Economic Development Bill’s Impact on Liquor Licenses

Additional liquor licenses for BostonJust prior to the close of the legislative session last week, Massachusetts lawmakers passed an economic development bill that provides Boston with additional liquor licenses. However, the impact on liquor licenses and current liquor license holders will not be as negative as feared with the threat of completely abolishing the quota system. The bill is currently waiting for the governor’s signature, and he has 10 days to sign it into law.

According to The Boston Globe’sLiquor license, opioid bills pass Mass. Legislature,” Boston, which already has 692 liquor licenses, will be granted an additional 25 licenses each year for the next three years. This is the first increase in liquor licenses for Boston since 2006 when the legislature granted an additional 55 licenses to the city. The licenses will be added on Sept. 1 of each year, beginning on Sept. 1, 2014.

Adding a relatively small number of licenses over a three-year period is a far more conservative approach than completely eliminating the quota system. The new legislation will help protect the value of existing licenses that are, in many cases, worth hundreds of thousands of dollars and represent a true asset to licensees.

New Liquor Licenses in Boston

Although initially it sounded like all of the new liquor licenses would be designated for areas currently underserved by bars and restaurants and restricted, upon further review, only 60 of the 75 total that will be issued fall under those parameters. MassLive writer, Garrett Quinn, notes that there will be five licenses issued each year for the next three years that are unrestricted (i.e. can be used city wide) and transferrable. (“Here’s some clarity on the expansion of liquor licenses in Boston.”)

Of the balance of 45 licenses, they are geographically specific: “The 45 new full liquor licenses will be limited to Main Street Districts as defined by the city and neighborhoods of Dorchester, East Boston, Hyde Park, Jamaica Plain, Mattapan, Mission Hill and Roxbury.”

These licenses are not transferrable.

The balance of the 75 additional licenses will be beer and wine licenses and will be issued according to the same geographic specific areas and are also non-transferrable.

Liquor License Control

Additionally, the new law returns control of liquor licenses to the mayor of Boston for the first time in well over 100 years. The mayor will appoint a three-person board to oversee liquor license distribution rather than the existing panel named by the governor. Councilor Ayanna Pressley, who has been leading the argument for the change is quoted in The Boston Globe article saying, “It’s been a hundred-plus years that this law has been on the books, standing in the way of Boston’s economic progress.”

By approving a limited number of non-transferrable liquor licenses with geographic restrictions, this economic development bill can help spur growth in targeted neighborhoods without severely and negatively impacting current liquor license holders.

To learn more: Watch this video explanation.