The state government has ruled that since they sell alcohol for consumption on premises, as part of their license that allows them to do that requires that they

The state government has ruled that since they sell alcohol for consumption on premises, as part of their license that allows them to do that requires that they not ban patrons from the establishment, specifically, "groups or individuals cannot be excluded on the basis of criteria that are not directly related to the your duties under your [liquor] license." If the city would get serious and simply say, "stop banning these people or stop selling alcohol", that would be the end of it.