One hell of a bar bill

(continued)

by Stephen Heuser

SOMETHING OLD SOMETHING NEW: in Park Square, an old bar called Richard's (bottom) closed its doors earlier this year and saw its license snapped up by seafood chain McCormick & Schmick (top) in the nearby Park Plaza Hotel. Also coming to the Park Plaza: Whiskey Park (middle), a bar owned by New York bar developer Rande Gerber (a/k/a Mr. Cindy Crawford), which bought its license from a Mattapan bar.

The system works for most of the players involved. Certain neighborhood groups enjoy an impressive amount of power to dictate local development. The lawyers and brokers get their cut. License-holders see their investments protected -- and often see a fat return on fees paid long ago. The Boston Licensing Board smiles on the arrangement to protect the equity of all involved. ("The courts," says chairman Pokaski, "have recognized that there is a monetary value in these." In other words, he says, the board could mess with the status quo, but not without being sued by angry license-holders.)

To an economist, this might look like a particularly dysfunctional marraige of free-market economics to government control. Yes, the market determines the value of a license, and the public votes with its dollars on which bars and restaurants will thrive in Boston. But business owners can't even get on the ballot, so to speak, without kicking someone else off, and to do that requires massive amounts of campaign money.

The obvious solution is to issue new licenses. This can be done more than one way. One possibility is simply to increase the cap from 650 to a number better suited to a developing city. (Small restaurateurs worried about diluting the value of their licenses can take some consolation from the precedent of taxi medallions: when new medallions were offered for auction recently, prices actually went up.)

Another method is to issue new licenses selectively. In Baltimore, for example, there's a moratorium on new bar licenses, much like Boston's. But restaurants larger than 75 seats -- anything bigger than a storefront bistro -- can apply to have a liquor license newly issued by the city's licensing board. This allows deep-pocketed chains to open without driving smaller businesspeople out of the market. As a result, licenses in Baltimore trade for more like $20,000 -- a price that doesn't exclude small, independent operators from starting a business.

Here in Boston, the idea of issuing new licenses is treated like a muddy dog at a lawn party. Neighborhood associations like those in the Back Bay and Bay Village spend a lot of their energy fighting licenses. Says one South End restaurant owner: "If you could get a license like in New York or San Francisco, there'd be a bar on every block. On one side, you'd love to have a funky bar on every block -- isn't that nice? But on the other side, if I lived in the neighborhood, in the South End or JP, I'm not sure how I'd feel about it."

But the argument against bars is easy. The argument for bars is more subtle. It requires a shift from thinking of a license as essentially a permit to sin -- and a threat to the neighborhood it lands in -- to thinking of it as a civic amenity. Robert Putnam, the sociologist whose book Bowling Alone raises alarms about the increasing isolation of American life, laments the decline in going to bars: it's a social activity that suburbanites simply don't take part in.

Hanging out over a drink is, largely, a luxury of city life. But it's hard to imagine that sipping martinis at a new seafood chain is what Putnam has in mind. What he has in mind is hanging out at neighborhood bars -- which are the guaranteed losers under the current system.

In the next few years, Boston has a challenge: everyone talks about turning the Seaport District into a 24-hour neighborhood, which means restaurants and (yes) bars. But with the current laws, the only players in business will be the handful that can afford to play the game: national chains or established local chains that can hire lawyers and wait until the market coughs up a license. In short, we're looking at a Seaport District populated by Chili's, T.G.I. Friday's, and some hotel restaurants. Maybe, if we're lucky, there'll be an Olives South. If new licenses are made available, however, we'd be more likely to see a mix of big chains and local upstarts.

CHANGING HANDS at the Motor Mart building, the divery Tar Bar was evicted, making room for new national franchise restaurant/bars.

"You can begin to make arguments as new areas are developed that there are needs for licenses in those areas," says Dennis Quilty. "I think the board thinks that, and I think the mayor understands that. I think they would all like to have some control over it, but that part is hard to legislate."

In fact, there are two ways to increase the pool of available liquor licenses in Boston, both of them fraught with political peril. One requires the city council to file a home-rule petition directing the mayor to send a bill to the state legislature, where it must pass both houses before going to the governor for signature. The other is to pass state legislation. Though this route avoids some of the complexities of local political wrangling, it opens up other troubles: the legislation could not be confined to Boston, but would have to affect other cities and towns.

Pokaski says he'd ultimately be in favor of issuing new licenses. "We have to do something," he says. He proposes a plan to remove Boston's innkeeper all-alcs from the overall license quota, which means some hotel bars and restaurants would no longer count against the 650 total licenses allowed in Boston. This, Pokaski estimates, would free up about 35 licenses.

"If you don't have 'em, I see a negative effect on neighborhoods," he says. "The people on Dot Ave have a right to a drink, just like the people in the hotel."

Maybe so, but for now, the people in the hotel -- or the people in the 300-seat chain restaurant -- are increasingly the ones with a drink in their hands. If you read the docket for the biweekly hearings of the Boston Licensing Board, it's like watching a city of little bars and small operators hand over the keys to a bunch of franchises.

"The little guys we see on violations, mostly," says the chairman of the city's licensing board. "Or if they're selling their licenses -- mostly to one of the big guys."

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