No, there's a difference between substantive review of applications with availability and queue management (and responding to inquiries) about applications pending availability.
> It sounds like the agency has to check that the applicant meets the criteria for the license in either case.
They aren't two alternatives, they are two different functions. Verifying that the applicant meets the criteria once there is a license available (given the quantitative limits) is one function. The other function is managing distribution of the limited number of licenses. The amount of work required by the public agency for the latter function (#1 in my original list) is greater when if the only way for that to happen is people to surrender unused licenses and then new applicants to apply to the issuing agency and be waitlisted until a slot is available than if a license that the current holder can be transferred directly to a new applicant.
This makes no sense to me. It seems like the major effort would be involved in examining the applicant is necessary in both cases, since that requires collecting individual information and exercising judgement.
The difference between the two is simply and administrative choice of how the queue of available licenses is managed..
You have done nothing to explain why the amount of work is any different between the two cases. You have simply asserted that it is.