More than three years since cheap small bar licenses were introduced in NSW, only a single venue is operating in Wollongong due to "prohibitive" setting-up costs and long processing times.Operators of a second small bar poised to open on lower Crown St have been waiting almost four months for a licence.However, the reforms have benefited the city's restaurants, with large numbers taking out a different licence that allows customers to drink alcohol without having to order a meal.Louise Keyte, co-owner of the city's first and only licensed small bar, Otis Bar, says the licensing reforms were "not as exciting as they seemed" when introduced in July 2008.The small bar licence, called a general bar hotel licence, was an affordable $500, but pricey development application requirements remained and processing times could be long, meaning months of lost rent, she said.Ms Keyte offers advice to customers who tell her they dream of opening their own Wollongong hole-in-the-wall bar, but says none have gotten far."It's such a difficult process and it's so expensive that it puts a lot of people off," she said."We have full-time jobs to cover the cost because we really want to do it, but if you don't have a full-time job it would be difficult. I think that's the main reason why there are no other small bars."Otis Bar has been operating for 18 months on the corner of Crown St and Crown Lane, in a building where leases aren't being extended because of uncertainty surrounding GPT's West Keira shopping complex development.The four owners have secured a new site in Globe Lane with space for 200 people and a kitchen.They lodged a development application with Wollongong City Council in December and received consent two weeks ago.Ms Keyte said the process had so far cost $32,000, mostly on a town planner and on requirements of the development application, and was still far from complete."You have to have a lease on a premises before you can put in a DA. We're lucky this time around that the landlord was able to give us a rent-free period, but the last time we had to pay rent for seven months," Ms Keyte said."There's a contribution fee of $6000 we have to pay council before we even get started."These fees are fine if you're opening a nightclub and can make lots of money, but a lot of people who want their own little place won't be people with millions of dollars. If it costs $30,000 to maybe get a DA - that's going to be half their budget. The process needs to be simplified."Small bars cannot operate poker machines or other forms of gaming, so don't have the earning capacity of bigger venues.A Wollongong City Council spokesman rejected extending special assistance to encourage a small bar culture in the city."Council works with applicants in this area, but as the determining authority for the development application," he said."If there are changes to the premises that the applicant is seeking a liquor licence for, then a development application must be lodged and this would incur the normal costs with a DA of that nature."Asked if the council was supportive of a small bar culture, he said: "Council is supportive of helping to create places that allow vibrant city life to occur. The management and running of individual places such as small bars is up to individuals and business owners."A second small bar appears poised to open on lower Crown St. The venue, linked to the Downtown Motel, is leased by the RDL Group.Their licensing application has been with the Casino, Liquor and Gaming Control Authority since February and will be considered at a June 28 meeting, according to a spokesman for the authority.The July 2008 licensing changes also introduced a new Primary Service Authorisation, allowing restaurants to serve alcohol to customers without them having to order a meal, provided the primary focus is on dining.Sixteen authorisations have been issued in the 2500 postcode, including for the Kembla St cafe/exhibition space/bar Yours and Owls, which has been mistaken for a small bar but lacks the licence.Two more - Crown St's Swell Coffee and Ghedia's Indian Restaurant, on Corrimal St, have primary service applications under consideration.