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Utah's liquor bottleneck is turning away restaurants

Published May 18, 2012 2:39 pm

This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Lawmakers are grappling with an acute shortage of liquor licenses amid fears that more restaurants and bars could increase drunk driving and underage drinking.

This week, a legislative interim committee looked at data from surrounding states, which seems to indicate Utah has much stricter quotas. And information from a national alcoholic-control association backs up that contention.

Sen. John Valentine, R-Orem, said next month he'll propose changes to the population-based quota system that sets limits on the number of liquor licenses. Commercial developers testified during the legislative hearing on Wednesday that the state is losing out on restaurant chains locating in Utah because the quota system is so rigid.

California, for instance, allows one bar or restaurant license per 2,000 population. Idaho's quota is one license per 1,500 population and Washington has one permit per 1,200 people, says the Utah Office of Legislative Research and General Counsel.

By contrast, the quota in Utah is one per 4,925 for a full-service restaurant license that allows all types of alcohol for patrons ordering food.

Through the years, Utah legislators have put together a patchwork of laws that seem to make little sense — favoring bars over restaurants that serve only beer and wine.

The Utah quota for bar license is one per 7,850 population while a limited restaurant license is one per 8,373 people.

Despite the particularities, Utah has fewer restaurant and bar permits, with 0.87 outlets per 1,000 adults over age 21, the legal age to imbibe.

By contrast, Montana has 3.4 outlets per 1,000 adults, Wyoming 3.13 outlets, Oregon, 2.37, Washington 1.67, California 1.65 and Idaho 1.11, according to the National Alcohol Beverage Control Association.

Salt Lake attorney Catherine Parrish Lake testified that Utah's license shortage has turned away a number of clients interested in opening restaurants in the state.

Steven Bogden, managing director of Coldwell Banker Commercial, said the license shortage is preventing the Darden Restaurant Group from opening 12 eateries in Utah, which would generate $40 million in sales and $2.7 million in taxes.

"The economy runs on a delicate nature of supply and demand," he said. "Utah has a great demand but we also have a limited supply of licenses."

Utah lawmakers have repeatedly said that liquor licenses must be balanced against underage drinking and drunk driving.

"The bottom line is a wetter environment would yield a higher DUI rate," said Valentine, citing studies about negative impacts associated with easier access to alcohol.

But Salt Lake City physician Thomas Barman challenged the assumption that the state should continue its tight quotas on restaurants, where patrons must order food with drinks, as a way to reduce overconsumption.

"Alcohol consumption has meritorious benefits to society when used in moderation, and this I dare say is irrefutable," he said in an interview. Severely limiting access to alcohol is "just as silly" as the logic that the state insists all Utahns drink in moderation "to achieve the clear health benefits."

The key to reducing violence and other impacts from overconsumption is to regulate the number of all outlets selling alcohol, according to the California-based public health group, Pacific Institute for Research and Evaluation.

A number of studies have found that violence increases in neighborhoods with a high density of bars, restaurants, liquor stores and other business that sell alcohol, such as convenience outlets, according to its report, "How Alcohol Affects Neighborhood Violence."

The Institute recommends spacing all alcohol outlets at reasonable distances, withholding new licenses in saturated neighborhoods and shutting down establishments that repeatedly violate alcohol laws, such as selling to inebriated adults and minors.

dawn@sltrib.com

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Regulating alcohol

Governments can help fight crime and blight by controlling licenses to sell alcohol and the location of licensees, according to the think tank, Pacific Institute for Research and Evaluation. Among its recommendations:

Make rules • Set minimum distances between all alcohol outlets

Restrict licenses • In areas that have outlets too close together

No new license • When a problem outlet goes out of business

Close outlets • That repeatedly violate liquor laws, such as selling to minors