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Beer at liquor stores? Just say no

January 29. 2013 5:02PM

Moving New Hampshire's Liquor Commission into the beer business is an idea rife with problems, not the least of which being that it will cost the state money. Legislators would do better to leave beer sales to the private sector.

House Bill 275, sponsored by Rep. Robert Cushing, D-Hampton, would order the Liquor Commission to engage in a two-year pilot program under which it would sell and market beer brewed in New Hampshire.

Clearing regulatory obstacles that hinder the growth of New Hampshire's young craft beer industry is a worthy goal, and other legislation has been proposed to do that. This bill, though, has too many negatives.

The bill's fiscal note states that it is likely to reduce the state's income from state liquor stores because beer has a much lower profit margin than wine or spirits. That alone ought to be enough to doom the bill. Liquor store revenue helps keep other taxes low. We should not reduce that revenue just to help one small industry.

Even if the idea were revenue-neutral, there are other considerations. Beer is a lucrative revenue source for convenience stores and grocers, particularly those in border and tourist towns. And in the last few years, specialty beer stores have popped up to cater to craft beer enthusiasts. Adding beer to state liquor stores would force these businesses to compete with the state (as some do with wine), although at an even more pronounced disadvantage.

Liquor stores can get good prices through large volume discounts (as can chain grocers), and they have a monopoly at highway rest areas. Even with wine sales at liquor stores, tourists, particularly men, might make a side trip into town to buy beer. If liquor stores sell both beer and wine, the impact on local businesses could be profound, as traveling parties could get all of their alcohol from the state without having to leave the highway.

Legislators should spike this bill and focus on other regulatory burdens that hurt small breweries.

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