Okay, are you guys ready for me to pontificate once again......
I've opened or planned over twenty restaurants in Chicago, and I've been on three Chicago liquor licenses myself. Here's how it goes:
First, if you think that you're going to do it without a lawyer, you're crazy. It's way to complicated.
The first thing that the lawyer will ask you is about the location. They will check for zoning and if the area is in a moratorium district. Then they will be able to tell you if there is an existing license and if that license has any "marks" against it.
In a general way, you will need to provide the following information to the city:
* a lease or deed showing your or your corporate entity control the real estate
* proof of liquor liabililty insurance with a total of $3MM in coverage
* six months bank statements showing the source of funds
* corporate documents or an LLC opertaing agreement and a disclosure of all investors
* a loan agreement if from a bank or traditional lending source
* a note and the corporate and investor information (or personal info) and six months bank statements if from a non-traditional lending source (e.g. my dad's landscaping business is loaning me the money, my mom's cousin is loaning me the money).
* menus, floorplans, etc.
* BASSETT or ServeSafe certificates for owner
* health certificates for chef, manager
* no debt to the city - parking tickets, water bills, etc
In addition, certain shareholders and the designated manager must be "processed" which is a full background check. If you have a criminal record, especially one related to alcohol (DUI) you can pretty much forget it. The background check includes fingerprinting, ten years of employment and residences, etc.
The bad part is that any investor and their spouse must be processed if they own more than 3% of the business, OR if they are one of the top three shareholders. The top three shareholders could be 90%, 5% and five at 1% each - in that case, seven parties and spouses must produce bank statements, etc. It's annoying but it's reality. Make sure your corporate lawyer is talking to your licensing lawyer.
The Licensing Commission will not accept your application until it is complete. At that time they will accept your check for $2200. (Remember that the Illinois license is about $275 and the US license is about $150.) Then, under the law, the MLC has 45 days in which to respond to your application. They can give you one of three answers - yes, no, and we need more time. The Commission is granted one automatic 35 day extension when they need more information.
The final part of the process is a multi-department inspection by the city called Task Force. Inspectors from Health, Electric, Plumbing, Buildings, HVAC, Fire and Police will need to inspect and pass your facility to license it. Almost no one passes first time, so you fix the errors and get reinspected.
NOW, the upside is that your licenses, lawyers and insurance for the first year will total about $9000, or $750 per month. When liquor gross profit is about 75-80% and alcohol revenue can be up too or more than half of food revenue..... It's obvious that this is worth the investment. The funny part is that BYOB operators are probably assuming as much (liability) risk, without the coverage or the upside.
DJ
