Group offers new plan for liquor sales in Kansas

A coalition of grocery stores and convenience marts has floated a new proposal for expanding liquor sales in Kansas, saying it would generate an near-instant $41 million cash infusion toward the state’s budget deficit.

In its new plan, Uncork Kansas abandons earlier efforts that would have required big-box stores to buy the liquor licenses of small businesses that are currently the only stores allowed to sell full-strength beer, wine and spirits in the state.

Instead, the large retailers would be able to buy full liquor licenses directly from the state. Convenience stores would be able to buy licenses to sell full-strength beer, eliminating the current laws that limit them to selling beer with an alcohol percentage of 3.2 percent or less.

Uncork represents major grocery retailers, including Wal-Mart, Dillons and Hy-Vee, and convenience stores, including QuikTrip.

Efforts to expand sales have been fended off for years by the smaller liquor-only stores who argue that it would run them out of business, strand the investments they’ve made in their stores and reduce the property-tax base in struggling rural communities.

Uncork thinks the influx of revenue to the state budget might change some minds at the Capitol, at a time when the government is searching for ways to fill a two-year, $290 million budget gap.

“I think what’s changed is the state is experiencing budget complications,” said Jessica Lucas, a lobbyist and spokeswoman for Uncork Kansas. “Our effort to bring $40 million to the state creates an advantage … It won’t raise taxes and it won’t cut services.”

Lucas said the bill has been sent to House and Senate leadership and Uncork hopes it will be considered this year.

The session is, however, in its waning days and most lawmakers are more focused on getting out of Topeka than on handling new legislation.

Under Uncork’s plan, an estimated 165 of the state’s largest grocers would pay $200,000 per license, generating $32.6 million.

Smaller retailers and convenience stores would buy licenses on a graduated scale from $10,000 to $100,000 per license, for about $8.4 million.

All stores would pay an annual $2,500 renewal fee to keep their licenses, which is estimated to generate about $6.5 million a year.

“Right now, the state only brings in $187,000 (in license renewal fees) because liquor stores pay $250 a year,” Lucas said.

Tuck Duncan, a lobbyist for the Kansas Wine and Spirits Wholesalers Association, which opposes wine and liquor in grocery stores, called the proposal “a blatant bribe” and said it would be detrimental to small retailers.

“They’re willing to pay $200,000 for the privilege of selling liquor,” Duncan said. “Don’t tell me that this is a magnanimous, gratuitous offer to benefit the state of Kansas. It has absolutely nothing to do with that.”

Bill enables production of hard cider

Microbrewers in Kansas will be able to brew hard cider starting in January under a bill approved by the House on Friday.

SB 326, which passed 111-10, will enable microbrewers to make up to 100,000 barrels of hard cider annually as long as it contains less than 8.5 percent alcohol. Current law prevents microbrewers from making anything other than beer.

The bill will also allow microbrewers to increase their production of beer from 30,000 barrels annually to 60,000.

Rep. James Todd, R-Overland Park, who carried the bill, said that the state’s microbrewing industry has potential for tremendous growth.

The legislation now heads to the Kansas Senate for a final vote.

This story was originally published April 29, 2016 at 6:34 AM with the headline "Group offers new plan for liquor sales in Kansas."