Push grows to expand New York’s liquor shipment, container laws

New York – Before the legislative session concludes in around five weeks, state lawmakers want to increase the kinds of alcoholic beverages that can be directly supplied to customers in New York and how restaurants purchase alcohol in the state.

The $237 billion state budget permits movie theaters that sell food to obtain a liquor license and extends the sale of to-go alcoholic beverages for a period of five years, until 2030. A number of legislators intend to permanently legalize alcohol-to-go in the future.

However, before lawmakers depart Albany on June 6, they hope to enact legislation that would let eateries purchase a restricted amount of alcohol from nearby merchants rather than having to wait for shipments from major wholesalers. A bill to allow cideries, distilleries, and other small beverage makers to ship to clients like wineries throughout the state is also being discussed for possible passage.

“A lot of these laws in the alcohol space are from the Prohibition era — they’re super antiquated,” state Sen. James Skoufis said Thursday.

The measures’ Democratic supporter from the Hudson Valley, Skoufis, stated that since Prohibition was abolished almost a century ago, it is time for reform.
According to the senator, Southern Glazer’s Wine & Spirits and Empire Merchants, the two biggest liquor distributors in the state, control over 90% of the market and operate as a duopoly. Distributors and other special interests have been fighting the move for years because they do not want small businesses to even slightly reduce their profit margin.

“These two reforms would take a very small piece of their business away — we’re talking a fraction of 1%, probably,” said Skoufis, adding the Legislature needs to take action.

However, proponents of addiction treatment like Rob Kent, a former state Office of Addiction Services & Supports attorney, contend the proposed regulations will negatively affect public health, particularly that of youth.

“They’re ignoring the data,” Kent said of state Health Department records. “One in 6 New York adults have shown to have excessive alcohol use in the form of either binge or heavy drinking. Everyone always talks about the revenue we’re going to generate if we make alcohol more accessible. They need talk about the cost of treating people who end up using it too much and ending up with health conditions.”

During budget deliberations, Kent joined a number of health professionals and organizations in opposing the expansion of alcohol for use on-the-go.
Kent argued that now is not the right moment to increase access to alcohol because binge drinking and its associated health problems are on the rise. He referenced figures from the National Institutes of Health indicating that over 178,000 Americans lose their lives to alcohol abuse each year.

“It’s the most preventable cause of death in the United States, and yet, we’ve got all these efforts to try to increase access to it,” added Kent, who is president of Kent Strategic Advisors.

In the meanwhile, state business leaders and restaurants are in favor of the proposed modifications to shipping and distribution. Many restaurants and other businesses in the hospitality sector have been struggling financially since the COVID-19 outbreak, therefore they contend that this will aid small businesses and the local economy by eliminating the taxes and costs associated with working with distributors.

“If I buy a case of Tito’s a week, and they’re buying 100 cases of Tito’s a week, even when they’re marking it up, it’s still less in the store than I can buy it for,” said Dominick Purnomo, director of the New York Restaurant Association and owner of Dominick Purnomo Restaurant Group.

Restaurant owners and liquor license holders stated on Thursday that the Legislature must give priority to other bills in order to fix inefficiencies in the State Liquor Authority, even if they would campaign for the measure to pass both houses within the next month.
A commission released eighteen recommendations to improve the organization last year. Legislative leaders have not moved Skoufis’ proposed legislation, which would have codified the majority of the suggested SLA reforms into state law, for a vote.
McGeary’s Irish Pub in Albany is owned by Tess Collins, who claims that the State Liquor Authority’s long-standing problems have caused months-long delays that have a detrimental effect on New York companies.

“It can really put somebody out of business,” Collins said. “That’s the issue here. People are calling me. Something that would take two months is taking a year for them. … These problems are huge problems for small business.”

A handful of the commission’s minor recommendations to streamline the State Liquor Authority’s application process in the face of an ongoing backlog were included in the state budget. These recommendations, which include allowing one-day permits for special events to serve alcohol and simplifying the licensing process for businesses, have started to show signs of progress.

Governor Kathy Hochul, who called the commission, is being urged by Purnomo and legislators to take the group’s recommendations seriously and restructure the agency as quickly as possible.

“It’s the execution problem that we’re lacking,” he said. “All of these little things, all of this nickel and diming adds up. A lot of it really is just streamlining the process. It needs to start from square one and then let those laws pertain to the modern age.”