New York State Liquor Authority Issues Guidance on Expansion of Licensed Premises and Indoor Service

In response to Governor Andrew Cuomo’s order, the New York State Liquor Authority (SLA) issued guidance on June 4, 2020, pertaining to the resumption of outdoor, on-premises service of alcoholic beverages and/or food. While the bulk of the media coverage focused on the effects of the changes as they pertain to bars and restaurants, the Governor’s order and subsequent SLA guidance will have a dramatic impact on wineries, breweries and other manufacturing establishments.

Pursuant to the Governor’s order, all New York State liquor license holders located in regions that have entered Phase 2 of reopening and which have on-premises service privileges under the Alcoholic Beverage Control (ABC) Law may resume outdoor, on-premises service of alcoholic beverages and/or food, subject to the guidance issued by the SLA. These rules pertain to on-premises licensees (e.g., bars and restaurants), as well as licensees holding manufacturing-class licenses that include on-premises privileges, such as farm-class wineries, breweries, distilleries and cideries.

As of the date of this posting, SLA has offered the following guidance in connection with the resumption of outdoor, on-premises consumption activities:

• Any consumption of food and/or beverage must happen in outdoor, open-air areas, without a fixed roof (besides a temporary or seasonal awning or cover).
• Food and/or beverages can only be consumed while seated at a table, bar, counter or similar contrivance.
• All tables must be 6 feet apart; any seat at a bar, counter or similar contrivance must be 6 feet apart.
• All staff of the licensed business must wear face masks at all times.
• All customers must wear face masks at any time they are not seated.
• Any consumption shall be subject to all other relevant executive orders, guidance promulgated by the Department of Health and/or any other relevant agency guidance.
• It shall be part of the licensee’s supervisory responsibilities under the ABC Law and Rules of the SLA to comply with the SLA Guidance and the Department of Health’s Interim Guidance for Outdoor Service; if unable to comply, it is the licensee’s obligation to discontinue outdoor service.

Notwithstanding SLA guidance, license holders need to be aware of the premises that is currently licensed for consumption of alcoholic beverages. SLA guidance provides that a license holder may (temporarily, during the term of the guidance) expand its licensed premises to include the use of any contiguous outdoor, open-air part of its existing premises for which it has control by deed, lease, management agreement or other agreement of control. To include such expanded area, the license holder must submit an updated diagram of the expanded premises to the SLA via email. The diagram must include the licensee’s name and serial number. Failure to provide the updated diagram to the SLA within five days of expansion may result in disciplinary charges. Note that the temporary expansion will not apply once SLA guidance has expired (currently set for July 6, 2020). After that time, a licensee will need to submit a formal Application for Permission to Make Alterations to the SLA if it intends to continue use of the outdoor area. Also note that use of outdoor areas remains subject to any local rules and regulations.

Effective June 12, 2020, certain regions of New York State have become eligible to move into Phase 3 of the State’s reopening plan. In Phase 3, licensed on-premises establishments located in regions that have reached that phase, may open indoor spaces with seating for customers. The establishments eligible to reopen with indoor seating include licensees holding manufacturing-class licenses that include on-premises privileges.

The SLA has issued guidance with respect to reopening of interior spaces for on-premises license holders. Pursuant to the SLA’s guidance, on-premises license holders located in a region that has achieved Phase 3 of reopening may resume indoor service of alcoholic beverages. These activities must be consistent with the New York State Department of Health’s interim guidance on indoor and outdoor food service, which requires 50% or less capacity, proper spacing, use of face coverings, etc. The Department of Health’s guidance may be found here. 

Note that each business must submit an affirmation that it is in compliance with the State guidelines regarding reopening. The affirmation may be found at this link.

This article was written by Zachary Benjamin, a previous consultant with Farm Credit East. Throughout his career, Zach has worked with customers engaged in a variety of agricultural and affiliated businesses, including working with dairy farms, crop growers, and fruit and vegetable operations. Zach's expertise in the alcoholic beverage industry found him working with farm-based alcoholic beverage manufacturers, distributors and retailers, on licensing and compliance matters, including obtaining and maintaining alcohol manufacturing, distribution and sales licenses and permits. He also worked on matters such as label and formula approval, record-keeping compliance, excise tax return preparation and preparation of operational reports. Zach assisted many businesses with expanding their operations to include out-of-state shipping of their alcoholic beverage products, including obtaining direct-to-consumer licenses.