Boston takes its case for more liquor licenses to Beacon Hill

The city aiming to add 250 licenses over five years — a 25 percent expansion — dedicated to neighborhoods where sit-down restaurants and bars are sparse

Loren Lin prepared a drink at Hecate, an underground speakeasy in Boston on June 24, 2022.Carlin Stiehl for The Boston Globe

A hodgepodge group of Bostonians — from established restaurateurs to septuagenarian residents — testified on Beacon Hill Monday in support of legislation that could introduce as many as 250 liquor licenses to overlooked and further-flung corners of the city.

The bills would create five new licenses a year for five years in 10 ZIP codes that span Roxbury, Roslindale, Mattapan, Hyde Park, West Roxbury, East Boston, and large swaths of Dorchester. If passed, it would more than double the number of licenses in the targeted areas — home to half of Boston residents, but a far lower share of its sit-down restaurants and bars — from 189 to 439.

What is of paramount importance, supporters added, is that the proposed licenses would be required to remain in the same ZIP code, meaning they could not be bought and sold in the private market. Permits for booze go for as much as $600,000 and have, in recent years, amassed in wealthier and more tourist-oriented parts of the city.

The benefit to this would be greater opportunity for entrepreneurs of color in majority Black and Latino neighborhoods, and a chance to spread the wealth that comes from running a more profitable restaurant, said Boston city councilor-at-large Ruthzee Louijeune.

Today, Louijeune’s neighborhood of Mattapan has just three licenses and scarcely any sit-down establishments. The Seaport, by comparison, has roughly 80 — some of them purchased from establishments that closed in less-wealthy parts of town. There are roughly 1,000 establishments with liquor licenses citywide.

“The current system operates as a zero sum game,” Louijeune said. “Growth in one neighborhood comes at the expense of another. By introducing more liquor licenses, we can break this zero sum cycle.”

The number of liquor licenses in Boston has long been capped by state law, a legacy of a century-old clash between Irish City Hall and Brahmin Beacon Hill that persists to this day in requirements that Boston win State House approval to change many city rules.

In this century, Boston officials have sought repeatedly to expand liquor licenses, especially to benefit neighborhoods where they are sparse, and created dozens of new permits in 2006 and again in 2014. Last year, the legislature granted Boston five new licenses for the Bolling Building in Nubian Square and the Strand Theatre in Uphams Corner.

Boston Mayor Michelle Wu said the addition of liquor licenses is crucial to the mission of creating vibrant neighborhood business districts that would draw visitors. It may also be a boon for the nightlife industry, which suffers when the supply of licenses in Boston is low and inaccessible.

“We know that for a long time, Boston’s structure of liquor licenses has not facilitated equitable and growing economic opportunity for all,” she said. “Even though the talent is here in Boston, [and] the dollars are there in Boston, we’re often seeing neighborhoods spending elsewhere because of the disparities in the system … As much as you’re willing to give us, we are willing to take.”

The state cap on liquor licenses in Boston is one piece of a long legacy of Beacon Hill's century-ago clash with City Hall.Suzanne Kreiter/Globe Staff

The City Council unanimously approved the current push for new licenses in March. Next, the Legislature’s Joint Committee on Consumer Protection & Professional Licensure must choose to vote on the bills before sending them off to additional committees before the session ends next summer.

In the past, these efforts have confronted similar criticisms. Some existing license holders fear that flooding the market with new licenses will devalue the ones they currently hold. That can be devastating for businesses whose licenses make up a large chunk of their equity, or those who plan to use the permit as collateral for a loan.

But Nick Korn, a partner at OFFSITE, a firm that focuses on training and development within the restaurant industry, said at the Monday hearing that the additions established by the bill are unlikely to cannibalize the value of other licenses. Nearly all the liquor license transfers that took place these past few years occurred outside the 10 ZIP codes targeted by the bill, he said. And prices continued to rise after 2014, when 75 licenses were flushed into the city at once.

“The ZIP code restricted licenses … will not have a demonstrable impact,” he added.

Even Nancy Cushman, a local restaurateur and a license holder herself, supported the bill. She was awarded a nontransferable liquor license in 2007 after her and her husband put their home up as collateral to fund their first endeavor, O Ya in the Leather District. Created in the 2006 legislation, the permit made it possible for the duo to succeed and open several subsequent businesses.

Now, Cushman said, other aspiring restaurateurs should have the same chance.

“None of that would’ve happened for us without the opportunity that first non-transferable license granted us,” she added.

Frank Poindexter, principal at Wally’s Cafe Jazz Club in the South End, also urged state legislators to consider the potential impacts on the bills on the vibrancy of neighborhoods. He said he struggles to recommend joints for people of color in areas of the city that primarily house Black and Latino residents.

“It doesn’t look good for us that we have deserts inside of our city where tourists can’t even go,” he said. “I suggest we find a way to alleviate these problems.”

Doyle's, the shuttered Jamaica Plain watering hole and political hangout, is one of a number of restaurants and bars in outer neighborhoods of Boston whose licenses have moved to the Seaport and other wealthy downtown neighborhoods in recent years.David L. Ryan