You Won the Liquor License Lottery! Now What?
The results of the public drawing for quota alcoholic beverages were announced this morning, and your entry was selected. Congratulations!
So, what’s next?
Let’s start with the most common misunderstanding: you haven’t actually won a liquor license yet. At this stage, you only posses the right to apply for a certain alcoholic beverage license. You have only 45 days from the date the Division mails the notice of selection to file an application for the license.
“The timelines are extremely important - you will not receive the license if you do not submit an application quickly enough.”
In order to receive the license, an applicant must be investigated - a background check and some personal disclosures are required. If you are unsure about whether you want to sell or use the license, that decision must be made fairly quickly. The firm is happy to assist by confirming the estimated value of licenses in your county.
If you submit are found to be a qualified applicant and pay the appropriate fees, the license will be issued within 90 days of a complete application. A qualified candidate is one with good moral standing determined through fingerprints and a background check. There are two fees required before the license will be granted: a $10,750 Hughes Act fee and a much smaller annual license fee.
“Yes, the licensing fees can cause sticker shock. However, they are generally only a fraction of what the sales price would be.”
If you intend to use the license, there are a number of requirements related to zoning, the licensed premises, and other operational matters. However, if you plan to sell the license, many site-specific requirements are temporarily inapplicable.
During any 12 month period, a quota licensed establishment must remain active during regular business hours of at least 6 hours a day for at least 120 days. Failure to comply with active status will result in revocation of the license - the Legislature intends for these licenses to be active. However, a quota licensee is entitled to a one-time waiver of the active operation requirements for up to 12 months.
Please note that the firm’s full liquor license lottery resource is available at quotalottery.com:
The firm’s analysis of the probability of winning the liquor liquor lottery is available here.
An article on the steps required to transfer a license to a buyer can be found here.
A breakdown of the applicable licensing and transfer fees is available here.
A background check is a required part of the licensing process - a summary of the state’s moral character requirements is available here.