Board previews rulemaking to allow liquor licensees to lease premises to other licensees under HB 1701

The Liquor and Cannabis Board will consider a CR102 to implement 2nd Substitute House Bill 1701, which permits liquor licensees to lease portions of their premises or other real/personal property to other liquor licensees while continuing to operate, a staff representative said at the June 30 caucus.

Daniel, presenting for the director's office, explained: "17 o 1 allows liquor licensees to lease real or personal property to other liquor licensees, including parts of the operating premises while continuing to operate." He said the CR102 was filed under delegated authority and staff will solicit public comment; a public hearing is scheduled for 10 a.m. on Aug. 12 with a request to file final rules at the Sept. 2 meeting and an effective date of Oct. 3 if adopted.

Daniel outlined rule details: the proposal defines lease-related terms (lessor, lessee, lease), requires submission and retention of lease agreements consistent with recordkeeping requirements, requires secured liquor storage when kitchen space is leased, and prohibits lease provisions that mandate advertising or sale of specific products. He said the changes do not expand shared-space or contract-kitchen situations beyond what statute allows. No public comments were received during the informal engagement sessions held in June.

Next steps: public comment period open through Aug. 12, public hearing Aug. 12 at 10 a.m., consideration of final rule language at the Sept. 2 board meeting.