It’s been just over a year since Proposition 125, which allows Colorado grocery stores to sell wine, went into effect. The impacts of the voter-approved measure have locally-owned liquor stores in Colorado’s mountain towns begging legislators for a lifeline.
Storeson the Western Slope have reported taking substantial financial hits now that the market has shifted.
“We’re literally fighting for our lives right now,” Central Park Liquors part-owner Greg Neely said.
Neely’s store in Steamboat Springs is next to a City Market grocery store. Following the passing of Proposition 125, his store took such a financial hit that it had to lay off 11 employees in the last year, cutting staff from 33 to 22, he said.
Just over a year after grocery stores introduced wine into their aisles, legislators heard enough from store owners to convince them that a remedy is worthwhile. Legislators introduced House Bill 1373 on March 12.
Sen. Dylan Roberts, a prime sponsor of the bill, said the legislation aims to even out the playing field and ensure that liquor stores have a viable future while still honoring the voters’ decision to allow wine in grocery stores.
This bill proposes creating a cap on the strength of beverages that can be sold at grocery stores, placing rules on the prices alcohol wholesalers can charge and regulating where alcohol can be displayed in stores. It also aims to eliminate a license that allows drugstores to sell spirits.
Roberts — a Frisco resident and representative for Clear Creek, Eagle, Garfield, Gilpin, Grand, Jackson, Moffat, Rio Blanco, Routt and Summit counties — said sentiments from his constituents, a handful of which are his Frisco neighbors, have made it clear something needs to be done soon. He said the impacts of Proposition 125 on Colorado’s mountain towns are particularly evident.
“In our small mountain and rural communities, we have small businesses, we have small independent liquor stores, we don’t have a lot of large chain retailers,” Roberts said.
“If we lose independent liquor stores, we lose the ability for other businesses to get good traction and expand their business,” he added. “It has an extreme trickle-down effect.”
Sen. Perry Will — who represents Delta, Eagle, Garfield, Gunnison, Hinsdale, Montrose and Pitkin counties, is another prime sponsor for the bill working alongside Front Range legislators Rep. Naquetta Ricks and Rep. Judy Amabile. House Speaker Julie McCluskie is also sponsoring the bill, but she is not a prime sponsor.
Roberts said a driving force behind the bill is to ensure liquor stores “retain the ability to sell spirits, and so that we won’t see a situation where grocery stores continue to expand their alcohol selections to include hard liquor.”
From struggles to support
Liquor stores sounded the alarm when Proposition 125 was first introduced and warned of the negative impact they expected to encounter if it passed. Now the stores say their trepidations have come true, so they are going to their representatives looking for help.
Liquors store employees in Frisco are pushing the town to support House Bill 1373, and the topic has also come up in Breckenridge Town Council.
The Summit County Chamber of Commerce said it was propelled to testify in favor of the bill at the capitol due to the feedback the organization has heard from local businesses.
“When Proposition 125 passed, that just crushed our independent liquor stores,” Summit County Chamber of Commerce executive director Cheri Ryan said. “A lot of them are seeing revenue drop from 30% to 40%.”
Documents obtained by the Summit Daily show that for Locals Liquors in Silverthorne, wine sales dropped by $222,184 year over year since the implementation of Proposition 125.
Local Liquors owner Chris Carran said that stores in Summit County hit a rough patch this holiday season causing sales at independent liquor stores to go “way down.”
“What we found out was — especially during Thanksgiving — that people were just picking up their wine when they were picking up the turkey,” Carran said.
Stores across the Western Slope have taken similar hits. Documents obtained by the Summit Daily show Copper Wine & Spirits in Glenwood Springs saw a decline of $137,396 year over year in wine sales alone.
Carran and Brady said mitigation measures such as those proposed in House Bill 1373 are needed to keep liquor stores in mountain towns alive.
Opposition to the bill
The Colorado Retail Council is among the loudest voices speaking against House Bill 1373.
The council is a not-for-profit organization that was founded by a group of retailers that wanted to be more involved in law-making that concerned their industry. According to the U.S. Chamber of Commerce, a not-for-profit organization differs from a nonprofit in that it is considered a recreational organization that does not operate with the goal of earning revenue.
Representative of the Colorado Retail Council Chris Howes said that the organization’s purpose is to serve as the voice of Colorado’s retailers at the state capitol. He said the organization lobbies on behalf of big box stores, convenience stores and brochures that are a part of nationwide chains. Kroger, owner of City Market, is a member of the Colorado Retail Council.
“We’re wholly opposed to the legislation,” Howes said. “We think it’s drastic and upends a decade and a half of modernizing alcohol licensing bills in Colorado.”
Howes explained the Colorado Retail Council has been backing initiatives such as bringing full strength craft beer and wine to Colorado grocery stores.
“The voters of Colorado agreed with us,” Howes said.
Fine details of the bill
A pillar of the bill would cap the strength of alcoholic beverages that grocery stores can sell, which would be 14% alcohol by volume, if passed. Roberts said legislators landed on that percentage after consulting with the beverage industry. Sponsors of the bill are particularly keen on the cap, Robert said.
“Everybody goes to a grocery store, of all ages, and having hard liquor in grocery stores presents a public safety risk — given the different environment that a grocery store is compared to a liquor store,” Roberts said.
The bill also aims to hold beverage wholesalers accountable, something liquor store owners, such as Carran, have been calling for throughout the past year.
“There’s allegations that wholesalers are offering better discounts and deals to liquor-licensed drugstores to grocery stores than they are to small liquor stores or restaurants,” Roberts said, explaining the provisions role in the bill.
The bill proposes giving the state’s licensing authority more teeth to enforce antidiscrimination practices.
House Bill 1373 also seeks to eliminate the liquor-licensed drugstore license. Roberts explained that this type of license was created to allow retailers that operate as a drugstore to get a license to sell alcohol. If passed, the bill would convert that license to a fermented malt beverage and wine retailer license which wouldn’t allow sales of hard liquor.
Additionally legislators are aiming to put some guardrails on the ways in which grocery stores can advertise alcoholic beverages. The bill is proposing a requirement that would force grocery stores to only display alcoholic beverages in a single location of its sales floor.
Legislators backing the bill are shooting to get the new regulations and restrictions it would bring into effect as soon as Jan. 1, 2025.
On April 11, the bill passed through the House Finance Committee with a 7-4 vote. It passed through the House Business Affairs and Labor Committee on April 4, after seven amendments, ending in a 6-5 vote.
