Liquor sales in movie theaters included in new state budget

ALBANY — New Yorkers will soon be able to buy alcohol, including hard liquor before and during movies, in far more theaters as part of new deals in the late state budget now being adopted.

The deal is among several detailed Friday in bills that are part of the late state budget. Another extends a 2022 law that allows restaurants and taverns to sell alcoholic drinks “to go.” The measure was enacted as a temporary provision during the COVID-19 pandemic to help keep restaurants afloat when fewer people were patronizing eateries. The measure was scheduled to expire next year, but will continue through at least 2030 under the new budget.

The State Legislature is trying to pass the budget by the end of Saturday. The budget was due April 1.

Lawmakers also tucked into the bills a tax on health insurance plans to try take advantage of a loophole that would allow New York to obtain more federal funds for Medicaid. They also reversed a proposed reduction in funding for clean water projects.

The alcohol-sales-in-theaters measure would greatly expand on a 2022 law. That measure allowed cider, wine and beer sales, but only if the limited number of theaters provided “meals,”  like restaurants, and where all seating was at tables where meals are served, according to the law. That provision is deleted under the new measure.

State law has traditionally required any business such as restaurants and taverns that sells alcohol to also sell food. The new measure complies with that provision by stating food includes “popcorn, candy, and light snacks” at theaters.

The new measure also requires that only one drink can be purchased at a time.

“We have safeguards in place to make sure that we maintain a family friendly environment,” said the prime sponsor of the measure, Sen. James Skoufis (D-Cornwall). “You can only purchase one drink per transaction. However, if you want to enjoy a cocktail while watching a movie in a theater, God bless, have fun, just don’t get three sheets into the wind with kids around and watching some animated movie.”

The budget agreement expanding alcohol sales in theaters is the latest measure since the COVID-19 pandemic that has increased access to alcohol. Those measures include allowing alcohol-to-go sales from restaurants and taverns.

“While this policy change alone isn’t a huge deal, it’s one of several moves state lawmakers have taken to increase access to alcohol,” said Jeffrey Reynolds, president and CEO of the social services organization Family & Children’s Association based in Garden City. “That’s challenging for addiction treatment providers who already have lines out the door, especially post-COVID, where folks are self-medicating away anxiety, depression and other untreated mental health conditions."

The state 2024-25 budget will also include a significant boost in enforcement of fair housing laws aimed at rooting out discrimination  against New Yorkers as they seek to rent and buy homes.

A municipality may try to stop a theater within its boundaries from obtaining a state license and serving alcohol, but can’t prohibit it locally: “Any municipality … may express an opinion,” according to the state law, “and such opinion may be considered in determining whether good cause exists to deny any such application.”

The National Association of Theatre  Owners organization based in Washington, D.C., didn’t immediately respond to a request for comment.

 Also in the budget, lawmakers approved a new tax that will amount to a pass-through for health insurance plans but generate more federal aid for New York — if it's not blocked by the federal government.

In short, New York would tax insurance companies, then repay them with Medicaid funds. But the repayment would be split by state and federal funds because the federal government covers half of state Medicaid costs generally.

The budget bills didn't specify the tax amount, but analysts have estimated it could generate up to $4 billion for New York once fully implemented.

The state program is similar to one California deployed. The federal Centers for Medicare & Medicaid Services approved the California tax, but warned it considered the end-around a violation of the spirit of the regulations and that it might approve a new regulation that would force states to modify such taxes.

The state budget bills also earmark $500 million for upgrading aging wastewater and drinking water infrastructure around the state, equaling the previous year's amount. Gov. Kathy Hochul had proposed cutting the amount in half.