The grocery store wine bill: Whiskey sellers protest UPDATE | Arkansas Blog

Friday, February 10, 2017

The grocery store wine bill: Whiskey sellers protest UPDATE

Posted By on Fri, Feb 10, 2017 at 11:37 AM

The Distilled Spirits Council, a lobby for producers and sellers, opposes the bill to allow sale of all types of wine in Arkansas grocery stores, not just Arkansas and small-batch wines.

The Council takes the stand that it's not a sufficient convenience to allow sale of wine in grocery stores, but not spirits. Said a news release quoting Council Vice President Dale Szndrowski:

“Any new legislation regarding alcohol should be consumer-friendly and provide a level playing field for beer, wine and spirits. As more foot traffic shifts from liquor stores to grocery stores, local Arkansas retailers and their workers will suffer. We believe there is a fair approach to reforming Arkansas’ outdated alcohol laws that serves all parties.”

SB 284 would allow wine purchases in grocery stores, while spirits sales would remain segregated to package stores. According to an economic analysis, existing package stores are projected to lose and average of $90,000 in revenue annually, or about 8 percent of store revenue. As a result, an estimated 35-40 stores are would go out of business, costing 100-150 workers their jobs.

“Lawmakers should focus on legislation that allows grocers to purchase the package store licenses of retailers within close proximity to grocery stores, thus not denying consumers access to beer, wine and spirits, while also protecting the value of the existing package stores. By compromising and providing some protections for those retailers that built a business based on the current legislative environment, every stakeholder can benefit,” Szyndrowski concluded.
Sen. Bart Hester is handling the bill for Walmart, which struck a deal with a handful of owners of some major so-called county line retail liquor stores to allow expanded wine sales in groceries. In return, Walmart said it wouldn't push for eight years for more local option elections in dry counties from which the county-line liquor stores make huge profits currently. A notable example is Conway County, represented in this matter by former legislator and lobbyist Bruce Hawkins. His forces have long fought alcohol sales in booming dry Faulkner County, whose citizens drive to Conway County or county line merchants in Maumelle for their booze supplies.

Other retail stores are fighting the bill because of expected negative impact. Their representatives distributed a release recently that said virtually all retail liquor store owners oppose the bill and that Arkansas wineries believe it will harm them as well, though it includes a fee that will be used to make grants to benefit Arkansas wineries. They predict Walmart will be back eventually with legislation to expand offerings to include spirits. That's a reasonable guess based on Walmart practice in other states.

The group opposing the bill also distributed an outline of the agreement by Walmart, some other major grocers and a handful of liquor retailers on the legislation. This proviso was of particular interest:

click to enlarge governor.jpg
I'm seeking a comment from the governor's office. Has it agreed to create a written agreement on the deal? To prevent further legislation during the eight-year cessation of legislation promised?

I'm unclear what power the governor would have to impose legal restrictions.  To date, I think the governor's office has been neutral on the legislation. If the governor's office responds, I'll pass it along. Curious, though.

UPDATE: J.R. Davis, the governor's spokesman, responded:

The Governor has maintained his neutrality on this process. While we had staff observing the process as it played out (which is our standard practice on many issues), the section you noted was a draft created by Walmart and others, and we had no part in crafting it. In fact, when we learned of it being in there we immediately objected as it is not the role of the Governor’s office to enforce an agreement between private entities. 

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