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Aug 25, 2016

#activateBOS: Recap of Liquor Licenses for the week of 8.24.16 (Hearing 8.24.16 & 8.25.16)

Follow Epicenter Community as we continue to monitor legislature. Keep up with us on Twitter under the hashtags #liftthecap & #activateBOS

New Business:

There were no new applications for liquor licenses this week though there were a few things of note happening with pre-existing liquor licenses.

On Wednesday, 8.24.16,

Dirt +Water, LLC dba haley.henry at 45 Province St, Boston MA, holder of a C.V 7 Day Wines and Malt Beverages License petitioned to pledge the license (license #: LB-99529) to Cambridge Savings Bank. On 8.26.16, their petition was granted by the board.
Columbus Avenue Liquor Group, Inc. dba Wine Emporium located at 474 Columbus Ave, Roxbury MA, petitioned to pledge their license (license #: LB-101943) to First Ipswich Bank located at 31 Market St, Ipswich MA. On 8.26.16, their petition was approved.
Strongbox Corp. dba Rox Diner located at 1881 Centre St, West Roxbury MA, holder of a Restricted C.V 7 Day Wines and Malt Beverages License petitioned to amend the description of the licensed business and also petitioned to change the license classification to a Restricted C.V 7 Day Malt, Wine and Liquers Beverages License. On 8.26.16, their petition was granted.

Old Business

There is no old business for this week. Starbuck’s petition for a Common Victualler License to be exercised at a new location at 749 E Broadway. South Boston MA, 02127 was deferred last week. To our knowledge, the petition is still deffered due to overwhelming amount of community input on the issue.

Thoughts On This Week’s Applications

What does it mean when a business “pledges” its loan to a bank?

According to MA law:

“Can a retailer use his/her license to secure a loan?

Yes, but only under certain conditions. Massachusetts Law states that “any license granted under the provision of this chapter may be pledged for a loan provided approval of such a loan and pledge is given by the local licensing authority and the Commission [ABCC].”

What are the different kinds of liquor assets/property that can be pledged?

The law permits three different kinds of liquor assets/property to be pledged. These are:

Licenses that authorize the sale of alcoholic beverages;

Corporate Stock in a corporation that holds a license to sell alcoholic beverages; and

Alcoholic beverages themselves which a licensee is authorized to sell.”

It comes as no surprise to us that liquor licenses can be used as a form of capital- businesses transfer their liquor licenses to other businesses all the time, usually for a hefty price.

But why does this matter?

Boston has a ridiculously low cap on the number of liquor licenses that can be issued each year- this is why Epicenter monitors liquor license hearings. This cap on licenses often leads to an uneven and skewed distribution of licenses that, more often than not, benefit already establish, economically developed areas. This overwhelming demand for liquor licenses paired with the ridiculously low supply has created an economy in which businesses can leverage their licenses for profit.

This overwhelming demand for liquor licenses paired with the ridiculously low supply has created an economy in which businesses can leverage their licenses for profit-

This means that liquor licenses often stay in the circle of wealthy business owners who can afford the inflated price of a liquor license when the city cap has already been met. This leaves our restaurant owners in certain areas (most often owners of color as well) in a proverbial liquor license desert.

While pledging a liquor license to a bank is a perfectly legal way to get needed loans, it also shows us the true nature of how liquor licensing works. If you can afford it, you can sell your license, buy a license when the city has already met the cap and also pledge your license for even more capital- where does this leave disenfranchised restaurant owners who already have limited access to liquor licenses? It denies them the opportunity of owning capital and being able to use that capital to build their business. It privileges the rich and already established.

And that, in itself, is an issue.

As noted in weeks past, this there is an amendment to language that was put before the state to include Boston in the Governor’s previous bill to lift the cap on the number of liquor licenses available to perspective restaurant owners in the state.

We encourage all of you to reach out to your city and state reps in order to encourage them to vote to lift the cap on the regulatory number of licenses within the city.

To find your city councilors: https://www.cityofboston.gov/citycouncil/councillors/

To find your state representatives: https://malegislature.gov/People/CityList