After series of scandals, Texas liquor agency pursues reforms


Last summer we covered the series of scandals that rocked the Texas Alcoholic Beverage Commission. Now, fast forward to 2018, and the agency is debuting new leadership and a revamped approach to regulation, according to the Texas Tribune:

Five years ago the Texas Alcoholic Beverage Commission spent more than $10,000 in taxpayer money to send four employees to Honolulu to attend a national liquor conference — complete with open bar, golf tournament and a “luau under the stars.” 

This summer, the National Conference of State Liquor Administrators is again holding its annual meeting in Hawaii — Waikoloa Beach to be exact — but there won’t be an official delegation from the TABC. In fact, the state’s alcohol regulators won’t be sending anyone to any liquor conferences outside Texas anytime soon.

The agency got its out-of-state travel privileges yanked last year by a Legislature angered over spending controversies and regulatory excesses, exposed in a series of investigative reports published by The Texas Tribune. When the smoke cleared, seven top agency honchos were gone and the TABC board had hired a retired Army general, Bentley Nettles, to clean up the mess...

Now, nearly a year later, even some of the TABC’s most vociferous critics say a wholesale change in leadership has produced a reformed agency that no longer triggers fear and loathing at the very mention of its name.

“The transformation that has taken place already under General Nettles’ leadership is hard to overstate,” Texas Craft Brewers Guild Chairman Josh Hare said in a thank-you note to Gov. Greg Abbott. “We have seen nothing other than a hard shift toward a business and consumer-friendly approach to business.”...

Read the whole article here.

Georgia Could Be Latest State to Expand Sunday Sales

Just off the heels of Indiana repealing its Sunday blue law, Georgia could be on the brink of passing a "brunch bill" that would expand on-premise alcohols sales to Sunday morning. According to the AP, the bill would allow restaurants and wineries to serve alcohol starting at 11 a.m.:

A proposal to allow Georgians to purchase alcohol at restaurants and wineries on Sunday mornings is headed to the governor's desk.

House lawmakers voted 97-64 on Monday to allow on-premise consumption to begin at 11 a.m. on Sundays.

If the bill is signed into law, earlier sales would have to be approved in local referendums.

Gov. Nathan Deal's spokeswoman declined to say whether the governor intends to sign the measure.

GOP Rep. Meagan Hanson of Brookhaven says earlier sales would generate an additional $11 million in state and local tax revenue.

Off-premise sales, such as those at supermarkets, would remain illegal until 12:30 p.m. on Sundays...

Read more here.




Opponents Continue to Fight Michigan's Half-Mile Liquor Rule Reform


Last year, Michigan's Liquor Control Commission repealed the state's anti-competitive "half-mile rule," which prohibited liquor stores from operating within a half-mile of each other. Incumbent liquor store responded by trying to get the state legislature to overrule the Commission's decision, although these efforts have so far failed to clear the state House. According to the Detroit News, opponents of the reform are now trying to use the courts to block it:

A long-running battle over Michigan’s prohibition against liquor stores operating within a half-mile of each other is back in court as existing small business owners try to stop the state from eliminating the distance requirement.

Michigan Court of Claims Judge Stephen Borrello in January temporarily blocked plans to rescind the liquor store rule after the Associated Food and Petroleum Dealers sued the state for a second time. Borrello is set to hear arguments in the case on March 19.

Eliminating the rule would cause “irreparable harm” to thousands of liquor store owners who “have invested substantial sums, time and sweat” to obtain state licenses with the expectation a competitor could not open next door, according to the lawsuit.

The complaint seeks to keep the four-decade-old rule in place while the Michigan House considers a Senate-approved bill that would write the 2,640-foot distance requirement into state law.

But the Liquor Control Commission says the rule squashes competition and is seeking to dismiss the case. Attorney General Bill Schuette’s Office argues the state followed proper protocols for rescinding the rule...

Read more here.



Kansas Could Legalize Self-Service Beer Bars

Self-service taps at craft beer bars are becoming all the rage among beer aficionados, but some states still don't even allow them. Kansas is one of these states, but according to the Lawrence Journal-World, this could soon change:

Kansas is one of the few states that prohibit self-service beer taps at bars and clubs, though a bill under consideration in the Legislature could finally allow patrons to be their own bartenders.

Behind the bill is a trio of Topeka entrepreneurs who are aiming to open a new downtown bar, the Brew Bank, that would feature a wall of self-serve beer taps boasting the best offerings from local breweries. The Senate Federal and State Affairs Committee had a hearing on the bill Tuesday but didn't vote on it.

The idea proved popular with city business leaders, who named the Brew Bank the $100,000 winner of the Topeka Top Tank Competition, a contest searching for business ideas to revitalize downtown Topeka.

While self-service wine taps are legal in Kansas, the team discovered that wasn't the case for beer...

Read more here.

Delaware Latest State to Consider Lowering the DUI Threshold


Delaware lawmakers are considering a bill that would lower the state's drunk driving threshold from .08 BAC to .05. This proposal comes on the heels of Utah's recent decision to lower its threshold to .05--a move which triggered a significant backlash and was even opposed by the founder of Mothers Against Drunk Driving. WDEL has the story from Delaware:

House Bill 320, if passed, would change the blood alcohol concentration (BAC) required for driving under the influence arrests from .08 to .05, a legislative measure aimed at reducing drunk driving and the fatalities that they cause.

In Delaware, nearly 60 percent of alcohol-related traffic fatalities involve drivers with BACs of 0.15 and above, while only about 2 percent of traffic deaths involve someone with a BAC between the legislation’s targeted interval of 0.05 and 0.08, according to ABI [American Beverage Institute].

Sarah Longwell, Executive Director of ABI, said the legislation would hurt the hospitality industry because social drinkers will feel that extra drink will lead to a DUI, and then other people won't even be able to have one drink because of their weight.

"The .05 limit is so low that it would essentially mean a 120 lb woman would be in a position of being arrested after a single drink," said Longwell. "It's going to have a tremendous chilling affect on moderate, social drinkers who otherwise would have gone out to happy hour dinner, split a bottle of wine with their spouse. At this point, splitting a bottle of wine with your spouse would put you absolutely in a place where you would get arrested if you drove home." ...

More here.

Why Beer Could Get More Expensive Under Trump’s Tariff


As previously noted, the Trump Administration's recently announced tariffs could have a real effect on the alcohol industry. The Wall Street Journal reports on how the aluminum tariffs could lead to higher beer prices:

"President Donald Trump’s planned 10% tariff on aluminum imports could hit America in its beer gut.

Beverage makers, including Heineken, Molson Coors Brewing Co. and Coca-Cola Co., who use aluminum cans had warned Mr. Trump last month of increases in production costs if the tax were imposed. Some of those costs are likely to be passed on to consumers, according to analysts. The Beer Institute, a trade group, said Thursday the tariff would amount to a $347.7 million tax on brewers and result in the loss of tens of thousands of jobs.

“Businesses don’t assume cost increases, they pass them on to consumers,” said Nico von Stackelberg, a consumer-goods analyst at Liberum.

More than half of the beer produced annually in the U.S. is sold in aluminum containers and is traditionally marketed to cost-conscious consumers. Cans of Natural Ice, known as “Natty Ice,” are staples of cash-strapped college students and Bud Light has become a symbol of working class America, which is a key part of Mr. Trump’s political base.

Cans are cheaper and easier to ship than bottles and they protect against ultraviolet rays, reducing the risk of beer going stale, or skunked.

The tariffs could also hurt craft beer. Part of the reason artisanal brew is increasingly sold in cans, producers say, is that aluminum offers a good surface for colorful, effective branding..."

Read the rest here.

R Street's Trade Policy Counsel Clark Packard signed a letter along with other leading trade policy experts speaking out against the tariffs

West Virginia Considers Allowing Sunday Sales for Distilled Spirits


The West Virginia legislature is considering a bill that would, among other reforms, allow Sunday sales of distilled spirits in the Mountain State. The Herald Mail Media reports that the bill would allow statewide hard spirit sales on Sundays after 10 a.m. as well as Sunday sales at distilleries:

Counties and home-rule municipalities currently can decide whether to allow restaurants and other licensed establishments to begin Sunday alcohol sales, but an alcohol administration official said the lack of uniformity across the state has created a "logistical nightmare."

Thirteen counties, including Berkeley, Jefferson and Morgan counties, and 18 home-rule municipalities, including Martinsburg, Charles Town, Ranson and Shepherdstown, allow Sunday sales.

Among other changes, the bill proposes allowing Sunday retail sales of liquor at a distillery or mini-distillery on Sundays at 10 a.m., a change area distillery owners wanted.

It appears that beer wholesalers and The Family Policy Council of West Virginia are both opposing this reform by ginning up scary hypothetical headlines such as: "Drunk Driver Kills a Bunch of Kids Coming Out of Church After Sunday School." Given that Sunday sales of beer and wine are already permissible in West Virginia, this line of argument is less than persuasive. In an age when a glass of a high-ABV craft beer can contain as much or more alcohol as a shot of liquor, it is irrational to draw arbitrary distinctions between different kinds of alcoholic beverages.

The reality is that 40 states currently allow Sunday sales of hard spirits and more are following suit. Minnesota repealed its Sunday sales ban last year, and Indiana overturned its version of a blue law just this week. The trend here is toward more freedom, and West Virginians are right to not want to be left behind. 




Kentucky Close to Allowing More On-Premise Sales for Breweries


It's no secret that bourbon is king in Kentucky, so perhaps it's also not a surprise that beer often gets second billing in the Bluegrass State. But there's signs that state lawmakers may be starting to level the playing field for brewers. According to, legislators are close to passing a bill that would allow Kentucky breweries to sell more beer from their taprooms (although the bill still maintains a cap on such on-premise sales):

"A bill raising the cap on how much packaged beer can be bought from Kentucky microbreweries is nearing final passage from the state legislature.

The measure would allow customers to take home up to 31 gallons of beer — the equivalent of two kegs — from microbreweries. Currently the limit is two dozen 12-ounce beers, or a little over two gallons.

Adam Watson, co-owner of Against the Grain Brewery in Louisville, said the measure would help boost sales out of their breweries and beyond...

Since Prohibition, Kentucky’s (and most other states’) laws require alcohol brewers, distributors and retailers to be independent entities to prevent monopolies — the so-called 'three-tiered system'

The original version of the bill would have totally eliminated the cap for how much packaged beer microbreweries can sell on site — but was scaled back after pushback from distributors and retailers, who said brewers shouldn’t be allowed to “skip” the other tiers..."

Read the rest here.



The Drinks Are Freed: Indiana Finally Allows Sunday Sales


We've noted in the past that Indiana has one of the most stringent Sunday blue laws on the books--it forbid all sales of carryout alcohol on Sundays. But now, after years of wrangling, state lawmakers have finally voted to allow Sunday booze sales and Indiana Gov. Eric Holcomb has signed the measure. Drinks writer Chuck Cowdery recaps:

"This Sunday, for the first time ever, Indiana's liquor stores will be open for business. Indiana becomes the 41st state to allow Sunday liquor sales, according to the Distilled Spirits Council.

You might expect liquor store owners to celebrate the change, but they won't. Such is the peculiarity of politics in the highly-regulated world of alcohol.

Consumers, of course, almost universally favor Sunday sales. Those with religious objections are mainly the ones who don't. Also unhappy about the change are liquor retailers in Illinois, Michigan, Ohio, and Kentucky who enjoyed a little extra business on Sundays from thirsty Hoosiers..."

Read Chuck's full post here.

As Chuck notes, Indiana lawmakers weren't able to clear away all of the state's antiquated booze laws. The Hoosier State's infamous "warm beer law" still remains in place.




Alabama Lawmakers Consider Reforming State Liquor Mark-ups


In recent years, the Alabama Alcoholic Beverage Control Board has become notorious for trying to sneak through increased mark-ups on booze in the state. As R Street's Cameron Smith exposed last year, Alabama ABC attempted to institute a 5% increase in booze mark-ups to provide more funding for state district attorneys. Using liquor mark-ups in this way essentially turns the mark-ups into a stealth tax on state residents, and R Street has called out this behavior by state liquor regulators in the past (our policy report on the issue can be found here).

Luckily, some lawmakers in Alabama are now trying to fix this system of unaccountable taxation by introducing a bill that would require any increase in the state liquor mark-up to be approved by the state legislature. Cameron Smith recently wrote another column for about this much-needed attempt to inject accountability into the process:

"If Alabama's legislators want to raise taxes, they should cast a vote to do so. They shouldn't be able to cut a deal between public employees and the state's liquor bureaucracy to avoid accountability at the ballot box. Sadly, that's exactly what happened in 2017, and State Sen. Bill Holtzclaw's SB120 aims to stop it...

SB120 simply prevents future ABC markups without a bill enacted by the Alabama Legislature. It's not a complicated bill, but it absolutely restores accountability for revenue policy decisions to the people Alabamians actually elect.

Alabama is in the minority of states retaining a 'control' model for liquor. Apparently the state's 'conservative' legislature would rather preserve a prohibition-era bureaucracy than fund the DAs properly, meet other spending needs or simply let Alabamians keep a little more of their hard-earned money.

But this is an election year. Hope for any real changes to Alabama's liquor control system is little more than wishful thinking. Maybe the Alabama Legislature will at least take responsibility for the taxes we pay on alcohol..."

Read the whole column here.