Regaining Your Liquor License After Revocation
States and municipalities throughout the country regulate the sale of alcohol, taking action to ensure their residents’ freedom to have a good time doesn’t threaten the safety of others. One of the ways governments enforce alcohol regulations is through liquor licenses, which give businesses state sanction to sell alcoholic beverages. When restaurants, bars, and other alcohol-serving facilities don’t comply with the law, they can lose their liquor licenses, which poses a big problem for their revenue stream.
The good news is that a liquor license revocation is not often permanent. Most businesses that have their liquor licenses revoked can obtain them—in some cases, liquor licenses can be regained in just a matter of weeks. Understanding common reasons why liquor licenses get revoked can help your business avoid pitfalls that may lead to a revocation. Understand the process of regaining a revoked liquor license can help you quickly resolve your issues and get back an important stream of revenue.
Tabak Insurance Agency specializes in restaurant insurance, nightclub, and bar insurance, providing liquor liability insurance, commercial general insurance, and commercial property coverage. We have seen a number of ways that businesses can lose their license, which can potentially be avoided. In the event that you do lose your liquor license, there are also ways to regain it.
Five Ways to Lose Your Liquor License
Governments have a vested interest in regulating alcohol, as irresponsible use can lead to some very tragic outcomes. While most people use alcohol responsibly, enjoying its use as a social lubricant and means of relaxation, some use it improperly, resulting in about 88,000 deaths each year. Regulation can decrease these unfortunate occurrences, deterring behavior such as drinking and driving and alcohol-related crime. Facilities that serve alcohol are an important frontline in these efforts, which is why governments regulate them, demanding that they purchase liquor insurance and meet requirements for liquor licenses.
Bars, restaurants, and other facilities can and do lose their licenses through non-compliance with laws regarding the sale of alcohol. Some of the most common reasons for revocation of liquor licenses include:
- Serving minors – The legal drinking age throughout the U.S. is 21 years of age, and state and local law enforcement are very vigilant in enforcing rules against serving minors. Get caught too often serving minors, and your liquor license will be swiftly revoked. Your bartenders and servers may even face criminal charges if it’s found they knowingly served minors.Unfortunately, many minors will try to skirt the law regarding the legal drinking age by lying about their age or presenting fake IDs. Your facility’s staff needs to receive thorough training on the drinking age and why it’s important that it’s enforced. Your staff should be taught to request identification for all customers who appear to be under the age of 40, and they also need to know how to spot fake IDs.
- Violating time limits on serving – In many cities and towns, liquor licenses only give establishments the right to serve alcohol at certain times of the day. Selling outside the window provided by your liquor license—for example, serving customers at 2:15 a.m. when local ordinance forbids sales after 2 a.m.—could be cause for revocation of your liquor license.
- Improperly trained staff – All of your establishment’s staff should meet state and local requirements for training. In many jurisdictions, bartenders and staff that serve alcohol must complete a ServSmart or SmartServe If your staff is caught serving without the right certification, you could lose your liquor license.
- Overserving – Most jurisdictions have laws against serving people who are obviously inebriated. If your staff serves someone who is intoxicated, and that person gets into an accident, your establishment may not only lose its liquor license—you may also end up getting sued by that person or the third parties who may be injured in an accident. Knowing when to cut off customers is an important part of the hospitality and entertainment industry.
- Disorderly conduct – Bars and other facilities that are the frequent locations of fights, public nudity, and other disturbances may quickly lose their liquor license, as well as their liquor insurance It’s up to bar and restaurant owners to maintain an orderly environment by establishing rules of conduct and strictly enforcing them.
Regaining Your Liquor License
Every town and city’s process for granting and revoking liquor licenses is different, as individual municipalities set their own rules, within limits, for this process. There are some general steps should take after losing a liquor license, however.
- Gather documentation – Get copies of all documents pertaining to the revocation, including police reports. If your facility has video monitoring, be sure to review the footage of the incident or incidents that led to the revocation. The more evidence you have, the stronger the foundation for any appeal you may launch. Obtaining documentation can also help you identify problems in your business you may need to address.
- Appeal your revocation – If you feel that your revocation was unjustified, find out your city or town’s appeal process and begin an appeal. You may need to retain an attorney to do this, as the municipal government’s attorney will likely fight your appeal. Work closely with your attorney and submit all requested information to improve your chances of a successful appeal. If you’re lucky, your attorney may be able to work out an arrangement with the city council to reinstate your license or may successfully challenge the revocation in court.
- Pay your fines – If you can’t appeal the revocation, comply with the fines and other penalties. Failure to pay fines will keep you from getting your liquor license back. Be sure to pay all fines and penalties in a timely manner, as a speedy resolution of these matters will help you get the clean slate needed for a new license.
- Address the problem that led to the revocation – If you don’t address the problem that led to the revocation of your liquor license, you may end up repeating this process if you are able to regain your license. If the problem is disorderly conduct, ban unruly customers and train your staff to better handle situations.If problem employees are overserving or are serving minors, correct the behavior or part ways with them. If your facility is violating time limits on sales or other local rules, make sure your staff knows that compliance is vital. Complying with the law is essential to your license and your ability to obtain affordable liquor insurance and commercial general liability insurance.
- Apply for a new liquor license – If you’re unable to appeal your revocation, or your revocation fails, your only option is to observe all stipulations of your revocation and re-apply for a new liquor license when you are able. In many cases, particularly for facilities that have lost their license for the first time, you can obtain a new license fairly soon.In some severe cases, you may have to take on a new partner to obtain a license. Consult with your attorney and make sure you follow all the right steps for obtaining a new liquor license.
Losing a liquor license is no small matter, as even restaurants and hotels derive a significant amount of their revenue from alcohol sales. Resolving any problems regarding your liquor license swiftly is important to the financial well-being of your business, so take the appropriate steps to handle these matters.
Tabak Insurance Agency has saved clients an average of 20 percent in insurance premiums over the last two years, thanks to the company’s expertise in serving the food, entertainment, and hospitality industries.
Get a quote today to find a policy that fits the individual needs of your organization.