Why haven’t Florida’s liquor laws changed an ounce since the Prohibition era?

 

Illustrations by Sabrina Siegel.

 

It’s a typical weekend night in Gainesville, Fla.

In midtown, the stairs to Rowdy Reptiles are lined with students, a disastrous domino effect waiting to happen. Due east in downtown, people sit outside Pop-a-Top and the Atlantic, awkwardly close to passersby. A throng can be seen queuing for Simon’s.

Around the corner on University Ave is a new kid on the block, Madrina’s, a Cuban-inspired cocktail bar. Inside, the rows of bottles and the painted lacquer of the bar glimmer, both brand-spanking new. Figurines of the Virgin Mary line the top of the liquor shelves—some are devoutly praying, judging those at the bar, while others are topless.

Financed by the team behind Crane Ramen, TJ Palmieri, a bartender who has worked around town, opened Madrina’s this past summer after a year and a half of planning.

After scoping out locations, Palmieri needed to obtain a liquor license before he could take the concept any further. Liquor licenses are required to open a bar, legally defined as an establishment where 50 percent or more of the profits come from the sale of liquor.

But unlike licenses for beer and wine, or restaurants—which can be bought by anyone who has enough money—liquor licenses are capped by population by state law. In Alachua County, there are 44 liquor licenses, one for every 7,500 people.

This population quota creates a ferocious secondary market where existing licenses are bought, sold, traded or leased as if they were property, and at tens of thousands of dollars.

“It’s an asset that doesn’t lose value whatsoever,” Palmieri said. “It’s as solid an asset as you could have, other than physical land.”

The small number of licenses available, as well as their high price, make it dififcult to break into the industry. And like seemingly everything in this world, most of Gainesville’s liquor licenses are owned by old men.

It all goes back to laws written over 80 years ago, when the state of Florida passed new liquor laws in the wake of Prohibition’s end. These laws, written in a time of moralistic fervor, political bosses and rebellious drinking, haven’t changed since.

 

Breaking down Florida’s liquor laws requires accepting that you will encounter a swamp of moisture-related metaphors—to this day, 83 years after Prohibition, counties remain a patchwork of “wet,” “damp” and “dry.”

Though the 18th Amendment was repealed across the country in 1933, Florida had its own “bone dry” constitutional provision. This meant that Floridians had to wait an extra year before they could repeal their own state amendment and legally hit the town.

But by 1934, authorities had given up preventing people from imbibing the devil’s orange juice, according to a Chicago Tribune article from that year.

“In Miami, bars operate openly, with no apparent effort on the part of county or city authorities to check them,” the paper reported.

At this point, enforcement of Prohibition was more or less a technicality.

“The country was basically drowning in liquor,” Palmieri said. “It was the highest rate of consumption in history.”

North Florida was a different ballgame. This part of the state still has damp counties where the sale of packaged liquor is legal, but you can’t buy a drink—and dry ones, where liquor can’t be sold at all.

Theyre all over the place, Barnett said. Liquor laws are all over the place. Its one of those crazy mixtures of laws.

In 2011, voters in Suwannee County were debating if alcohol could be sold for consumption or not—ultimately, they decided to go wet. Lafayette, in North Central Florida, and Liberty and Washington counties in Florida panhandle are still dry.

The 1934 alcohol laws were written to balance South Florida’s heady nightlife with the North’s puritanical bent. Lawmakers decided to make it a local option whether counties would be wet or dry, explaining the patchwork of laws you see today.

Florida, along with 30 other states, also decided to require by law the licensing of the sale of liquor, and to restrict the number of licenses by a population quota.

The quota was initially set at one license for 2,500 people. Over the years, to keep up with population increases, the quota has been raised to 7,500 per county.
This way, Palmieri said, you don’t have a “crazy red-light district,” but rather a town even “soccer moms” can love.

Every population increase of 7,500, the state issues a new liquor license through a double-blind lottery. Hundreds of people enter each year, so your chances of striking liquid gold are low.

Mark Barnett, the owner of Gator Beverage, was one of the lucky ones. After about 15 years of selling beer and wine, he decided to apply for the lottery. For him, the third time was the charm.

Barnett said he thinks Florida’s current liquor laws are a reasonable compromise between private enterprise and public ownership, but he noted their patchwork quality.

“They’re all over the place,” he said. “Liquor laws are all over the place. It’s one of those crazy mixtures of laws.

For example, similarly arcane alcohol laws prevent stores like Publix and Walmart from selling liquor in the same space as tomatoes, cans of beans or tampons. But they can sell beer and wine just fine. This is why stores like Pop-a-Top, which shares its liquor license with The Atlantic and Barcade, can’t sell tampons or band-aids.

Liquor laws also supposedly comes with an exception. Called the “Disneyland rule,” several sources said this allows businesses to open multiple bars or stores under a single liquor license if the bars occupy a contiguous space. This is what owners of Te Top have done with Te Atlantic, Pop-a-Top and Barcade.

However, The Top couldn’t be reached for comment, and neither could the owners of Palomino or Boca Fiesta, which operate under a similar situation. 

 

If you can’t hit the jackpot with the liquor lottery, your other option is to try your hand in the robust, and expensive, secondary market where the cost of liquor licenses is dictated by good ol’ supply and demand.

Liquor licenses legally function like personal property—owners of existing licenses can move them to any location (for instance, now closed 101 Cantina’s liquor license is now a liquor store on the east side of town, according to Gator Beverage employee).

But sometimes you want to open a bar, and no one wants to sell. Situations like this might require you to go through a beverage lawyer, or a liquor broker. This can be foreign to people who just want to sell good drinks and good memories, and don’t make their living of financing new businesses.

“A lot of us that are in this business were not necessarily for means and a lawyer like, it’s sort of seen as a scary thing, but rich people have a lawyer like we have a fucking doctor or a veterinarian,” Palmieri said.

And if you aren’t familiar with these lawyers, it can be difficult to find them.

A local beverage broker lists their offices in suite 10-B of the Seagle building. But step out of the elevator on the tenth door of the Seagle building, and you won’t find an office. Instead, you’ll be greeted by a padlocked door blocking a nondescript hallway.

Furthermore, a woman who works in the building said the tenth floor isn’t for commercial businesses. “So unless they’re running a business out of their condo,” she said, trailing off.

Though beverage lawyers typically work in statewide law offices, quota licenses can only be bought for a particular county.

“It’s drastically different market to market,” Palmieri said. “The licenses in Jacksonville are more expensive. Te licenses in Miami are more expensive—you might imagine why. Different cities have different curfews. … It’s absolutely unique to every market.”

In Alachua County, liquor licenses typically go for around $50,000, but they can reach into the six figures depending on factors out of left field like whether the football team is performing well, Palmieri said.

Our members have substantial dollars invested in their quota liquor licenses, Dick said.

Alex Girard, a bartender at Madrina’s, said he experienced “sticker shock” when he learned how expensive liquor licenses can be.

“The general consensus is that it’s a pain in the ass,” Girard said. “It’s mainly the cost, for one, and the negotiation with people to buy a new one or waiting for one to become available.”

It can take a tremendous amount of capital to accumulate liquor licenses, Palmieri said. Most people in his situation are financed by people who have been in the business much longer, typically older men.

In Alachua County, no liquor licenses are owned by women.

Palmieri likened the situation to the Yale Club during Prohibition, a private club in New York City that’s restricted to Yale University Alumni. During Prohibition, the club was able to hoard enough liquor to last them through the era, even as its members were writing laws that prevented the rest of America from drinking too.

“Sounds like a bunch of little, old white guys are gonna decree where, and when, and how much you can imbibe, right?” Palmieri said. “There’s that certain element of, ‘you need control, and we’ll tell you how much is good for you’—that sort of thing. Tat sounds familiar and aggravating.”

But some, like Scott Dick, a lobbyist for the Florida Independent Spirits Association, thinks a more controlled environment is a good thing.

“Take underage sales,” Dick said. “I mean, if you had a liquor store or an establishment on every street corner, it’d be almost impossible for the ABT (Division of Alcoholic Beverages and Tobacco) to enforce it.”

Dick represents independent beverage retailers small and large, from that one corner shop to ABC Fine Wine & Spirits. But despite their varying size, according to Dick, these establishments all have one thing in common.

“Our members have substantial dollars invested in their quota liquor licenses,” Dick said.

But if you can swing it, your business is set. Money, much like alcohol, can make every problem go away, Palmier said. 

“They can actually be a boon to some young business people who might not be able to get their hands on them otherwise,” he said.

 

Down the road from Madrina’s is the University Club (UC), Gainesville’s only gay bar. Rainbow lights spiral around the two-storied space, lighting upon the bar where people are waiting for a drink.

Spangler, who opened the UC 27 years ago, has seen bars and liquor stores come and go, and the town’s liquor licenses change hands. Spangler actually owns the first liquor license ever issued in Alachua County—license “0001.”

“They weren’t hard to come by then,” he said, his voice reaching over loud speakers. But Spangler said today there are more people wanting to open a bar, and not as many licenses available. So the price has gone up and your chances, like a graph you’d make in high school microeconomics, has gone down.

And with higher prices, comes higher stakes.

“It’s a lot to go through,” Spangler said. “You have to get different people to sign of on them—of course, you gotta find one first.” •