Saturday, December 20, 2014

Businesses await final action on grocery store liquor bill

By ELISE REUTER, KU Statehouse Wire Service | 3/6/2014

TOPEKA — Soon, Kansas residents might be able to purchase a bottle of wine with their groceries. In a hearing Wednesday, lawmakers discussed House Bill 2556, which would allow grocery and convenience stores to obtain liquor licenses.

The bill, which was originally proposed by Uncork Kansas, differs from previous attempts by instating a 10-year license freeze to help liquor store owners adjust to the new competition. 

“The 10-year cap ultimately benefits the liquor store owner who would like to get out of the business,” Jessica Lucas, Uncork Kansas, said. 

According to the bill, store owners wishing to sell liquor would have to purchase an existing license from a retailer in their county during the 10-year period. A slow phase-in would allow these stores to gradually begin selling alcoholic beverages.  In 2017, stores could apply for a license to sell “stong” beer (with an alcohol content exceeding 3.2 percent), and in 2020 grocery and convenience stores could sell both beer and wine. By 2024, licenses for all types of alcohol will be available. 

“Consumers ultimately win when there is competition in the marketplace and there are more places to buy products,” Lucas said. “We’re bleeding a lot of money to Nebraska and Missouri when Kansans go there to buy alcohol and groceries at the same time.”

While Lucas and other supporters of Uncork Kansas, including many convenience chains and grocery stores, say the compromise should help the bill pass, Lawrence liquor store owners are not satisfied with the deal. Those looking to keep their licenses and stay in the business were especially concerned about the addition of grocery stores to an industry that is already competitive. 

“It’s said there’s a monopoly in state of Kansas; well, there’s not. Owners are limited to one liquor license,” said Matt Easley of On the Rocks Discount Liquor. “You have to really compete to gain business.”

While a liquor store might have a larger selection of available brands, including beverages put out by local wineries and breweries, most convenience stores and standard grocers won’t have the space dedicated to a large range of products. While this gives larger wholesale liquor stores an advantage, smaller businesses will still feel the hit.

“I don’t really like the idea of people I’ve known for many years losing their livelihood,” said Jon Smiley, owner of Cork and Barrel. “This would affect businesses that are more convenience driven, and less selection and price driven. So if you’re a small liquor store next to a grocery store, you’re in trouble.”

The biggest concern among the bill’s opposition is the availability of alcohol for minors. If HB 2556 is passed, the age for selling alcohol would drop from 21 to 18. This poses some concerns for local law enforcement who already struggle to combat underage drinking. 

“Alcohol is a regulated product; it’s not a pair of shoes or a bag of potato chips,” Easley said. “Liquor store owners have a vested interest in not selling alcohol to minors, but for grocery stores it’s just another item.”

Some of the bill’s broad economic implications — including employment and taxation — merit further discussion. The House Committee of Commerce, Labor and Economic Development will work on the bill Thursday, with possible action in the afternoon.

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