Brothers divided

During a recent tour of the vacant space adjacent to Cold Stone Creamery on West Second Street, local entrepreneur Scott Baldwin enthusiastically shared his vision for his bar-to-be, The Argus.

As he described where the L-shaped bar would go, how he would keep the rough brick work lining the walls “for character,” and the extensive back patio area that would make The Argus “a real gem” in downtown Chico, there was a sense that Baldwin has taken a painstaking approach to launching a business with long-term success in mind.

“I feel extremely confident in the location, the business plan, in the community being welcoming to what we’re going to bring to town,” he said.

But despite his preparations, including having his architectural plans reviewed by the city and the approval of building and use permits, construction has been on hold since Sept. 21. That’s when Eric Hart, owner of the nearby El Rey Theatre, filed a formal protest and prompted a Department of Alcoholic Beverage Control (ABC) review process that went well past the 175-day window for “investigation, hearing preparation and administrative review” associated with a protested liquor-license application.

As reported early this year (see Newslines, “Bar Crawl,” Jan. 10), in order to open The Argus, Baldwin agreed to purchase the liquor license Woody Sjorstrom has used for the past 11 years as owner of the Towne Lounge.

Interestingly, the vacant space The Argus is looking to fill is owned by the Hart and Fleshman Investment Group, a company owned in part by Eric Hart’s brother, Michael, who believes Baldwin’s business model will be a positive addition to the downtown area.

“He’s got his building plans done beautifully, his concept is top of the line,” Michael said. “We feel privileged to have such a high-caliber businessman investing into our properties and into downtown.

But his brother isn’t so convinced.

Eric’s complaint to ABC raised issues of bar congestion in the downtown area, “vandalism and alcohol-related issues such as vomit and waste,” the proposed bar’s proximity to Bidwell Presbyterian Church’s services held at the El Rey, and that relocating the liquor license to the West Second Street location would “hurt existing businesses which are already struggling in this area.”

The review was completed on Feb. 21 and, as per ABC policy, he was given 15 business days to respond. Eric filed a second protest citing the same grievances on March 14—the last day of the response period—forcing a judicial hearing scheduled for May 9.

In the meantime, Sjostrom can’t afford to abandon his only revenue source in the Towne Lounge and Baldwin can’t move forward with construction of The Argus. Baldwin maintains that, since the original protest was filed, he’s made frequent attempts at meeting Eric halfway by adding provisions to the liquor license to address his concerns. He said those efforts have been met with silence.

“[Eric] never put his best foot forward to reach any kind of compromise,” Baldwin said. “I think that a solution was never in the works.”

Eric maintains that a compromise was not reached because he believes Baldwin’s business model—an upscale bar for businesspeople—simply won’t work and that he will be forced to cater to the college crowd by offering “high-volume discounted drinks.” In that event, he said, business at the El Rey would suffer and downtown Chico in general will continue “deteriorating.”

“I think the location is terrible as far as having a bar between a movie theater and an ice cream shop,” Eric said during a phone interview.

As for the argument he will present during the May 9 hearing, Eric said, “I grew up in this community and I love this town. I work downtown every day. I hope to show the judge that setting up a bar in that area is going to hurt downtown Chico.”

Among the points he will bring to the judge’s attention are Chico’s well-chronicled alcohol-related issues, and how another bar “along the college drinking corridor” is not in the community’s best interest.

“We need to be proactive here, and that’s what I’m doing,” he said.

His brother, Michael, voiced frustration over the ordeal.

“It’s hard to watch,” Michael said of Baldwin’s ongoing construction delays. “Eric’s been very fortunate to have a lot of successes, and for him to impede a young family man like Scott is beyond me.”

Baldwin expressed similar frustration, claiming his establishment would only benefit the El Rey’s semi-regular movie nights and concerts.

“It’s a very wealthy commercial property owner preventing another business coming into town that’s going to provide employment and tax revenue,” Baldwin said. “It’s the exact opposite of what anyone would want for the economic well-being of downtown Chico.

“Ultimately, we’re going to benefit each other,” he said. “There’s no way around it.”