On Monday, May 9, the Assembly Oversight, Reform, and Federal Relations Committee heard testimony from key stakeholders of the New Jersey alcoholic beverage industry on the current state of the industry and discussed ways to improve the manufacturing, distribution, and retail sectors along with its impact on the competition with neighboring states and within the hospitality and tourism economies. The New Jersey Restaurant and Hospitality Association, New Jersey Liquor Store Alliance, and the Wine and Spirits Wholesalers Association, were among those who testified.
Most stakeholders advocated for reform regarding the 1,200 pocket licenses, and inactive liquor licenses that do not have a site or licensed premises, held in the State. Noting that releasing these pocket licenses would create economic opportunities for companies attempting to enter the alcoholic beverage market, the stakeholders agreed this is the starting point for reform. During the hearing, testimony also included requests that reforms include reasonable compensation for stakeholders who invested millions into buying a liquor license while also allowing new investors into the market.
The only stakeholders opposed to major reform were the Beer Wholesalers Association of New Jersey and the Wine and Spirit Wholesalers Association. They testified that there are other avenues for investors entering the market, including beer pub licenses, which allow for the holder to brew malt alcoholic beverages in quantities not to exceed 10,000 barrels per license term and can be operated in conjunction with a restaurant. The associations also testified that with the proper pocket license reform, there would be no need for the introduction of new licenses.
The League had previously testified before the committee that the State’s current regulatory structure governing alcoholic beverages has remained relatively unchanged for generations, creating impediments to economic growth and development. Reform is needed to modernize these laws including laws addressing pocket licenses as well as those that permit municipalities to allow neighborhood restaurants to provide patrons with alcoholic beverages on a limited basis.
The Committee concluded the hearing with Chairman Assemblyman Danielsen thanking all stakeholders for testifying and noting that the committee will be holding another hearing soon.
Contact: Andrew LaFevre, Legislative Analyst, alafevre@njlm.org, 609-695-3481, x.116