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House of Representatives
Session of 2019 - 2020 Regular Session


Posted: May 14, 2019 04:45 PM
From: Representative Frank Burns
To: All House members
Subject: Protecting Small Businesses by Suspending Zombie Liquor License Auctions
Mom-and-pop businesses – from the corner tavern to the local hardware store – face daunting challenges every day. We as policymakers must ensure that state government isn’t one of those challenges.

Act 39 of 2016 allowed the state Liquor Control Board to resurrect old restaurant liquor licenses and auction them to the highest bidder. These so-called “zombie licenses” were given new life by the auctions, but pumping them back into the marketplace is accelerating the death of independent restaurants and the thousands of jobs they offer across the Commonwealth.

The auctions put the LCB in direct competition with restaurant licensees who want to sell their license but who are continually undercut by the LCB’s auctions. With a $25,000 minimum auction bid, the owner of the corner tavern who banked on his liquor license as his retirement now has an asset whose value diminishes every day.

That’s why I’m introducing legislation that would suspend the zombie license auctions until the formation of the Wine and Spirits Wholesale and Retail Privatization Commission and the publication of its study. Act 39 required the formation of this commission and tasked it with studying the supply and demand of liquor licenses in each county and the effectiveness of the auctions. Three years later, we’ve had no commission, no report and no evaluation of the liquor licensing system.

Please join me in sponsoring this legislation to suspend the auctions and protect the mom-and-pop businesses that have been the cornerstones of our communities for decades.

Introduced as HB1544