Good afternoon,
Delaware House Speaker Pete Schwartzkopf introduced legislation that makes cocktails go a permanent offering of bars and restaurants is likely to sail through the General Assembly. The bill also keeps expanded outdoor dining areas in place.
Legislation passed earlier in the pandemic as a way to aid bars and restaurants expires at the end of March.
Sadly, the bill is not part of comprehensive legislation that would reform an alcohol beverage regulatory system that has persisted, thanks to the clout of those who profit the most from it.
The most puzzling law is a ban on wine shipments that all but a few states have abandoned. Lobbying efforts by liquor store owners and unions representing distribution employees have doomed previous efforts.
State Rep. Lyndon Yearick recently wrote a guest piece calling for a change in the shipment ban. His piece became the most widely read commentary in years on our website.
But the wine shipment ban is only the tip of the iceberg when it comes to laws and regulations on the books.
The current three-tier system keeps small brewers and distillers from getting their offerings in beverage stores. A few craft brewers have run the gauntlet and gotten big enough to get a distribution deal. Still, local offerings at the local package store are meager.
In 2019, we saw Iron Hill Brewery opt for a production brewery in Exton, PA, due to a limit of three production breweries in the state.
The result was the loss of the equivalent of 50 full-time jobs and a significant amount of tax revenue. Worse yet, Iron Hill, founded in Newark and now with 20 locations, moved its headquarters to Pennsylvania.
Then we have a law that bars beer, wine, and liquor sales at supermarkets and convenience stores. Warehouse giants like Costco and BJ’s have circumvented the law by building a separate section separated by a wall. The workaround shuts out smaller grocers.
There is also the rule that limits the number of liquor stores owned by one entity to two, an apparent reaction to liquor store giant Total Wine’s ambitions. Total Wine opened its first store in Delaware and is now a nationwide retailer.
Finally, the state has a liquor control czar who makes final rulings on violations and even beer gardens. Delaware has grown to the point that a board or commission with a citizen representative should handle such decisions.
It is true that most states have odd laws. Pennsylvania’s state-owned wine and liquor stores come to mind.
But Delaware’s liquor laws are in dire need of a makeover as a way to build a friendlier and more competitive business environment that adds jobs.
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