The Union Café, run by long-time area restaurateur Seth Kerzner, and open sporadically at the corner of Lena and Sherman Streets in the old San Juan Mama’s bakery space, was seized by the state Department of Revenue on Monday, July 18 for failure to pay nearly $9,000 in sales taxes, said Mark Couch, department spokesman.
But then, just a week later, the signs were gone, and, according to building co-owner Bruce MacIntire of Telluride, “The bill has been paid, and we’re in deep conversation with someone to get it open again as soon as possible.”
The bill was not paid by Kerzner, who has a long history of grilling delicious hamburgers but then running afoul, in one way or another, of landlords, copyright holders, or the state. (Kerzner lives in Montrose County and has an unlisted phone number, and could not be reached for this story.)
In MacIntire’s telling, Kerzner began with the Union Café in Mountain Village at the base of the gondola. The historically tough off seasons in Mountain Village eventually drew Kerzner to Ridgway, where MacIntire’s group gave him a “screaming deal” on a lease of the old bakery space. “We thought he had the right product for Ridgway,” MacIntire said. “A good burger and fries. We’d give him our giveaway price until he got established, and make our money later in the lease period.”
Kerzner installed a bar and new kitchen equipment but, for the first couple of years, kept the restaurant closed “as a defensive mechanism,” according to MacIntire, “to keep another restaurant from opening in Ridgway.”
In the meantime, Kerzner opened a second Union Café in the Harley-Davidson building in north Montrose. That enterprise somehow sparked the ire of Harley-Davidson, which sued Kerzner for copyright infringement, a lawsuit that Harley-Davidson eventually won.
Meanwhile, Kerzner had finally opened the Ridgway café, off and on, while neglecting to pay state sales taxes between May and October 2010, according to Couch.
Neither was he paying his rent, according to MacIntire. “We should have terminated his lease years ago.” As it was, the state seizure put the building’s owners in a difficult situation.
“In real estate law,” MacIntire continued, “if it’s screwed down, it belongs to me, the landlord. But the state has a different definition. Mr. Couch explained to me that the state looks at your space as ‘a yoga studio with no lighting.’” In other words, the state can auction off anything it can remove – kitchen equipment, bathroom fixtures, furniture – in order to repay the taxpayers’ money. “It’s an interesting law,” MacIntire said. “It gives the state a big hammer.”
For that reason, the landlords decided to pay the taxes and penalties themselves, to keep possession of the restaurant equipment and “get those signs off the building… I had no choice but to protect our choice, if we were going to reopen quickly.” (The state’s auction had not yet been scheduled, but they typically take place about 40 days from seizure.)
“That space is going to be a restaurant,” MacIntire concluded. To that end, he and his partners are already close to closing a deal with another restaurateur. “We want to get the doors open again as soon as possible.”