Summary:

 House Bill 478 (HB 478) revises provisions in the Liquor Control Act related to the transfer of certain liquor licenses between local option districts. The bill modifies the regulations governing the transfer of dispenser’s and retailer’s licenses originally issued before July 1, 1981, allowing them to be relocated to any local option district in the state, subject to governing body approval and compliance with Liquor Control Act regulations. The bill removes a provision that previously allowed local option districts to prohibit license transfers by election. It also clarifies that transferred licenses count toward the statutory license cap in the receiving district. Additionally, the bill allows rural dispenser’s, rural retailer’s, and rural club licenses to be transferred to any local option district within a county that has not reached its maximum number of licenses under Section 60-6A-18 NMSA 1978. 

Legislation Overview:

 House Bill 478 (HB 478) amends Section 60-6B-12 NMSA 1978 to revise criteria for transferring liquor licenses between local option districts. The bill retains the authority for dispenser’s and retailer’s licenses issued before July 1, 1981, to be transferred to any location in the state, subject to governing body approval. However, it removes language that previously allowed a local option district to hold an election to prohibit incoming license transfers. The bill maintains the restriction that class B counties with a population between 56,000 and 57,000, as determined by the 1980 federal census, remain ineligible to receive transferred licenses.

The bill clarifies that transferred licenses count toward the statutory cap on the number of licenses permitted within a local option district under Section 60-6A-18 NMSA 1978. Additionally, HB 478 modifies the rules governing rural dispenser’s, rural retailer’s, and rural club licenses, allowing them to be transferred to any local option district within a county that has not exceeded its statutory license cap. This change eliminates the prior requirement that these licenses remain within the unincorporated areas of the county where they were originally issued and removes the restriction preventing transfers within ten miles of another licensed premises.

The bill also updates language to specify that when a license is transferred to a local option district that has not exceeded its license limit, the licensee is authorized to sell alcoholic beverages by the drink on the premises and in unbroken packages, including locally produced growlers, for off-premises consumption. If the license is transferred to a district that has met or exceeded its statutory cap, the licensee is restricted to on-premises sales and consumption only. The bill does not alter local governing bodies’ authority to approve or deny license transfers.

Implications

HB 478 streamlines the process for transferring liquor licenses by eliminating the ability of local option districts to prohibit incoming transfers through an election. This change increases flexibility for businesses seeking to relocate licenses to districts with stronger market demand while maintaining the requirement for local governing body approval. The clarification that transferred licenses count toward a local option district’s statutory cap ensures that the total number of licenses in a given area remains consistent with regulatory limits.

Allowing rural dispenser’s, rural retailer’s, and rural club licenses to transfer more freely within eligible counties could promote business growth in areas that have available license capacity. The removal of the previous ten-mile restriction on rural license transfers may increase economic opportunities for businesses in rural communities while preventing an oversaturation of alcohol-selling establishments in areas that have already met their statutory license limit.

By retaining local governing body approval requirements, the bill ensures that municipalities and counties maintain control over liquor license transfers within their jurisdiction. However, the removal of the election-based prohibition mechanism may generate opposition from local governments or residents concerned about the potential impact of additional liquor licenses in their communities. The provision specifying sales restrictions based on district license limits ensures consistency in how transferred licenses are treated across different jurisdictions.

The bill may lead to an increase in license transfer requests as businesses seek to move licenses to locations with higher consumer demand. However, because local governing bodies still have the authority to approve or deny transfers, the ultimate impact on individual communities will depend on local decision-making. The bill does not increase the total number of licenses statewide but provides greater flexibility in how existing licenses can be relocated.
 

Current Law:

 Under current law, dispenser’s and retailer’s licenses issued before July 1, 1981, may be transferred between local option districts, subject to approval by the receiving district’s governing body. However, local option districts currently have the authority to prohibit license transfers through an election process. Existing law also restricts rural dispenser’s, rural retailer’s, and rural club licenses from being transferred outside the unincorporated area of the county in which they were issued and prohibits transfers within ten miles of another licensed premises.

Local governing bodies must approve any proposed license transfers within their jurisdiction, and transferred licenses currently count toward the statutory license cap in the receiving district. HB 478 modifies these provisions by eliminating the election-based prohibition on transfers, allowing rural licenses to be moved to any eligible local option district within a county that has not reached its statutory license limit, and clarifying the sales restrictions for transferred licenses based on local option district capacity.