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How can I apply for a liquor license in Colorado?

Applying for a liquor license in Colorado can be a great way for business owners to expand upon their current enterprises. If you wish to sell adult beverages in your establishment, having a liquor license in place is essential to ensure you remain in full compliance with all pertinent regulations.

Colorado Liquor License Application Process

The Colorado Department of Revenue outlines the proper steps you must take when applying for a liquor license. Background checks play a significant role in the ultimate approval of your application. Still, you must first show that a specific neighborhood or locale exhibits a need for a new establishment offering liquor and beer to patrons. This is done on the local government level, which will also be responsible for conducting the background check.

In addition to filling out and submitting an application, the retailer must also pay a non-refundable application fee, which ranges from $1,550 to $1,750. This is in addition to fees that are due once the application is approved.

One of the biggest concerns with the sale of alcohol is whether the business in question could prove problematic for the local community. For example, restaurants with lax attitudes toward checking the age of its customers could be particularly problematic close to densely populated neighborhoods or within walking distance of schools.

There are also logical concerns on the impact a business will have on local services and infrastructure. Entertainment venues that want to sell alcohol may increase the need for security and support staff at their location, which local governments and police officers may not be able to provide. Businesses of all kinds need accessible parking. High-traffic stores can create a headache for neighbors without proper planning.

By requiring that local authorities sign off on the first stage of the licensing process, the state of Colorado helps avoid issues where the state government approves a license that later becomes problematic for local officials. You need to be ready to plead your case to local government members and to demonstrate that your business will be an asset to the community, not a potential problem.

If your establishment is part of a chain seeking licenses for multiple locations, an initial check will be conducted, which will then be applied to all other enterprises. Background checks include a number of considerations, including your past criminal history, which can preclude you from being awarded a liquor license.

Your tax history will also be reviewed, as will any violations of the state's liquor licensing statutes. Because Colorado has a statutory ownership limitation, any ownership interests you have in other establishments holding liquor licenses will be reviewed.

What are Some Common Violations of Colorado Liquor Laws?

It's important to remain in compliance with pertinent liquor laws in Colorado. Even seemingly minor violations can result in a range of negative effects, up to having your license revoked and losing exorbitant amounts of money on your investment.

The Colorado Restaurant Association lists some of the most frequent liquor license violations that can occur during inspections. Establishments that serve alcohol will undergo a cursory hygiene inspection to ensure conditions are safe for customers. The presence of fruit flies in and around liquor bottles or unhygienic tap systems could result in a formal reprisal. If food is served, these areas will also be checked for cleanliness.

In terms of food sales, different types of establishments will be privy to different regulations. For instance, a tavern license stipulates that your establishment must provide some sort of sustenance during hours of operation (such as light snacks).

Conversely, restaurant licenses designate that food must be sold between 8 AM and 8 PM, with lighter fare being made available after hours. You also want to make sure that all documentation of liquor purchases can be made available to the inspecting agent if requested. Keeping invoices and receipts organized is crucial to this end, as surprise inspections are not uncommon.

Protection of minors is another concern, and there must be a process in place to ensure minors are not sold alcohol. Accordingly, agents conducting an inspection will look into how your establishment checks IDs and how often. You must also post signage warning minors that they are not permitted to purchase alcohol under any circumstances.

Removal of Colorado's 3.2 Beer Law

Up until 2018, major retailers, such as grocery store chains, were not allowed to sell wine or liquor. They were also only able to sell 3.2% beer, except for one store location in the entire state.

As of January 1, 2019, the governor signed a bill that changes the previous law has been in effect. The new legislation allows major grocers and retailers to expand the number of stores that can sell liquor over 20 years. Considered to be a compromise, the bill allows the retailers to compete with smaller liquor stores through a slow phase-in while protecting these smaller entities from being completely taken over.

In the first month of the new bill going into effect, the Colorado beer market saw a jump in beer sales of about 20%. But it should be known that liquor stores still hold the exclusive right to sell wine and hard alcohol. This applies to liquor stores across the entire state of Colorado. This exclusivity will end in 2036, at which time grocery stores will be able to sell any same type of alcohol as liquor stores.

Contact a Colorado Liquor License Attorney

From adequate liability insurance to proper staff training, many concerns will impact your ability to secure and maintain a liquor license in Colorado. Such necessary infrastructure or business investment must be demonstrated within your application. Partnering with an attorney can improve your chances of navigating the application process, and also when planning future changes or expansions to your business' services or goods. Reach out to one of our experienced liquor license attorneys today. Call (303) 395-4773.

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