Bill to preserve liquor license quotas passes Senate panel

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Jimmy Higdon, R-Lebanon, talks in committee about a bill that would preserve liquor license quotas on Tuesday. (Kentucky Today/Tom Latek)

 

By TOM LATEK, Kentucky Today

FRANKFORT, Ky. (KT) –  A bill that would make current regulations limiting the number of liquor by the drink and package into law passed a Senate committee on Tuesday.

 

The Alcoholic Beverage Control Board, part of the Executive Branch of government, has proposed repealing regulations that set a limit based on population and recently held a public hearing on the issue.

But SB 110, sponsored by Senate President Pro Tem Jimmy Higdon, R-Lebanon, would codify the administrative regulations, meaning only the General Assembly could make changes. It puts the regulatory limits on the number of liquor licenses into state law.

It was approved by the Senate Licensing, Occupations and Administrative Regulations Committee.

Higdon said many people made their decisions in wet/dry votes based on how many liquor outlets there would be.

“The voters in the 89 wet or moist counties and the voters in 31 dry counties have all decided what they want in the rules we play by,” he said.  “We’re looking at a government agency making those decisions instead of the voters of Kentucky.  I’m with the voters.”

The current system is working fine, according to Higdon.  “Jefferson County is authorized 500 package liquor licenses and there’s only about 300 that are active.”

Jason Underwood with Sazerac, which includes Buffalo Trace Distillery in Frankfort and Heaven Hill in Bardstown, supported the bill, due to what removing the quota system would do to the bourbon industry.

“With the bourbon boom, many of our products are on allocation.  (Repealing quotas) isn’t going to do anything necessarily to alleviate that.  What you’re just doing is spread the product thinner.”

Among those testifying against the bill were ABC officials, including Carol Beth Martin, Malt Beverage Administrator and one of the three ABC board members.  “If passed, this would create a special protected class of businesses, who are free from competition,” she said.

“SB 110 does not help with the regulation of alcohol,” Martin said.  “It merely provides protection and a monopoly to a select sector of the alcohol industry, in select areas of the state.”

Senate Majority Leader Damon Thayer, R-Georgetown, also spoke against the bill, saying it takes us down a dangerous path.

“I don’t think I’ve ever seen a time where we are trying to codify a regulation that the executive branch is trying to repeal.  I’ve also never seen an executive branch agency come before a committee in Frankfort and ask for less enforcement power.”

He says he knows retail liquor stores in his district want the bill passed and he wants to be for his constituents.  “But how can I go against my set of core beliefs that I have preached in this committee for years and years, that we should be about removing artificial barriers to free enterprise?  So, I can’t support the bill.”

The bill cleared the committee on an 8-3 vote, with Thayer, Sen. Christian McDaniel, R-Taylor Mill and Committee Chairman John Schickel, R-Union, casting the no votes.  Several members who voted in favor of the bill said they might change their minds when it comes to a floor vote.

In other action, the Senate Committee on Licensing, Occupations and Administrative Regulations unanimously approved HB 84, which would require coroners and medical examiners to notify Kentucky Organ Donor Affiliates if they have organs suitable for donation.  Hospitals already have that requirement.

The panel also adopted HB 74, which would require pawnshops to put items received in pawn onto an internet-based register that law enforcement would have access to and for pawnbrokers to hold the items they receive for at least 12 days before selling them.

All three bills now head to the full Senate.

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