how to apply for a liquor license in chicago

By Posted in - Uncategorized on September 14th, 2015 0 Comments

Well perhaps you’ve heard the news: We’ve successfully acquired a liquor license and are selling beer and wine! We’re new at this game, so expect the selection to be refined and retargetted a lot in the next few months.

I’ll cover how we picked what to sell and how sales have been going in a future post, but I’ve also gotten a lot of questions about what the application process was like (hint: not straight-forward or easy, it’s taken us about 18 months), so I’ll give a quick run-down here. Hopefully this will be helpful to anyone else applying for license, and may also be interested to the curious layman.

Step 1: Talk to your Adlerman. This is not an official step, but it’s an important one. We first approached our Alderman (Leslie Hairston, 5th ward) over two years ago when we first started thinking about selling beer and wine. She suggested that we do a quick survey of our customers, and if the result was favorable she would hold a community meeting to further assess neighborhood sentiment. We gave a little quarter-page survey to about 100 customers and received about 90 positive surveys back, which we felt was strong enough to go forward.

Step 2: Make sure you qualify legally. There are many, many rules. Your precinct cannot have voted itself dry. You must be a certain number of feet from any church, school, or house for the indigent or aged. You must be in a zone that allows the type of license you’re applying for (for instance, we are in B1, which allows grocery stores to carry liquor, but doesn’t allow straight-up liquor stores). Everyone who owns more than 5% of the business, and their spouses, must be free of any felony convictions and any vice-related misdemeanors. There’s no sense in plowing ahead with the other steps if you don’t even qualify.

Step 3: Buy out the other owner (optional). Changing ownership after you get the license is more burdensome, and our desire to apply for one was one reason we did the transaction when we did.

Step 4: Have a preliminary community meeting. This is not an official step, and probably varies by ward, but our Adlerman really likes to have a meeting before you start the official application. We distributed notices to all neighbors within 250 feet (and on our door, etc.) and had a meeting last August. About 15 people attended and there were no objections raised. The meeting was covered in the Hyde Park Herald. Separately, some neighbors got in touch with me or one of my managers to express concerns or ask questions. Most concerns seemed to be centered on the possibility that people would purchase beer and drink it on the sidewalk. We intend to focus on 6-packs of craft beer from local Midwest breweries and mid-range bottles of wine. Many of the people who approached us with concerns ended up being enthusiastic about being able to pick up a bottle of wine with dinner.

Step 5: Figure out how to apply. This is harder than you might think. If you call the Chicago Department of Business Affairs and Consumer Protection, which handles licensing, the phone tree says “press 6 for liquor licenses”. 9 times out of 10 this goes to voicemail. No one responds to those voicemails. After calling 10 times I finally got a person, who told me she didn’t handle liquor licenses and transfered me back to the phone tree. Pressing 0 for an operator and asking to speak to someone who handles liquor licenses got me transfered to the Illinois Liquor Control Comission, which took my name and number and never called me back. Finally, I just took the #6 bus to city hall and sat there until someone saw me. Which worked really well: within 20 minutes I met with an extremely helpful staffer who walked me through the requirements and left me with a checklist of documents to gather.

Step 6: Correct 7 years of City paperwork. You know when you move and then you don’t update the address on your driver’s license, and then that later comes to bite you? That happened to us. We’d been updating our ownership and addresses with Illinois, but not with the City. We had to update (1) the name of the business (2) the address of the business (3) the ownership of the business before we could move forward. Some of these required documents from the IL Secretary of State which I had misplaced, so I had to go get certified copies. This whole process took a few weeks.

Step 7: Gather 100 pieces of paperwork. Ok, more like 20. You need all sorts of notarized documents, copies of your lease, affadavits, internal floor plans, external site plans, proof of insurance, BASSET training, etc. Even though our lease allows us to do any legal business, the city wanted an addendum that explicitly allowed alcohol. Our landlord was happy with that, but wanted to us pay for any insurance increase. We weren’t happy with that without a clause allowing us to shop around for new insurance. You get the idea. I probably spent 100 hours gathering those 20 documents.

Step 8: Apply. The city makes you go through zoning approval first, which took 5 weeks for us. After that, we actually applied (we’re up to May 12), paid our $4,400, got our bright orange sign to put in our window, and started a 35-day public comment period. I also got fingerprinted and background checked. P.S. if you don’t get the license for whatever reason, you don’t get your $4,400 back.

Step 9: Wait. You post an orange sign in your window and the city also sends a post card to every registered voter within 250 feet. The notices request any objections to be made in writing to the Chicago Liquor Control Comission. The Comission also gets formal recommendations from the Alderman and Poice District Commander. At this point we started getting lots of excited customers asking if they should send in letters of support, but city hall had assured me they only look at letters of objection, so I told them no need.

Step 10: Objections. There’s probably a couple thousand registered voters within 250 feet, and we expected a few objections. At this point the they seem centered around a liquor store near us that closed over 20 years ago. Apparently this store, which had an illegal bar in the back, had caused some problems, and a few long-time residents feared a small selection of beer and wine on our shelves would bring those problems back. We feel pretty strongly otherwise.

I heard from the Alderman’s office that they had received two letters of objection and no letters of support. I noted that City Hall had said they didn’t consider letters of support. The Alderman’s office indicated that City Hall might not consider them, but the Alderman’s office certainly did, so if I had any supporters I should get them to write letters ASAP! This was 5 days before the deadline.

Step 11: Support. I rushed around like crazy trying to contact everyone I had told not to bother with a letter of support, to tell them that they should in fact please write a letter of support and postmark it in the next 48 hours. I think in the end we got 11 or 12 letters. Many people CCed me on the letter and it was a nice confidence boost to hear all the nice things people had to say about Open Produce.

It’s also crazy to think that in a neighborhood of 30,000 people, 10 letters can make a huge difference.

Step 12: Wait. When our comment period was over, there was nothing to do but sit around and wait. They are supposed to either approve or deny in 15 days.

Step 13: Get a random email. I received a perfunctory email from City Hall telling me that a license was ready to pick up. I really hoped this was the liquor license and not, say, a renewal of our retail food license or some other unrelated matter, but the email didn’t bother to say. But I went to City Hall and sure enough, it was our liquor license!

Step 14: Get State License. Before you can buy or sell liquor, you also need a state license. This is more or less a rubber stamp once you’ve gotten your municipal license, but every extra step is an opportunity for something to go wrong. When I picked up our city license, I brought with me all of the documents I would need to apply for the state license, except one: a copy of the city license. I spent a stupid amount of time trying to figure out where I could photocopy the license in the Loop, before I realized the City had already included a photocopy in the envelope as a courtesy. Because the first thing everyone does with their City license is they go apply for their state license. Class act, City Hall!

Walked over to the Thompson Center, through the metal detector, up to the Illinois Liquor Control Commission, and dropped off my paperwork. Three days later received my Illinois license by email.

Step 15: Buy & Sell. With an Illinois license in hand, I was finally able to set up accounts with various distributors and start the process of building out an initial inventory line-up. But this whole world will be covered in a future post!

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