Florida Business Law Calls for Liquor License Lottery

It’s an unusual way to make a profit and a quirky area of business law, but some people in Florida only enter the lottery to obtain one of a limited number of liquor licenses issued by the state each year because they will have the opportunity to sell it later to someone who really wants and needs it.

The annual drawing for quota liquor licenses by Florida’s Division of Alcoholic Beverages and Tobacco likely will be drawn within the next few months. But forget about entering this time — if you didn’t submit an application by Oct. 23, you’ll have to wait.

Florida is one of 17 states with quotas on liquor licenses. In last year’s lottery, 46 winners were drawn through a lottery system, The Tampa Bay Times reported.

Quota licenses can be used anywhere in an area where alcohol is permitted, and the only way to get one is to win it in a license lottery or buy it from someone who has won it. Although businesses that need a license can enter the drawing, it is most often won by individuals, many of whom turn around and sell the licenses to businesses. The number available in each county is limited.

If the licenses are in high demand, they can resell for as much as $500,000, per the Times. More than 95 percent of lottery winners end up reselling the licenses. Counties where licenses sell for high prices include Duval ($450,000) and Orange ($350,000).

Lottery entries are accepted for 45 days starting on the third Monday in August. People pay $100 to enter the lottery, and can enter for multiple counties, but only once for each county. Last year, the number of people who applied for licenses totaled 11,847.

Winners must pay a license fee that varies county to county, plus $10,500 to a state fund to fight substance abuse. They have 45 days to apply for the license.