Governor’s liquor license plan lacks legislative support, top Dem says

BY: NIKITA BIRYUKOV – APRIL 4, 2023 3:18 PM

A leading Senate Democrat said Gov. Phil Murphy’s push to expand the availability of liquor licenses for restaurants and bars has won little support from lawmakers, threatening to doom the administration’s efforts to retool the state’s Prohibition-era liquor laws.

“I think the governor’s proposal to expand liquor licenses does not have a lot of support in the Legislature,” Sen. Paul Sarlo (D-Bergen), chair of the chamber’s budget committee, said during a hearing of the panel Tuesday.

Under a bill unveiled last month, New Jersey would begin a six-year phase-out of its liquor license limits — which allow municipalities to issue one retail consumption license for every 3,000 residents — while lifting restrictions imposed on breweries and wineries operating under a different type of license.

Local officials and some restaurateurs have clamored for the state to allow more licenses, arguing their availability would boost economic activity and help drive residents to downtowns still recovering from the pandemic.

But the plan has met with opposition from others in the industry who fear the bill would send the value of existing licenses plummeting. Because of tight demand, retail consumption licenses in New Jersey typically cost hundreds of thousands of dollars, and their value sometimes broaches $1 million.

The bill offers existing license holders tax credits worth between $30,000 and $50,000, depending on sales, though Sen. Gordon Johnson (D-Bergen) in March told the New Jersey Monitor those figures could still shift.

Sarlo on Tuesday also raised concerns about the number of liquor licenses in the state that are regularly renewed despite not being in use and being tied to no establishment.

There were 617 of these so-called pocket retail consumption licenses in the state as of early March, according to Division of Alcoholic Beverage Control data. That’s about 11% of all 5,855 retail consumption licenses in the state.

“There’s urban centers that we want to redevelop, and people want these licenses. We need to do a better job of getting these inactive and pocket licenses out there,” said Sarlo.

Sarlo has sponsored a separate bill that would allow towns to auction inactive licenses to other municipalities for use in urban enterprise zones, pedestrian malls, and other types of redevelopment areas. That bill has not moved since its January introduction.

Attorney General Matt Platkin, who testified before the Senate budget panel Tuesday, said the rules for license extensions are set by statute, and he declined to comment on the governor’s proposal, saying that was a matter best left to the administration and Legislature.

A spokesperson for the governor declined to comment.