BY DION LEFLER, THE WICHITA EAGLE 02/07/2015 3:08 PM 02/07/2015 3:19 PM
http://www.kansas.com/news/politics-government/article9521867.html
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After years of political stalemate and trench warfare in Topeka, a pivotal next two weeks at the Kansas Legislature could lead to a breakthrough in the battle of the booze.
At issue: Will chain grocery stores be allowed to sell full-strength beer, wine and spirits, and convenience stores allowed to sell stronger brews? Or will the state continue to restrict sales of full-strength alcoholic beverages to independent stand-alone liquor stores?
The state’s largest grocery chains and convenience stores have spent the past five years trying to get a bill passed that would let them sell stronger stuff than the 3.2 percent beer and wine coolers that are all they can currently stock.
So far, they’ve been held off by a determined resistance movement of liquor store owners, who say they’ve poured their lives into their businesses. They fear that allowing out-of-state big-box retailers to sell booze would mean extinction for locally owned mom-and-pop liquor shops.
House Speaker Ray Merrick intervened last week, summoning lobbyists from both sides and telling them to try to work toward a compromise.
Different sides had different takeaways from the House speaker’s meeting.
Uncork Kansas, the coalition of grocers and convenience store owners, interpreted it as Merrick endorsing their effort and trying to get a bill through the House.
Keeping Kansans in Business, the coalition of liquor store owners, said their impression was that Merrick just wants to bring it to a floor vote to settle the question one way or the other.
Rep. Mark Hutton, R-Wichita and chairman of the committee that will hear the bill, said he hasn’t been pressured by the speaker to get the bill through his committee, nor is he pressuring his committee members to approve it.
“He (Merrick) encouraged both sides to have discussions and see if they could come closer to agreement,” Hutton said. “He didn’t ask me to get it out of committee and I’m not talking to members” about how to vote.
Hutton’s Commerce, Labor and Economic Development Committee is slated next week to hold three days of hearings on Uncork Kansas’ bill,House Bill 2200. Proponents will testify Wednesday, opponents Thursday, and neutral parties, such as police and state agencies, Friday.
Committee debate, possible amendments and a vote on the bill will likely come the following week, Hutton said.
The hearings were originally scheduled to begin Monday but were postponed to allow members time to attend the funeral for Annette Hedke, the wife of Rep. Dennis Hedke, R-Wichita. She was killed in an auto accident Thursday.
House Bill 2200 would cap the number of liquor licenses in the state at about 760. Grocery stores that wanted to put high-octane beverages on their shelves would have to buy out an existing liquor store to get the license.
The theory is that would escalate the value of the license high enough to allow the independent liquor store owners to sell theirs to a Dillons or Wal-Mart and make enough money to recoup the investment in their business.
“If anything is moving this bill, it is the support of Kansans who are growing increasingly impatient with the lack of action by the Legislature and liquor store lobbyists reluctant to negotiate reasonable outcomes,” said Uncork Kansas spokeswoman Jessica Lucas.
The liquor store owners argue that major store chains would be able to use their market dominance in groceries to leverage small-time liquor store owners to sell out at cut rates.
“We have never seen an offer,” said David Dvorak, owner of Flint Hills Wine and Spirits in Andover, whose store sits across the street from a Dillons market. “Is it $2,000, is it $10,000? My inventory is $150,000 and I’ve got blue sky (business value beyond the value of hard assets) attached to that as well.”
Dvorak plans to testify at the hearing and scoffed at Uncork Kansas’ argument that its bill upholds free market principles. He said he thinks it is carefully written to let big grocery stores sell alcohol but cut out middle-sized retailers.
“They’re trying to eliminate Walgreens, they’re trying to eliminate CVS, they’re trying to eliminate Dollar General … whoever’s not a grocer is who they’re going to try and eliminate in any bill,” he said. “Well, wait a minute, guys, what’s this free market you’re talking about? If you want to open it up, open it up.”
Despite Merrick’s directive to compromise, the odds seem slim. The liquor store owners don’t want to and the grocery stores think they already have.
“Uncork Kansas has always been willing and ready to compromise,” Lucas said. “The liquor lobbyists never came to the table. So what happened this week is that the speaker said grocery stores have come up with solutions, and you guys haven’t, and I want to see solutions, not excuses.”
Liquor store owners see their opposition as a matter of survival and a last stand for their small businesses.
“We know for a fact that some local liquor stores will go out of business” if the bill passes, said Spencer Duncan of Keep Kansas Jobs. “We also know no Hy-Vee or Wal-Mart or Dillons is going out of business if it doesn’t pass.”
A version of the Uncork bill made it through a Senate committee about four years ago. But it never got to the floor because Senate leaders wouldn’t schedule a vote unless the bill’s backers could line up commitments from a majority of senators.
If it gets through the House committee this time, Merrick will almost certainly put it up for a floor vote. If it passes, then it goes to the Senate. If it doesn’t, it will probably be back next year.
“Kansans want the opportunity to be able to buy their beer, wine and spirits in grocery stores,” Lucas said. “Until legislation is passed that affords them that opportunity, this issue doesn’t go away.”
Reach Dion Lefler at 316-268-6527 or dlefler@wichitaeagle.com.
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