The business of selling booze

While many people view choosing which wine to have with dinner a difficult choice, business owners often have their own menu to choose from when determining which license they need to offer beer, liquor or wine to customers.

Pennsylvania — one of just two states in the nation that still has a state-run liquor system — offers 68 different types of licenses to sell alcohol in the commonwealth. There are licenses available for off-track wagering facilities, restaurants, special occasions and even a Sacramental Wine License.

According to the Pennsylvania Liquor Board, there are a limited amount of licenses in the state. It is usually one license for every 3,000 residents in each county. These licenses can transfer from town to town, but not out of the county.

Elizabeth Brassell, director of communications at the Pennsylvania Liquor Board, said a license can be obtained by applying for a new one from the state if the county has not yet met its quota or as a transfer from a private owner.

Brassell said the application fee for a restaurant liquor license is $700 and the license fee ranges from $250 to $700, depending on local population.

However, when licenses are transferred between private individuals, Pennsylvania has no control over the price. “The only monies due the PLCB in association with licenses are the application and licensing fees,” said Brassell. “We have no involvement in the private market transactions to ‘sell’ liquor licenses.”

In comparison, Bill Crowley, Director of Public Affairs at the Liquor Authority in New York said his state doesn’t have any quotas in place. Instead, interested parties directly buy their licenses and permits, the price ranging from $80 to $36,000 depending on the type of permit or license, from the state.

The PLCB’s role is to evaluate applications for license transfer and approve or deny transfers, and not to regulate the private transfer price.

Real estate tied into licenses

Tedd Biernstein, owner of the Smiling Chameleon in Lewisburg, originally wanted to open a bar in downtown Lewisburg. He was able to obtain his license for his bar by buying another business, the Varsity Club. While he ran the Varsity Club for 15 years, he eventually transferred the license to the Smiling Chameleon’s location downtown.

“There is an extra cost to get a license because 15 years ago, I would have rather have just bought the license without the real estate, but people are so invested in real estate, they don’t want to give up the license,” he said.

He said buildings with liquor licenses have increased value so owners can get more money by keeping the property and the licenses together. He had to pay $250 for the liquor license and $100,000 for the property.

However in New York State, “you can’t transfer a license. If you buy a business, you have to buy a new license,” said Crowley.

Regardless of how a restaurant receives a license, they still have to apply for the license so the state can run a series of background and financial checks on the business owners. Afterward, the application comes before the PLCB where it is decided if an restaurant is ready for a license.

Plenty of paperwork

Currently, the Packer House, owned and operated by the Garman family, is in the middle of the background checks. The Garmans said the process has required a lot of paperwork.

“They have a list of documents that they want for that application,” said Chelsey Garman, the daughter of owner Lori Garman. Some of the documents include floor plans, photos of the building, the operating agreement, background checks, and forms that include your tax identification number.

Despite the large amount of paperwork, the Garmans said the Pennsylvania Liquor Board has been extremely helpful throughout the process.

“Our bureau exists to review applications and to support licensees in the pursuit,” said Brassell. “We have a group of people dedicated to helping people through the licensing process.”

Brassell said the PLCB has a number of costumer services available to applicants depending on what kind of license they seek. This year, they are offering a seminar to applicants and businesses with licenses to help the navigate the new online licensing and ordering system, and other changes.

While the board is investigating an application, the restaurant applying for the license must place an orange placard on their building for 30 days so that the public is aware, said Brassell.

She also said it can take from 45 days to much longer for a restaurant to receive a licenses depending on the complexity of the application.

Even if a restaurant isn’t up to the board’s standards, the board offers conditional licenses to restaurants as long as the restaurant obeys the board’s guidelines.

Opting out

However, some people choose to opt out of owning a license. Paul and Noelle Taylor, the owners of Paulie’s restaurant in Sunbury, decided that run their business as a bring your own beverage establishment. They are the only advertised BYOB in Sunbury.

“We just thought it had an appeal to the general public and kind of cliental we are trying to get through the door,” Paul Taylor said.

He said that BYOBs tend to be easier on customer’s wallets because the price of wine per glass is “off-set” by bringing their own and they can choose their own wine. Paulie’s also doesn’t charge a corking fee or a glass cleaning fee.

In order to become a BYOB restaurant, “First we had to have the approval of our insurance company and our insurance company first told us that they would prefer us to have a full liquor license because with a BYOB, we aren’t dispensing the alcohol to the patrons. They are pouring it on their own,” Paul Taylor said.

After they finally had the approval from the insurance company, they were able to start allowing people to come with their own alcohol. “The City of Sunbury doesn’t have special licensing or anything for BYOB,” Paul Taylor said.

Author: Emma GinaderPublication: The Daily Itemhttp://www.dailyitem.com/news/the-business-of-selling-booze/article_6cf9f2fe-efda-11e5-b661-670d0dc3ef51.html