hits hard financially for businesses that rely on alcohol sales. 

In the first half of this year, eight businesses have had licenses suspended, and one had its license revoked. That compares to just five suspensions in the previous three years combined, according to publicly available city records. 

The stated goal of this crackdown is to prevent businesses from selling alcohol to people under 21. Half of the enforcement actions this year involved businesses on University Hill, while the rest were scattered across the city, including on Pearl Street downtown. 

The city has been conducting stings, also known as liquor license compliance checks, since the early 2000s. It largely halted investigations during the Covid-19 pandemic due to safety concerns about sending people into businesses, according to a city official. The current frequency of suspensions so far this year appears to align with pre-pandemic levels. 

The revival of the city’s liquor law enforcement program follows a change in leadership at the police department. In November 2023, Officer Leah Rech, a 23-year veteran of the Boulder Police Department, assumed the role of the city’s alcohol enforcement officer.

“You can tell that the establishments have not had any police interaction in quite some time,” Rech said during a meeting late last year with the Beverage Licensing Authority, a volunteer board with the power to issue liquor licenses and revoke them. “We plan on hitting those hard,” she added, referring to the compliance checks.

The investigations rely on underage volunteers, referred to by the city as “underaged operatives.” The city pays these volunteers, who are up to 20 years old, $22 per hour, according to a city official. They typically present valid vertical IDs — which state the person is under the age of 21— to test whether the employee approves the sale. The operatives typically pay with marked cash to track the transaction. 

One of the first businesses investigated this year was Baseline Liquor. On Feb. 26, two underage operatives purchased an eight-pack of High Noon hard seltzer. One presented an ID indicating he was 20 years old. The cashier asked for and checked the ID but proceeded with the sale, according to an affidavit from an officer involved in the case. Two officers, waiting outside, then entered the store and notified the cashier of the violation.

On April 17, the Beverage Licensing Authority held a quasi-judicial “show cause” hearing to determine whether Baseline Liquor’s license should be suspended or revoked. Present at the hearing were a police officer, a prosecutor from the City Attorney’s Office and a licensing analyst.

Edward Gonzales, the owner of Baseline Liquor, represented himself. Gonzales said the cashier was a reliable employee who was rushed and miscalculated the age. “We’re dealing with human beings,” Gonzales told the board. “We’re doing the best we can.”

Despite this apparent request for leniency, the board unanimously decided to suspend the business’s license for three days, citing concerns over Baseline Liquor’s lack of a written policy for managing alcohol sales. Board member Leah Roberts said the business demonstrated a “lack of responsibility to the community.”

The Boulder Police Department has also targeted bars and restaurants. For instance, on Feb. 26, a 20-year-old operative purchased a 12-ounce can of Coors Light at Chicken on the Hill, a restaurant and bar, according to an affidavit from an officer involved in the case. The employee did not ask for an ID. During an April show cause hearing, Duong Lu, owner of Chicken on the Hill, said he had stepped out 30 minutes before the sale due to a family emergency involving his one-year-old at the hospital. “I take full responsibility,” Lu said.

He described the employee who sold the alcohol as reliable at a time when it’s challenging to find staff. Lu requested that the suspension be served after students leave for the summer to avoid a financial loss during a busy period. The board declined the request, citing a history of past alleged violations, and imposed a 14-day suspension.

The city’s most consequential case this year involved Taco Junky, a tequila bar on University Hill. The operation spanned multiple days and involved at least five police officers and two underage operatives. A bouncer had allowed an underaged operative to enter the bar with a fake ID in exchange for payment, according to a stipulation of facts filed as part of the show cause hearing. Staff also refused to allow officers into the bar on multiple occasions. The business owners sought to surrender their liquor license, in part to avoid a lengthy public hearing, according to an attorney representing Taco Junky. But the Beverage Licensing Authority members chose to revoke the business’s license, which can impact the business owners’ ability to obtain another liquor license in Colorado. Taco Junky has since closed. 

In determining the length of suspensions, the Beverage Licensing Authority considers “mitigating factors,” such as a written policy for serving alcohol or other preventative measures. 

During a June show cause hearing, Savanna Hyde, operations manager of My Neighbor Felix, a Mexican restaurant on West Pearl, said she fired an employee who sold margaritas to an underage operative without checking IDs. 

“It was probably one of the hardest times I, personally, had firing an employee because he was genuinely a great employee,” Hyde told the board. “It was just a horrible, horrible slip-up.”

A lawyer for My Neighbor Felix requested that the suspension start after the Fourth of July holiday week. The board approved the request, citing the business’s comprehensive operations manual on alcohol service. The three-day suspension began on July 8.

The ability to serve alcohol is crucial for some businesses in Boulder, many of which operate on slim profit margins. Last year, the Boulder City Council repealed 2013 rules that restricted alcohol sales on University Hill as part of an effort to revitalize the neighborhood. 

“Alcohol is everybody’s markup. There is no markup on food,” Jessica Benjamin, executive producer at Savor Productions, which organizes dining events across Boulder County, told Boulder Reporting Lab. Benjamin said she supports liquor license compliance checks. 

Given the high stakes of losing a liquor license, some question whether the punishment fits the crime. Jason Savela, a criminal defense attorney who has represented clients before the Beverage Licensing Authority, said business owners are punished for their employees’ actions, which often occur without the owner’s knowledge.

“If you’re the owner, it doesn’t seem fair,” Savela told Boulder Reporting Lab. “Are we actually punishing the right person? I don’t know.”

Despite this, he said he holds no animosity toward the Beverage Licensing Authority, acknowledging that the members generally do their job as they are trained. 

“I give them that benefit of the doubt,” Savela said. “I wish that business owners would get the same benefit of the doubt.”