House panel weighs allowing liquor sales at groceries

All three state liquor commissioners, and one former commissioner, showed up at a packed three-plus-hour House Commerce Committee hearing to oppose a bill that would allow some 1,400 grocery stores in New Hampshire to sell liquor.Under House Bull 1251, grocery stores would be able to buy liquor though the State Liquor Commission.Supporters said the convenience of being able to go down to the corner store for a bottle of gin, vodka or scotch would boost the state’s sales so much that it would more than make up for the loss of sales at state-owned liquor stores.”New Hampshire has too long held a monopoly on liquor,” said Jennifer Coffey, R-Andover, vice chair of the Commerce Committee and co-sponsor of the bill.But the commissioners argued that it would result in problem drinking, a massive loss of revenue to the state and primarily profit large retail stores that are owned by out-of-state corporations.”Our profits directly go to the general fund, not to the profits of large retailers,” said liquor commissioner Joseph W. Mollica.More than 80 percent of the increased sales at grocery stores will come out of revenue at state stores, testified economist Brian Gottlob, principal of PolEcon Research, about a study he did at the behest of New Futures, an advocacy group aimed at discouraging substance abuse among young people.Gottlob said the change would cost the state $13.4 million to $16.8 million in revenue. Sales would have to go up 22 percent, for the state to break even, a very “unlikely scenario,” said Gottlob.Besides, the program would also require inspectors, according to the fiscal note the commission filed with the bill — a cost of nearly another $1 million a year. But the bill’s sponsor, Rep. John Hikel, R-Goffstown, took issue with the fiscal note, arguing that the commission already licenses the stores that sell beer and wine, so it wouldn’t need any more people to inspect them once they start selling spirits.But it isn’t the same, said Earl Sweeney, a former liquor commissioner.”The difference selling beer and wine to hard liquor is like the difference between selling Fourth of July sparklers and dynamite,” Sweeney said.And Sweeney brushed off the job creation argument, saying that if the state stores suffer, state workers would lose their jobs, offsetting any job gain in the private sector.”Why mess with a monopoly with a half billion dollars in sales?” he said.The state would have to raise new taxes and fees to make up for the lost revenue, probably by raising business taxes, he said.But John Dumais, president and CEO of the New Hampshire Grocers Association, said that the commission issued such warnings before, when groceries stores started selling wine, and then when they started selling dessert wines, and the state stores have thrived anyway.The two could coexist, he said, indeed even complement each other.”The state stores close at night. We will be there, and on weekends and holidays too.”Those who buy a bottle at a grocery store are impulse buyers, Dumais said, “while those who go to the liquor store are more likely to buy larger quantities.”Liquor Commissioner Mark Bodi, however, said that the Grocers Association largely represents large chains, not small independent stores not able to compete on price. (Dumais responded by saying 65 percent of some 900 members are independent stores.)Bodi also took issue with the implication that Granite Staters are having trouble finding liquor.”New Hampshire is the wettest state in the USA,” Bodi said. “We sell more spirits per capita than any other state. If they are having difficulty getting to the liquor stores, it is certainly not reflected in the sales figures.” — BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW