New Mexico does the same thing with liquor licences. The worst part is that the state's biggest liquor distributor now owns the vast majority of the licenses. "You have to buy all your shit from me AND give me a percentage of your profits" - sounds like the mafia but it's every day business in NM.
That's actually a by-product of prohibition. When they reversed prohibition, a regulation was put into place that the manufacturer, distributor and seller of alcoholic beverages all had to be separate (not owned by the same company or individual).
The gov't decided to step in and do all three after prohibition and it's been a VERY slow move back into the private model since then.
