In the meeting, Democratic Rep. Carol Spackman Moss, of Salt Lake City, questioned "why the scrutiny to this rule" now, when the event has been running for years.
State law tasks the commission with considering benefits to the community before granting such a permit, and that's the part that led officials to favor nonprofits and charitable organizations, Petilos said.
The commission plans to revise the new approach starting Tuesday, Nielsen said.
Assistant Attorney General Sheila Page noted officials are seeking to crack down on sports arenas and other entities seeking the permits as a quick fix to expand their alcoholic offerings.
In a written statement, Snowbird general manager Bob Bonar called Oktoberfest an "important celebration for Snowbird and the community" and said the resort will continue to work with officials.
It's the latest flashpoint surrounding the policing of Utah's singular liquor laws. Last year, the beverage control department came under fire for citing restaurants serving patrons alcohol without first making sure they intended to stay and eat.
The state relaxed its heavy-handed liquor laws in 2009, when it stopped requiring bars to operate as members-only social clubs. But officials rejected further revisions this year after Mormon church leaders defended Utah's liquor laws, saying they keep residents safe.
The majority of Utah residents belong to the Mormon church, which teaches members to avoid drinking alcohol.