Tuesday, March 03, 2009

Toasting a Change in the Law

In this morning's NY Daily News, Bill Hammond comes out strongly for what he sees as a budget no-brainer-wine in grocery stores: "Here's a budget-balancing idea that won't cost average New Yorkers a penny - and goes down really well with a nice, aged cheddar: Start selling wine in grocery stores. There's no good reason that the store where you buy a T-bone steak can't also sell you a Cabernet to go with it."

Well, there is one good reason; but it has nothing to do with sound public policy-an antiquated law and the liquor lobby that backs it: "But thanks to New York's antiquated, Prohibition-era alcohol control laws, grocery stores can sell beer but not wine. And liquor stores can sell wine and the hard stuff - and pretty much nothing else...Overhauling these laws would make life easier for almost everyone, boost the economy and raise a few bucks for our cash-strapped state government in the bargain. The only thing standing in the way is the liquor store lobby, which is predictably opposed to giving up even part of its longstanding monopoly."

And Hammond underscores one of the law changes best features; it would-unlike some of his retail taxes-actually benefit consumers, the folks who back the idea in poll after poll: "This would be a great deal for consumers. Unlike Paterson's other money-raising ideas - such as taxing sugary soda or taxing music downloads or taxing movie tickets - this is one levy that promotes pleasure instead of penalizing it. Wine lovers who like a nice Chianti with their spaghetti would gain the convenience of one-stop shopping. And they'd probably save a few bucks, too, as thousands of additional retailers compete for their business."

Not only that; but there's a great deal of dough in this proposal for the strapped state: "Plus, this is a unique situation in which the affected taxpayers - supermarkets and bodegas - are eagerly volunteering to chip in a couple thousand bucks each for the opportunity to move into a new market." Not to mention what kind of shot in the arm this would be for an upstate economy that is down in the dumps: "With thousands of additional retailers selling wine, it stands to reason that New York's winegrowers - a surprisingly important part of upstate's economy - would benefit, too. New York, which once was the nation's No. 2 wine producing state, has been slipping in recent years. "I really believe if wine goes into grocery stores, I'll have to triple my production," says Scott Osborn of Fox Run Vineyards in upstate Penn Yan."

As Hammond points out, however, the liquor lobby does have one argument against the plan that isn't-on its face-self serving; the specter of an increase in underage drinking. He isn't much impressed by the scare tactic: "For example, they quote the scary-sounding figure that grocery stores account for 90% of illegal sales of alcohol to minors. What they generally fail to point out is that there are more than 16,000 grocery stores in New York, but only 2,700 liquor stores. So proportionally, the rate of underage sales is right in line with what you'd expect. Also, grocery stores already carry beer, which is widely recognized as the drink of choice for young people. Nobody's suggesting changing that."

But what about all of those lost jobs on Main Street claimed by the lobby? "The liquor stores also claim that changing the law would drive 1,000 of their members out of business and eliminate 4,000 jobs. But that figure comes from a five-year-old industry-sponsored study that leaves out any hiring that might occur at grocery stores and vineyards."

There will undoubtedly be some dislocation involved if the 80 year old state monopoly is upended; but that's why supporters of the measure believe that the liquor stores deserve some extra considerations: "In fairness, liquor store owners deserve some consideration for losing part of their traditional monopoly. The right way to balance that out is to let them sell additional products - such as mixers and snack foods - and open more than one store on a single license."

With the state in a financial bind-and with city grocery stores really struggling to survive-a change in the law would be a real boon. We'll give Hammond the last word: "Thirty-five other states already allow wine sales in grocery stores. It's high time that New York joined the party."