Sale of alcohol is regulated by both the federal government and the Commonwealth of Pennsylvania (in the latter case via the Liquor Control Board). Before a restaurant, bar, deli, brewery, hotel or similar establishment can legally sell alcohol in Pennsylvania, it must obtain a proper liquor license from the Board. Obtaining a license to sell alcohol can be a time-consuming and expensive process. Indeed, the cost of some licenses in Pennsylvania can be in excess of $500,000, and that does not include transfer costs. Once an establishment is licensed, its license must be renewed annually.
With a liquor license comes extensive responsibility for the licensee. The laws and regulations governing licensed premises are wide-ranging. Licensees are subject to inspections by Pennsylvania State Police working in the Bureau of Liquor Code Enforcement (LCE) to check for compliance with the Liquor Code. These inspections are often unannounced and can happen any time that the establishment is or can be open. Investigators can announce their presence and be in state police uniform or they may never make themselves known and enter undercover in plain civilian clothing. Investigators may also enlist minors to attempt to purchase alcohol from any licensed establishment. Should an investigator find a violation, the LCE can and usually will issue a citation to the licensee. Citations can be issued for any number of reasons but most commonly result from: sales of alcohol to patrons who are visibly intoxicated or are underage; loud music escaping the premises; writing bad checks to beer distributors; illegal activity involving drugs or weapons inside or nearby the establishment; and allowing patrons to smoke in areas not specifically set aside for that purpose. Citations can also be issued for activity that occurs outside the licensee’s premises or control, such as fights or arrests for drugs or weapons.
A sufficient number of citations can result in the suspension or even revocation of the license. When a citation is issued, the licensee has the right to a hearing before an LCB Administrative Law Judge (ALJ). This takes the form of a simple trial whereby the licensee is entitled to have an attorney present. At the hearing the LCE puts on its case producing evidence of the violation, which can then be challenged by the licensee. The ALJ will determine whether a violation occurred and what, if any, disciplinary action is required. Penalties are based on the nature of the infraction(s), and the licensee’s history. Penalties can range from a nominal fine to a total revocation of the license. ALJ determinations are appealable to the Court of Common Pleas in the county in which the establishment exists.
When a citation is received by the licensee, it is typically accompanied by a form called an “Admission, Waiver and Authorization.” Signing this form is effectively a plea of “guilty” to the charge(s) in the citation and usually will avoid the need for the hearing before the ALJ. Often the attorney for the LCE will make a recommendation to the ALJ such as a fine or suspension in exchange for the licensee’s signature. Many licensees will gladly exchange the uncertainty and stress of a hearing for a known fine or penalty; in a very high percentage of citations the State’s evidence is clear, leaving virtually no other option. However, executing the “Admission, Waiver and Authorization” form comes with its own set of risks and should be seriously considered before signing. First, the recommendation made by the LCE’s counsel does not have to be accepted by the ALJ (although it usually is). Second, by signing the “Admission, Waiver and Authorization,” a licensee waives his or her right to an appeal; thus, should the ALJ impose a sentence exceeding the recommendation of the Enforcement Bureau’s counsel, the licensee does not have a right to an appeal. Finally, the LCB has a long memory and may revoke a license if it has too many admitted or adjudicated violations on it regardless of how long ago they occurred.
It is important that a licensee consider the consequences of admitting to a violation even if it seems to be a minor infraction. Advice of legal counsel is strongly recommended. Liquor licenses are expensive, and the loss of a license usually spells the end of the business that owned the license. Citations, even minor ones, must be taken seriously. Should you receive a citation or notice of a possible citation, contact our office to see how we might help.
— J. Ken Butera