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Governor Hochul signed new legislation yesterday that will have major positive impacts for New York retail licensees. The dual legislation will automatically double the duration of temporary operating permits while keeping the cost the same, and will also serve to remove a barrier that kept many businesses located in New York City from being eligible to obtain temporary permits. 

Businesses seeking liquor (and/or beer and wine) licenses in New York are generally eligible to apply for what are known as “Temporary Operating Permits” which, if approved, allow the business to begin selling alcohol while their underlying license application is reviewed by the New York State Liquor Authority (the “SLA”). 

Temporary permits for retail licensees (bars, restaurants, hotels, etc.) previously had an initial duration of 90 days, after which they would have to be extended or allowed to expire. Applicants could apply to extend the permits for up to an additional 90 days at a time. While the SLA continues to work to shrink the licensing backlog, processing times for the underlying licenses remain fairly delayed, and so licensees often have to apply to extend their permits several times before the license is granted. In order to do so they had to pay additional fees and submit a renewal application to the SLA prior to the expiration of the existing permit. The SLA would then have to review, process and issue the permit renewal, thus diverting staffing resources away from being able to review and process the underlying license applications.

The new legislation expands the duration of temporary permits from 90 to 180 days while not increasing the cost. This not only saves the applicants significant money but should also help the SLA to continue to improve processing times, as it will no longer need to devote as many resources to renewing permits and can instead redirect more staff to be able to review and process the underlying applications. The goal is for the SLA to improve its processing times such that it will be able to issue the actual licenses prior to the expiration of the initial 180-day permit.  Extensions are still available so if there is an issue and the license is not granted within 6 months, the applicant can still apply to extend their permit. 

The other part of this dual legislation will make more businesses located in the New York City area eligible to obtain a temporary permit. Previously, applicants in New York City for premises that have not been licensed within the past 2 years were not eligible to obtain a temporary permit for their business if their location was subject to the 500-foot law (meaning three or more other on-premises liquor licenses located within 500 feet). This new legislation removes that two-year restriction and will allow these businesses to apply for a temporary permit while their full application is pending with the SLA. This means that business which previously may have had to wait a year or more to open can now do so much sooner, which should help to stimulate the economy, create jobs, and revitalize the City which is still bouncing back from the pandemic, and the havoc wreaked on the hospitality industry. 

Both of these changes go into effect immediately and further Governor Hochul’s stated goal of improving and modernizing the State’s laws relating to alcoholic beverages. In her time in office Governor Hochul has continued to work toward this goal by, among other things, permanently legalizing to-go alcohol, allowing direct-to-consumer shipping for New York State liquor, cider and mead manufacturers, permitting the sale of liquor in movie theaters, expanding one-day permits to include full liquor in addition to beer and wine, and changing the requirements for catering permits to allow purely outdoor events. 

There are a number of other changes which were recommended by the 2022 Commission to Reform the Alcoholic Beverage Control Law which have not yet been implemented, including the elimination of the 200 and 500-foot rules, changes to both the 30-day notice and corporate change processes, and allowing individuals to have an interest in more than one retail package store.  It will be interesting to see if any of these changes are made, either by legislative or agency action.

Contact Whiteman Osterman & Hanna Today

If you have questions regarding the operation of your existing New York licensed business or are contemplating applying for a new license, don’t hesitate to get in touch with Alexandra Becker by e-mail (abecker@woh.com)  or phone (518.487.7725) to see how the Alcoholic Beverage Team at Whiteman Osterman & Hanna may be able to assist.