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SB 136 LOCAL OPTION FOR RESTAURANTS

Current Location: STBTC
Referrals: SRC/STBTC

[3] SRC/STBTC-SRC- DP-STBTC

SB 136 PDF  |  SB 136 FIR


Scheduled on - Date:  Time:   Location:

1/31/2021 [3] - Sent to location Senate Rules (SRC)
Synopsis:

 Senate Bill 136 (SB 136) provides that a local option district may hold an election to allow the sale by certain restaurant licenses of spirituous liquors distilled and bottled in New Mexico.  

Analysis:

 Senate Bill 136 (SB 136) provides that a local option district may hold an election to approve the issuance of a restaurant license for either the sale of beer and wine only or for the sale of beer and wine and spirituous  liquors distilled and bottled in New Mexico in Section 60-6A-4 NMSA 1978 (Restaurant License).  

It limits the geographic location in which these licenses are effective to an enterprise zone; a tax increment development district; an arts and cultural district; a main street; a business improvement district; a frontier community as defined by the respective relevant acts; or any other geographic location within a local option district that has been identified by the Main Street Program coordinator or the relevant local government as a location in need of revitalization or economic development improvement.

SB 136 requires the necessary election and designation of the geographic location as provided for in this act before the department may issue a restaurant a license to sell, serve, or allow the consumption of beer and wine, and spirituous liquors distilled and bottled in New Mexico. 

It requires the applicant to provide evidence o the department of the restaurant’s location within the local option district’s designated area.  It applies the exiting requirement that the primary source of revenue for the restaurant is from the sale of meals and not beer and wind or spirituous liquors to these licenses as well as existing reporting requirements and hours and days of operation. 

Fees for restaurant licenses for the sale of beer and wine only remain at one thousand fifty dollars ($1050). It sets the fee for a restaurant license for the sale of beer and wine and of spirituous  liquors under this act at two thousand dollars ($2,000).

SB 136 would be effective on 31 July 2021.

Amendments:

Current Law:

Bill Comments:
Position: Serious Concerns   Priority: High
ICBA/NM has serious concerns regarding any actions taken by local or state officials that could impact the value of licenses held by New Mexico Community Banks as collateral for commercial loans.

It is only logical to assume that a sudden devaluation of the value of liquor licenses would cause New Mexico banks (and other lenders) to seek alternative or additional collateral to shore-up commercial loans that have been made. In extreme cases of under-collateralized loans, it is conceivable that loans could be called (the borrower asked to pay the debt in full) due to the bank’s asset to debt ratio requirements for commercial loans being out of alignment.

While ICBA/NM takes no position on the public policy issue surrounding reform of New Mexico Liquor Laws, we urge extreme caution due to financial impact that will surely occur in the marketplace.