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The City of St. Paul Tries to Close down Diva’s Bar

Diva’s owner, Debra Johnson, now 53, grew up in St. Paul. Her father, Ken Rauschnot, owned the Esquire Lounge on University Avenue. Debra’s career in the bar industry began at the age of 18 when she worked as a bartender and cocktail waitress in her father’s establishment. She worked there for three years starting in 1978. Then she took a job at Finegan’s bar in Roseville to make more money and learn how to prepare upscale drinks, prior to working at the Lexington Restaurant on Grand Avenue in St. Paul. She obtained a degree in psychology from the University of Minnesota and later worked in the educational field.

Deb Johnson is part native American, on her mother’s side. Her great-grandmother once owned Madeleine island in Lake Superior before the Ojibways were moved to the reservation. Her mother, from the Speten family, is descended from Chief White Cloud. The family has ties to the White Earth reservation in northern Minnesota and is related to the well-known American Indian activists, Vernon and Clyde Bellacourt. On her father’s side, her ancestry is Italian and German.

In 1992, Deb and her mother pooled their resources to purchase a duplex on Lawson Street on St. Paul’s east side. After extensive renovation work, they sold this building for a profit in 1995. The proceeds were used to purchase the Sports Break bar at the corner of Rice Street and Maryland Avenue. This became a family-run business involving Deb, her brother, father, and mother. It had a racially mixed clientele.

Deb left the family business in 1999. During the next five years she was a bartender at the Beer Belly bar in Oakdale and at the Chalet in Maplewood. Her father and mother both died in 2004, leaving the brother to manage the Sports Break bar. He had some shortcomings as a manager and the bar closed in 2006. Even so, this bar caused few problems for the neighborhood. It inspired no complaints.

Deb Johnson bought Vanelli’s bar on June 20, 2005, and promptly renamed it Diva’s Overtime Lounge. The word, “diva”, usually applied to opera singers, suggested to Johnson a beautiful, glamorous woman - someone like Princess Di or Marilyn Monroe. She speculates that this term offends a certain type of feminist woman, well represented at St. Paul City Hall, who resent the adoration of women in a sexual role. But for Johnson, it was the personification of her dreams.

Deb Johnson’s first act as new owner of the bar was to knock out most of the interior walls to create a large common space which increased security and the sense of community. She installed an elevated platform at the south end which critics believed was used for nude dancing but, in fact, showcased certain individuals such as singers or persons having a birthday. Johnson also renovated the kitchen. The grease was so thick she was afraid to turn on the oven. Johnson cleaned this up and purchased an expensive hood. Nardini’s, the fire-equipment contractor, pulled a permit to install an Amstell sprinkler system. But trouble was brewing.

trouble with the church

On June 25, 2005, five days after she became the bar’s owner, the operator of the pull-tab booth benefiting nearby St. Bernard’s Roman Catholic church reported to the head priest, Father Mike Anderson, that Deb Johnson ran around the bar in her bra and underwear. Father Mike mentioned this accusation in a sermon delivered in July 2005. It was the first of many negative comments that this priest made about Johnson and her bar in the course of more than a year.

Persons from St. Bernard’s church complained to St. Paul city officials of Johnson’s allegedly lewd behavior. Someone from the License-Inspections and Environmental Protection (LIEP) department at St. Paul city hall called Johnson to request the security tape for the day when she was accused of prancing around the bar in a partially clothed state. Johnson refused to surrender the tape. She couldn’t believe that she would be accused of such a thing since there was no basis for it.

Diva’s bar did receive its liquor license on October 1, 2005, with the provision that the bar not sponsor any bikini shows or lingerie contests. With that out of the way, Johnson promptly notified the manager of St. Bernard’s pull-tab operation that she would not be renewing their contract. They had until the following day to remove the spinning (K) wheel and the pull tab booth. Several days later there was a letter from St. Bernard’s notifying Johnson that they were not planning to renew the contract either. Furthermore, bar customers were not welcome to use the church parking lot - not that any had used it.

The pull-tab operation had been quite lucrative for St. Bernard’s. Johnson estimates that the church was clearing at least $50,000 a month. Pull tabs come in the form of $.50, $1.00, or $2.00 tickets. The purchaser removes the cover from a set of boxes to see if the ticket has a winning combination, worth a certain amount of money. Since the odds are heavily against winning, the charitable organizations running the pull-tab operations make enormous amounts of money. The bar receives a smaller share. Diva’s receives $1,750 a month from the pull-tab operator. The operator must be a charitable organization, and it is required to file financial reports stating the gross proceeds and how the money was spent for various charitable purposes. One of Johnson’s concerns was that she never received the reports from St. Bernard’s.

Another bar owner on Rice Street, Bill Schally, who once owned Schally’s bar at the corner of Rice and Magnolia between 1995 and 2001, had previously threatened to remove St. Bernard’s pull tabs from his bar. He thought other charitable organizations offered better deals than St. Bernard’s did. Father Mike Anderson responded by contacting numerous business establishments on Rice Street asking them to call licensing about Schally. Feeling political heat, Schally agreed to keep the St. Bernard’s pull tabs in his bar if Father Mike apologized to Schally on five separate occasions and if the church paid $10,000 to stuff the deceased gorilla at Como zoo. Only three such apologies were given. Schally, who now works as a bartender at Diva’s, estimates that the St. Bernard’s pull tabs at his bar grossed between $1.5 million and $2 million per year. Diva’s grossed a similar amount.

After giving St. Bernard’s the boot, Deb Johnson selected a pull-tab operator representing a charity called Drop Dead Broke, which provides safe houses for young people trying to escape gangs. However, she was disappointed that none of its expenditures benefited to people in her neighborhood. For that reason, she next chose to benefit Lady Slippers which provides scholarship money for low-income college students. The new pull-tab operator started on October 1, 2006.

In any event, Diva’s cancellation of the pull tabs benefiting St. Bernard’s church gave Father Mike a compelling reason to intensify his campaign against the bar. The church had powerful parishioners. One of them was the City Council member from that area, Lee Helgen. Helgen is personally close to Father Mike. Father Mike and Lee Helgen met with influential businessmen on Rice Street, representing such businesses as the Capital Bank and the Klub House, and occasionally the Mayor, to discuss issues relating to Diva’s bar. The Klub House, owned by Bruce Larson, was a favorite meeting place for Johnson’s critics. Two blocks down Rice Street, one would imagine that its business stood to gain from Diva’s closing.

Father Mike's writings

Deb Johnson had secret allies who kept her informed of the plotting against her. Parishioners at St. Bernard’s told of Father Mike’s sermons urging people not to patronize Diva’s. He implied that Johnson exhibited or encouraged lewd behavior and that the bar had brought violence to the neighborhood. He himself was afraid to walk past Diva’s bar, he said. The same message was expressed in Father Mike’s column in the parish newsletter. This column makes heavy use of sarcasm and mock humility and occasionally misstates the facts.

In the latest issue (December 3, 2006), for example, Father Mike was galled by the fact that a Ramsey County judge refused to revoke Diva’s liquor license immediately. “Now I am not sure,” he wrote, “but in July it seemed to be reported that there were three people shot within the bar, one of them murdered. In no report of that incident did we read about any drive-by shootings that caused this terrible mishap. It seems that the shooting happened close up by a man wielding a gun in the bar, but I don’t have the insight of a Judge to make such distinctions.”

(Yes, there was a fatal shooting in the bar, but Father Mike neglected to mention that Diva’s security personnel did screen persons entering the bar that night. The four gang members involved in that incident, who had never previously set foot in Diva’s, had robbed a number of businesses on Rice Street and then, in the same evening, exchanged gun fire at the McDonald’s restaurant in an apparent argument over how to split the loot before retreating to Diva’s. The shooter may have had a "glock gun", made of plastic, which eluded security.)

Father Mike also wrote in this newsletter: “When I get back on my feet I will not find myself being afraid to walk the streets in the North End ... I will, however, be cautious while walking by Diva’s. It is not a whole neighborhood, but it is a location within the neighborhood that seems to be distressing the whole. In her press conference/ protest in front of the parish office Ms. Johnson wanted to make sure that we knew that none of what was happening was her fault. If this is the case then she is either the most hapless bar owner around and we should all feel very sorry for her, and help her as best we can by perhaps patrolling around her establishment to make sure that the bad people stay away.”

(The press conference did not deal at all with the question of who might be responsible for neighborhood crime but with the possibility that the church might be using its political connections to ruin Diva’s financially so that it, St. Bernard’s church, could acquire the property at a sharply reduced price to build a church-owned assisted-living facility on the corner where Diva’s bar now sits. The protesters carried signs with such slogans as “Serve God, not Money” and “How many of the Ten Commandments have you (Father Mike) broken today?”)

In short, the head pastor at St. Bernard’s church, Father Mike Anderson, had mounted a publicity campaign to vilify Deb Johnson and Diva’s bar using both real (shootings in or near the bar) and imagined (the bar owner running around in her underwear and bra) incidents as a front for the campaign. An ulterior motive was the possibility the the church might acquire Johnson’s property at a sharply reduced price if it could persuade the city of St. Paul to revoke Diva’s liquor license and forbid anyone else to operate a bar on the same site.

The church's long reach in the neighborhood

Even though Deb Johnson’s two daughters attended Johnson High School rather than the school at St. Bernard’s, they experienced harassment both from teachers and students because their mother owned Diva’s bar. Through substitute teachers and others, the long arm of St. Bernard’s church extended across the east side of St. Paul.

Father Mike was a man of enormous influence throughout the Rice Street neighborhood both for his position as pastoral leader of the St. Bernard’s church community and his political connections, especially to Lee Helgen, member of the St. Paul City Council who was also a parishioner. In the name of neighborhood improvement, he was quick to encourage parishioners to call the city’s licensing department to complain about certain businesses, threaten Rice Street business owners, and urge parishioners and their friends to boycott businesses such as Diva’s bar. Father Mike Anderson thus became a feared political player.

Some customers at Diva’s have choice words to describe him. One man, for instance, told of a woman who had twice been fined by the city of St. Paul for failing to pick up excrement from her dog. This woman ran into Father Mike near Maryland and Rice when he was walking his St. Bernard’s dog. This large dog defecated on the side walk. When the woman confronted Father Mike, he said that he did not have to pick it up. In other words, he thought himself to be above the law. In another situation, Father Mike promised a certain bar owner (not Deb Johnson) exclusive meat raffles conducted by the church. Two weeks later, this bar owner discovered that the Tin Cups restaurant also had meat raffles. Father Mike evidently did not feel a need to keep his promises.

After the City of St. Paul instituted a smoking bar in March 2006, Deb Johnson converted a parking space in back of the bar to a "smoking patio" where smokers could go to take a break. This meant that the bar lacked the required number of parking spaces. Johnson attempted to overcome the deficiency by renting a space at DeLisle's across Rice Street. The owner of DeLisle began to receive threatening telephone calls to the effect that rocks would be thrown through his window or no one would purchase real estate from his firm if he went ahead with plans to let Diva's rent a space in his parking lot.

Father Mike’s political henchman was St. Paul City Council member Lee Helgen - the same Lee Helgen who had spearheaded the demolition of Nancy Osterman’s house at 14 East Jessamine Street in February 2006. According to Deb Johnson, Helgen came into Diva’s bar at least once a month between July 2005 and April 2006 to engage in conversation that was not friendly. Its consistent message, according to Johnson, was: ”I don’t like anything about your place.”

Helgen objected to a specialty drink advertised at the bar which was called “Diva’s naughty fruit”. This drink consisted of cherries, olives, and pineapple soaking in vodka. But to Helgen it might have been like the forbidden fruit that Eve offered to Adam - something that was sexually provocative. Council Member Helgen also did not like that fact that Diva’s featured a singer named “Rowdy Cowboy” on Thursday evenings. “Rowdy Cowboy”, also known as “Bo Billy”, was a Nashville recording star who sang Country and Western songs. Maybe Helgen thought that his presence at the bar incited rowdy or violent behavior. There was also an elevated platform at one end of the bar room which looked like - but was not - a place for nude dancing.

Month after month, for nine straight months, Deb Johnson had to endure this representative of St. Paul city government coming to her bar to harass her. His message was always something like: “You’re a poor bar owner, you’re a poor business woman.” By April 2006, Deb Johnson had had enough of this man. When Helgen started into his routine, she fired back in words like these: “You closed Club Cancun driving its gangster clientele to other bars in the city. The city never offered us bar owners any help. You never gave us any warning. Now, you take your puppet ass out my door and don’t come back.”

Thus confronted, Lee Helgen did leave the bar and never returned. The puppeteer in this case, Johnson later explained, was Father Mike Anderson.

A real-estate angle

There was something else in the background that may help to explain Father Mike’s and Lee Helgen’s behavior. “The root of all evil is money”. Money, not personal animosity toward Johnson, may have been the driving force behind the campaign against Diva’s bar.

Some time in July 2006, Deb Johnson saw Father Mike and some real-estate developers walking around near the bar. She heard that these developers had offered her neighbor, First Asian grocery store, $625,000 to purchase its building. The same developers called Fred Macalus, owner of the building that housed Diva’s bar, and offered to buy his property. Macalus said that, since Diva’s bar had a business interest in the building, he would have to consult first with Deb Johnson.

The developer, Mendota Homes of Little Canada, held two meetings with Johnson and Macalus to discuss terms. They disclosed that they were planning to build an assisted-living facility at the location of the bar and that St. Bernard’s church would own this facility. Another developer, Sherman Rutzick, who was a parishioner at St. Bernard’s, was presumably representing the church in these negotiations.

During the first meeting, which took place at the beginning of September, 2006, the developers offered $1 million for the property. Fred Macalus, the building owner, would receive $725,000 of this and Deb Johnson the rest. Johnson said that this ($275,000) was too little. She would agree to sell if the developers paid $1.2 million. The developers said they needed to think about that.

At the second meeting, which took place the following month, the developers declined to pay the additional amount. Rutzick told Johnson that they had better accept the $1 million offer because, if they refused the offer, no one would ever get a liquor license for that site and the property would be worth much less. “You’d better accept our offer - or else” was basically what he told Deb Johnson. At this point, Johnson walked out of the meeting after remarking “Nobody threatens me like that ... Talk to my lawyer.”

This failed negotiation helps to explain why the police response to a shooting incident near Diva’s which took place an hour after its closing was much harsher than the one in July that involved a fatal shooting in the bar. The city thought it had Johnson pinned to the mat. There were press reports, both in St. Paul and Minneapolis, that the St. Paul City Council was proposing tough new ordinances to curb violence near bars and that Diva’s would almost certainly lose its liquor license. St. Bernard’s campaign to close down the bar was nearing fruition. Victory seemed almost in sight.

The Watchdog shows up outside the church office

Then Deb Johnson and friends, joining forces with the Metro Property Rights Action Committee and the Watchdog newspaper, staged a protest demonstration in front of the business office of St. Bernard’s church on Woodbridge Street at 1:00 p.m. on Tuesday, November 21, 2006. Around twenty persons, many carrying picket signs, took part in the demonstration. Reporters from both the St. Paul Pioneer Press and the Star Tribune and from three radio stations covered the event.

Father Mike was unavailable to come out of the office to address the protesters’ concerns since, at the time of the demonstration, he was in the hospital undergoing ankle surgery. Protest organizers announced a moment of silence to wish him a speedy recovery. No one else from the church office agreed to meet with the protesters.

In reference to the proposed property acquisition, the theme of the protest was “Serve God not Money” (a saying of Jesus) although some of the signs identified Father Mike as a “racist” because it was thought his campaign to close the bar was aimed at Diva’s black clientele. Apparently, Father Mike had been quoted in the Pioneer Press to the effect that “Rice Street has never been so dark since Diva’s opened.”

Mainly, however, the event consisted of Deb Johnson’s description of the situation at Diva’s and of events leading up to the proposed license revocation. Bill McGaughey from MPRAC held a microphone to ask questions at certain points in Johnson’s testimony and Jim Swartwood, publisher of the Watchdog newspaper, manned the video camera which taped the event for later broadcast on cable television.

There were articles about the rally on the following day in both the Minneapolis and St. Paul newspapers. The Watchdog newspaper, a metro-area tabloid, featured the protest demonstration on the front cover of its next issue. When the city took Johnson to court to seek the bar’s license revocation, Judge Marybeth Dorn refused to grant the city’s request. Unknown to city prosecutors, the judge had previously visited the bar in person to check its conditions and, finding all in order, allowed Diva’s to keep its license at least for the immediate future.

not yet out of the woods

That does not mean, however, that all is rosy for Deb Johnson. The church’s unrelenting campaign and all the negative publicity have succeeded in driving away many of the bar’s customers. It’s less than half what it used to be. The city’s anti-smoking ordinance, which went into effect in March 2006, also had a negative impact on bar patronage. Deb Johnson reports that she has lost a half million dollars this year in operations, not counting the $32,000 which she spent on a new hood for the grill which St. Paul city inspectors forced her to remove despite compliance with permitting requirements. Additionally, Johnson has spent $200,000 in legal fees trying to save her liquor license.

Johnson, who is not a wealthy woman, may soon be forced out of business. Some of the bar suppliers, fearing that she may not remain in business much longer, have already started to pull out. The beer distributor won’t give her a new sign. The video man wants to remove his machines. The owner of the ATM machine is balking at a new contract. Law-enforcement officers continue to stalk her because of issues related to the drivers license.

A well-placed source told Johnson that the police were tapping her telephone calls. A tracking device was planted in her car. If that were not enough, the authorities confiscated the license plates of the car. Then they decided to proceed with revocation of the liquor license despite the court order denying the city's request. And the lawyer (Andy Dawkins) was asking for more money. It was enough to cause a nervous breakdown.

On the other hand, Deb Johnson is not a woman who gives up easily, and Diva’s has a loyal customer base. The political fight is just beginning. With the help of other metro-area property owners, Johnson is hoping that a combination of able bar management and publicity to counter the false information given out by Father Mike and the city will turn the tide against license revocation and bring the lost customers back.

Post script: Deb Johnson, supported by the Libertarian Party of Minnesota, plans to run for St. Paul City Council against Lee Helgen.

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