New Jersey on the Verge of Overhauling Outdated Liquor License Laws, Boosting Craft Brewing Industry

TRENTON, N.J. (AP) — New Jersey is poised to make significant changes to its liquor license laws, ending a long-standing standoff between Governor Phil Murphy and top state lawmakers. The deal, if approved, will ease restrictions on craft breweries and modernize the state’s decades-old regulations.

Lawmakers are set to introduce a compromise bill by Thursday, with the aim of securing approval from both houses of the state Legislature on Monday, the final day of the ongoing lame-duck legislative session. Anonymous sources familiar with the negotiations disclosed this information to NJ Advance Media.

The highlight of these potential changes is the activation of dormant licenses, also known as “pocket licenses.” These licenses, which have not been utilized by a restaurant or bar for eight years or more, will be made available for auction if businesses fail to utilize them within two years.

Additionally, municipalities will be allowed to transfer one dormant license and up to two licenses every five years to neighboring towns in need. This transfer option, however, will not extend to municipalities that share a border with Newark.

Another key provision in the proposed bill relates to mall townships. Those with malls larger than 750,000 square feet will be eligible for two additional liquor licenses, while those with malls exceeding 1.5 million square feet will have the opportunity to obtain four more licenses. The decision to grant these licenses will be left to the respective towns.

Regarding craft breweries, wineries, and distilleries, the restrictions on events and food service will be eased. Unlimited events and private parties will be permitted on their grounds, and off-site events will be capped at 25 per year. Moreover, these establishments will have the freedom to sell a range of food items and collaborate with outside vendors.

For years, New Jersey’s liquor license regulations have faced criticism for their antiquated nature. The proposal to update these laws gained momentum after Murphy sought to bring sweeping change to the state’s alcohol sales rules. However, the Democrat-controlled state Legislature remained reluctant to support a comprehensive overhaul. Instead, they passed a limited bill that lifted regulations preventing breweries, wineries, and distilleries from serving food and hosting more than 25 events annually.

Murphy conditionally vetoed this bill in December, aiming to secure a more substantial reform of the liquor license system. Negotiations between the governor and lawmakers resulted in a narrower plan that is expected to be signed into law by Murphy.

The current agreement, which is yet to be made public, aims to strike a balance between modernizing the liquor license regulations and honoring the concerns of existing license holders and the restaurant industry. Notably, the proposed changes seek to alleviate the burden on restaurants by allowing greater flexibility in licensing.

If approved, these revisions would mark a significant departure from the state’s long-standing strict regulations, which have limited the number of liquor licenses and created a market for buying and selling licenses worth millions of dollars.

This potential overhaul of New Jersey’s liquor license laws reflects an ongoing effort by Murphy to bring about meaningful change to the state’s alcohol sales regulations and support the growth of the craft beverage industry.