Rural liquor stores fear big box ballot measure
Robert Cionek has owned the only liquor store in Haxtun, Colorado for 10 years. It’s his principle source of income.
Whether he stays in business may be up to Gov. John Hickenlooper, who is so far publicly undecided about whether to sign a bill that would protect rural liquor stores from having to compete with grocery stores on the sales of full-strength beer and wine.
But the survival of small business liquor stores could also be decided by voters in November.
State law dating back to the prohibition era allows grocery and convenience stores to sell only 3.2 percent alcohol-by-volume beer and wine. State law also restricts who can sell full-strength alcohol: Today, a liquor license can be held only by one business and in a single location.
Grocery stores with pharmacies or liquor-licensed drugstores can only have one location in the state where they can sell full-strength beer, wine or spirits. That applies to chain grocery retailers like King Soopers, Safeway, Target and Wal-Mart, as well as locally-owned grocery stores.
Such grocery stores have been trying to change the law for years. Lawmakers have unsuccussfully tried to persuade their colleagues to allow those sales at least four times in the past decade.
And you’ve probably seen the signs in local grocery stores asking you to support an effort to allow them to sell full-strength beer and wine.
The grocery stores, under the Your Choice Colorado campaign, are working on that effort: A petition to allow those sales has been out since April to put the question to the ballot.
In the meantime, lawmakers took one more stab at a compromise: Senate Bill 16-197. The bill, backed by craft brewers, beer and alcohol distributors and even Wal-Mart and 7-11, won where previous efforts had failed. It passed on the last day of the 2016 session.
But the bill is complicated, and even former craft brewer Hickenlooper said shortly after it passed that he didn’t understand it.
Under the bill, sales of full-strength beer, wine and spirits would be allowed at grocery stores, but only under a 20-year roll-out. And the bill has special provisions for the mom-and-pop liquor stores that operate in rural Colorado, like the one owned by Robert Cionek in Haxtun.
Under SB 197, in communities with populations of 10,000 or less, a grocery store would not be allowed to sell full-strength alcohol if it is 3,000 feet or less from a liquor store. The only exception: if the grocery store decides to buy the liquor store’s license. Cionek told this reporter that if the local grocery store wants to buy his liquor license, “I can come up with a nice price.”
The grocery closest to Cionek’s store is 500 feet away.
He doesn’t like the ballot measure idea. “It would give grocery stores unfair advantage that they can sell anything they want, along with beer and liquor. As a small liquor store I can sell oranges, limes and lemons, but I can’t even sell a bag of peanuts or potato chips.”
If signed by the governor, Senate Bill 197 would allow him to sell non-alcohol products so long as they don’t account for more than 20 percent of the store’s annual revenue.
Cionek likes having a grocery store nearby because it drives customers his way. He noted that when the store went out of business two years ago, his business fell off, too. “People shop locally,” he said. When the grocery store was gone, he said, people went to other communities to buy their groceries, and ended up buying their alcohol in those communities, too.
But whether the governor signs the bill or not, backers of the ballot measure aren’t going away. By the end of the session, backers said they had already gathered more than 60,000 signatures. They will need 98,492 total signatures by August to get the measure on the ballot.
Late last week, Hickenlooper met with the proposal’s sponsors as well as the licensed beverage distributors and craft brewers to talk about the bill.
Sen. Pat Steadman of Denver was its sponsor. The bill “is a well thought-out transition to an open system of selling alcoholic beverages,” he told this reporter this week. The state’s current laws have served Colorado well for 80 years, he said, but now there’s a lot of pressure to change.
But if that change is coming, it shouldn’t be done by ballot measure, Steadman said, “where we flip a switch and open up competition against businesses that by law are required to be small. If we’re going to bring that kind of competitive pressure into the marketplace, there should be a more thoughtful way to do it.”
Twenty years may seem like a long time, he added, but it would give the marketplace time to evolve and adapt to new competitive pressures that either allows a business to survive, or to get out, if that’s the decision. The bill would prevent “big box” stores from putting people out of business, Steadman said.
Your Choice Colorado maintains that consumers want the freedom and convenience to buy full-strength alcohol in grocery stores and that opponents, including large liquor stores, are just trying to protect their turf. The campaign has already raised $2.6 million to cover the costs of the petition drive as well as the campaign to persuade voters to support the measure in November.
Matt Chandler, spokesperson for the Your Choice Colorado campaign, said the ballot measure is not intended to hurt small businesses.
“Our intention is to give Coloradans a choice to buy the products they want,” he told this reporter. Chandler noted that 42 other states allow sales of full-strength beer and wine in grocery and liquor stores in both rural and urban areas, “and they seem to coexist peacefully.”
Chandler added that people will continue to frequent the small businesses they’ve known for years. But for the person who wants to make a quick trip to the grocery store to pick up a bottle of wine, under the ballot measure they can do that.
“We fully expect people to continue to patronize local businesses,” Chandler said.
Photo credit: Elvert Barnes, Creative Commons, Flickr
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