Frank DePasquale may have built an empire of about a dozen restaurants in the North End, but he wants something for free from the city of Boston: a full liquor license worth as much as $600,000.
It’s a bold ask, given the city wants these hard-won permits to go to business owners and neighborhoods that historically have been shut out of the profits that flow from pouring alcohol. Last anyone checked, nobody goes thirsty in the North End.
Still, as DePasquale tells it, his neighborhood’s popularity means it’s a reliable source of tax revenue from meals and drinks sold. City Hall should factor that in.
“The North End is very deserving,” said Depasquale, who’s seeking a full liquor license for his restaurant Il Panino, which currently can serve beer and wine. “I am deserving of that license.”
Ask Carla Gomes, who owns Terramia and Antico Forno in the North End, and she’ll tell you she, too, deserves a full-alcohol license after being turned down multiple times over the years.
“I don’t think anyone should get a liquor license before me,” she said.
And so it begins. The high-stakes scramble from the Back Bay to East Boston for one of the biggest prizes City Hall can bestow: a liquor license that can make or break the economic livelihoods of restaurants and the neighborhoods they are in.
New legislation passed in September created 225 new liquor licenses for Boston, perhaps the biggest batch since Prohibition. All these licenses are free, and the first round of completed applications were due Friday. The Boston Licensing Board is expected to review them in January and begin awarding licenses early next year.
Exactly how many will be handed out over the next few months is hard to say. The bulk of the new licenses are restricted to 13 ZIP codes in parts of the city that could benefit from the economic boost of sit-down restaurants — including Mattapan, Roxbury, Hyde Park, and East Boston.
These neighborhood permits cannot be bought or sold and must be returned to the city after the restaurant closes. The board plans to distribute them over three years. So far, the neighborhood that appears most eager for them is East Boston, with at least nine applications filed as of late November, according to licensing hearing records tracked by hospitality consultancy Offsite.
But the legislation also created a dozen unrestricted licenses, so-called golden tickets, that can be used anywhere in the city. These permits are worth as much as $600,000, because when the city has none to give out, restaurateurs must buy one on the secondary market from another business that is closing. These licenses retain their value, enough that they’re even used as collateral on loans.
That’s the kind of license DePasquale and other restaurateurs in places that don’t have neighborhood licenses are after.
The Legislature has left it entirely up to the city of Boston on how it will distribute these coveted licenses. Licensing Board chair Kathleen Joyce, in an email response to questions, said the board “has not yet determined how many unrestricted licenses will be granted during the first round of review.”
State Senator Liz Miranda, who co-authored the liquor license bill, has been meeting with Joyce, licensing board staff, and city chief economic chief Segun Idowu on how best to implement it. She said she was pleased to learn that about 60 applicants are in various stages of applying for licenses.
As for the unrestricted licenses, the Boston Democrat said she recognized how they could be “life changing” for restaurateurs and would like to see them equally distributed across the city.
“I hope that they go to prospective small business owners who are not part of large chains,” she added. “The North End deserves, I think, a shot at some of these but not all of them.”
A decade ago, when the state authorized 10 new unrestricted licenses, they primarily went to neighborhoods that already had plenty of these permits and to owners who are well-funded and well-connected.
Three of that batch landed in the North End (including one at DePasquale’s Mare Oyster Bar), one in the Back Bay’s Prudential Center, and two in the Seaport District. Only one unrestricted license went to an owner who is a person of color.
That was far from the intent of the legislation, which was designed to generate wealth for entrepreneurs of color and communities of color long shut out of the liquor license system.
This time city officials want to be more intentional, and plan to review applications in batches rather than first-come, first-served. The board will set a deadline in the spring to evaluate the next set of applications.
Still, guardrails haven’t stopped those with deep pockets from pursuing unrestricted licenses in hopes they, too, can get something for free.
Serafina on Newbury Street, for instance, is part of an international chain with close to 30 locations from New York City to Tokyo. Now the Back Bay restaurant is seeking a free upgrade of its beer-and-wine license to a full value license.
“Newbury Street is not only very active but also a very expensive proposition to operate a fine dining restaurant,” said Serafina’s lawyer, William Ferullo, during a licensing board hearing in November. “We have been basically at a disadvantage not being able to serve all alcohol at this location.”
Then there’s WS Development, the developer that controls a sizeable chunk of the Seaport. WS wants an unrestricted license for a new venue on the site of the now-shuttered District Hall, which it is dubbing the Seaport Innovation Center and giving a multi-million-dollar upgrade to bring back a popular community hub for Boston’s innovation scene.
“The new citywide license that we applied for would catalyze all of that vision and activity,” Yanni Tsipis,a senior vice president at WS, said during a November licensing board hearing.
WS could apply for a community license — a new kind of license created in the legislation for nonprofits and small theaters that cannot be bought or sold — but prefers a full permit. To sweeten its pitch, WS is pledging to donate $600,000 worth of rental space — the market value of an unrestricted license — to community organizations and nonprofits during the first three years of the building’s reopening.
While the Licensing Board has laid out general guidelines on how it will evaluate applications, the three commissioners have their work cut out for them in deciding who gets the unrestricted licenses. While some applications may be a hard no because they don’t meet the licensing’s board criteria that the neighborhood or small business needs a license, others will require a thoughtful calculus.
For example, Silver Dove Afternoon Tea in Downtown Crossing has applied for an unrestricted all-alcohol license so it can compete with deep-pocketed players like the Four Seasons and the Raffles Boston Hotel, both of which serve cocktails. Silver Dove, which offers British-style tea service, only has a beer-and-wine license, and with only 24 seats, it is too small to justify the steep cost to buy a full license on the open market.
Yet an upgraded license will allow the restaurant to potentially expand its space and hours into the evening. For co-owner Lee Morgan, the new licenses represent a chance to help small, independent businesses like Silver Dove thrive.
“Every year, Boston gets more and more corporate,” he said.
Then there’s Angela’s Cafe in East Boston’s Orient Heights neighborhood, which wants to exchange the beer-and-wine license it bought years ago for an unrestricted all-alcohol license. The city has indicated that anyone applying from a neighborhood with restricted licenses could also be considered for an unrestricted license.
So that’s what the popular, 54-seat Mexican restaurant is asking for. Its owners, attorney Kristen Scanlon told the licensing board last month, hope not just to serve tequilas and mezcals but also to build equity in a family business.
“Based on the business owners themselves, the size of the restaurant, the uniqueness of the offerings and location,” she said, “we would submit that this is exactly the type of business contemplated by the legislation.”
Shirley Leung is a Business columnist. She can be reached at shirley.leung@globe.com.