Whether you’re opening a brand new bar, or seeking to obtain a liquor license for your existing restaurant or other business operation, obtaining the proper license and permits can feel like a significant hurdle. With layers of both state and local regulations, you likely have a host of questions about Illinois liquor license types and their costs.
At Hays Firm, our goal is to help you understand these intricate laws so you can gain compliance and set a solid foundation for the success of your business.
We are a Chicago based business law firm, specializing in helping our clients navigate the complex landscape of liquor licensing and alcohol sales in Illinois.
In this blog, we’re going to break down the different Illinois liquor license types, the application process, and the associated costs involved, as well as answer some commonly asked questions.
No matter if alcohol sales in Illinois are your primary offering or only an incidental part of your business, this guide will offer a comprehensive overview of everything you need to know about Illinois liquor license types.
Who Issues and Regulates Illinois Liquor Licenses?
Illinois liquor laws are regulated at two levels:
- State Level: Regulated by the Illinois Liquor Control Commission (ILCC)
- Local Level: Local municipalities and counties, like the City of Chicago, or Cook County
Before any restaurant, bar, or other enterprise can make legal alcohol sales in Illinois, they must obtain both a state liquor license from the Illinois Liquor Control Commission (ILCC), as well as the appropriate local liquor license.
To make legal alcohol sales in Illinois, you must submit an application for the appropriate license type to the ILCC. Most businesses require retailer licenses, but those who produce alcohol, such as breweries, distilleries, or wineries will require licenses for manufacture and/or distribution.
Once a state liquor license is obtained, you’ll need to apply for the appropriate local licenses. This is a critical point to research as different municipalities will have different local liquor laws.
We’ll break down both state and local liquor laws in greater detail next.
State-Level Illinois Liquor License Types
The ILCC is the State’s official regulatory body for Illinois liquor laws, setting the primary framework and issuing state-level licenses that any business who wishes to sell alcohol must possess.
Illinois liquor license types are broken down by the nature of the business and type of alcohol being sold: manufacture, distribution, and retail sale of alcohol.
Here is a breakdown of the most common Illinois liquor license types:
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Retailer License
This license is for businesses that sell alcohol directly to consumers, including:
- Bars
- Restaurants
- Liquor Stores
- Wineries and breweries with tasting rooms
This is the most common type of alcohol license for bars, used for on-site consumption and the sale of packaged goods. In some cases, breweries and wineries with tasting rooms may need both a manufacturer’s and a retailer’s license, depending on how they operate and the local municipal requirements.
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Distributor License
This Illinois liquor license type is intended for businesses that purchase alcoholic beverages directly from manufacturers, with the intent to sell them to retailers. Businesses with this type of liquor license function as middlemen between manufacturers and retailers.
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Manufacturer License
If your intent is to produce alcoholic beverages in Illinois, such as a brewery, distillery, or winery, a manufacturer’s license is required.
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Importer/Distributor
Required for businesses that import alcoholic beverages into Illinois from other states or countries.
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Special Event License
This type of Illinois liquor license is designed for non-profits or short-term events where alcohol is to be served. Fundraisers and festivals often require this form of license.
Local Liquor Licenses in Illinois
In addition to the required state liquor licenses, you will also need the appropriate local liquor license from the municipality that you operate in.
Liquor licenses at the municipal level address specific local requirements and limitations, such as hours of operation, zoning and other community-specific rules.
For example, in the city of Chicago, there are different municipal licenses based on things like:
- On-site or off-site alcohol consumption
- Hours of operation, including special licenses for late night sale of alcohol
- Food service requirements
- Entertainment or dancing permissions (Public Place of Amusement licenses)
Furthermore, local municipalities may also require specific categories of licenses, including:
- Consumption on Premises (COP)
- Packaged Goods License
- Tavern License
- Late Hour License
- Outdoor Patio License
In addition to simply requiring these licenses, it’s also important to note that some municipalities may actually limit how many of these licenses are granted in a given area or neighborhood.
It is also vital to mention that anyone seeking an alcohol license for a bar, restaurant, nightclub, hotel or any other business purpose must obtain their local liquor license first.
Only after obtaining your local liquor license can you apply for a state license.
The Cost of Illinois Liquor License Types
The cost of liquor licenses in the state of Illinois will vary greatly depending on the type of business you have. Let’s take a look at both state-level fees and local level fees, using Chicago as the example:
State-Level Fees (ILCC)
The cost of ILCC’s state-level liquor licenses can vary based on the exact nature of your business. However, you can estimate these annual ballpark figures:
- Retailer Licenses: $750 to $2,500 (based on classification)
- Manufacturer Licenses: $1200+
- Special Event Licenses: $25-$100 per day (depending on the nature of the event)
- Distributor Licenses: Most standard distributor licenses are subject to a flat annual state fee of $25, though larger volume distributors may be subject to tiered licensing based on the total volume of gallons distributed.
- Importer/Distributor Licenses: A $25 flat annual fee is charged for a license to import alcohol into the state, including for foreign importers.
Local-Level Fees
Using the city of Chicago as an example, you can expect to pay significant licensing fees:
- Consumption on Premises: $4,400 every two years.
- Packaged Goods License: $4,400 every two years.
- Late Hour License: An additional $6,000 fee, paid every two years aligning with the renewal of your on-premises consumption license. This license is only available in certain areas of Chicago, and requires community input.
Other Considerations to Be Aware of When Seeking an Illinois Liquor License
In addition to both state and local licenses needed for alcohol sales in Illinois, there are a few other important considerations to keep in mind:
- Zoning Compliance: Your physical location must be zoned for alcohol sales.
- Proximity Rules: Most businesses that sell alcohol must not be within 100 feet of a school, church, or hospital.
- Background Checks: The ILCC will run a criminal background check on all applicants. Those with a significant criminal history may be denied a license.
- Food Requirements: Some municipalities, including Chicago, require that for certain license types a majority of sales come from food, not alcoholic beverages.
How to Apply for a Liquor License in Illinois
When you’re ready to begin the process of applying for one of the Illinois liquor license types, you’ll need to take a few steps.
- Ensure Your Business is Registered with the State of Illinois
You’ll need to have a Federal Employer Identification Number (FEIN) as well as an Illinois Business Tax (IBT) number. - Secure Your Local Liquor License First
You’ll need to meet with your city or county’s local liquor commission first to understand the exact local licenses you need. Requirements will vary, but you’ll need to get this situated before you can apply for a state license. - Apply With the ILCC
With your local licenses approved, you can submit the appropriate application for your business to the ILCC either online or by mail. Visit the ILCC website for the current forms and applications needed. - Complete Inspections and Background Checks
The ILCC will conduct a background check on all applicants. Local municipalities may also require a site inspection, and in some cases, a public hearing. - Wait for Approval
How long you wait for approval will depend on your exact municipality and the complexity of your application. Expect anywhere from several weeks to a few months to receive approval.
Frequently Asked Questions About Illinois Liquor Licenses
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How Long Does It Take to Get a Liquor License in Illinois?
The timeline can vary depending on the nature of your business, and your local jurisdiction, but you can expect the complete state plus local licensing process to take anywhere from 6 to 12 weeks or longer. Remember, you must gain local approval first before you can apply for an Illinois state liquor license. Once you receive local approval, the ILCC typically pushes new licenses through within 2 to 4 weeks.
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Can I Sell Alcohol at a One Time Special Event in Illinois?
Yes, you can apply for a Special Event Retailer’s license through the ILCC. This can also be done in conjunction with a local special event permit. These licenses authorize short-term alcohol sales, typically for a period of 1-15 days.
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How Much Does an Alcohol License for a Bar Cost in Illinois?
Costs will vary based on the geographic location of the bar, but at the state level, you can expect the retailer license to cost anywhere from $750 to $2,500 per year. Local municipalities will have their own costs, but in Chicago, an On-Premises Consumption License is $4,400 every two years. If you wish to operate late, an optional Late Hour License will cost an additional $6,000 every two years.
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Do I Really Need Both State and Local Licenses to Make Legal Alcohol Sales in Illinois?
Yes, Illinois is a dual licensing state. In order to legally sell alcohol in Illinois, you must first apply and be approved for a local liquor license from your city or county. Once approved, you can apply for a state liquor license through the ILCC. The specific type and costs of the licenses you need will depend on the nature of your business. Both state and local licenses must be active for you to be compliant and operate your business legally.
Need Help Obtaining an Illinois Liquor License? Contact Hays Firm Today
Navigating the Illinois liquor license process can certainly feel overwhelming. With so many different types of licenses, at both the state and local level, it can be difficult to understand exactly what licenses you need, and how much it will all cost.
If you’re opening a business in Chicago or anywhere else in Illinois, consider partnering with Hays Firm. We offer extensive experience in Illinois business law, including Illinois liquor license types, combined with a personalized approach to our clients.
We’ve served the Chicago area and greater Illinois as experienced business attorneys since 2008. We don’t just help you file the right forms – we help you understand the process, avoid delays, and get licensed with confidence.
Contact Hays Firm for a professional consultation, and let’s get your business started on the right foot – with the right licenses, the first time.
**Disclaimer**
This content of this blog is for general informational purposes only, and does not constitute legal advice. Please consult with a qualified attorney or lawyer for advice specific to your situation.
