WIGS bill dropped in fight over competition restriction

By Eric Schelzig, Associated Press
NASHVILLE, Tenn. — A legislative disagreement over protecting liquor stores from competition means Tennesseans looking to buy wine at their local supermarket will likely have to wait a little longer for the shelves to be stocked.

Rep. Curry Todd, R-Collierville, on Tuesday made good on his earlier threats to kill the entire bill if his colleagues stripped a provision that sought to impose a two-store limit for liquor retailers.

Todd said the cap was meant to protect mom-and-pop stores, but opponents argued that the free market should decide winners and losers.

Rep. David Alexander, R-Winchester, noted that in his private retail business he must compete to succeed.

“I have no protections whatsoever in the free market, except how hard I work and how good a job I do,” he said “What’s all this protectionism? I don’t like that. I like that free market.”

The effort to remove the package store cap from the bill was approved on a 10-9 vote, and Todd promptly withdrew the measure from consideration. (Note: It’s HB2586. The legislature’s website indicates it was taken ‘off notice,’ not withdraw, which means it could be brought back up again later in the session.)

The main aim of the bill was to allow grocery stores to begin taking deliveries to be ready for a new law allowing wine sales starting July 1.

The failure of the bill doesn’t mean that supermarkets will not be able to sell wine, but it could take a few weeks for them to be supplied by wholesalers.

Todd told the committee that he had been involved in closed-door negotiations with several unnamed parities before the legislative session to come up with bill. But at least one out-of-state liquor store chain argued that the measure was aimed at preventing it from investing in Tennessee.

Republican Gov. Bill Haslam said earlier in the day that he was concerned about placing limits on liquor store ownership. “My gut feeling is to leave the cap off,” said Haslam, whose family owns the country’s largest truck stop chain.

The Senate version of the bill advanced to a full floor vote without debate in the State and Local Government Committee earlier Tuesday. But bills must clear both chambers before they can be sent for the governor’s consideration.

The Tennessee Wine and Spirits Retailers Association was a longtime opponent of the popular effort to allow supermarket wine sales, and removing restrictions on ownership was a concession to package store owners as part of the 2014 law.

The group’s lobbyist, David McMahan, has said owners had originally thought that lifting the cap would help them compete with grocery store chains that will soon be able to sell wine. But now they worry about being squashed by larger competitors coming into the state, he said.

McMahan said there’s a public interest in limiting how a “controlled product” can be sold.

“I don’t think that cheaper, more available liquor everywhere is what Tennesseans want,” he said.

Justin Owen, the president of the conservative Beacon Center think tank, said he considers the package store owners’ arguments to be “ridiculous,” and contrary to free market principles.

“If you don’t want to make liquor more available, then get out of the liquor business,” he said. “It’s not the government’s role to protect the bottom line of liquor stores.”