Summary:

 Senate Bill 466 (SB 466) makes several amendments to liquor licensing regulations in New Mexico. The bill reduces renewal fees for Type B restaurant licenses, removes the restriction on the number of alcoholic drinks per customer, and allows holders of Restaurant A licenses to obtain a Restaurant A New Mexico Spirituous Liquors Permit without maintaining a twelve-month good standing period. SB 466 also introduces a Restaurant C license, removes proximity restrictions for liquor licensees near churches, reduces certain permit fees, and allows local governments to establish entertainment zones where they may regulate alcohol sales and consumption independently. The bill takes effect on July 1, 2025. 

Legislation Overview:

 Senate Bill 466 (SB 466) amends the Liquor Control Act to revise restaurant liquor licensing requirements and permit structures. The bill reduces the renewal fees for Type B restaurant licenses and eliminates the current restriction that limits the number of drinks a customer may be served at a licensed establishment. It allows holders of Restaurant A licenses to obtain a Restaurant A New Mexico Spirituous Liquors Permit without needing to maintain a twelve-month period of good standing.

The bill creates a Restaurant C license, which permits the sale and service of beer and wine only. It restructures the classification of restaurant licenses by specifying that Restaurant A licenses allow for beer, wine, and certain craft-distilled spirits, while Restaurant B licenses permit full liquor sales. The newly established Restaurant C license provides a lower-cost option for establishments seeking to sell only beer and wine.

SB 466 authorizes counties and municipalities to designate entertainment zones where local regulations may supersede statewide liquor control laws. Within these entertainment zones, local governments may set their own regulations regarding public alcohol possession, consumption, and open container allowances. Establishments operating in these zones must still comply with applicable state licensing requirements.

The bill also removes restrictions that prohibit the issuance of liquor licenses near churches, eliminating location-based barriers for establishments seeking to obtain licenses. Additionally, SB 466 reduces specific permit fees, including those for Restaurant A licenses, which increase from $1,050 to $1,550, and introduces a structured fee schedule for Restaurant B and Restaurant C licenses.

Implications

SB 466 lowers financial and regulatory barriers for restaurants and entertainment venues seeking liquor licenses, potentially encouraging more establishments to apply for licensure. By removing the cap on the number of drinks per customer, the bill grants greater discretion to businesses in serving alcohol while increasing potential revenue opportunities. The elimination of the twelve-month good standing requirement for Restaurant A licensees to obtain a New Mexico Spirituous Liquors Permit streamlines the permitting process and makes it easier for new businesses to offer craft-distilled spirits.

The introduction of the Restaurant C license provides a more affordable option for restaurants that wish to serve only beer and wine, possibly expanding access to smaller or lower-margin establishments. The establishment of entertainment zones grants local governments more control over liquor regulations, potentially fostering economic growth in districts with high concentrations of restaurants, bars, and entertainment venues. However, this shift may create inconsistencies in alcohol regulations across different municipalities.

Removing the proximity restriction for liquor licenses near churches increases the number of available locations for licensed establishments, which could lead to more businesses entering the market. While this change may benefit economic development, it may also raise concerns among community groups that previously relied on these restrictions to regulate alcohol sales in their neighborhoods.

The bill’s fee adjustments may result in increased costs for certain licensees, particularly Restaurant A establishments, while lowering barriers for others, such as new applicants seeking Restaurant C licenses. The financial impact on state and local revenue will depend on how these changes affect the number of applicants and renewals. 

Current Law:

 Under current law, Type B restaurant license holders must pay higher renewal fees and are subject to a restriction on the number of drinks they may serve per customer. Restaurant A licensees must maintain a twelve-month period of good standing before obtaining a New Mexico Spirituous Liquors Permit. There is no Restaurant C license category, and existing regulations do not allow for the creation of entertainment zones where local governments can establish independent liquor laws.

The Liquor Control Act currently prohibits liquor licenses from being issued near churches, restricting where businesses may operate. Additionally, various permit fees are structured differently, with some licenses carrying higher costs than those proposed in SB 466.