Yet another attempt to modernize Colorado’s liquor laws is stumbling in the legislature. The latest version is suddenly weighed down with new layers of complexity and arbitrary requirements.
The bill, as originally written, would have allowed grocery stores to stock their shelves with liquor, wine and beer but only after buying the neighborhood liquor store’s license. Now, it’s been amended to say the grocery store has to buy out two liquor stores. Why not three? Or four?
Rep. Kevin Priola’s well-intentioned amendment is meant to help ease the transition for mom-and-pop liquor stores by doubling the number of those who would benefit from the rule change. But the change just highlights our misgivings that current laws already treat liquor-store owners and grocers unfairly in ways that wouldn’t be addressed in the bill.
Though we were supportive of the initial legislation, House Bill 1279, we think lawmakers ought to put the newest version aside for now.
We have long argued that entrepreneurs who wish to sell liquor, wine and beer be allowed to do so in a free-market system. Consumers would benefit from the competition and better prices as well as the end to the ridiculous requirement that grocers sell only 3.2 percent beer.
But there’s even more to the current uneven playing field that needs to be remedied if we want a true market. First, liquor-store owners aren’t allowed to operate more than one outlet. Yet if this bill passes, Safeway, for example, could sell liquor in many locations. Arcane rules also prevent liquor stores from negotiating deals with wholesalers. And the stores aren’t allowed to sell food.
Since the repeal of Prohibition, Colorado’s laws have allowed the mom- and-pops to thrive, but many of the smaller stores would close if supermarkets begin to offer the same products. So the theory behind HB 1279 was that the stores most likely to be hurt by liquor sales at grocery stores — those bottle shops that operated within 1,000 feet of the grocer — would sell their license to the grocer, and the grocer would pay top dollar for it.
Now a grocer would have to buy two licenses. The result could create a new environment where grocers controlled much of the market share and mom-and-pops would be at a competitive disadvantage with only one location apiece.
The entire system needs to be reformed. One of the overarching problems is that past efforts have been piecemeal and attempted to serve one special interest over all others.
That’s one reason we’re intrigued by the idea of creating a task force of experts who would conduct a thorough review of Colorado’s laws and suggest a range of comprehensive reforms that lawmakers could debate.
Such a task force would face enormous political pressure, so its makeup would have to be balanced between competing interests to ensure that reforms create a level playing field.
Perhaps it is naïve to expect the special interests to ever agree to such a review.
But until some credible approach to reform is crafted, this perpetual fight will either ensure the status quo continues or translate into a one-sided victory that makes even more mockery of free-market fairness.
