Eye On Boise

Guv's liquor license bill sets up a 'brawl'

Gov. Butch Otter has long talked of changing Idaho’s liquor license system, which limits liquor licenses on a strict, population-based quota system that’s driven up their value to $100,000-plus, while making exceptions for essentially anyone with the wherewithal to hire a lobbyist and push a special bill through the Legislature. Now, Otter’s readying to introduce a 52-page reform bill, doing away with the quota system and making other sweeping changes. AP reporter John Miller writes that “foes promise a brawl.” Click below to read his full story.

Otter aims to update Idaho's liquor licenses
Associated Press Writer

BOISE, Idaho (AP) — After years-long rancor over how Idaho doles out liquor licenses, Gov. C.L. "Butch" Otter is playing bouncer with a 52-page reform bill his aides say will boost the economy, remedy concerns over aggressive enforcement and preserve existing licenses' value.

Foes promise a brawl, labeling the bill a buzz killer for some existing bar and restaurant owners, as well as speculators trying to make money on licenses under the existing system.

The measure would eliminate a 62-year-old quota system that allots a single license for every 1,500 residents in Idaho cities. Cities and counties would issue the new licenses, but only to businesses with restaurant or lodging services. There would be no new state bar licenses.

Meanwhile, owners of more than 1,000 existing licenses who have fought any changes for fear those assets would become worthless, would receive special treatment, like 10 percent discounts on liquor from the state liquor monopoly, cheaper relicensing and transferability almost anywhere in Idaho.

And while enforcement of liquor laws would still fall to the Idaho State Police Alcohol Beverage Control, a new state entity would be created to administer the rules. Bars and restaurants now complain the law enforcement agency is "judge, jury and executioner," slapping violators with unfair punishments like month-long closures.

"We think those penalties are way too strict for the violation," said Butch Morrison, president of the Idaho Licensed Beverage Association and owner of The Crescent No Lawyers Bar and Grill in Boise. "A lot of bars or restaurants couldn't afford to be closed for 30 days, especially in today's market. They'd go out of business."

Jerry Russell, Idaho State Police director, didn't return phone calls seeking comment Wednesday. Alcohol Beverage Control Lt. Bob Clements wasn't in the office and other agency officials didn't return additional phone calls.

For years, Idaho's liquor license quota system has resulted in long waiting lists. Complaints have multiplied that an archaic system meant to instill temperance instead spawned bidding wars, rewarding speculators while punishing the patient.

Otter's proposal would leave it up to cities and counties — liquor licenses are now banned outside city limits, except in special cases such as ski areas and golf courses — to dole out licenses. Local officials say new restaurants or hotels currently are reluctant to set up shop in growing communities if they can't get a license to sell alcohol, or are forced to pay high prices for the privilege.

"Why would you want a system that doesn't accommodate for demand, when you can have one that does?" said David Hensley, Otter's top legal adviser.

Still, the bill, which won approval last week by an Otter-appointed panel that studied the issue for more than a year, has aroused bitter opposition.

Brian Donesley is a former state lawmaker and Boise attorney who represents liquor license holders in disputes with the Idaho State Police.

Donesley, whose name appears more than 20 times in various locales on Idaho's liquor license waiting list, argues that letting cities and counties issue new licenses will lead to local favoritism, do nothing to remedy enforcement abuses and gut the value of existing owners' assets.

"If Joe Schmoe can go out and open a restaurant across the street, a license is going to be worth very little, instead of being worth something around which people have built their lives," he said.

Donesley suggests loosening the quota to one license per 1,200 people, as well as abolishing a current requirement that new license holders operate a bar or restaurant for two years before they can sell their license to somebody else. He accuses the Idaho State Police Alcohol Beverage Control agents of making life difficult for applicants like him and his clients in order to manufacture a furor.

Ken Burgess, a lobbyist for the roughly 250-member Idaho Licensed Beverage Association, said not everybody in his group supports all elements of the plan. But it includes enough protections for existing license holders that many, like group president Morrison, are going along, he said.

In addition to the 10 percent liquor discounts, annual renewal fees for existing licenses would be cheaper than for the new licensees. And unlike state licenses, new ones wouldn't be transferable.

A year ago, Burgess said, members of his group feared Otter's push to dump the quotas would hurt their businesses.

"Rather than sitting back and saying 'Hell no,' we chose to engage in the debate, try to come up with a solution that was reasonable, to resolve some of those legitimate problems," he said.


Gov. C.L. "Butch" Otter aims to quell long-simmering animosities over Idaho's liquor license law with 52 pages of reforms. Here are some of the details of his bill — and the debate.

TWO TYPES: There would be existing state licenses, whose holders would get cheaper liquor at the Idaho Liquor Dispensary, and be able to transfer their licenses. There would also be new municipal licenses issued by cities or counties. Perks for state license owners are meant to help preserve their value; people have paid tens or even hundreds of thousands of dollars for licenses in sought-after markets and don't want them diluted by new licenses.

AGGRESSIVE ENFORCEMENT: Bar owners who claim Idaho State Police Alcohol Beverage Control officers are unfairly cracking down on them praise provisions that would create a new state entity to settle disputes over violations. There's also a new punishment scheme that includes warnings for the first two violations of state liquor laws, like serving to minors, in three years. Idaho State Police would still be responsible for enforcement.

OBVIOUSLY DRUNK: The measure, being promoted by the 250-member Idaho Licensed Beverage Association, clarifies "dispensing to a drunk" language to require that the person be "obviously" intoxicated. It also makes it a misdemeanor for minors to knowingly misrepresent their age to get into a licensed establishment.

MANDATORY TRAINING: Training is required for servers in bars where alcohol is consumed on the premises.

TWISTING IT: Brian Donesley, a Boise attorney who represents liquor license holders in disputes with the Idaho State Police, says the state is "twisting it" — making it seems like there's a crisis in order to ram through changes he says will undermine the value of licenses for speculators and business owners alike. Donesley has his name more than 20 times on the state's waiting list for liquor licenses.

Copyright 2009 The Associated Press.


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