In 1947, the state limited the number of hard liquor licenses available, creating a continuing source of friction between applicants waiting in line and those who own the precious permits.
With limited licenses now based on population, their resale price far outstrips the initial fees. A new license costs less than $2,000 in fees. But it soon is worth whatever the going rate is on the resale market: $35,000 in Twin Falls or $150,000 in the Sun Valley area.The state should not be in the business of creating speculation on something offered as a service, said Steve Kohntopp, who is seventh in line for a Twin Falls license.
Current license holders agree the original quota system was a misguided idea, but now they have to protect their investments that were made in good faith.
Many people have paid upwards of $60,000 for a license in Twin Falls, and they will be hurt financially if the state throws the system wide open, Turf Club co-owner Steve Soran said.
"I paid a lot of money for my license. It's one of my assets," said Laura Miller, manager of the Oasis.
A legislative interim committee formed to study the alcohol beverage laws held its first hearing in Boise last week.
Among the options the committee is considering is altering or abolishing the license quota system or shifting control of liquor policies from the state to municipal governments.
Rep. Emerson Smock, R-Boise, co-chairman, said the Legislature has authorized so many special classes of licenses and other changes in the liquor laws that it is time to update those regulations.
Smock said the state simply should have declared at the outset that licenses could not be transferred or resold.
Twin Falls-area license holders have a plan that may placate both sides.
A committee of the Magic Valley Hospitality Association headed by Soran has recommended to the legislative panel to loosen restrictions on the number of licenses but charge a one-time $60,000 fee for all new permits issued in addition to the current $1,500 annual fee.
The one-time fee would maintain the value of existing licenses, eliminate license purchases by speculators and would provide a substantial amount of money to the state, the association says.