The co-owners of Deacon Giles Distillery in Salem want the state to revisit the legal relationship between producers and distributors, and reduce regulatory red tape.

Credit: Howard Powell

When It Comes To Mass. State Liquor Laws, There's A Thirst For Change

January 25, 2017

 

In the kitchen of Seven Star Street Bistro in Roslindale, owner and chef Chris Lin cooks up a wide range of cuisine, from Asian standbys like Ma Po tofu at dinner to American brunch fare during the day. But if you visit Seven Star, you won't be able to have an alcoholic drink with your meal — even though he says many customers would like to.

"Last night ... we had customers sit down, and when they realized we didn’t have liquor, they ended up taking their food to go," Lin says. "Which we totally understand."

In Boston, the demand for liquor licenses far outpaces the supply — and the state, not the city, strictly controls the creation of new ones.

A few years back, Lin considered buying a liquor license on the resale market. But he balked at the cost, which can range anywhere from $50,000 for a beer-and-wine license to $400,000 for a license that allows proprietors to serve beer, wine, and booze.

Later, when Boston released a new batch of licenses, Lin thought he’d locked one up. But he was stymied at the last minute.

"They were only designated for areas in economic need, or Main Streets districts," Lin says, referring to a special development designation employed by the city.

"We happen to fall two blocks out of a Main Streets district, so we didn’t qualify. I was very upset, because I thought with the support we had behind us it was, like, a slam dunk."

That rejection also meant the loss of what could have been a key source of revenue.

"I’ve been in the restaurant industry all my life," Lin says. "I’ve worked at restaurants and seen restaurants who really are only financially viable based off of their ability to sell liquor. Food does not make them any money whatsoever."

Lin eventually purchased a beer-and-wine license secondhand, for an unusually low price, but ended up selling it when he needed extra capital. Now he hopes to land one of Boston’s new bring your own bottle, or BYOB, licenses — customer-friendly, he says, but not lucrative.

As he waits, he dreams of an alternate reality where serving alcohol with food is no big deal.

"I wish a normal person, a business owner like myself, could go to City Hall and apply for a license — and as long as I take on my responsibility as a business owner, and I’m responsible for my license, I should be able to own and maintain that license," Lin says.

In the future, that vision could actually come to pass. State Treasurer Deborah Goldberg, who controls alcohol regulation in Massachusetts, is forming a new task force charged with sizing up existing alcohol laws that date to just after Prohibition.

"Basically, everything is on the table," Goldbeg says.

Wide-ranging reform of the state's alcohol status quo could also be good news for Ian Hunter and Jesse Brenneman, who make handcrafted gin and two types of rum at Deacon Giles Distillery in Salem.

"The state franchise laws are first and foremost in our mind," Brenneman says, referring to laws that govern the relationship between producers like Deacon Giles and the wholesalers who distribute their products across the state.

Under existing law, Hunter says, the producer is in a weak position if the relationship with their wholesaler goes sour.

"It’s very hard to terminate that relationship once it’s established," Hunter says. "It’s very costly. It involves a lot of lawyers and a lot of time."

Hunter and Brenneman also suggest a reduction in the red tape required to make and pour spirits. Hunter recalls giving the state a wealth of information to get a license to manufacture gin and rum then sending that same info a second time to get clearance to sell drinks made from those spirits in an on-site pour room.

"We essentially submitted all the same information, from financial data to personal information, for our pouring permit, which we couldn’t require unless we had our distillery permit," he says.

Streamlining processes like that might not prompt an outcry. But other shifts in the liquor status quo could — for example, from people who already own a valuable Boston liquor license or from liquor wholesalers reluctant to give up their clout.

The good news for people like Lin, Hunter, and Brenneman is that Goldberg thinks the status quo is untenable.

"This is for real," she says of her new reform push. "This isn’t so we can say, 'OK, we did that, good, here’s a couple recommendations and we can move on.' I’m looking at a 21st century industry."

If she gets it, business involving alcohol could be done very differently than it is today.

 


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