Bill Text: NJ A584 | 2024-2025 | Regular Session | Introduced
Bill Title: Allows municipalities to transfer inactive alcoholic beverage retail licenses for use in certain redevelopment and revitalization areas; establishes procedure to transfer inactive retail licenses.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Oversight, Reform and Federal Relations Committee [A584 Detail]
Download: New_Jersey-2024-A584-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblyman STERLEY S. STANLEY
District 18 (Middlesex)
Assemblyman REGINALD W. ATKINS
District 20 (Union)
Assemblywoman CAROL A. MURPHY
District 7 (Burlington)
SYNOPSIS
Allows municipalities to transfer inactive alcoholic beverage retail licenses for use in certain redevelopment and revitalization areas; establishes procedure to transfer inactive retail licenses.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning alcoholic beverage licensing, supplementing Title 33 of the Revised Statutes, and amending P.L.1977, c.246.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) As used in this act:
"Sending municipality" means a municipality from which an inactive license is issued pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) to the governing body of a receiving municipality as part of an economic redevelopment plan or in connection with a premises located within a redevelopment, improvement, or revitalization area.
"Inactive license" means a plenary retail consumption license that has been placed on inactive status and renewed as authorized by the provisions of R.S.33:1-12.39 for two consecutive license terms.
"Receiving municipality" means a municipality that enters into an agreement to acquire an inactive plenary retail consumption license from a sending municipality as part of an economic redevelopment plan or in connection with a premises located within a redevelopment, improvement, or revitalization area pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill).
"Redevelopment, improvement, or revitalization area" means an urban enterprise zone designated pursuant to P.L.1983, c.303 (C.52:27H-60 et seq.) or P.L.2001, c.347 (C.52:27H-66.2 et al.); a downtown business improvement zone designated pursuant to P.L.1998, c.115 (C.40:56-71.1 et seq.); a pedestrian mall or pedestrian mall improvement or special improvement district as defined in section 2 of P.L.1972, c.134 (C.40:56-66); a transit oriented development as defined by section 2 of P.L.2011, c.149 (C.34:1B-243); an area determined to be in need of redevelopment pursuant to sections 5 and 6 of P.L.1992, c.79 (C.40A:12A-5 and 40A:12A-22); or an area determined to be in need of rehabilitation pursuant to section 14 of P.L.1992, c.79 (C.40A:12A-14), or any improvement which is 100 percent new construction, which is an entirely new improvement not previously occupied or used for any purpose.
2. (New section) a. A governing board or body of a sending municipality that is authorized to issue a new plenary retail consumption licenses shall be entitled to offer the license at public sale pursuant to P.L.1981, c.416 (C.33:1-19.3 et seq.) or offer the license at public sale to the highest bidding governing body of any other municipality in this State.
A license transferred to a receiving municipality pursuant to this section only shall be used in connection with a premises as part of an economic redevelopment plan or located within a redevelopment, improvement, or revitalization area as defined in section 1 of P.L. , c. (C. ) (pending before the Legislature as this bill). The sending municipality shall not be entitled to issue a new license pursuant to P.L.1975, c.275 (C.33:1-19.1 et seq.) to replace the license transferred to the receiving municipality pursuant to this section.
b. Notice of the public sale shall be provided to the director and other municipalities at least 90 days prior to the sale. The notice to the municipalities shall specify the minimum acceptable bid and general conditions of sale including a statement that the sending municipality reserves the right to reject all bids where the highest bid is not accepted.
The funds derived from the sale shall be remitted to the municipal treasurer for the general use of the sending municipality.
c. A receiving municipality that acquires a license pursuant to subsection a. of this section shall be entitled to offer the license at public sale pursuant to P.L.1975, c.275 (C.33:1-19.1 et seq.).
d. A license transferred to a receiving municipality and issued to a qualified bidder that is not actively used in connection with the operation of a premises within two years of the issuance date shall revert to the receiving municipality. The receiving municipality may reissue the license by public sale in a manner consistent with P.L.1975, c.275 (C.33:1-19.1 et seq.) or may transfer the license to the sending municipality to be reissued at public sale.
The license holder shall not be entitled to appeal the expiration of the license to the director or a court of law unless the license holder has been deprived of the use of the licensed premises as a result of eminent domain, fire, or other casualty, and establishes by affidavit filed with the director that the license holder is making a good faith effort to resume active use of the license in connection with the operation of a licensed premises.
e. A receiving municipality shall not be entitled to acquire more than one license pursuant to this section each calendar year.
f. No person who would fail to qualify as a licensee under Title 33 of the Revised Statutes shall be permitted to hold an interest in a license transferred under the provisions of this section.
g. Licenses transferred pursuant to the provisions of this section shall be subject to all the provisions of Title 33 of the Revised Statutes, rules and regulations promulgated by the director, and municipal ordinances.
h. A license issued pursuant to this section shall not be included in the total number of licenses based on the population necessary to issue a new plenary retail consumption or seasonal retail consumption license pursuant to section 2 of P.L.1947, c.94 (C.33:1-12.14).
3. (New section) a. The holder of an inactive plenary retail consumption license issued by any municipality may apply to the governing bodies of the issuing municipality and a receiving municipality located within the same county to use the license in connection with a premises located in the receiving municipality.
A license used in the receiving municipality pursuant to this section shall remain in a redevelopment, improvement, or revitalization area of the receiving municipality permanently and shall not be transferred to any other location within the receiving municipality or the governing body of any other municipality. The sending municipality shall not be entitled to issue a new license pursuant to P.L.1975, c.275 (C.33:1-19.1 et seq.) to replace the license transferred to the receiving municipality pursuant to this section.
b. The sending and receiving municipality shall submit to the director notice of the intent to transfer a license at least 90 days prior to the transfer. The issuing and receiving municipalities shall adopt by majority vote identical resolutions authorizing the transfer of the license. The identical resolutions shall establish the license transfer fee, which shall be paid by the license holder and deposited in the general fund of the host municipality. Prior to adopting the resolution pursuant to this section, the governing body of both municipalities shall give special consideration as to whether sufficient attempts were made by the license holder to use or transfer the license for use in connection with a premises located in the sending municipality.
c. A license transferred to a receiving municipality pursuant to this section that is not actively used in connection with the operation of a premises within two years of the transfer date shall expire and shall not be reissued by the receiving municipality. The license holder shall not be entitled to appeal the expiration of the license to the director or a court of law unless the license holder has been deprived of the use of the licensed premises as a result of eminent domain, fire, or other casualty, and establishes by affidavit filed with the director that the license holder is making a good faith effort to resume active use of the license in connection with the operation of a licensed premises.
d. A receiving municipality shall not be entitled to acquire more than one license pursuant to this section in each calendar year.
e. Licenses transferred pursuant to the provisions of this section shall be subject to all the provisions of Title 33 of the Revised Statutes, rules and regulations promulgated by the director, and municipal ordinances.
f. An applicant for a license issued pursuant to this section shall certify to the sending and receiving municipality that the license will be used in connection with the operation of a restaurant at which the retail sale of food is the primary and principal business and will constitute a majority of the restaurant's total annual sales. A license holder who applies to renew a license issued pursuant to this section shall annually submit to the issuing authority a report supported by receipts demonstrating that the sale of food constituted at least 60 percent of the store's total annual sales in the last full calendar year preceding the renewal date. A license holder who fails to demonstrate that the sale of food constituted at least 60 percent of the store's total annual sales in the last full calendar year may be subject to revocation of the plenary retail consumption license.
g. The holder of a license issued pursuant to this section shall cease the sale of alcoholic beverages each day at the time that food service has ended or 11:00 p.m., whichever occurs earlier.
h. The holder of a license issued pursuant to this section may transfer the license to another person in a private transaction. A license issued pursuant to this section shall not be relocated to a another premises.
i. The restriction in section 2 of P.L.1947, c.94 (C.33:1-12.14) concerning the number of retail consumption licenses that may be issued in a municipality shall not be applicable to a license issued pursuant to this section.
4. (New section) a. A receiving municipality in which the number of plenary retail consumption licenses has reached the population limitation established in section 2 of P.L.1947, c.94 (C.33:1-12.14) may issue a request for proposal to acquire from a license holder an additional inactive plenary retail consumption license that was initially issued by any other host municipality in this State. The inactive license acquired pursuant to this section shall be used in connection with a premises as part of an economic redevelopment plan or a redevelopment, improvement, or revitalization area.
b. The request for proposal issued pursuant to subsection a. of this section shall specify a time and date after which no further applications from license holders will be accepted. The request shall be published in a newspaper circulating generally throughout the State by not less than two insertions, one week apart, the second of which shall be made not less than 30 days prior to the time and date specified in the notice as the time and date after which no further applications will be accepted. In addition, the request for proposal shall be published by the governing body on the official Internet website of the receiving municipality. The request for proposal shall require that all bids shall be sealed and remain confidential to other bidders. Notwithstanding the provisions of section 1 of P.L.1981, c. 416 (C.33:1-19.3) the license shall be awarded to the highest qualified bidder.
c. The holder of an inactive plenary retail consumption license shall apply to the governing body of the sending municipality for permission to transfer the inactive plenary retail consumption license from the sending municipality prior to submitting a bid in response to the request for proposal. The governing body of the sending municipality may approve the application only by a resolution adopted by a majority vote. The sending municipality shall not require the applicant to disclose the location of the proposed licensed premises.
After the receiving municipality accepts a successful bid, the sending municipality shall submit to the director notice of the intent to transfer a license at least 90 days prior to the transfer. The sending and receiving municipalities shall adopt by majority vote identical resolutions authorizing the transfer of the license. The identical resolutions shall establish the license transfer fee, which shall be paid by the license holder and deposited in the general fund of the sending municipality. Prior to adopting the resolution pursuant to this section, the governing body of both municipalities shall give special consideration as to whether sufficient attempts were made by the license holder to use or transfer the license for use in connection with a premises located in the host municipality.
d. A receiving municipality that acquires a license pursuant to subsection a. of this section shall be entitled to offer the license at public sale pursuant to P.L.1975, c.275 (C.33:1-19.1 et seq.). A license issued by the receiving municipality to a qualified bidder that is not actively used in connection with the operation of a premises within two years of the issuance date shall expire and shall not be reissued by the receiving municipality. The license holder shall not be entitled to appeal the expiration of the license to the director or a court of law unless the license holder has been deprived of the use of the licensed premises as a result of eminent domain, fire, or other casualty, and establishes by affidavit filed with the director that the license holder is making a good faith effort to resume active use of the license in connection with the operation of a licensed premises.
e. A receiving municipality shall not be entitled to acquire more than one license pursuant to this section in each calendar year.
f. Licenses transferred pursuant to the provisions of this section shall be subject to all the provisions of Title 33 of the Revised Statutes, rules and regulations promulgated by the director, and municipal ordinances.
g. A license issued pursuant to this section shall not be included in the total combined population necessary to issue a new plenary retail consumption or seasonal retail consumption license pursuant to section 2 of P.L.1947, c.94 (C.33:1-12.14).
5. Section 1 of P.L.1977, c.246 (C.33:1-12.39) is amended to read as follows:
1. [No] a. Following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), a Class C license [,] as [the same is] defined in R.S.33:1-12 [,] shall not be renewed if the [same] license has not been actively used in connection with the operation of a licensed premises within [a period of two years prior to the commencement date of the license period for which the renewal application is filed unless the director, for good cause and after a hearing, authorizes a further application for one or more renewals within a stated period of years; provided, however that, if] two consecutive license terms. A license that remains inactive at the end of the two-year period shall expire. Prior to the expiration of a plenary retail consumption license pursuant to this subsection, the license holder may transfer the license for use as part of an economic redevelopment plan or in connection with a redevelopment, improvement, or revitalization area pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill).
b. Notwithstanding subsection a. of this section, if the licensee has been deprived of the use of the licensed premises as a result of eminent domain, fire or other casualty, and establishes by affidavit filed with the director that [he] the licensee is making a good faith effort to resume active use of the license in connection with the operation of a licensed premise then the time period [of two years] provided for in this section shall be automatically extended for an additional period of two [years] license terms.
c. Following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill) and in accordance with the schedule established by the director pursuant to subsection d. of this section, an inactive license that is not transferred pursuant to subsection a. of this section shall be:
(1) actively used by the license holder;
(2) transferred to another person who intends to use the license in a private transaction for fair market value. The transferee shall actively use the license in connection with a premises upon receipt of the license; or
(3) transferred from a sending municipality to a receiving municipality in accordance with P.L. , c. (C. ) (pending before the Legislature as this bill)
d. The director shall divide the inactive plenary retail consumption licenses that are placed on inactive status on the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill) into quartiles based on the total length of time that the licenses have been inactive. The licenses shall be transferred pursuant to subsection c. of this section in accordance with the following time schedule:
(1) the quartile that has been inactive for the longest period of time shall be transferred pursuant to subsection c. of this section within one year of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill);
(2) the quartile that has been inactive for the second longest period of time shall be transferred pursuant to subsection c. of this section within two years following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill);
(3) the quartile that has been inactive for the third longest period of time shall be transferred pursuant to subsection c. of this section within three years following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill); and
(4) the quartile that has been inactive for the shortest period of time shall be transferred pursuant to subsection c. of this section within four years following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill).
e. Any request for relief under this section shall be accompanied by a nonreturnable filing fee of [$100.00] $100 payable to the director.
(cf: P.L.1996, c.127, s.1)
6. This act shall take effect on the first day of the seventh month following the date of enactment.
STATEMENT
This bill establishes several procedures by which a plenary retail consumption license, generally issued to bars and restaurants, may be transferred for use as part of an economic redevelopment plan or in connection with premises located in a redevelopment, improvement, or revitalization area located in another municipality. The bill defines "redevelopment, improvement, or revitalization area" as an urban enterprise zone; a downtown business improvement zone; a pedestrian mall or pedestrian mall improvement or special improvement district; a transit oriented development; an area determined to be in need of redevelopment; an area determined to be in need of rehabilitation; or any improvement which is 100 percent new construction, which is an entirely new improvement not previously occupied or used for any purpose.
Under current law, a municipality may issue plenary retail consumption licenses until the combined total number in the municipality is fewer than one license for each 3,000 municipal residents. This bill allows a municipality that is entitled to issue an additional plenary retail consumption license to offer the license at public sale to the highest bidding governing body of any other municipality in this State. A license transferred to a receiving municipality only is to be used in connection with a premises as part of an economic redevelopment plan or located within a redevelopment, improvement, or revitalization area. The bill requires the host municipality to provide notice of the public sale to the Director of the Division of Alcoholic Beverage Control and other municipalities at least 90 days prior to the sale. The notice to the municipalities is to specify the minimum acceptable bid and general conditions of sale including a statement that the transferring municipality reserves the right to reject all bids where the highest bid is not accepted. The funds derived from the sale are to be remitted to the municipal treasurer for the general use of the host municipality. A receiving municipality that acquires the license would be entitled to offer the license at public sale. A license issued by the receiving municipality to a qualified bidder that is not actively used in connection with the operation of a premises within two years of the issuance date is to expire and not be reissued by the receiving municipality. The receiving municipality would be prohibited from acquiring more than one license through this bidding process in each calendar year.
In addition, this bill establishes two procedures for transferring an inactive plenary retail consumption license to a different municipality. Under current law, an inactive plenary retail consumption license is a license to sell alcoholic beverages for on premises consumption that is not being used at an open and operating licensed premises. A licensee is required to place the license on "inactive status" when the licensed business ceases operation and the license continues to be held by the licensee of record.
Under this bill, a license that remains inactive for two license terms is to expire. Prior to the expiration of the license, an inactive license is to be actively used by the license holder or transferred to another person who intends to use the license in a private transaction for fair market value. The bill also allows the holder of the inactive license to apply to the governing body of a sending municipality that issued the license and a receiving municipality located within the same county to use the license in connection with a premises located in the receiving municipality. An inactive plenary retail consumption license used in the receiving municipality only would be used as part of an economic redevelopment plan or in connection with a premises located within a redevelopment, improvement, or revitalization area. The bill requires the transferred license to remain in the receiving municipality and prohibits the transfer of license to any other municipality. Under the bill, the sending and receiving municipalities are to submit to the director notice of the intent to transfer a license at least 90 days prior to the transfer. The bill requires the sending and receiving municipalities to adopt by majority vote identical resolutions authorizing the transfer of the license. The identical resolutions are to establish the license transfer fee agreed upon by both municipal governing bodies. A receiving municipality that acquires a license would be entitled to offer the license at public sale in accordance with current law. A license issued by a receiving municipality that is not actively used in connection with the operation of a premises within two years of the transfer date would expire and not be reissued by the receiving municipality. In addition, the bill provides that these licenses would be subject to certain restrictions. The receiving municipality would be required to issue the license to an applicant who certifies to the sending and receiving municipality that the license will be used in connection with the operation of a restaurant at which the retail sale of food is the primary and principal business. The license holder would then be required to annually submit to the issuing authority a report supported by receipts demonstrating that the sale of food constituted at least 60 percent of the store's total annual sales in the last full calendar year preceding the renewal date. A license holder who fails to demonstrate that the sale of food constituted at least 60 percent of the store's total annual sales in the last full calendar year may be subject to revocation of the plenary retail consumption license. The bill also requires the license holder to cease the sale of alcoholic beverages each day at the time that food service has ended or 11:00 p.m., whichever occurs earlier. A license holder would be entitled to transfer the license to another person in a private transaction, but the bill prohibits the license from being relocated to another premises.
This bill also allows a receiving municipality that has reached the license population limitation established under current law to issue a request for proposal (RFP) to acquire an inactive plenary retail consumption license from any license holder in this State. The bill requires the receiving municipality to issue the license for use in connection with a premises as part of economic redevelopment plan or a redevelopment, improvement, or revitalization area. The RFP would specify a time and date after which no further applications from license holders will be accepted. The municipality is to publish the RFP in a newspaper circulating generally throughout the State by not less than two insertions, one week apart, the second of which is to be made not less than 30 days prior to the time and date specified in the notice as the time and date after which no further applications will be accepted. In addition, the request for proposal is to be published by the governing body on the official Internet website of the receiving municipality. The RFP is to require that all bids be sealed and remain confidential to other bidders. The holder of an inactive plenary retail consumption license is to apply for permission to transfer the inactive plenary retail consumption license from the sending municipality prior to submitting a bid in response to the RFP. The sending municipality may approve the application by resolution. The sending municipality would be prohibited from requiring the applicant to disclose the location of the proposed licensed premises.
After the receiving municipality accepts a successful bid, the sending and receiving municipality are to submit to the director notice of the intent to transfer a license at least 90 days prior to the transfer. The bill requires the sending and receiving municipalities to adopt by majority vote identical resolutions authorizing the transfer of the license. The identical resolutions are to establish the license transfer fee agreed upon by both municipal governing bodies. The bill requires a license that is not actively used within two years of issuance date to expire. A receiving municipality that issued the RFP would be prohibited from acquiring more than one license through this process in each calendar year.
Finally, the bill requires the director to establish a four-year timeline for the reissuance of inactive licenses based on the length of time that the license has been inactive. The plenary retail consumption licenses transferred to or acquired by a receiving municipality under the bill's provisions would not be included in the population formula used to issue new licenses.
