License to Swill

Officially it's called "substandard orange wine," but to small business owners, Premium Blend is a strong shot in the arm

Fortunately for the brothers Santos, Florida's stingy system of distributing hard liquor licenses has assured them a generous market. Because the state only allows one hard liquor license per 2500 people, few applicants actually receive a license from the state. This year, for instance, only 47 new licenses were doled out in Dade, leaving several hundred applicants with no recourse but to purchase an existing license from a licensee. Prices on this informal market, which is unregulated by the state, have skyrocketed to tens of thousands of dollars. The annual renewal fee runs $1820.

By contrast, beer and wine licenses are issued to almost any applicant, as long as they abide by local zoning ordinances, serve only patrons over 21, and have not committed a felony in the past fifteen years. Those cost $392 per year.

To purists, the notion of sipping a gin and tonic that is, in fact, substandard orange wine with gin flavor and tonic may smack of sacrilege. But Premium Blend's growing throng of devotees say most drinkers never know the difference. "We've never had any trouble," says Luis Alonso, whose North Miami Beach restaurant, Paquito's, runs through 25 cases of Premium Blend every month. "When customers ask what brand of liquor is in our margaritas, we tell them. Otherwise, there's no reason."

Legally, though, neglecting to tell the consumer he's not drinking hard liquor is a no-no. "It's misrepresentation of a product," admonishes Barry Schoenfeld, the Department of State's chief of licensing. "You've got to tell folks what they're drinking."

Orestes Santos says he encourages his customers to be up-front with their patrons. "We even give them tons of promotional material that advertises Premium Blend. Heck, we want our name out there. But you can't police everybody." What's more, he says, most vendors know better than to serve Premium Blend straight. "We encourage clients to serve it only in mixed drinks," he stresses, gingerly sidestepping a direct assessment of his product's taste.

"We're building a base with the beer and wine outlets, because they can use us to compete," Santos says. "But we're not going to stop there. With the new health consciousness and the success of light beers and wine coolers, we see our product as perfect for designated drivers, or the guy who's got a business lunch and wants the taste of liquor without getting plastered. Our dream is that someday people will walk into a liquor place and say, 'Give me a Premium Blend screwdriver.'"

Until then, the plan is to infiltrate bar chains and supermarkets. Already, Premium Blend is being served in tropical drinks at Miami Subs franchises, and the brothers are discussing a deal with Hooters. With distributors in South Carolina and South Dakota, and negotiations under way in Texas and Alabama, they hope to corner the national market.

"I hear people say all the time that we're going to get bought out. People want to buy stock. But the company's not public and it's not for sale," Henry Santos insists. "Besides, in the scope of the liquor business, we're a fly on the wall. Actually, I don't even think we're a fly on the wall yet."

Still, if Premium Blend continues its steady seep into the mainstream, the Santos brothers know they'll receive plenty of attention. Not all of it friendly.

"It may be that the state statutes allow a synthetic liquor to fall through the cracks," says state licensing chief Schoenfeld. "But if the liquor industry feels strongly enough about this stuff they might start to lobby the legislature" to close the statutory loopholes that have allowed Premium Blend to thrive.

And the liquor industry, Schoenfeld warns, can be one mighty force. Several years ago, for instance, lobbyists successfully pressured lawmakers to rewrite the statutes so that low-alcohol hard liquor brews such as Bacardi Breezers could be legally sold by any merchant with a beer and wine license. That includes supermarkets A on whose shelves, ostensibly, Premium Blend will soon appear.

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