10 NEW FULL VALUE BOSTON ALL ALCOHOLIC BEVERAGE LICENSES SURE TO GO QUICK

Law Offices of John P. Connell, P.C.: Contained within an “Economic Development Bill” signed by then Governor Patrick in August 2014, the Massachusetts Legislature amended Chapter 138 of the Massachusetts General Laws, the state’s Liquor License Act, and allowed the City of Boston to issue 75 new liquor licenses, 25 of which were to be available in September 2014; 25 more would be available in September 2015; and a final 25 more would be available in September 2016. Of the 25 new liquor licenses that were to be available to the City of Boston for each of the then three coming years, 20 of those licenses (15 All Alcohol and 5 Beer & Wine) were to be “restricted licenses,” meaning they could only be issued to restaurants located within certain parts of the City, such as Roxbury, Dorchester and Jamaica Plain, amongst other neighborhoods and so-called “main street” zoning districts, and these “restricted licenses” could not be sold or transferred by the licensee once they were acquired.

The other 5 liquor licenses to be issued in the then three coming years were to be so-called “full value All Alcohol licenses,” meaning they could be issued to a restaurant located anywhere within the City of Boston, including such hot neighborhoods as the North End, the Seaport and the Back Bay, and once issued they could be sold on the private market to any other restaurant located or proposed to be located anywhere within the City of Boston. Such “full value All Alcohol licenses” regularly sell for $400,000.00 or even more on the private market, and the possession of such a license substantially increases the re-sale value of a restaurant.

In August and September 2014, however, the City of Boston and the Massachusetts Alcoholic Beverages Control Commission, and their respective legal counsel, read the revisions to the Chapter 138 made by the Legislature and determined that the amended Section 17 of G.L. c. 138 was ineffectual as to the annual allocation of 5 new “full value All Alcohol licenses,” as portions of the old Section 17 remained which still prohibited the issuance of new “full value All Alcohol licenses” over a certain stated amount. Accordingly, while the remaining 20 “restricted licenses” became available in September 2014, and another 20 “restricted licenses” became available in September 2015, the 10 “full value All Alcohol licenses” intended by the Legislature remained in limbo. Until now.

In October 2015, the Legislature finally went back to the drawing board and took another effort at drafting language that would legally effectuate the City of Boston’s ability to issue new “full value All Alcohol licenses.” Tucked away in House Supplementary Spending Bill No. 3829, dated October 28, 2015, were Sections 18 & 19 which further revised G.L. c. 138, Section 17. On November 2, 2015, Governor Baker signed into law the Supplementary Budget legislation which included the proposed curative language for G.L. c. 138, Section 17.

After the amended language was considered, it was unofficially determined at least as of last week that such language successfully cured the prior defects with the 2014 legislature and the City of Boston was now authorized to issue 10 new “full value All Alcohol licenses.” Since word has spread of these valuable and much sought after licenses were available upon mere application to the City of Boston instead of having to pay upwards of $400,000.00, a scramble has ensued for both existing and proposed restaurants to have their paperwork filed with the City of Boston Licensing Board so as to be “in line” for one of these licenses.

On the January 13, 2016 Boston Licensing Board hearing agenda, there appears to be only 2 applications for All Alcoholic Beverage Licenses, and reportedly at least 15 more applications were filed this week. Only applicants already having an existing Lease and those having already appeared or scheduled to appear shortly before their local neighborhood associations – an essential step in order to prove “public need” at the actual hearing for a new liquor license – would be considered as having their “ducks in a row” and ready to be heard on an application for a new liquor license. One thing appears certain, however, these 10 new “full value All Alcohol licenses,” whether they be scooped up by small or large restaurants in the right place at the time, surely will not be available for long.

© Law Offices of John P. Connell. P.C. 2016

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