Rhode Island: R.I. alcohol makers want looser liquor laws

Brewers, vintners and distillers argue that limits on on-site sales hamper business

Source: Providence Journal

By Patrick Anderson

Mar. 23, 2016

What Rhode Islanders drink has changed a lot in the last few decades, but how they buy bottled alcohol – through the neighborhood liquor store and its network of wholesalers – hasn’t changed much since Prohibition.

This year, some of the growing number of new Rhode Island brewers, vintners and distillers are again proposing alternatives to the state’s strict “three-tier system” that would, to some degree or another, cut out the middle man and let them sell directly to consumers.

Take Joshua Karten, co-owner of Proclamation Ale Company in South Kingstown, who wants to be able to sell more than 72 ounces of the brewery’s beer to customers on site.

“Throughout the Northeast – Massachusetts, Connecticut, New Jersey and Vermont – they have opened up their laws because that is what people want,” Karten said Wednesday. “No one is coming into the state to see a wholesaler or retailer. They are coming for breweries, but we are way behind.”

Karten added that he had no desire to enter the distribution business and allowing him to sell more would help all sides of the three-tier system.

“Retail would be gaining because I could send more product to them; right now I only have three people bottling,” he added.

Karten is supporting a bill, introduced by Rep. Joe Solomon Jr., D-Warwick, that would allow licensed breweries, wineries and distilleries to sell an unlimited amount of their product to on-site visitors for off-site consumption. Currently, they are limited to selling a single 72-ounce “growler” per trip.

Karten said the margins he makes selling three-quarters of his volume through distributors and retailers does not allow him to expand, but just meeting the demand of on-site customers directly would provide enough of a boost to grow.

A similar bill from Senate Minority Leader Dennis Algiere, R-Westerly, would allow alcohol makers unlimited sales of half-gallon growlers and allow customers to drink on the premises.

A pair of bills sponsored by House Minority Leader Brian Newberry, R-North Smithfield, and Sen. Adam Satchell, D-West Warwick, would allow Rhode Islanders to buy up to 24, 9-liter cases of wine through the mail each year.

Newberry said he first introduced the bill several years ago at the suggestion of a constituent, who had a wine shipping business and had to operate out of Massachusetts where mail-order wine is legal.

At a hearing on the Senate version of the bill Wednesday night, Nancy Parker Wilson, general manager of Greenvale Vineyards in Portsmouth, said Rhode Island is now one of only six states in the country that does not allow mail order wine shipments and the current law is limiting her business with in and out-of-state customers.

But liquor store owners and wholesalers are not convinced and say allowing an end-run around them will mostly benefit large out-of-state companies at the expense of local mom-and-pops and taxpaying Rhode Island companies.

“[The bill] would allow any and all wines to be shipped directly: what good does that do the local economy and local stores?” said Robert Goldberg, lobbyist for the United Independent Liquor Retailers of Rhode Island. “[The stores] employ people, pay taxes in Rhode Island and are part of the community. If there is a wine that is not available in store, they will do everything they can to acquire it though the normal distribution system.”