Massachusetts package stores are trying to fend off a growing number of bills aimed at increasing the number of licenses, boosting direct-to-consumer sales, expanding discount programs, and allowing retailers to be open on Thanksgiving. “I am now fighting off 184 bills, and another one got added today,” says Rob Mellion, vice chairman of government affairs at American Beverage Licensees and president of the Massachusetts Package Store Association (MPSA). “All 184 bills are directed at usurping retail.”
Covid emergency measures and the landmark U.S. Supreme Court retail wine case in Tennessee are two main contributing factors to legislative activity in Massachusetts. “The 2019 Tennessee case allowing non-residents to obtain retail liquor licenses was a catalyst for opportunity, and Covid presented an opportunity to introduce direct-to-consumer shipment measures,” Mellion says. “The view is that the Supreme Court opened the door for wine producers to be able to sell at retail in competition with liquor stores. I get it but don’t be upset if the local retailer wants to become a producer and introduce their own label.”
The current number of bills targeting beverage alcohol retail in Massachusetts is much higher than previous legislative sessions, Mellion notes. During the 2019-2020 legislative session, 81 bills were aimed at changes to the retail tier, and in the session before that, 30 bills were introduced. “Some of the core ideas are similar to those of vertical integration or stuff being pushed by large corporate interests,” Mellion says. “Now it’s amplified.”
The MPSA is spearheading a ballot initiative for beverage alcohol retail reform that would appear on the election ballot in November 2022. If approved by voters, the initiative would increase the number of allowed beer and wine licenses an entity can have from nine to 18. The number of full liquor licenses a corporation or individual could have would decrease from nine to seven. “The ballot measure is a compromise,” says Ryan Maloney, president of MPSA and owner of Julio’s Liquors in Westborough, Massachusetts.
Of the approximately 3,000 off-premise spirits licenses in Massachusetts, about 1,800 are standalone beverage alcohol stores. Big box stores, grocery stores, convenience stores, and retailers with no storefronts own the other licenses. “We are the only retailers designed and legislated to deal with the controlled substance of alcohol,” Maloney explains. “We have been the gatekeepers and very successful at it. We have skin in the game.”
The initiative petition also prohibits the retail sale of beverage alcohol at self-checkout and bases a fine for selling to a minor on gross store sales rather than just beverage alcohol retail sales. “These measures put everyone on a level playing field,” Maloney says. “The penalty for selling to a minor that an independent retailer in Massachusetts pays can be devastating. If I’m a giant corporation, it’s a loss leader and only part of the business. They can pay and move on.”
In addition, the initiative would allow Massachusetts beverage alcohol retailers to reasonably rely on out-of-state IDs as valid proof of legal drinking age. Currently, Massachusetts is the only state that doesn’t allow beverage alcohol retailers to accept IDs from other states.
Mellion anticipates similar bills will be introduced in other states in the near future. “See what happens in Massachusetts, and it will probably be happening in your state in two years or sooner because everything is expedited,” he says. “The attacks aren’t just here. They’re employed elsewhere too. But don’t underestimate the local retailer.”