Unintended consequences

Like New Jersey, Idaho limits the number of liquor licenses in a municipality, based on the population. As Atrios notes, this limit is one reason there are so many chain restaurants.

State law dictates that a municipality is entitled to one package store license per 7,500 people and a restaurant or bar consumption license for every 3,000 residents.

Faced with the tight population quotas, national chains like Applebee’s used larger wallets to win auctions or buy inactive licenses, driving up prices, said Tim Delaney, president of Delaney Restaurant Realty.

One consequence of having more chain restaurants is that there are fewer local ones. There are only so many dining out dollars to go around, obviously, and each dollar that goes to a chain is one that does not go to a local restaurant.

And of course, profits by chain restaurants go out of state, though admittedly not entirely, depending on the franchise setup. Still, even with a local franchise owner, the owner is sending money to corporate headquarters through franchise fees and mandatory purchasing of franchise inventory. So by limiting liquor licenses, the legislature is shifting money out of the state.

If the legislature is serious about "Buy Idaho," they'll abolish the liquor license limit and allow more local restaurateurs to have a go at it. This will help by lowering up front costs (don't have to cough up $250,000 for a license), and by allowing the restaurant to serve alcoholic beverages, which for some diners is part of the experience they seek when dining out. This should allow for more dining variety, should help grow local business, and should help lower prices at the restaurants because it won't have to pay for an expensive license.