The Utah Legislature today in a special session passed a bill (S.B. 4001) to increase the number of restaurant licenses available in the state. The bill will now go to Governor Herbert , who is expected to sign.

50 additional full-service restaurant licenses and 40 limited-service restaurant licenses will be available as of July 1, 2012. Currently, there is one full-service restaurant license available and no limited-service licenses. 25 applicants are reported to be waiting for both types of licenses. 

The increase in restaurant licenses is commonly seen as a stop-gap measure. At current rates, Utah is likely to run out of restaurant licenses again within a year or two. 

 

A full-service restaurant license allows for the sale of all wine, beer and spirits. Limited-service restaurant licenses are allowed to sell only wine and beer.  Both types of restaurants must maintain a ratio of at least 70% food to 30% alcohol sales and food must be ordered to serve a drink. Restaurants also must abide by the so-called “Zion Wall” that requires that all alcohol, except for wine, be poured out of the public view. 

 

The bill also pushed back the effective date of a law that would have allowed license holders to sell existing licenses as of July 1, 2012. The new effective date is July 1, 2013. The bill’s sponsor, Senator John Valentine (R – Orem), indicated that the additional year was to provide the state with time to consider the effects of commoditization and possible unintended consequences.   

 

The bill did not address “Club” licenses, which cover bars, restaurants with visible bars and fraternal clubs (such as the Elks Lodges). Utah currently is out of all Club licenses (in fact is at negative 1, having issued more than the current quota allows). 17 applicants have been waiting for more than a year for various Club licenses. Representative Gage Froerer (the House sponsor of S.B. 4001) indicated that more work is needed to address the lack of availability of licenses for restaurants (called dining clubs) that are currently operating under the Club scheme. 

 

Additionally, the bill added measures to increase alcohol enforcement, particularly with regard to restaurants. Certain application and renewal fees were increased by 10% to offset these enforcement measures.