More liquor licenses will soon be available to local restaurants

Restaurateurs hoping to expand their offerings to include liquor will have a chance to do so starting next year.

Assemblyman Katcho Achadjian successfully passed a bill, AB 461, which will provide San Luis Obispo County with five additional liquor licenses over the next three years.

Achadjian had hoped to gain an additional five licenses annually for three years, but the bill came under the scrutiny of the Governmental Organization Committee, which oversees bills related to alcohol, Indian gaming, horseracing and tobacco, among other areas.

The committee limited the additional licenses awarded to San Luis Obispo County to five, not the 15 Achadjian originally sought.

A scarcity of liquor licenses in the past two years has inflated the costs of existing licenses to the point that many restaurant owners can’t afford them.

A new license issued by the state’s Department of Alcoholic Beverage Control is $13,800. However, existing licenses are often sold for as much as $100,000 because of high demand.

Achadjian’s bill was signed into law by Gov. Jerry Brown on Aug. 16. It will take effect January 2014 and expire in December 2016.

Only restaurants that have a seating capacity of 50 or more will be eligible for the new licenses.

Achadjian introduced the bill to help struggling local restaurants stay in business, acknowledging that liquor sales are typically a large part of a restaurant’s income.

The Department of Alcoholic Beverage Control regulates liquor licenses distributed in all of the state's counties.

San Luis Obispo County is one of 26 counties in California that has reached its "saturation" point and is not allowed new licenses.

On-sale liquor licenses, those used by restaurants, are limited to one for each 2,000 people in the county. There are 1,094 alcohol retail licenses in the county.

The population in San Luis Obispo County is not growing fast enough to warrant new licenses based on that formula. Typically the county would gain three additional licenses annually. That stopped in 2012.

The lottery for new liquor licenses in California will be held in mid-September. San Luis Obispo will not be on that list.

However, it will be next year.

“The current formula for allocating liquor licenses to counties is outdated and does not meet the needs of counties like San Luis Obispo which host a large number of tourists each year,” Achadjian said. “By allocating additional liquor licenses to our county, AB 461 will fuel hospitality-based economic development without undermining local control.”

This story was originally published August 28, 2013 at 5:07 PM with the headline "More liquor licenses will soon be available to local restaurants."