Background - License to Pour: Access & Equity in Massachusetts Liquor Licensing Report

A history of liquor licensing in Massachusetts and an overview of the current framework.

1. Massachusetts Liquor Licensing—A Brief History

Massachusetts has a long history of alcohol regulation, dating back to the colonial era.²² The first legislative attempt to regulate the liquor trade by means of a license system was enacted in 1633.²³ By 1675, county courts were given the authority to issue liquor licenses, and, in 1680, a numerical limitation was placed on licenses for the first time.²⁴

The American Revolution and the years that followed saw a surge in alcohol consumption and related social issues throughout the United States.²⁵ The temperance movement soon emerged in response, with Massachusetts quickly playing a central role as Boston became the birthplace of the American Temperance Society in 1826.²⁶ In 1832, licensing authority was transferred from the courts to elected county commissioners, and the status of local prohibition depended largely on the outcomes of those elections.²⁷ Within five years, a majority of the Commonwealth found itself under local prohibition.²⁸

Differences of opinion began dividing the temperance movement between extreme prohibitionists seeking legislative means to abolish all intoxicating liquors statewide, and others who viewed absolute prohibition by legislation as a violation of liberty.²⁹ Massachusetts witnessed the passage of the first statewide prohibition law in 1838, the 15-gallon law, which restricted liquor purchases to quantities not less than 15 gallons, with certain exceptions (later repealed in 1840).³⁰

The pendulum continued to swing back and forth in Massachusetts during the following decades. The movement toward statewide prohibition was revived by the US Supreme Court’s decision in 1847 that every state had the right to regulate, restrain, or prohibit the liquor trade within its borders.³¹ Periods of statutory prohibition in Massachusetts were followed by repeal or accompanied by exceptions and lax enforcement.³² In 1881, the General Court enacted a local option law over liquor licensing.³³ Shortly before a final, unsuccessful popular referendum for state constitutional prohibition in 1889, the General Court set local licenses at one license per five hundred Boston residents, and one license per thousand residents elsewhere–the first time Massachusetts tied liquor license limits to population. 

Another period of prohibition followed, beginning in 1919 with the passage of the National Prohibition Act (Volstead Act) and ending with the passage of a constitutional amendment ending federal prohibition (the 21st Amendment) in 1933.³⁴ In anticipation, Massachusetts formulated laws regulating the manufacture, transportation, sale, importation, and exportation of alcohol and alcoholic beverages to become effective upon the 21st Amendment’s ratification.³⁵

2. Current Massachusetts Liquor Licensing Framework

Despite the passage of almost 100 years, Massachusetts continues to employ the population-based approach included in the liquor licensing framework originally enacted in 1933 and embodied in MGL Chapter 138.³⁶ Chapter 138 remains the statutory authority governing the liquor industry today, with provisions for production, distribution, and retail (see Figure 3).

Figure 3. Liquor Licensing Overview (MGL c. 138)³⁷

As noted in Figure 3, retail licenses are further classified between on-premises (Section 12) licenses, off-premises (Section 15) licenses, and special and auxiliary licenses. Figure 4 on the next page offers more detail regarding which retail licenses are subject to, or exempt from, the state-imposed population-based quota in MGL c. 138, § 17.

Figure 4. Retail Licenses³⁸

Section 15 off-premises categories include package stores, grocery stores and supermarkets, wine and malt stores, convenience stores and warehouse clubs. Five additional cards identify special and auxiliary licenses, which are issued outside of section 17 quota. These include caterer licenses, one-day special licenses, farmers’ market licenses, charity wine permits, and farmer-series pouring licenses.

2.1 Dual Regulatory Oversight over Liquor Licensing at State and Local Levels

The post-prohibition legislative framework centralized regulatory oversight of MGL c. 138 under ABCC, established in 1933.³⁹ ABCC is responsible for the “general supervision of the conduct of the business of manufacturing, importing, exporting, storing, transporting, and selling alcoholic beverages” across the Commonwealth.⁴⁰ Licensing decisions, however, begin at the local level where local licensing authorities (LLAs) consider applications and hold hearings. Approved applications are then submitted to ABCC for review and approval. If licensing is approved by ABCC, the LLA issues the licenses. This process is outlined in Figure 5 below.⁴¹

Figure 5. Process for issuing liquor licenses

2.2 On-Premises Liquor License Quotas (MGL Chapter 138, Sections 12 and 17)

As in 1933, today’s liquor licensing system relies on population despite substantial changes in demographics, municipal development, and regional economies. MGL Chapter 138 establishes multiple categories of liquor licenses, including on-premises licenses under Section 12 and off-premises licenses under Section 15. Section 17 establishes population-based quota limits on the number of liquor licenses that may be issued by municipalities in the foregoing categories, further divided into All-Alcohol licenses and Wine-and-Malt licenses.⁴² 

This report focuses specifically on on-premises liquor licensing. Equity and accessibility with respect to on-premises liquor licensing have been identified as an area needing reform, with continuing debate among stakeholders and legislators.

The statutory formula allocates a minimum number of licenses to each municipality that has voted to allow on-premises liquor licenses and is subject to the quota (14 all-alcohol on-premises licenses and 5 wine-and-malt on-premises licenses), regardless of population.⁴³ Additional licenses are allocated to municipalities based on population. The population-based component of the quota formula is triggered when a municipality’s population exceeds a certain number of residents, as established by the decennial federal census.⁴⁴

With respect to All-Alcohol on-premises licenses, municipalities may grant an additional license for each 1,000 residents, or fraction thereof, over 14,000 residents, as well as an additional license for each 10,000 residents, or fraction thereof, over 25,000 residents.⁴⁵ With respect to Wine-and-Malt on-premises licenses, municipalities may grant an additional license for each 5,000 residents, or fraction thereof, over 25,000 residents.⁴⁶ Figure 6 on the next page illustrates the operation of the quota formula. 

Figure 6. On-premises Quota Formula Calculation

The wine-and-malt allocation starts at five licenses regardless of population and increases by 1 for every 5,000 residents, rounds up any partial to whole. The practical effect of the formula is that every municipality below 14,000 residents receives the same allocation - 14 and 5 - whether it has 250 residents or 13,000.

Figure 7 on the next page further illustrates operation of the quota formula as applied to varying municipal populations from 3,000 to 100,000 residents, with respect to allocated on-premises licenses.

Figure 7. Quota Calculations by Municipalities of Varying Population Sizes

Two horizontal reference lines mark the statutory minimums of 14 All-Alcohol and 5 Wine-and-Malt for all three municipalities. Braintree with a population of 39,143, is allocated 42 all-alcohol and 8 wine-and-malt licenses. Marblehead with 20,441 residents is allocated 21 all alcohol and 5 wine and malt. Ayer with 8,479 residents, is allocated 14 all alcohol and 5 wine and malt. Ayer remains at both minimums, Marblehead exceeds the all-alcohol minimum, and Braintree exceeds both minimums.

As illustrated above, Braintree, with a 2020 census population of 39,143, is allocated 42 All-Alcohol on-premises licenses, composed of 1 license for each 1,000 residents or fraction thereof (40) plus 1 additional license for each 10,000 residents or fraction thereof above 25,000 residents (2), and 8 Wine-and-Malt on-premises licenses, composed of 1 license for each 5,000 residents or fraction thereof. Marblehead, with a population of 20,441, is allocated 21 All-Alcohol licenses, composed of 1 license for each 1,000 residents or fraction thereof, and 5 Wine-and-Malt on-premises licenses, composed of 1 license for each 5,000 residents or fraction thereof. In comparison, Ayer benefits from the statutory minimum allocation of 14 All-Alcohol on-premises licenses and 5 Wine-and-Malt on-premises licenses despite having a population of only 8,479 residents.⁴⁷

Of the Commonwealth’s 351 municipalities, 302 are subject to the statutory quota formula (quota municipalities).⁴⁸ As of 2023, over half of the 302 quota municipalities, 173 (57.3%), have populations below 14,000 and thus are statutorily allocated the minimum number of on-premises licenses (14 All-Alcohol licenses and 5 Wine-and-Malt licenses). Another 61 quota municipalities (20.2%) have populations between 14,000 and 25,000, meaning their All-Alcohol license statutory allocations are determined in part by the minimum and in part by the population-based formula (1 per 1,000 residents, or fraction thereof, over 14,000) while their Wine-and-Malt license allocations remain at the 5-license minimum. The remaining 68 quota municipalities (22.5%) have populations exceeding 25,000, meaning all statutory allocations are driven by the population-based formula (1 per 1,000 residents, or fraction thereof, over 14,000, as well as 1 per 10,000 residents, or fraction thereof, over 25,000).⁴⁹

2.3 Twenty-Six Municipalities Get Local Control⁵⁰

While 302 municipalities are subject to the restrictions of the state-imposed population-based quota on on-premises liquor licensing, 26 municipalities (local-control municipalities) were able to exempt themselves from on-premises quota limits under the Massachusetts Acts of 1978, c. 377, § 2.⁵¹ This legislation allowed municipalities that had granted seasonal licenses prior to January 1, 1978, and voted to accept the provisions of MGL c. 138, § 17A, to grant on-premises licenses “in addition to, and irrespective of any [quota] limitation” (emphasis added).⁵²

On January 9, 1985, Chapter 491 of the Massachusetts Acts of 1984 closed this window of opportunity for eligible municipalities that had not accepted the provisions of § 17A prior to January 1, 1985. Municipalities that were previously precluded from exempting themselves from the state-imposed population-based quota on on-premises liquor licensing were never given a similar opportunity to become local-control municipalities. The benefits to local-control municipalities of the 1978 exemption and compounding implications for quota municipalities are discussed in Findings 1 and 2.

2.4 Control of Quota Relief Valve

Quota municipalities seeking authority to issue on-premises licenses beyond their quota formula allocations generally have only one option—a special act of the Legislature obtained through a home rule petition. Under the Home Rule Amendment to the Massachusetts Constitution, approved by voters in 1966, municipalities may act on their own authority to enact some policy changes, but not in a manner inconsistent with a general law enacted by the Legislature.⁵³ Notably, a municipality cannot unilaterally grant liquor licenses in excess of quota limits. It must instead petition the Legislature for a special law applying only to that municipality. 

A home rule petition passes through a series of gates, each controlled by different actors. The petition begins locally, when municipal officials draft the request and the local legislative body approves it. A member of the municipality’s legislative delegation must then file it. Filing is only the first step at the State House. It does not determine whether the petition succeeds. Once filed, the bill is referred to a legislative committee, the chairs of which decide whether to hold a hearing and report it favorably, and on what terms. House and Senate leadership decide whether and when it reaches the floor. It must pass both chambers and be signed by the Governor, and there is no statutory deadline at any stage. A petition can fail, stall, or be narrowed at any stage, and the outcomes usually depend on the delegation’s support, committee preferences, leadership priorities, the legislative calendar, and how the request has been framed.

Despite the existence of the home rule petition process, system complexities leave some municipalities at or above quota and unable to meet license demand for extended periods of time; a more detailed analysis of the system and its impacts is discussed in Finding 4. Figure 8 on the next page illustrates an overview of the home rule petition process. 

Figure 8. Overview of Home Rule Petition Process

First decision is city or town approval. If the approval fails, the petition is not filed. If local approval is obtained, the petition is filed as a bill in the Legislature and proceeds to a joint committee for hearing and review. Second decision comes from the passing of the bill by the Legislature. If the Legislature does not pass the bill, there are two branches - the petition dies, or a champion refiles with the Legislature, which loops back to the filing stage. If the Legislature passes the bill, the Governor signs the special law, and additional licenses are allocated to the municipality in accordance with the terms of that legislation. Two of the five possible outcomes are failure, and the refile loop means the process can repeat across multiple legislative sessions.

2.5 Secondary Market: Liquor Licenses as Commodities

Prospective business owners in municipalities that have issued all of their allocated on-premises licenses generally have two avenues to acquire a license: 

• ask the municipality to seek additional licenses through a home rule petition and/or
• look to purchase a license from an existing holder. 

Where licenses are scarce, that scarcity attaches a market value to existing licenses and transfers in high-demand municipalities can command substantial sums; in municipalities that have not reached their cap, a comparable license may change hands for little more than application fees.⁵⁴ This secondary market can transform a regulatory device intended as a public benefit into a privately held asset. Figure 9 below illustrates an overview of the license transfer process. Finding 4 examines both pathways, and the costs and delays each imposes, in detail.

Figure 9. Overview of License Transfer Process

The process begins when no license is available under the quota. An applicant identifies an existing license holder willing to transfer a license, negotiates price and terms, and applies to the local licensing board. The board holds a hearing with public notice. First decision comes from the local licensing board. Local disapproval stops the transfer along the route depicted. If the transfer is locally approved, then application is sent to ABCC for review of the buyer and premises. Second decision comes from ABCC. If ABCC disapproves, the transfer is denied. If ABCC approves, it leads to completion of the transfer and sale. Note that price negotiation happens before either approval gate - a buyer commits to a figure before knowing whether the transfer will clear.

State law seemingly discourages these liquor license transfers for private benefit through a secondary market. MGL c. 138, § 23, states that “the provisions for the issue of [liquor] licenses . . . imply no intention to create rights generally for persons to engage or continue in the transaction of the business authorized by the licenses” and, further, that “no holder of such a license . . . hereunder shall have any property right in . . . such license.”5⁵ Additional language in this section indicates that any license transfers should be in the public interest.⁵⁶

LLAs are also authorized to cancel licenses if a licensee ceases to conduct the licensed business, prohibiting what are sometimes called “pocket licenses” held solely for potential market value.⁵⁷

2.6 Section 12D

In 2025, the Legislature added § 12D to MGL c. 138, effective July 1, 2025.⁵⁸ In any municipality that votes to accept the provisions of § 12D, the LLA may allow any holder of a Wine-and-Malt on-premises license to trade it in for an All-Alcohol on-premises license, regardless of whether the municipality is at quota for either type of license. Pursuant to § 12D, any Wine-and-Malt license that is traded in to the LLA for an All-Alcohol license shall become non-transferable upon the issuance of the license to sell all alcoholic beverages. Conversions require ABCC approval and remain subject to MGL c. 138’s notice and hearing requirements; the LLA may charge a reasonable fee and set additional requirements. Critically, § 12D does not increase the total number of licenses authorized under § 17: It changes the beverage scope of an existing license rather than adding to the quota system. Most municipalities responding to DLM’s survey had not adopted § 12D: Of the 190 municipal officials who responded, only 33 (17%) from 25 municipalities reported that their municipality had accepted § 12D, 106 (56%) from 93 municipalities reported they had not, and 51 (27%) from 50 municipalities were not sure. Among 67 business owners, 49 (73%) were not sure whether any municipality where they hold a license had accepted § 12D, 13 said “Yes,” and 5 said “No.”⁵⁹ Prospective licensees would have a difficult time determining which municipalities accepted § 12D and have this conversion opportunity, as ABCC currently does not publish a list of municipalities that have accepted this local option.

22.      Wendell D. Howie, “Three Hundred Years of the Liquor Problem in Massachusetts,” Appendix B in Bentley W. Warren et al., Report Made to His Excellency the Governor by a Special Commission Appointed by Him (Boston, 1933), 75–284, http://archives.lib.state.ma.us/handle/2452/289532 (hereafter Special Commission Report).

23.      Special Commission Report, at 86–87.

24.      Special Commission Report, at 106, 109. 

25.      Special Commission Report, at 122–123.

26.      Special Commission Report, at 127.

27.      Special Commission Report, at 127–128.

28.      Special Commission Report, at 128.

29.      Special Commission Report, at 136.

30.      Special Commission Report, at 137–138.

31.    Special Commission Report, at 159.

32.    Special Commission Report, at 159–215.

33.    Special Commission Report, at 222, 224–225.

34.    Special Commission Report, at 225; U.S. Const. amend. XVIII, repealed 1933, https://www.reaganlibrary.gov/constitutional-amendments-amendment-18-beginning-prohibition; Volstead Act, Ch. 85, tit. II, § 3, 41 Stat. 305, 308-309 (1919).

35.    See St. 1933, Ex. Sess., c. 376, § 8. https://archive.org/details/actsresolvespass1933mass/page/744/mode/2up

36.      Special Commission Report, at 231–232; see MGL c. 138. 

37.      See MGL c. 138, § 12, § 15, § 17; 2017 Task Force Report. The distribution chain is enabled by Storage and Logistics licenses (§§ 13, 20, 20A, 22) and are issued directly by ABCC. They are not subject to the § 17 quota. 

38.      MGL c. 138, § 12, § 15, § 17; 2017 ABCC Task Force Report: This analysis examines All-Alcohol licenses and Wine-and-Malt licenses as a unified category. While these license types authorize different beverage categories—All-Alcohol permits the sale of all alcoholic beverages, while Wine-and-Malt restricts sales to wine and malt beverages (with the Cordials add-on expanding the scope to include certain spirits)—they share a common regulatory framework. All are subject to the population-based quota constraints of § 17, all require the same local licensing authority approval and ABCC oversight process, and all represent functionally equivalent barriers to market entry for prospective on-premises licensees.

39.      Department of the State Treasurer Alcoholic Beverages Control Commission, 2014 Transition Report, accessed August 8, 2026, https://www.mass.gov/files/documents/2017/09/27/2014TransitionReport.pdf.

40.      MGL c. 10, § 71.

41.      Alcoholic Beverages Control CommissionFrequently Asked Questions: Fall 2025 Update, FAQ 2, accessed June 18, 2026, https://www.mass.gov/doc/abcc-state-license-faqs/download.

42.      MGL c. 138, § 17. This analysis examines on-premises All-Alcohol licenses and on-premises Wine-and-Malt licenses as a combined number. This is a deliberate methodological choice because the important consideration for a prospective licensee is whether any on-premises license is available.

43.      See MGL c. 138, § 17. Except for Boston, which has its own statutory license allocations under § 17. This report analyzes on-premises (§ 12) licensing only; see Appendix B. Section 17 also sets quotas for off-premises (§ 15) licenses. Quota calculation for off-premises retail licenses: (1) All-Alcohol off-premises: 2 minimum allowable licenses with 1 additional license per 5,000 residents >10,000 and (2) Wine-and-Malt off-premises: 5 minimum allowable licenses with 1 additional license per 5,000 residents >25,000.

44.      See MGL c. 138, § 17. Section 17 also has a separate process for cities and towns to issue seasonal licenses, such as municipalities on Cape Cod and the Islands. Seasonal licenses are outside the scope of this study.

45.      See MGL c. 138, § 17. Boston is excepted from the population formula and operates under fixed statutory allocations under § 17; it is retained in the quota-bound sample because it operates under a state-imposed ceiling amendable only by the Legislature. Excluding Boston (n = 301) does not materially change the Finding 3 results. On the quota-bound sample, the Spearman correlation between EQV per capita and licenses per 10,000 residents is ρ = 0.118 (p = 0.040) with Boston and ρ = 0.114 (p = 0.048) without; the Kruskal-Wallis test across wealth quartiles is H = 6.50 (p = 0.090) and H = 5.92 (p = 0.116); and the ratio of mean license access in the wealthiest to the least wealthy quartile is 1.37 in both. On the 328-municipality outcome-based sample the corresponding values are ρ = 0.180 (p = 0.001) and 0.176 (p = 0.001), H = 13.57 (p = 0.004) and 12.90 (p = 0.005), and a ratio of 1.58 in both. The without-Boston values are reported in the sensitivity table in Appendix B.

46.      Id.

47.      US decennial census population estimates, 2020. 2020 estimates are used to demonstrate quota calculations as they are aligned with each municipality’s quota allocation, which is fixed by the decennial census. 

48.      Of 351 Massachusetts municipalities, 302 are subject to the quota formula. Boston is included among the 302 but is governed by a separate quota allocation within MGL c. 138, § 17. Twenty-six municipalities operate under local control and are exempt from the on-premises quota (discussed in Section 2.3). The Other 23 municipalities excluded from the scope of this study include (1) 14 municipalities for which no data was provided by ABCC: Florida, Heath, Leyden, Middlefield, Monroe, Monterey, New Braintree, Pelham, Peru, Rowe, Royalston, Tolland, Warwick, and Washington; (2) eight dry municipalities: Alford, Chilmark, Dunstable, Gosnold, Hawley, Montgomery, Mount Washington, and Westhampton, and (3) Milton, which maintains a local prohibition specifically on All-Alcohol licenses while permitting other license categories. 

49.      Department of Revenue/Division of Local Services municipal population estimates, 2023.

50.      Other provisions of MGL c. 138 contain specific exclusions intended to benefit particular types of licensees outside the scope of this study. For example, § 12 allows     municipalities to grant licenses to veterans’ organizations regardless of § 17 quota limits (currently 112 issued statewide). Sections 19B (farmer-winery), 19C (farmer-     brewery), and 19E (farmer-distillery) allow municipalities to grant pouring permits, which allow businesses that meet certain criteria to serve their winery, brewery, or distillery products to customers on their production premises (currently 432 issued statewide). See Alcoholic Beverages Control Commission, 2024, https://www.mass.gov/info-details/resources-and-forms-for-local-licensing-authorities-llas; https://www.mass.gov/doc/municipal-retail-license-quota-information/download.

51.      The Other 23 municipalities excluded from the scope of this study include (1) 14 municipalities for which no data was provided by ABCC: Florida, Heath, Leyden, Middlefield, Monroe, Monterey, New Braintree, Pelham, Peru, Rowe, Royalston, Tolland, Warwick, and Washington; (2) eight dry municipalities: Alford, Chilmark, Dunstable, Gosnold, Hawley, Montgomery, Mount Washington, and Westhampton, and (3) Milton, which maintains a local prohibition specifically on All-Alcohol licenses while permitting other license categories.

52.      St. 1978, c. 377, § 2.

53.      Art. 89 of the Amendments to the Massachusetts Constitution (Home Rule Amendment), §§ 1, 6, 8, ratified November 8, 1966; MGL c. 43B (Home Rule Procedures Act), St. 1966, c. 734. See also Massachusetts Department of Revenue, Division of Local Services, “What Is Home Rule?,” accessed September 13, 2026, https://www.mass.gov/info-details/what-is-home-rule.

54.     See Finding 4.

55.      See MGL c. 138, § 23, par. 1. MGL c. 138, § 23, provides that a licensee has no property right in a license and, at the same time, the section permits a license to “be pledged by the licensee for a loan” with local and ABCC approval.

56.      See MGL c. 138, § 23.

57.      MGL c. 138, § 77. 

58.      St. 2025, c. 9, § 51; MGL c. 138, § 12D.

59.      DLM Survey, 2025–2026. Percentages are of all respondents in each group; every municipal official answered the acceptance question. Of the 148 officials who answered the follow-up question on future adoption, 81 reported that their municipalities are not currently considering adopting § 12D, 42 did not know, 14 said “Yes” without a timeline, and 11 said “Yes” within 12 months. Of the 13 business owners aware of § 12D, 2 had applied to convert a license.

Date published:	October 13, 2026