Rival groups of liquor retailers kick up dust in legislative fight over spirit licenses

In this photo taken Wednesday, April 6, 2016, Brett Jones, a sales representative with High Country Beverage, stocks 3.2-percent alcohol content beer at a Safeway store in Fort Collins, Colo. Colorado's unusual requirement that most grocery stores sell only low-alcohol beer could be ending as a bill wends its way through the state legislature, which closes its 2016 session on Wednesday, May 11, 2016. (Valerie Mosley/The Coloradoan via AP)

In this photo taken Wednesday, April 6, 2016, Brett Jones, a sales representative with High Country Beverage, stocks 3.2-percent alcohol content beer at a Safeway store in Fort Collins. The Legislature revamped Colorado’s liquor licensing laws in 2016 and is revisiting the topic in the 2017 session. (Valerie Mosley/The Coloradoan via AP)

The battle over Colorado’s liquor store landscape intensified Monday in the wake of a Senate vote that killed a bill to let Wal-Mart sell full-strength liquor in as many as 20 locations over the next two decades, among other tweaks to 2016 legislation that overhauled the state’s liquor licensing laws.

And amid renewed threats of a potentially expensive ballot fight over liquor sales at grocery stores, two organizations representing different groups of independent liquor retailers squared off and hurled charges, each claiming to be standing up for the little guy.

“How dare they put small liquor stores at the risk of another ballot issue?” asked Jeanne McEvoy of the Colorado Licensed Beverage Association, after the Senate voted 18-17 to sink Senate Bill 143.

Her group — in coalition with numerous allies, including grocery chains, big box retailers, breweries and trade groups representing convenience stores and other retailers — supported the legislation, sponsored by state Sen. Angela Williams, D-Denver, and blamed Support Your Local Liquor Store, a rival organization formed in January by lobbyist Jason Hopfer to represent another group of independent liquor stores, for derailing it.

Hopfer dismissed the prospects of a potential ballot fight as a “hollow threat” and said McEvoy’s group was merely feeling sour grapes over its unexpected loss in the Senate.

CLBA threw down a gauntlet late Sunday when McEvoy and Scott Chase of Coloradans for SAFETY, an allied coalition of independent liquor stores owners, delivered a memo to lawmakers blasting Hopfer and his group.

“Who are you going to listen to? The CLBA and Coloradans for SAFETY that, collectively, has been the voice of your local liquor stores for more than 63 years? Or a newly formed LLC, less than two months old, formed by a lobbyist?” the memo from McEvoy and Chase asked. (Attached to the memo was a document filed with the Colorado Secretary of State creating Support Your Local Liquor Store, a limited liability company, dated Jan. 19.)

McEvoy and Chase urged lawmakers to support Senate Bill 143, described as a simple fix to correct “mistakes and oversights” in landmark legislation passed last year to allow grocery stores and other retailers, along with liquor stores, to gradually expand the number of liquor licenses they hold in Colorado over the next 20 years. (State law had previously restricted liquor retailers to a single license statewide.)

The passage of last year’s bill, Senate Bill 197, headed off as many as five proposed ballot measures to allow some combination of beer, wine and liquor sales in grocery and other stores, which the owners of smaller liquor stores worried would have led to the demise of mom-and-pop stores, particularly in rural Colorado.

“Unfortunately,” McEvoy and Chase wrote, “in January a few individuals who have a narrow legislative agenda formed a ‘front group’ called ‘Support Your Local Liquor Store’ to confuse legislators on the true intent of SB17-143 and blow up this historic deal in order to try and pass alternative legislation.”

Hopfer rejected that characterization in an interview with The Colorado Statesman on Monday after Williams’s bill went down in defeat.

“They don’t like the message, so they’ve attacked the messenger,” he said. “The fact is, if those liquor stores felt they were being adequately represented, they wouldn’t have come to us.”

He said his firm, JLH Consulting and Public Affairs, was approached last year by “multiple liquor stores,” including Applejack Wine and Spirits in Wheat Ridge, PJ’s Wine & Spirits in Longmont and Molly’s Spirits in Lakeside. “Their concern is being on a level playing field to compete with Safeway, King Soopers and Target,” Hopfer said. “They don’t see that level playing field today with the limitations on licenses they can get as truly independent stores.”

Hopfer’s group is supporting Senate Bill 199, sponsored by state Sen. Tim Neville, R-Littleton, which would grant locally owned liquor stores the ability to amass as many licenses as liquor-licensed drugstores — the classification that major grocery chains fall in — as opposed to a smaller number of licenses they can acquire under current law reflecting last year’s compromise legislation.

“We’re supporting Sen. Neville’s bill to bring parity to the number of licenses that liquor stores can have with Safeway and King Soopers,” Hopfer said. “Our members are concerned with their ability to compete when they can only get four license over 20 years when Kings Soopers or Safeway will have 20, potentially.”

Sounding like she was barely able to contain her anger, McEvoy vowed to sink any legislation Hopfer was supporting. She charged his group wasn’t interested in looking out for corner liquor stores but instead was angling to usher in an era of liquor megastores that would make competition from Wal-Marts pale in comparison.

“I will walk through fire and ice to do everything I can for the little stores,” she told The Statesman. “Twenty Applejacks? Are you kidding?”

McEvoy said she was certain that Hopfer’s group was merely a cloak to allow maybe a handful of liquor retailers with access to enormous capital to rig the system, contrary to the compromises worked out last year in Senate Bill 197.

“They decided that four stores wasn’t enough — they want 20,” she said. “The small little mom-and-pops, the wonderful independent system, you can kiss that goodbye.”

Noting that she owned a liquor store in Loveland for a decade before her current role with the Colorado Licensed Beverage Association, McEvoy added, “I know what it’s like to open that door every morning in a liquor store, and I know exactly what it takes to compete with the big boys.”

She said out-of-state giants were licking their chops at the prospect of soon being able to swoop in and scoop up as many as 20 giant liquor store locations in Colorado. “Guess what, they’re going to do it in a heartbeat,” she said.

She also lamented that Senate Bill 143 had died on such a close vote, blaming Hopfer’s group for sowing confusion among lawmakers.

“We negotiated this compromise so people would pull down their ballot measures,” she said, referring to last year’s Senate Bill 197. All that Williams’s bill this year was trying to do, McEvoy maintained, was clean up some language that had unintended consequences.

“If Walmart made a mistake,” she added, “we should have been able to fix it. The spirit of (Senate Bill) 197 is what’s important. It’s the legislative intent, it’s the spirit of what we were trying to accomplish.”

Monday’s developments might restrict Wal-Mart’s ability to sell full-strength liquor — although Williams signaled she might try another route to accomplish the same results — but more than that, McEvoy said, it injects uncertainty into a business environment after various sides had gone to great lengths to hammer out a solution they all felt they could live with.

“The bigger picture is much more important,” she said. “We don’t have the resources or time to go through another onslaught. Our members are now going to live in fear that there might be another ballot issue — maybe not from Walmart but someone else.”

“Maybe they don’t plan on going to the ballot, but I will tell you, Wal-Mart will move heaven and earth to get every possible opportunity to get back in the system they shouldn’t have been kicked out of,” McEvoy said. (While a Wal-Mart spokesman didn’t reply to an inquiry from The Statesman, an executive with the retail giant told The Denver Business Journal on Monday that the company “would be forced to look at all of our options” if last year’s compromise doesn’t materialize as had been envisioned.)

“I think that’s a very hollow threat,” Hopfer said, suggesting that Wal-Mart got what it bargained for last year and has likely lost any potential allies who might join the company supporting a ballot measure.

“They decided not to do it last time to get (full-strength) beer, which they now have,” he added, noting that other grocery chains got more than they had initially sought — the ability to sell full-strength beer, wine and liquor, as opposed to just beer and wine — in last year’s deal.

“I don’t know who’s out there besides Target and Wal-Mart to run a different ballot measure,” he said, adding, “They didn’t pull the trigger last year when they had the potential for support from other interested parties for a broader (measure) that was probably more popular.”

ernest@coloradostatesman.com

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