Blue Laws imposing stringent restrictions on how and when alcohol could be sold in New York State predate the American Revolution by a century.  Yet many of these laws still exist, restored after the end of prohibition in 1933, and they continue to have a negative impact on small businesses, wineries and consumers.  Originally established to support a particular version of morality, to modern eyes blue laws appear mainly to function to restrain trade and limit choice.

 

Especially in this period of economic readjustment, it is critical that the State examine whether the legal remnants of our colonial past are helping or hurting the business climate in the state, and where necessary to update our laws to reflect realities of the 21st century.

 

Working with Assemblymember Joseph Morelle, I have developed The Wine Industry and Liquor Store Revitalization Act (S5787/A8632) that reforms the rules for wine and liquor sales for off-premises consumption.  Current law reduces consumer choice by imposing limits on access to wine found in few other states.  It hurts New York’s growing wine industry by making it harder for them to market their products.  And it hurts small businesses – both grocery stores AND liquor stores -- by imposing convoluted rules about who can sell what, and limiting the ability of existing businesses to grow or compete.

 

During this year’s budget process, this issue came up, but was primarily discussed in relation to allowing wine sales in grocery stores.  I supported this goal, but was also sympathetic to the concerns of liquor stores about unfair competition, because of the ridiculous rules that they faced as to what they could sell.  Under current law a liquor store can sell a bottle of wine but not a gift basket, soda, or any food products.   Liquor store owners can’t own more than one store, nor can they form buying pools like food stores to increase their negotiating power with their distributors.  These rules serve to limit opportunities for liquor store owners, making their concern about protecting their exclusive rights to sell wine, one of the few products they were allowed to sell, very understandable.

 

The discussions I had during the budget process led me to the conclusion that there were solutions that could address problems for all the players, and that those solutions had to involve confronting the Blue Laws head on.  The state had already started this process a few years ago when we passed legislation allowing liquor stores to be open on Sunday, but that was only a small step in addressing the irrationality of our current laws. 

 

The legislation Assemblymember Morelle and I have now introduced takes on the various anti-competitive aspects of our liquor law.   Among its key provisions:

 

• Allows liquor stores to sell items complementary to their business, gift baskets, mixers and sodas, and food products;
• Allows liquor stores to sell directly to restaurants and other retailers;
• Expands legal operating hours for liquor stores;
• Allows liquor stores to form cooperatives for joint purchasing, which will create opportunities to take advantage of volume discounts;
• Allows liquor store owners to operate more than one store;
• Creates a medallion system enabling liquor store owners to auction off their existing licenses to the highest bidder;
• Allows grocery stores and drug stores to sell wine for off premises consumption.

 

If New York is going to have a vibrant economy, it has to find ways to support local businesses.  Grocery stores and liquor stores are the quintessential local business, providing jobs and contributing to the economic stability of the community.  New York wineries are a growing part of the agriculture industry in our state.  The legislature has the opportunity to remove barriers to the success of all these small businesses and level the playing field by repealing outdated Blue Laws.