Idaho liquor license laws send Idaho restaurateur to Colorado

The owner of the restaurant and distillery Bardenay is planning to open a fourth restaurant, but he’s not considering Idaho because of its liquor laws.

Bardenay first opened in Boise in 1999 and has since expanded to Eagle and Coeur d’Alene. Owner Kevin Settles said when he decided to open his fourth restaurant, he chose Colorado.  Idaho’s cap on city licenses creates a competitive market, driving up the cost of the licenses.

“The last one I heard selling in Boise went for something like $175,000,” Settles said.

In Idaho, a city starts with two liquor licenses available for businesses and can get one additional license for every 1,500 citizens. There’s a waiting list of several years for the licenses.

Because of the cost and hassle associated with finding a liquor license, Settles said he didn’t look very hard at a fourth Idaho location for his next restaurant, which will open in 2016 or 2017. He hasn’t chosen a specific location yet in Colorado.

“I would like to operate in a state that doesn’t have a state control system,” Settles said.

Boise now has 145 issued licenses and 61 names on its waiting list, according to Alcohol Beverage Control, a bureau of the Idaho State Police. The top name on the list has been on the waiting list since 1999.

“I have three licenses in three areas and even then it isn’t a stable investment,” Settles said. “There is always the chance you lose it to a violation and then who knows when you will get another.”

The areas hurt most by the license cap are small destination towns, according to Alcohol Beverage Control. The combination of a small population mixed with the demand for liquor from tourists means few licenses change hands. In McCall, the name at the top of the list for the next liquor license has been on the waiting list since 1979.

“Idaho needs to redo its liquor license laws,” said Pam Eaton, executive director of the Lodging and Restaurant Association. “They are awful.”

The Idaho Legislature hasn’t seriously discussed an overhaul of the state licensing laws since 2009, when the Senate passed a reform bill to transfer more control over licenses to local governments. That bill failed in the House.

“Since that time, every single year there has been discussion about changing it,” Eaton said. “Legislators don’t seem to have the appetite for it though.”

Settles, a board member of the National Restaurant Association, and Eaton said they have talked to business owners who wouldn’t consider moving to Idaho because of the law. Both said they do not expect any serious look at reformation in the next legislative session.

“This is a gigantic problem crimping economic growth,” Eaton said. “It’s huge, but I don’t think anybody has the appetite to bring it up.”