IT’S NO SECRET that Boston’s liquor license market is antiquated and broken. This year, Boston’s liquor licenses have been selling for $625,000 on the private secondary market. That means that before a chef or owner invests one penny into a buildout, stocking the kitchen, or hiring staff, they must come up with a $625,000 loan in order to serve liquor. It’s the cost of doing business in well-trafficked neighborhoods such as Seaport, Back Bay, and the North End, but it’s a non-starter in neighborhoods where there’s not a robust work or tourist crowd such as Hyde Park, Dorchester, Roxbury, and Mattapan.
These neighborhoods have less than 10 percent of Boston’s licenses combined, despite having nearly 40 percent of the city’s population. As lifelong residents of Dorchester, we’ve become familiar with seeing businesses struggle over the years, but in the wake of the pandemic the liquor license shortage’s effect on our underserved neighborhoods can no longer be overlooked. The story of a restaurant closing in a neighborhood and selling a liquor license to a chain restaurant in a well-heeled part of town is common by now. That’s why there are so few restaurants in Mattapan and no prospects for one to open anytime soon.
Efforts to reform the city’s liquor license system aren’t new, and many of those efforts have successfully moved our city forward. The 2006 one-time influx of licenses led to Nancy and Tim Cushman opening their first restaurant, O Ya, which launched their incredibly successful roster of restaurants in Boston and beyond. Douglass Williams opened his first restaurant, MIDA, in the South End with one of the Main Street licenses that were part of the 2014 law. He just opened his fifth restaurant this fall. And a one-time restricted liquor license that became available in 2019 helped The Pearl open in the South Bay Shopping Center, where it’s received enough rave reviews that there are plans to open another restaurant in Boston Landing.
But there have been challenges created by those past efforts as well, with the liquor licenses able to be transferred elsewhere, and in some cases, the licenses getting taken all at once.
The ordinance that Brian introduced, which passed unanimously through the City Council last year, takes a more thoughtful approach at providing new opportunities to restaurateurs in these neighborhoods, while learning from past efforts to better anticipate potential drawbacks.
This home-rule legislation is now being discussed at the State House, led by Christopher and State Sen. Liz Miranda. It takes 10 underserved ZIP codes — selected in part on demographics and demand — and awards them five new liquor licenses per year for the next five years. Those liquor licenses cannot be resold or transferred to someone else. When the restaurant closes, it goes back to the city to be reissued to the same ZIP code.
It’s a slow rollout that solves a couple of key issues. Based upon current demand and prior history, it won’t devalue the existing liquor licenses that are sold on the secondary market, which protects current restaurateurs who might have mortgaged their house to open a restaurant. Second, the economic development opportunity from this legislation in 10 ZIP codes that are struggling for commerce will be enormous.
Imagine five new restaurants opening in your neighborhood every year for five years. This will provide opportunities for workers in the restaurant industry to work closer to their homes, thus reducing traffic. This will help add foot traffic on our main streets, thus driving other investments and benefiting other small businesses. This will help encourage people from other areas to visit some of our oft-overlooked neighborhoods to enjoy a nice meal. And, we’re willing to bet the food in some of these highly diverse areas is going to be pretty darn good.
As this bill moves out of committee, we’re hoping the possibilities this bill will create speaks for itself. This is a chance for equity-minded economic development that comes at no cost to the state or the city. Breaking down the $625,000 barrier to opening a restaurant is a multimillion-dollar idea for our communities.
Brian Worrell is a Boston city councilor. Christopher Worrell is a state representative from Boston.