By Joshua Burd
Efforts to revitalize downtown Hackensack have leapt forward in recent years after more than a decade, with the successful lease-up of a new apartment building and a growing development pipeline that calls for more than 2,000 additional units.
But advocates for the city say they are still missing one key ingredient.
Amid the sweeping push to reform the state’s outdated liquor license laws, stakeholders in Hackensack are seeking a more targeted solution for their city. Business leaders and local officials have thrown their support behind a bill that would allow builders in transit-oriented, downtown redevelopment zones to apply for yearly liquor permits based on the new residents that their projects would bring to the area.
Supporters of the bill say it would fill a gap in Hackensack’s redevelopment effort, allowing the city to create the type of bar and restaurant scene that has helped other downtowns thrive. They say downtown Hackensack is underserved by liquor licenses because of the growth of malls and highway shopping centers around the fringes of the city in recent decades.
“Hackensack is kind of at a tipping point right now, because we’re right on the precipice of major redevelopment down here,” said Jerry Lombardo, chairman of the Upper Main Alliance in the city. He noted that the city has around 10 projects “that are either on the drawing board or coming out of the ground. And yet the development of the nightlife and the whole ambience of the downtown is languishing because we’re very limited with our liquor license situation.”
The bill, sponsored by Assemblyman Gordon Johnson, is tailored specifically to Hackensack and amounts to a pilot program for the Bergen County seat. The measure would allow the city to issue a special, nontransferable permit to serve liquor to builders for every 100 residential units constructed within the downtown redevelopment area.
Developers seeking the permits would be selected via a lottery process and, if selected, would pay $25,000 for the permit for the first year and $15,000 in each subsequent year. As compensation, 80 percent of that permit revenue would be divided among the holders of existing traditional liquor licenses in the city, except for corporate-owned establishments within the Shops at Riverside.
Johnson, a Democrat from Teaneck, said about two dozen liquor license holders would be affected and receive compensation under the proposal. He acknowledged there is some pushback from some of those businesses, citing the high costs associated with liquor licenses and the barriers to acquiring them, but he said “this is the best compromise that we felt we could get. That’s why we’re going forward with it.”
The bill was referred to the Assembly Regulatory Oversight and Reform and Federal Relations Committee after being introduced in March.
The proposal comes amid a push, led by the state’s development community, for statewide liquor license reform. Critics say the current system, which is based on population counts from decades ago, is archaic and has caused the cost of liquor licenses to skyrocket, hindering mixed-use development projects that rely on bars and restaurants as anchors.
A measure backed by NAIOP New Jersey and spearheaded by Assemblyman John Burzichelli would look to protect existing liquor license holders while creating an opportunity for small restaurants. The measure would allow municipalities to issue permits to establishments that would serve liquor for table service only, as opposed to standing bars or liquor stores.
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The bill would also require liquor permits to be purchased annually, while stipulating that they are not transferrable and their value cannot increase unless the law is changed. The bill would also allow municipalities to decide if they want to participate or not.
Advocates say Burzichelli, who introduced the bill during the last legislative session, has been refining the proposal with stakeholders on all sides of the issue.
Johnson said Hackensack was “a good example of why we should amend our licensing technique that we have in the state,” but believes there is more of a sense of urgency when it comes to Hackensack. He also noted that the measure is meant to help small businesses succeed.
“We want to get this done as soon as we can, recognizing that these residences are being constructed and being planned,” Gordon said. “So we want to go forward with this to ensure that once they’re occupied, the residents can come down to Main Street in Hackensack and have a place to go … thereby making it a downtown vibrant area and hopefully increase the pedestrian traffic that could be there.”
Developers and renters have in fact responded to the efforts to revitalize the downtown. Lombardo said the city’s first new luxury multifamily project, a 222-unit project on State Street by Capodagli Property Co., is just about fully leased.
Other developers have come calling in Hackensack. But Lombardo believes that expanding the availability of liquor permits is critical to cementing that success in the long term.
“I think there’s a lot of good in this for everybody and we’re going about it in a very measured way to try to do the right thing,” he said. “But now we need some help.”
