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Senate Bill 1383 — Alcohol, licensing

Senate Bill 1383 — Alcohol, licensing

by
Parrish Miller
March 10, 2022
Parrish Miller
March 10, 2022

Bill Description: Senate Bill 1383 would create new city- and county-level bureaucracy to sell highly restricted liquor licenses. 

Rating: -5

Does it create, expand, or enlarge any agency, board, program, function, or activity of government? Conversely, does it eliminate or curtail the size or scope of government?

Idaho's laws on liquor licenses are highly convoluted, steeped in cronyism, and have created artificial scarcity that would not exist in anything resembling a free market. These government-created barriers to entering a market are valuable — and increasingly so. They are worth more than $300,000, and the waiting list for anyone seeking a new one stretches out to 30 years.

The statement of purpose for Senate Bill 1383 acknowledges that "Idaho's current liquor laws are a roadblock for local business owners." That’s a small step forward.

Unfortunately, rather than repeal these needless regulations, Senate Bill 1383 doubles down on this failure. It manufactures an entirely new city- and county-level bureaucracy to sell a new class of highly restricted liquor licenses. The licenses will cost  $6,000 for the first year and "up to $5,250 every year thereafter."

Senate Bill 1383 is a massive 35-page bill containing 103 sections that creates new licenses which will only be available  to "eating establishments" that "must be engaged in the preparation, cooking, and serving of complete meals." Bars, clubs, "luncheonettes, drive-ins, sandwich shops, or similar businesses" do not qualify. 

The solution to a problem created by government is not more government. 

(-1)

Does it increase barriers to entry into the market? Examples include occupational licensure, the minimum wage, and restrictions on home businesses. Conversely, does it remove barriers to entry into the market?

The difficulty in opening a business that serves liquor in Idaho is entirely government-created. Instead of removing these unnecessary obstacles, Senate Bill 1383 creates more obstacles, more bureaucracy, and more fees.

(-1)

Does it directly or indirectly create or increase any taxes, fees, or other assessments? Conversely, does it eliminate or reduce any taxes, fees, or other assessments?

Senate Bill 1383 would impose enormous fees — $6,000 for the first year and "up to $5,250 every year thereafter" — on all businesses that receive the highly restricted liquor licenses created by this bill. The bill also creates a nonrefundable $400 application fee and a host of administrative fines of up to $1,000. 

(-1)

Does it increase government redistribution of wealth? Examples include the use of tax policy or other incentives to reward specific interest groups, businesses, politicians, or government employees with special favors or perks; transfer payments; and hiring additional government employees. Conversely, does it decrease government redistribution of wealth?

Senate Bill 1383 would repeal and replace Section 23-934, Idaho Code, to create a "state license value loss mitigation fund" to reimburse holders of existing state liquor licenses up to $50,000 if they sell their license at a loss. 

"Moneys in the fund shall consist of moneys deposited pursuant to sections 23-617, 23-913, and 23-914, Idaho Code, and legislative appropriation..." which means that taxpayers will be required to subsidize any losses incurred by businesses when they sell a state liquor license. 

(-1)

Does it in any way restrict public access to information related to government activity or otherwise compromise government transparency or accountability? Conversely, does it increase public access to information related to government activity or increase government transparency or accountability?

Because Senate Bill 1383 uses the strategy of "repealing and replacing" dozens of sections of code, it is difficult for anyone (including analysts and lawmakers) to fully and accurately understand the scope of the changes being proposed to Idaho law. Add to this problem the rushed introduction of this massive bill after the transmittal deadline, and it's clear that the entire process is sorely lacking in transparency. 

(-1)

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