Tuesday, January 12, 2010

Community Boards Push Back Against New Liquor Rules

by Gamal Hennessy

The New York State Liquor Authority is trying to improve its service to the restaurant and nightlife communities. But by making its applications more efficient, it has stirred up anger among local community boards that see the new moves as an attack on their political influence. Unless a compromise can be reached, we could see a return to the corruption and stagnation that has plagued the agency in the recent past.

Improvements in the SLA
A venue requires a license to serve liquor in New York State. The State Liquor Authority (SLA) grants these licenses and plays a pivotal part in the ability for a venue to be successful, because a club that doesn’t serve liquor will not be opened for very long. For the past few years, the SLA was understaffed and the application process was extremely inefficient.
Applications that were supposed to be reviewed within a few weeks routinely took 6-8 months to process. There was a huge backlog of applications that cost the state money and curtailed growth of the industry. In 2009, things got so bad that former SLA employees were accused of taking bribes from operators in an attempt to get their applications out of this administrative limbo.

After the corruption scandal, a new chairman named Dennis Rosen was brought into the SLA with a mandate to weed out corruption and improve the SLA. Chairman Rosen
created a fast track process that made the liquor license process more efficient and streamlined. This move was praised by operators and industry advocates across the state who were shocked at the speed that this "new" SLA could do its job.

Community Board Reaction
But the previous system did work in favor of some groups. Local community boards (CBs) provide advisory opinions to the SLA for almost every new venue that opens in the city. If they vote against a venue, there is a good chance that venue will never open. If members of the CB push hard enough, they can
force an existing venue to close. Many CBs base their decisions based on a vague "quality of life" concepts as opposed to formal economic or urban planning concerns so operators were often at the mercy of anti-nightlife elements within the CBs. The previous process benefited the "not in my backyard" (NIMBY) elements within the CBs who exerted power and control over nightlife through the SLA.

The new streamlined system undercuts the CB’s influence. Some CB members didn’t even know that the rules had been changed. Now they are voicing their displeasure. Harold Egeln of the Brooklyn Daily Eagle reports that
Community Board 10 has formally asked the SLA to abandon the new policy and go back to the 6-8 month waiting game.

Considering how pivotal the license process is to CB influence over bars, we should expect to see more CBs join the fight to roll back SLA rules and regain influence. But, as with all political issues, there is a compromise between alienating the CBs completely and giving NIMBYs control of the liquor license process.

One solution could be to bring in actual experts in urban planning, zoning, and real estate development to advise the SLA on behalf of the individual CBs within the new fast track framework. This would give the CBs a voice within the new licensing process without crippling the process itself. That will allow the SLA to continue its improvements, foster growth within nightlife and address relevant community concerns.

Going back to the old process is not the answer, unless the goal is to stifle nightlife in New York.

Have fun.

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