House says no full-strength beer in grocery stores

House says no full-strength beer in grocery stores

A bill that would have allowed Walmart and other big-box grocery stores to carry full-strength beer died in the House Monday. On the House floor legislators said the doubling of stores selling beer would compromise the promise liquor store owners were given by the state when they decided to invest in the industry.

“What we have is a system that has grown up over decades and decades based on regulatory environments,” Rep. Claire Levy, D-Boulder, said, arguing against the bill. “Families have made investments of their life savings in these liquor stores based on the promise that in Colorado Statutes they can have the one liquor store, and the store next door that is owned by a big corporation based out of state, will not be selling the same product.”

Calling liquor stores’ exclusive ability to sell full-strength beer a monopoly that went against free market principles, co-sponsor Rep. Larry Liston, R-Colorado Springs, used pictures and diagrams to argue his point that neither liquor stores nor the craft brew industry would collapse if the blue laws in Colorado were changed to allow grocery store and convenience store owners to carry full strength beer.

Liston argued that mom-and-pop convenience and grocery stores were suffering under the weight of Sunday beer sale losses that have come in the wake of law changes that allowed liquor stores to open on Sundays. But he said that grocery stores would stock craft beers and liquor stores could continue to have exclusive right to sell high-strength beer over 11 percent and liquor that would keep clientele coming to their stores.

The craft brew industry has said that its prosperity has grown out of the unique market created by Colorado’s regulatory structure. They argue that it allows every small brewery to approach individual store owners about placing their beer on the shelves–a dynamic they say would change if big-box stores take over the market place.

While the bill had bipartisan sponsorship, with freshman Democrat Crisanta Duran, D-Denver, co-sponsoring the bill with Liston, it also had considerable bipartisan opposition. Only about a third of the House stood with Liston on the bill as it failed– with many staunch free-market Republicans standing against it.

Rep. Chris Holbert, R-Parker, said the bill would use the power of government to establish new winners and losers and challenged Liston’s definition of monopoly.

“I would ask that we be careful to use the heavy hand of government to reorganize a marketplace that I think is doing very well. One which in my opinion, in no way represents a monopoly but an equal opportunity for anyone to obtain one license.”

Brian DelGrosso, R-Loveland, said Walmart would hold a massive advantage over liquor stores if it was allowed to sell full strength beer.

“I submit to you that this is nothing more than a redistribution of wealth going from those liquor stores to the big box stores,” DelGrosso said.

“Many people have said that we can’t change the rules as they currently stand–that there have been liquor stores that have opened based on past Colorado law. That is what we do day in and day out. No law is set in stone,” Duran said.

Liston amended his bill to allow liquor stores to hold more than one license and to carry non-perishable foods, however, the liquor store industry said they would still be unfairly disadvantaged against grocery stores where people would begin purchasing the majority of their beer.

The legislation is not new to the Legislature, with this year being the 4th attempt by grocery and convenience store owners to pass the bill.

This was the first year the bill reached the floor. Liston said, that fact showed that public sentiment over the bill was changing.

However, Jeanne McEvoy, president of the Colorado Licensed Beverage Association, said the 4 years of uncertainty is hurting industry growth as owners have become fearful of losing a significant portion of its daily sales to a sudden influx of retailers.

“Independent retailers and craft brewers represent a strong sector of our economy,” she said “But these businesses have had a damaging cloud over their business for four years because of this yearly effort. These bills will kill jobs, send money out of Colorado and allow minors to sell alcohol at convenience stores. It’s lose-lose proposition for Colorado, and we ask legislators to support local businesses by saying ‘no’”.

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