City denies permit for Carnival rail jam

For the second consecutive year, Whitefish city officials have denied Great Northern Brewing Company a special permit to hold an event during Winter Carnival.

The brewery planned to host a ski and snowboard rail jam in downtown after the Grand Parade on Feb. 7, but couldn’t come to agreeable terms with the city over requirements for extra insurance and indemnification.

Last year, the brewery canceled its beer barter following a similar dispute that played out in front of city council.

“Unfortunately, we're in a similar position to last year with this denial from the city,” brewery general manager Marcus Duffey told the Pilot. “We took measures to ensure we didn't go down this road again, but to no avail.”

City Manager Chuck Stearns officially rejected the rail jam permit on Thursday. He said he would have approved the event had the brewery agreed to sign the same insurance and indemnification clause city councilors required for last year’s beer barter.

The clause says the brewery will hold the city “harmless from any and all claims, costs and liability of every kind and nature, for injury to or damage sustained for any reason by any person or entity in connection with or on account of the [event].”

It also requires $1.5 million in liability insurance.

Like last year, Duffey contends the requirements are unreasonable and said the brewery’s insurance provider wouldn’t accept the terms that extend coverage beyond the event area. He said attempts to negotiate the terms with the city were turned down.

“How can the city of Whitefish expect any entity to accept responsibility for any and all circumstances occurring on the day of an event with an indiscriminate assignment of liability to Great Northern Brewing Company?” he wrote in an email to Stearns.

Duffey questions whether the city is making a “deliberate” attempt to keep the brewery from hosting these events.

“This condition the City of Whitefish is requiring for our special event is impossible to meet,” he said. “That leads me to one conclusion; this condition is intended to eliminate the possibility of the event going forward.”

The rail jam was to replace the beer barter, a popular event that asked contestants what they would do or trade for a year’s supply of beer. Hundreds of spectators filled the street in front of the brewery as offers were made to a panel of judges.

The brewery canceled the regular barter last year following its dispute with the city, but held a smaller version inside its facility.

This year, they wanted to try something new.

“The beer barter had run its life cycle,” Duffey said. “We like to keep things fresh and we were going to take this opportunity to put a twist on things.”

Working in conjunction with Whitefish Mountain Resort and Malmquist Construction, the brewery planned to build an elevated ski ramp on Railway Street for the rail jam. A portion of the street was to be closed off and open containers of beer would be available to spectators.

The brewery submitted a permit application on Jan. 6, which included proposed changes to the insurance and indemnification clause.

Stearns swiftly rejected the proposal.

“We believe your responsibility, liability, and risk extends beyond the perimeter of your enclosure, especially with the risk of over-serving or drunk patrons,” Stearns said of the extra requirements.

Duffey asked why other special events weren’t held to the same standards.

Stearns replied that the brewery was being held to a higher standard because it’s in a “penalty box” for non-compliance at past beer barters.

“You were in their same position with prior beer barters until you did not control the beer barter and there were open containers throughout town, twice,” Stearns wrote. “Once you did not perform adequately for a second time after being warned from the prior beer barter, additional provisions become necessary.”

Stearns added that city taxpayers shouldn’t be exposed to costs or liability from special events.

“If your insurance company won’t cover the risks, why should city taxpayers?” he wrote in denying the permit.

Stearns said he would have considered approval if no alcohol were served.

Duffey said he addressed concerns about open containers by meeting with Whitefish Police Chief Bill Dial and Fire Chief Joe Page. He said they both verbally supported the event.

Duffey went on to say the brewery has unfairly been placed in an “inescapable penalty box” while the city “remains immune from being labeled unfriendly to business.”

“To pin bad behavior on the brewery is unfair, unrealistic and inaccurate,” he said. “There seems to be this idea we don’t follow rules. I admit, we do think outside the box, but we do follow the laws.”

He noted that the brewery was granted nine catering and event permits last year, with six taking place on city property.

“Not a single event resulted in a citation, misconduct, or incident of any sort,” he said. “I would say we demonstrate responsible conduct, and I'm proud of the way Great Northern and its employees do business.”

In a final email to the city, Duffey expressed disappointment.

“I realize you feel very strongly that this is the best way to protect the city and it's taxpayers from costs and liability,” Duffey wrote. “Know that Great Northern has very strong beliefs, as well. We work hard as stewards of this community, and we undoubtedly have the support of the hard working people that keep Whitefish viable. We believe that the city should work for the interests of these people.”

The brewery can appeal the decision at the Feb. 2 city council meeting, but Duffey says he has no interest in going in front of council again.

Last year, council overturned Stearns’ permit denial for the beer barter as long as the insurance and indemnification requirements were met, but they also handed the brewery a stern warning for its past performance.

“I do not intend to subject Great Northern to another public scolding on the part of the Whitefish City Council,” Duffey said. “Especially one that characterizes, not only Great Northern, but me personally as a disrespectful and irresponsible member of this community.”

Whitefish Mountain Resort said it will not hold a rail jam at the resort on Winter Carnival weekend. Resort spokeswoman Riley Polumbus said that in partnering with the brewery, the resort was attempting to bring its Carnival events to town.

The resort’s traditional torchlight parade and fireworks display has been moved to President’s Day weekend.

Whitefish Winter Carnival weekend is set for Feb. 6-8.