The 220th New Jersey Legislative Session concluded earlier this month, with the new session beginning on January 9th. Read below to learn more about the legislation that moved during lame duck and signed into law.

What Happened To New Jersey Liquor Licenses?

The Murphy Administration made comprehensive liquor license reform a priority over the last year, with plans to completely overhaul the system. However, the plan would have reduced the population cap within five years, creating unlimited licenses without a fair path forward for current licensees. The New Jersey Restaurant and Hospitality Association collaborated with business owners and industry leaders over the last year to provide legislators and members of the Administration with factual information regarding the complexities of owning a liquor license. After months of discussions, numerous variations of legislation and committee hearings, Governor Murphy just signed a law that ensures current license holders maintain their investment while unused licenses are pushed back into the market. The law also addresses restrictions for breweries, as well as mall liquor licenses.

What Does The New Law Do?

Fair Market Value

• The cost of a liquor license will continue to be determined by fair market value

Unused Licenses

• A Class C license that remains inactive for two years will expire. Prior to the expiration, an inactive license is to be:
  • actively used by the license holder
  • transferred to another person who intends to use the license in a private transaction for fair market value
  • or transferred from a sending municipality to a contiguous receiving municipality for use in a redevelopment, improvement, or revitalization area
• The governing body where the license is located may extend the period for one additional year

License Flexibility

• Municipalities that have reached the license population limitation may issue a request for proposal (RFP) to acquire an unused consumption license from a contiguous municipality
• The license must be used in a redevelopment, improvement, or revitalization area
• Municipalities can acquire one unused license in each calendar year, but not more than two unused licenses in five calendar years

What Happened With Breweries?

Events

• Brewery, cidery and meadery license, and craft distillery license holders may now hold an unlimited number of on-premises special events
• Licensees shall be entitled to annually hold up to 25 off-premises special events
• Licensees shall be entitled to hold an unlimited number of private parties per year to occur on the licensed premises.
  • “Private party” means an event that is held on the licensed premises and closed to the general public, either by the establishment of a special area of the licensed premises that may be reserved to be occupied only by the hosts or guests of the private party, or by closure of the licensed premises to the public for the duration of the private party
• Licensees may coordinate with food vendors for the provision of food at private parties and, subject to the consent of the licensee, may provide wine and malt alcoholic beverages purchased off premises at the private party

Food Vendors

• Licensees may offer for sale or make the gratuitous offering of de minimis food items including, but not limited to, packaged crackers, chips, nuts, and similar snacks, as well as non-alcoholic beverages, to customers
• The license holder also may coordinate with a food vendor for the provision of food on the licensed premises and provide menus to customers for the sale of food
• Licensees that coordinate with a food vendor including, but not limited to, a food truck or restaurant, shall not own or operate the food vendor
• The holder of a brewery license that is used in connection with a licensed premises that is adjoining a food vendor’s premises shall have its own entrance and exit way to and from the licensed premises and shall not have a doorway that allows direct access and egress to the food vendor’s premises

Brew Pub Distribution

• Restricted brewery license holders, known as "brew pubs," are now entitled to to sell and distribute their product to wholesalers and retailers, and maintain a warehouse