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Fighting For The Right To Sell Strong Beer, Wine and Spirits

Bob Mical

Last week, the Kansas House Committee on Commerce, Labor and Economic Development heard testimonies concerning House Bill 2200, known as the "Uncork Kansas" bill. It would allow stronger beer to be sold at convenience stores and stronger beer, wine and spirits to be sold at grocery stores. It would also allow liquor stores to sell snacks, cocktail mixes and cigarettes. KMUW’s Sean Sandefur takes a look at the issue…

Customers are scarce at Flint Hills Wine and Spirits in Andover. It is a Tuesday afternoon, after all.

Owner David Dvorak walks down row after row of liquor bottles, each with a different shape, size and color.

“This row is rum," Dvorak points out. "What store have you been in where you get a whole row of rum?”

Dvorak is passionate about his business, which he’s owned for 16 years. During that time, he’s fought off efforts to allow what he calls “his product” to be sold in anything other than a liquor store. He testified before a committee last week, urging lawmakers to keep liquor laws the way they are. Currently, there are limits to the strength of alcoholic beverages sold at convenience stores and grocery stores.

“I'm getting better at (testifying)," he says. "But, then again, the other side is getting much more eloquent. The other side talks a good talk. Convenience and free market.”

The other side is Uncork Kansas, an organization started by members of grocery and convenience stores of all sizes. It includes Kroger-owned Dillon’s, Hy-Vee, QuikTrip and the Retail Grocers Association.

Dvorak says that if House Bill 2200 becomes law, it would take money out of the hands of small business owners like him.

“Why do you have out-of-state corporations coming in wanting to change the laws to cater to them?" he asks. "The people in Uncork Kansas don't vote for our representatives; these people don't live in a district of a representative."

"They're out-of-towners...out-of-staters.”

Credit Sean Sandefur
Owner David Dvorak looks down at his bourbon inventory at Flint Hills Wine and Spirits. He's owned the store for 16 years, and says he's had to fight since day one to keep "his product" from being sold in grocery and convenience stores

Forget about wine and spirits, Dvorak believes this bill is all about beer. If gas stations and grocery stores are allowed to sell domestic and craft beer above the current 3.2 ABV threshold, many liquor stores won't survive, he says.

“You have to realize that 60 percent of a store's money probably comes from domestic beer," he says. "Once they let strong beer go to anyone, a store is devalued.”

Dvorak likes to think his store would survive. He says he's got a good location and has fared well over the years, despite growing competition from other liquor stores. But, he fears what added competition will do to his profits.

There is one thing Dvorak says he can agree on.

“Convenience--it's going to make it easier, so the mom doesn't have to take her kids out of the car a second time," he says. "And the dad can go ahead and pick up his 30-pack with a steak.

"I understand that. I can't refute that.”

That’s the main argument Uncork Kansas stands behind. 

'Where's the real beer?'

Jessica Lucas is a spokesperson for Uncork Kansas.

“Our coalition is comprised of grocery and convenience stores, all of whom react every day to their customers asking for beer, wine, and spirits," Lucas says. "In particular, where's the real beer? And where can I get wine?”

Credit Sean Sandefur
Jessica Lucas works for Uncork Kansas, an organization fighting for the right of grocery and convenience stores to expand their alcohol selections. She says 2015 is the year it gets done

Alcohol regulation and the state of Kansas go way back, from Carrie Nation busting up saloons at the turn of 20th Century, to commercial airplanes being barred from serving alcohol while flying overhead. There are still over a dozen dry counties throughout the state.

Lucas says reworking current liquor laws will finally allow Kansans to enjoy the convenience its neighbors already enjoy. She says there are people living in border towns that will go across to Missouri in order to do their shopping all at one store.

“We are losing tremendous tax revenue because consumers are choosing to cross the border to purchase their products," Lucas says. "It's a huge problem in the northeast portion of the state.”

She adds that if HB 2200 passes, convenience would lead to more purchasing and Kansas would stop losing business to neighboring states. A 2011 study from the University of Kansas supports that argument, which estimates $70 million in increased state and local tax revenue.

Lucas also says the fear that may liquor stores would close down, is unfounded. She points to similar liquor law changes in South Dakota.

Credit http://www.ksrevenue.org


“(When) they passed this legislation, grocery stores were able to enter the market and liquor stores are still thriving right alongside grocery stores," she says. "Just as we see in Missouri, just as we see in Nebraska and many other states.”

To put some of the control back into the hands of liquor stores, the bill would permanently cap the number of liquor licenses. Meaning if a grocery store wanted to start selling wine and spirits, they’d have to wait for a liquor store to close, or buy one out. They wouldn’t have to wait to sell strong beer, however. Stores that currently sell 3.2 ABV beer would only need to modify their current license.

But, Lucas says the cap is still a safeguard for current liquor store owners, and that licenses could fetch upwards of $100,000.

“That gives value to their business in perpetuity," she says. "At whatever point they want to exit the marketplace, they can then sell their license, which is significant because it provides value and essentially insures a buyer for that license when they're ready to (sell).”

Lucas believes that after fighting for these changes for five years, a win is finally in sight. She was unable to give a dollar figure for how much the Uncork Kansas coalition has spent over the years. Dick Stoffer, a founding member of Uncork Kansas and a lobbyist for the Des Moines-based Hy-Vee grocery store chain, was able to give an approximation.

“If I had to guess, I’d say about $500,000," he says.

Year after year, Stoffer says he's heard the concern that corporate chains are bad for local business. But, despite Hy-Vee being an outside company, he says they bring a lot to local economies.

“An investment in one of our stores is about $20 million," he says. "We reinvest our profits back into our plant, equipment, and people. We hire about 600 people per store.”

Stoffer says that there are numerous locally owned grocery and convenience stores throughout Kansas who are struggling, and that being able to sell strong beer, wine and spirits will allow them to stay in business.

The Committee on Commerce, Labor and Economic Development will continue its review of the Uncork Kansas bill next week. It would then need approval in the House and Senate before being placed on the desk of Gov. Sam Brownback.

To contact KMUW News or to send in a news tip, reach us atnews@kmuw.org.  

Follow Sean Sandefur on Twitter, @SeanSandefur