The Pennsylvania Liquor Control Board (PLCB) is accepting sealed bids for 20 expired restaurant liquor licenses through its 16th regular license auction. The auction includes one license in each of 20 counties: Adams, Berks, Bucks, Cambria, Carbon, Crawford, Delaware, Greene, Jefferson, Lancaster, Lehigh, Luzerne, Lycoming, Monroe, Montgomery, Northampton, Schuylkill, Snyder, Washington and Wayne. Bids are due by noon on Monday, October 5, and the PLCB has stated that bids will be opened on Thursday, October 8 and auction winners will be determined soon thereafter.

For restaurants, hospitality businesses, event venues and other businesses looking to serve alcohol in Pennsylvania, the auction may present a valuable opportunity to obtain a restaurant liquor license in a market where restaurant licenses are subject to county-wide quotas and can involve additional transfer considerations. However, businesses should understand that submitting the highest bid is only one part of the process. Before participating, prospective bidders should carefully evaluate several legal, financial and practical considerations.

1. The License Cannot Be Transferred Across County Lines
Unlike the excess license auction conducted earlier this year, the licenses available in this auction are county-specific and may not be transferred outside the county in which they are being auctioned. Each license may only be transferred to another municipality within the same county, consistent with applicable laws and regulations. 

This is an important limitation for businesses considering expansion or relocation. A bidder interested in a particular county should confirm that the license can be used in the municipality where the business is located or plans to operate. Depending on the proposed location, municipal approvals, zoning requirements and other local considerations may also affect whether the license can be successfully transferred and used.

2. Winning the Auction Is Not the Same as Receiving Final Approval
A successful bid does not automatically result in the immediate issuance or transfer of a liquor license. The PLCB has stated that the highest responsive bidder for each license, after receiving notice of the auction award, will have up to 30 days to remit bid payment and up to six months to submit an application for the license. 

That means businesses should be prepared for a multi-step process. In addition to submitting a timely and compliant bid, a successful bidder will still need to complete the required licensing application process and address any legal or regulatory issues that may arise before the license can be transferred and used.

3. Bidders Should Evaluate the Full Cost of Participation
The minimum bid for each license is $25,000. Each bid must also be accompanied by a bid surety of $5,000 or 5% of the total bid amount, whichever is higher.

For businesses, the bid amount is only one part of the overall cost. Prospective bidders should also consider costs associated with the license application, possible municipal transfer proceedings, zoning or land use review, business planning, lease or purchase obligations, financing and legal guidance throughout the process. Because the PLCB has stated that the second-highest bidder may have the opportunity to apply if the winning bidder does not timely remit payment, bidders should be prepared to move quickly if selected. 

4. The Proposed Business Location Matters
Before submitting a bid, businesses should evaluate whether the proposed location is suitable for the intended use of the license. This may include reviewing zoning requirements, local ordinances, proximity restrictions, lease terms, municipal approval processes and whether the property is appropriately configured for the planned restaurant, hospitality or entertainment use.

Businesses should also consider whether the license fits their long-term plans. Understanding those issues before bidding can help avoid delays, unexpected costs or complications after an auction award.

5. Timing Is Critical
The auction is moving on a defined schedule. Bidders must submit bids by noon on October 5, and questions regarding the invitation for bids must be submitted to the PLCB by noon on August 27. The PLCB has stated that questions and answers will be posted on September 3. 

Because the process includes strict deadlines and post-award requirements, businesses considering a bid should begin evaluating their options as soon as possible. Early planning can help determine whether a license is available in the appropriate county, whether the proposed business location is viable and whether the bidder is prepared to satisfy the PLCB’s financial and application requirements.

Bottom Line
The PLCB’s latest auction may create a meaningful opportunity for Pennsylvania businesses seeking to enter or expand in the restaurant, hospitality or alcohol service industries. However, a successful bid is only the beginning. Prospective bidders should understand the county-specific transfer restrictions, application requirements, financial obligations and location-specific considerations before moving forward.

Barley Snyder’s Liquor Law attorneys assist businesses with liquor licensing, license transfers, regulatory compliance and related business planning. If you are considering participating in the PLCB’s current license auction or have questions about how a restaurant liquor license may fit into your business plans, please contact attorney Katelyn Rohrbaugh Lewis or any member of our Liquor Law Team.