Colorado: Tempers flare over latest effort to expand liquor sales in Colorado

 

The move would allow liquor sales at Walmart, which was accidentally left out of last year’s overhaul.

 

Source: Denver Post

By BRIAN EASON

May 3, 2017

 

Colorado lawmakers are mounting a last-ditch effort to loosen the state’s restrictions on alcohol sales, arguing that customers are not seeing benefits from last year’s attempt to shake up the market for booze.

 

Introduced with just a week left in the legislative session, the measure would revisit last year’s massive overhaul of the state’s alcohol laws just months after its provisions began to take effect.

 

It would allow liquor stores to expand to up to nine locations over 10 years. Under the law passed last year, they are allowed to operate a total of four locations by that year, starting with one new location this year.

 

The proposal also would clarify that Walmart and Target can obtain up to 20 liquor licenses each over a 20-year period. That would put the big-box giants on a level playing field with grocery chains that won similar allowances in last year’s hotly debated measure.

 

On Wednesday, the measure narrowly passed out of the House Finance Committee, 7-6, over deep reservations of lawmakers in both parties who said the legislation was moving too quickly and too late in the legislative session.

 

Alcohol-related bills are always among the most contentious and heavily lobbied at the Colorado statehouse. And, in an unusual wrinkle, this year’s debate has split the state’s powerful liquor lobby, exposing the competing motivations of large outfits such as Applejack Wine and Spirits in Wheat Ridge that may want to expand, and owners of smaller shops who fear that allowing liquor stores to expand will drive Colorado’s mom-and-pop stores out of business.

 

“The minute you pass a bill that allows the expansion of liquor stores at the rapid pace that this legislation allows, you will have an arms race to see who can build the biggest and who can build the fastest,” said Jeanne McEvoy, CEO of the Colorado Licensed Beverage Association, which represents 1,600 liquor stores around the state. “And the little guy is going, ‘What can I do now?’ ”

 

McEvoy and other opponents say the bill would gut the bipartisan compromise reached last year that overhauled the state’s Prohibition-era alcohol laws.

 

The law allows grocery stores to gradually add new locations selling full alcohol over 20 years, starting this year, if they meet certain conditions, such as buying out the liquor licenses of competitors within a certain radius. The old law had limited each chain to a single location in the state.

 

Meanwhile, because Walmart is subject to different regulations than grocery stores, it was inadvertently exempt from last year’s changes. Target may have been as well. Lawmakers earlier this year attempted to rectify that, calling it an oversight, but that effort was defeated in the state Senate by a single vote after a contentious debate.

 

The last-minute fight over House Bill 1370 – sponsored by Rep. Faith Winter, D-Westminster, and Rep. Larry Liston, R-Colorado Springs – promises much of the same on a tight timeline. The bill was introduced Tuesday and scheduled for a Finance Committee hearing less than 24 hours later.

 

The debate on the measure Wednesday reflected divisions that don’t fall neatly along party lines.

 

Liston argued that further changes to last year’s law were needed, saying that liquor stores continue to enjoy a near-monopoly on alcohol sales and that the market activity lawmakers had hoped to see hadn’t occurred. “Right now, the market is stuck,” he said. “A year later, there’s been zero transactions.”

 

Liston’s comments drew a swift rebuke from his fellow Republican, Rep. Polly Lawrence, who said the law hadn’t been given a chance to work.

 

“We said this needed to be a phased-in approach, because a lot of these stores are a lifetime investment for a lot of the smaller stores,” Lawrence said.

 

Grocery stores could begin applying for new alcohol permits Jan. 1. But the process for doing so is complicated, requiring grocers to buy out the alcohol licenses of competitors nearby. Josh Phair, a Walmart public affairs official, said that right now, both buyers and sellers are cautious of making a sale in an uncertain market.

 

“Nobody wants to be the first one to pay too much or have sold for too little,” Phair said.

 

The committee chairman, Rep. Dan Pabon, D-Denver, cited consumer choice in voting to expand sales.

 

“At the end of the day, we also represent the consumers, and the conversations that we’ve always had is that consumers should have as many choices as they can have,” he said.

 

In unusually pointed criticism, lawmakers chastised lobbyists on both sides for the frenzy of texts, phone calls and emails they received late into the night. Some of them, the committee members said, came across as vitriolic and threatening.

 

“What happened with this bill was not OK,” said Rep. Dafna Michaelson Jenet, D-Commerce City. “I hope that the interaction from the lobby from this point will be different.”

 

And with supporters hesitant to offer full-throated support of such a far-reaching measure this late in the session, its prospects of passage are uncertain.

 

“My patience is very thin with this bill,” said Rep. Kevin Van Winkle, R-Highlands Ranch, who voted for it. “Time is very short.”