MIDDLESEX - Two-and-a-half months. That’s how long Stoneham Theatre has been able to keep its doors open over the past year.
Considered by many as Stoneham Square’s marquee attraction — many downtown restauranteurs readily admit their businesses flourish due to dinnertime traffic from evening showtimes — the town’s Select Board took note earlier this month when Stoneham Theatre representative Amy Morin made clear how much the COVID-19 crisis has hurt the Main Street fixture.
And with the owners of nearby restaurants reminding the town officials about the severe financial repercussions arising from state-mandated restrictions on their operations, the Select Board agreed to take action.
At some risk to the stability of the municipality’s own budget, the town leaders wiped 75 percent of an annual $2,250-to-$3,500 expense for 15 local businesses in the form of granting liquor licensing fee waivers. The discount is expected to drain roughly $30,000 from Stoneham’s coffers.
According to Morin and other business leaders, the relief seemed more than justified given the crippling restrictions being placed on local businesses due to the public health emergency.
“We shut down last March and haven’t reopened. In the 24-month period of having purchased liquor licenses, we will maybe get to use them for five of those months,” reasoned the Stoneham Theatre representative, explaining the small performance venue has now paid two consecutive years for liquor licenses and been forbidden by the state from using them since last March.
With at least one analysis from Harvard University’s non-profit Opportunity Insights estimating that 37 percent of the state’s small businesses had closed their doors for good by the end of 2020, Stoneham is just the latest community to take the unprecedented step of offering heavily discounted and even free liquor licenses in 2021.
In fact, months earlier, in October of 2020, the Town of Winchester became one of the first towns in the region to waive local liquor licensing charges in their entirety for the approaching calendar year.
Winchester’s Select Board, at the urging of Town Manager Lisa Wong, also zeroed out a $50 fee normally assessed to restaurants that rely upon propane heaters for outdoor dining spaces.
In a small downtown like Winchester’s, only a handful of businesses have the ample outdoor space needed to offer patio seating. However, beginning late last spring, restauranteurs who were still forbidden from seating customers indoors began lobbying municipal officials for permission to relocate tables onto municipal sidewalks and streetscapes across the Commonwealth.
Although the state as part of its multi-phased business reopening plan began loosening indoor seating bans early last summer, Mass. Governor Charles Baker reinstated strict 25 percent occupancy permit caps after the second COVID-19 surge hit the state this winter. At the time, restaurants had been restricted to 50 percent occupancy rates for just a brief months-long period.
Winchester officials, aware that many eateries will again depend upon outdoor seating arrangements when the winter season lifts, have acknowledged the heater fee reduction will do little to help cash-strapped enterprises. Nonetheless, Select Board members like Amy Shapiro maintained that every little bit helps.
“Restaurants are the pulse of this town,” Shapiro said during a public hearing in October.
According to Wong, the loss in licensing revenues will cost Winchester about $40,000 in FY’21. The 100 percent discount will apply to all classes of businesses that sell alcohol, including package stores.
In Reading, the town’s Select Board enacted a discount similar to Stoneham’s by slashing licensing fees by 75 percent for all 13 restaurants in the community permitted to serve alcohol.
Rather than stopping with the restaurant classes, the neighboring community also extended the discounts to hard hit social clubs, which have been unable for most of the year to rent out function rooms for weddings and private parties.
For Reading’s restauranteurs, who pay $3,700 each year to serve alcohol to customers, the license fee waiver amounts to a savings of around $2,000. The community’s three licensed social clubs, assessed an annual fee of $1,300, will see $1,000 shaved from their bills.
In total, Reading is expected to lose $42,550 in revenues by offering the discounts in 2021.
According to municipal officials like Stoneham Town Administrator Dennis Sheehan, the temporary relief being granted to area merchants could very well play a role in determining how cites and towns later emerge from the pandemic.
In particular, Sheehan pointed out that Stoneham and most of its neighbors have witnessed unprecedented losses in real-estate tax payments and other revenue streams normally generated by building permits, licensing fees, and other funds generated by healthy economic activity.
Thus far, the small bedroom community has like Reading and Winchester been able to avoid drastic cuts in services to offset those budgetary impacts. But the consequences can only be delayed for so long, Sheehan contends.
“[A]s the town looks to recover post-pandemic, meals tax revenue will be an important [funding] source for us. You need restaurants [to still be open] in order to regain that," he contended.
“[W]e have to be diligent about our overall financial position both in the short-term and the long-term," the town administrator later responded, when asked about implementing a 100 percent liquor licensing discount. "There's still six months left in the fiscal year in a very, very uncertain environment. The calendar year might have changed over, but the pandemic didn't end."