How Do You Obtain a Liquor License in Your State?

“Quick Summary” Before venturing into the retail liquor business, the elementary question that nudges anyone will be, “How do You Obtain a Liquor License in Your State?” This answer needs some quantum of research to be made before you visualize the big picture.

What will be the liquor license cost, the types of liquor licenses, the application process, and how do I renew it before expiry? This blog will walk you through various passages of information pertaining to getting a liquor license for a restaurant, bar, or retail shop. So let’s get started.

Liquor License - Know It

By nature, a liquor license is a legal document. A liquor license is a government-issued permit that authorizes the license holder to sell alcohol and alcoholic beverages. If your business is involved in the manufacturing, distribution, or retailing of alcohol, the liquor license is mandatory and a basic document for you. 

This license applies equally to restaurants, bars, hotels, private clubs, and retail establishments like liquor stores, gas stations, grocery shops, and convenience stores.

Your primary concern should be understanding the liquor license type applicable to your business.

If you broadly classify the liquor licenses, you land upon two major choices:

1. On-Premise Liquor License
2. Off-Premise Liquor License

Before we delve into the types of licenses, let’s understand how much a liquor license costs you.

How Much Does a Liquor License Cost

You might want to consider the expense you will incur for obtaining a liquor license. Please take it as an investment, not as an expense. Your liquor license is like a partner in your business. It will pave your way to sell alcohol and alcoholic beverages. 

You can’t think about selling or serving alcohol without a valid license.

There are mainly 3 fee types (or costs) associated with obtaining (and continuing) a liquor license. 

• The first is the Application Processing Fee which generally amounts to a few hundred dollars. 
• The second is the Fee for the License itself. 
• Last but very important is your License Renewal Fee. 

Now the trickiest part is you cannot delay your license renewal application. If you are late in applying for the renewal, be prepared to pay the penalty and surcharges. This being said, the fee is not uniform throughout the United States. Each state has its fee applicable for each category. 

Now, who decides the applicable fees for their state?

Alcohol Beverage Control Board (ABC Board)

The Alcohol Beverage Control Board (ABC Board) is authorized to decide the applicable fees for each liquor business category. 

Each state's Alcohol Beverage Control Board (ABC Board) oversees the manufacture, sale, and distribution of alcohol in its jurisdiction. In terms of alcohol laws, the state government sets more stringent guidelines than federal laws. Due to this reason, liquor license terms and the process of obtaining it differ from state to state. 

The simplest way is to contact your state’s Alcohol Beverage Control Board, discuss your license needs, understand the documentation requirements, fulfill the obligations and obtain a liquor license for your liquor store, bar, or restaurant. 

Visit here for the complete information on fee schedules for the United States and Canada. You will see a list of states with individual links to their respective Alcohol Beverage Control Board mentioned on this page.

Types of Liquor Licenses - Which One is For You

It all depends on whether you sell alcohol or you even serve it.

On-Premise Liquor License is only issued if you serve liquor, alcoholic beverages, etc., on your business premises. At the same time, Off-Premise Liquor License is meant for those establishments that don’t serve alcohol to their customers but instead sell packed units only. 

Bars, Restaurants, Pubs, and Community Clubs are the ones that serve beer, wine, spirits, and other alcoholic beverages with varying percentages of alcohol. Hence, they apply for On-Premise Liquor License. 

Alternatively, standard Liquor Shops, Wine and Beer Shops, Grocery Stores, Gas Stations, and Convenience Stores tend to apply for Off-Premise Liquor Licenses as they don’t serve liquor on their premises.

Digging deeper, we have 3 more sub-classes of liquor licenses. 

They are 

• Restaurant License
• Beer and Wine License
• Tavern License

Which license is for me? The best part is that each license type has a precise and simple understanding. It all depends on the type of business you are in and the variety and the class of alcohol you will deal in.

Talk to an expert at your state’s Alcohol Beverage Control Board, and he will be more than willing to help and guide you. Please give it a thorough thought and make your choice.

Liquor License - The Application Process

Obtaining a liquor license is a lengthy process. As a primary step, you must contact your state's Alcohol Beverage Control Board. Talk to them, and collect the necessary form(s) and a list of documents to be submitted with your application. Also, ask if they need your financial statements. Request your bank to provide you with the financial documents, account statements, and certificates (if any).

The number of liquor licenses is decided based on the area (size) and state population. You may inquire about the availability of the liquor license from your respective ABC board. Once your application, forms, and necessary documents are ready, submit them to your state’s ABC board with the necessary application fee. 

You also must arrange to submit other documents like employer identification numbers, zoning permits, building permits, health permits, and signage permits. The department might ask you to get a background check done if required. They might also verify your financials and request you to furnish a Certificate of Good Standing from the Secretary of State.

Waiting Period Before Receiving a Liquor License

Now your state’s ABC board will process your application. The board will send it for further approval if everything is in order. Receiving approval might take anything between 2 months to 6 months. 

Individuals above the age of 21 can apply for a liquor license in their state. Bars and restaurants must hire employees or waitstaff aged 18 years and above.  

Liquor License Renewal - An Overview

Every liquor license comes with an expiry date. A liquor license stands valid from 1 to 3 years. Considering your efforts to obtain a liquor license in your state, renewing it before the validity ends is much simpler.

Unless some crime is reported against you (like selling alcohol to minors), your license renewal process should complete smoothly. If the renewal request is made well in advance, you can expect to receive your renewed copy between 90 to 120 days. Your license renewal time with the fee charged depends again on the prudence of your state’s ABC board.

Conclusion

In conclusion, obtaining a liquor license is a crucial step for businesses involved in alcohol sales, whether it's a restaurant, bar, or retail shop. The process involves understanding the types of licenses, costs associated with them, and the application procedure. Liquor licenses are classified into On-Premise and Off-Premise, with further sub-classes tailored to different businesses.

The fees for liquor licenses vary by state, and the Alcohol Beverage Control Board plays a pivotal role in determining and overseeing these fees. The application process is comprehensive, requiring documentation, financial statements, and various permits. The waiting period for approval can range from 2 to 6 months.

Renewing a liquor license is essential, with the process being relatively straightforward if no violations are reported. Timely renewal is crucial to avoid penalties, and the renewal period depends on the state's ABC board. Understanding these aspects and consulting with experts at the ABC board ensures a smoother experience in obtaining and renewing a liquor license for your business.