It's That Time of Year Again: Renewal Season Is Upon Us

Calling all restaurant, bar, hotel, tavern, pub, club and package store owners:

By now, you should have received your 2018 renewal package from your local licensing authority (LLA) regarding your alcohol beverages license(s).  Packets must be fully completed pursuant to Massachusetts G.L. Ch. 138 § 16A by Thursday November 30, 2017 at 5:00PM. Outside of Boston, this deadline may be earlier, so be sure to read your paperwork carefully for all applicable deadlines.

I always recommend that my clients get a head start on this process; the sooner you file, the better, and your LLA will thank you for it. To avoid any issues or missing documentation to your package, don't wait until the last minute!

For those of you located in the initial pilot towns for e-licensing, please note that this year, all renewals will be done the old fashioned way: back to paper applications. 

Lastly, it is IMPORTANT TO NOTE for Boston Licensees that this year, the Licensing Board for the City of Boston and the Mayor’s Office of Consumer Affairs and Licensing (MOCAL) will only be accepting up to date Building Inspection Certificates from the Inspectional Services Department (ISD); no proof of payment will be accepted as in years' past.

Good luck, and cheers to a prosperous 2018.

The Clock Is Ticking For That Alcohol License Renewal Deadline

Calling all restaurant, bar, hotel, tavern, pub & club owners.... you have approximately T-minus 7  days to get those renewal forms in to your local licensing authorities!  

If you are planning to keep your alcohol license active through the New Year, make sure to satisfy all renewal process requirements pursuant to Massachusetts G.L. Ch. 138 § 16A no later than Monday, November 30, 2015 at 5:00 p.m.  You should have received a renewal package from your local licensing authority a few weeks ago, detailing the step by step process for renewals.  If your business is located outside of Boston, be sure to check the deadline for renewal submission, as some licensing authorities require earlier submissions (e.g., the Town of Watertown's deadline is TODAY).  Failure to submit the required renewal forms and supporting documentation will result in 1) the expiration of your license as soon as the ball drops in Times Square at midnight (i.e., not a good way to start off 2016), and 2) having to start from scratch and apply for a new license.  I'm all into New Year's resolutions and getting things off to a fresh start, but this is not the kind of clean slate I have in mind for my clients. 

Want to beat the renewal rush? Get there no later than Wednesday to avoid lines and delays, as well as provide yourself a cushion should the Board require further documentation not already included in your submission.

(Un?)happy Hour, Private Functions & the Dos & Don'ts of Alcohol Pricing

No happy hour dollar drafts here! The Alcoholic Beverages Control Commission (ABCC) enforces the Commonwealth’s ban on happy hour discounts on alcoholic beverages. The ban, in place since 1984, forbids a licensee from changing prices on alcohol during the same calendar week. Massachusetts was the first state to enact such a rule and is one of only a few with such a rule left on its books. (See Time Magazine's recent article regarding the last states standing strong with bans on happy hour.) Earlier this year Beacon Hill legislators withdrew a proposal to alter the ban, citing lack of support. (See a thorough explanation of both sides of the happy hour argument by Statehouse reporter Christian Wade here.)

Until the legislature or ABCC acts to repeal or limit the ban on promotional pricing, restaurants, bars, and retailers must be aware of the so-called “Happy Hour Regulations.” The regulation requires that all alcoholic beverage prices must remain the same for a calendar week. Private functions are the sole exception to the rule (which is another blog post in and of itself). If challenged, the licensee must prove that it qualifies for the private function exception based upon strict requirements set by the ABCC. The ABCC requires:

1. the private function has a host;

2. access to the private function is restricted to invited guests;

3. invited guests are not charged indirectly or directly;

4. the host is the only individual responsible for payment to the licensee;

5. the private function was not publicly advertised; and

6. written records containing the guest list exist and are available for inspection by the licensing authorities. 

Regulations impact licensees in various ways. For example, licensees may not deliver pitchers to a single patron. Licensees may not allow or encourage drinking games. Licensees offering a “bucket” of beers violate the Happy Hour Regulation if the price per beer contained in the “bucket” is less than what the establishment charges for a single beer. (See Boston Nightlife Ventures, Inc., ABCC Decision, 1/13/09). To somewhat skirt the (un)Happy Hour rule, many bars and restaurants discount food in place of discounts on alcohol. 

While the Happy Hour Regulation focus on on-premise licensees, off-premise licensees, by law, must “keep conspicuously posted in each room where any alcoholic beverages are sold a price list of such beverages.” Massachusetts General Laws, Ch. 138 § 15. Coupons offering discounts on alcoholic beverages are strictly forbidden as they alter the price offered from the establishment’s price list to which an off-premise licensee must adhere. The ABCC has imposed one day license suspensions on licensees caught accepting or distributing coupons in violation of this provision of Chapter 138. See Denrich Enterprises, Inc., d.b.a. Liberty Liquors, ABCC Decision, 1/24/97 (licensee had $1 off coupons printed on the back of grocery store receipts and had accepted at least six such coupons); West Mansfield, Inc., d.b.a. Rum Runner Wine & Spirits, ABCC Decision, 1/24/97 (licensee had 10% and 15% discount coupons printed on the back of Stop & Shop receipts, the ABCC rejected the argument that the coupons at issue were available to the general public).

Before engaging in a practice which may lower prices for short time periods, or for some, but not all customers, a licensee should seek legal guidance for the proper course of action, or it may be at risk for sanctions by licensing authorities.

What are your thoughts on special drink prices? Coupons? Happy Hour? 

BYOB in Boston?

This past winter, Boston City Councilors At-Large Michelle Wu and Stephen Murphy proposed an amendment to Chapter 17 of the City of Boston Code to allow patrons to bring their own alcoholic beverages into dining establishments that lack an alcoholic beverages license. See Boston Globe article for details. Currently, Massachusetts law prevents patrons from bringing any alcohol into an establishment which already holds a license to sell or serve alcoholic beverages. According to the Alcoholic Beverages Control Commission (ABCC), unlicensed establishments are at the mercy of local officials: every municipality is free to prohibit, allow, or license the practice known as “Bring Your Own Bottle,” (“BYOB”).

Some locales, such as Mansfield, MA, issue BYOB (beer and wine only) permits to unlicensed establishments for free, however they elect to include certain caveats, such as TIPs training for servers, ID checking, and corkage fee rules. (Helpful tip: TIPs training is always a good idea for any restaurant establishment.) As another example, the Watertown Town Council is scheduled to vote on the subject of BYOB this week (September 22), at it's public hearing.  Watertown's liquor license quota is currently capped at 34, while it awaits the legislature's decision in response to it's home rule petition for 15 additional licenses. Boston, like Cambridge, and Somerville, ban the BYOB practice all together. 

Boston could learn from the experience in other municipalities and states when proposing new BYOB regulations for the City. Take Pennsylvania for example: a licensed or unlicensed restaurant may opt to allow BYOB. (See PA's law in further detail here.) Some municipalities in Pennsylvania charge fees for a BYOB permit, while others will issue it free of charge and use the license as a means of ensuring that the establishment is current on all of its local taxes and fees. The City of Philadelphia alone (probably the prime example of BYOB in the country) has over 200 BYOB establishments in Center City.  According to wine writer Roger Morris, restaurants in Pennsylvania have “turned a major negative—limited liquor licenses, and expensive ones at that—into a marketing positive” using BYOB. 

Let’s face it: the ability to sell and serve alcoholic beverages at full-service dining establishments increases frequency of visitors and the chances that patrons stay a little longer and return time and time again for a complete dining experience.  However, with all-alcoholic beverage licenses costing nearly $400,000 in Boston, a BYOB option could theoretically help those first time restaurant owners or young chefs with less capital focus on the food while they attempt to earn their place in the ever-evolving restaurant industry.

Of course, the allowance of BYOB would not come without its restrictions and regulations.  The Boston BYOB proposal states that instituting BYOB would “encourage local economic development.” But how should it be regulated? Is it fair to those who have paid thousands of dollars for liquor licenses? Should there be a cost for BYOB permits? Should the number of seats matter? Should geographic restrictions be imposed? Does this even make sense for the Boston restaurant scene?  Let's hear your thoughts.