The City of Boston announced on Friday a plan to help address the low number of liquor licenses held by minority-owned businesses — and the resulting economic inequities.
Mayor Martin J. Walsh’s chief of economic development, John Barros, proposed the plan during a working session Friday morning, noting that the change is much like the legislation the city had already been working on regarding licensing.
The difference is the initiative would create a new class of restricted liquor licenses that only minority-owned businesses can apply for. Barros said during the meeting that the city would distribute five of these licenses per year over the next three years.
“In an internal review of liquor licenses in Boston... it was clear that there is a huge gap" between minority-owned businesses and non-minority-owned businesses, Barros said in an interview. “The Mayor would like to begin to address that gap immediately.”
Mayor Walsh was already pushing for a policy that would issue 10 general nontransferable liquor licenses per year, so the new language would require half of them to go to minority business owners.
Barros said the initial review was cursory, and that the city would continue to look for statistical inequities in license holders.
“Liquor licenses are an important asset in generating revenues for any restaurant — historically, they are not held by minority-owned restaurants,” he said. “This gives us an opportunity for us to give them an amazing tool to position them for wealth creation and long-term success.”
As with other licenses, restaurants would apply through the Boston Licensing Board. Once these licenses are granted, they could only be resold to minority-owned businesses.
Barros said the city has not yet determined the price of these licenses, but that they would be “far less expensive than market rate,” since the city would only collect administrative fees. In pre-pandemic times, licenses were sold for hundreds of thousands of dollars.
Boston’s liquor licenses have long been a source of debate— earlier this year, a committee held a hearing to discuss issuing new licenses. And City Councilor Lydia Edwards proposed the idea of the city buying liquor licenses from struggling establishments to help them survive the pandemic in May.
Barros said he thinks the new initiative fits into the city’s previous plans to make the city’s restaurant scene more equitable, particularly for minority-owned businesses and communities of color.
“We have put this right in the middle of that — because the effort [was] to expand liquor licenses and target them to neighborhoods that have been underserved. We feel that this sharpens our intent,” Barros said.
Bob Luz, president of the Massachusetts Restaurant Association, said he was disappointed the City Council was moving forward on the legislation during a time of crisis for restaurants. Some critics have said that adding more licenses will dilute their value.
City Council members also admitted that licensing reform would not be an easy task, and that the legislation would need to be backed by additional support for businesses and regular reviews.
“This creates additional licensing, but it does not change the real issue,” Councilor Edwards said. “[A liquor license] should not be an asset... it should not be something that people can buy, trade, and sell... It should simply be permission.”