If you are one of the many restaurateurs and developers across the state struggling to move projects forward amid a dearth of liquor licenses, Beacon Hill has a message for you: Take a hike.
State lawmakers passed a liquor license bill in twilight hours of this year’s session, but failed to cut anyone in on the action beyond the Hub. Boston gets 75 new liquor licenses to help juice up new development from Back Bay to Hyde Park, a temporary solution to a chronic problem.
Yet a common-sense proposal by Gov. Deval “Lame Duck” Patrick, one that would have scrapped the arbitrary cap on liquor licenses across the Bay State, inexplicably went nowhere. So once again we are stuck with the same crazy, crooked little system, with an ethically challenged Legislature micromanaging who gets a liquor license, and, all too often, which projects move forward and which stall out.
In fact, it’s a system that has opened the door to all sorts of mischief on Beacon Hill, from a bid to protect a supermarket from competition by denying a liquor license to its rival to bribery charges that put a prominent state senator in the federal slammer.
“Restaurants play a key role in the vitality of neighborhoods, and increasingly serve as anchor tenants in large-scale retail or mixed-use developments of regional significance,” writes Massachusetts Municipal Association Executive Director Geoff Beckwith on the group’s website. “Delays in the liquor license issuance process are bad for business and bad for the local economy.”
Holding Up Development
For developers with ambitious plans, the liquor license crunch has become yet another obstacle to building in the Bay State.
The delays encountered by Wegmans in securing a liquor license back in 2008 contributed to the collapse of earlier plans for the massive Westwood Station mixed-use project off of Route 128. The culprit? A state lawmaker held up legislative approval of Wegmans’ liquor license in a bid to protect a Roche Brothers store in Westwood from unwanted competition.
Six years later, that project, now dubbed University Station, is moving ahead with a liquor-license equipped Wegmans as the centerpiece, though it sure would have been nice to have those construction jobs during the downturn.
Dedham’s Legacy Place and MarketStreet in Lynnfield have all had to go through the cumbersome process of working with local officials to tease more liquor licenses out of the Legislature.
Frankly, given the strong push by mayors and local leaders across the state to scrap this archaic and nonsensical system, it’s really an amazing screwup this year by the Legislature.
Certainly the Boston deal will help the Hub, though it still keeps an artificial cap on the number of licenses. That is certain to keep the price of existing licenses – and the lucrative side market for them – inflated beyond any reasonable number. (At last count, it can cost nearly half a million to buy a liquor license in Boston – almost as much as to buy a house.)
Making the system even more unfair, a few cities and towns have managed to free themselves of the cap altogether.
That means Somerville is perpetually scrambling to scrounge up liquor licenses to help fuel the wave of new development taking shape in that city, even as neighboring Cambridge is free to dole out as many licenses as it pleases.
Somerville Mayor Joseph Curatone, in a letter to state lawmakers last month, noted the dearth of liquor licenses has created major problems for the city as it pushes ahead with ambitious redevelopment plans. He tells the story of one veteran entrepreneur who bought a new restaurant but was unable to obtain a liquor license. He wound up watching potential customers walk past his establishment to a competitor who does have one.
The state liquor licensing body, which along with the Legislature determines which establishments get to serve beer, wine and hard liquor, and which don’t, turned down an appeal from the business owner, citing his lack of “experience,” Curtatone notes in his letter.
“That does not support someone willing to invest in Somerville,” he writes.
Several other suburbs across Eastern Massachusetts share Somerville’s predicament. Hot-spots for new development like Foxborough, Norwood, Walpole, Canton and Hingham, among others, are also struggling with the cap, having run out of liquor licenses.
“Liquor licenses are not evil,” said David Begelfer, chief executive of NAIOP Massachusetts, which represents developers across the state. “They bring in foot traffic. Liquor license these days are really the key to economic development.”
Profiting From A Crooked System
To figure out why the Legislature is so reluctant to give up its power and let local officials decide who gets a liquor license, it’s revealing to first ask who benefits from the current system.
The cap on liquor licenses has created a perpetual and artificial inflated market, with licenses selling for hundreds of thousands of dollars. Certainly there’s money to be made brokering these deals. And restaurant owners forced to pay this ransom are understandably concerned about the prospect of new competitors able to set up shop without the burden of this artificial entry fee. But that doesn’t make it right, or justify perpetuating a system that’s a huge burden on restaurateurs as well as developers looking to create new jobs.
Of course, the current system also appears to be just fine with all our hard-working representatives up on Beacon Hill, who apparently just can’t let go of the peculiar but potent power they hold.
For those tempted to play petty power games, being able to hold up a liquor license to help a competitor is certainly tempting, as the shenanigans with the proposed Wegmans in Westwood a few years ago showed. But there is also the potential for even more serious wrong-doing, as the bribery case against Sen. Diane Wilkerson highlights.
Wilkerson was snagged in 2008 by the FBI for taking eight bribes totaling more than $23,000 to help a developer with a liquor license and approval for a new development in Roxbury. She was memorably videotaped stuffing $100 bills into her bra. She was later convicted and sent to federal prison in Connecticut, returning to Boston after completing her sentence earlier this year.
These are unusual cases, to be sure, but it reveals some of the unwholesome temptations the current liquor license system creates on Beacon Hill.
Just think of all the ethical issues raised by the recent probation department trial. Leaders of the state’s probation department are now heading off to jail after allegedly running a rigged hiring system aimed at filling patronage requests by House Speaker Robert DeLeo and others. Add that to the fact that three other previous House speakers are all now convicted felons, having been nabbed after indulging in various forms of political corruption.
It seems only like good, common sense to remove another dangerous source of temptation from the State House – control over liquor licenses – while giving development across the state a boost.
Who can be opposed to that?
Email: sbvanvoorhis@hotmail.com
