Leading GOP lawmaker fighting Bevin Administration’s effort to scrap liquor quotas

A leading Republican lawmaker has filed a bill to stop the Bevin Administration’s attempt to eliminate liquor license quotas, a move critics say would bring a glut of bars and liquor stores in rural Kentucky.

Senate Bill 110, filed by Senate President Pro Tempore Jimmy Higdon, would write state regulations that limit the number of liquor licenses into state law.

“I want to keep the current system for liquor licenses and my Senate Bill 110 will keep intact what they are trying to repeal, said Higdon, R-Lebanon.

The Kentucky Alcoholic Beverage Control Board last month filed proposed administrative regulations that would repeal rules that limit the number of licenses available for retail package liquor stores and by-the-drink sales of liquor.

The agency did not immediately respond Monday to a request for comment on Higdon’s bill. Republican Gov. Matt Bevin also has not responded to the Herald-Leader’s request for a comment on the issue.

Senate President Robert Stivers, R-Manchester, said there are some serious questions about the ABC’s proposed regulations, noting that he has received more calls about the issue than any other in the legislature this year except public pension reform

He said many liquor dealers started their businesses believing there was a limited number of licenses and are now worried their investments will be undercut.

Under the current state system, the number of liquor licenses is limited based on the population of a given community — one license per 2,300 people for package stores and one license per 2,500 for drink sales.

But an impact and analysis statement done for the ABC board said market forces rather than arbitrary quotas should determine the number of businesses competing in a community.

Some liquor store owners said at a public hearing last week that ending the quota system would hurt their businesses and betray voters who approved alcohol sales with the understanding that the number of stores would be limited.

“Voters counted on a system that has been in place for half a century,” said Karen Lentz of the Kentucky Association of Beverage Retailers.

The board, in its analysis, said “eliminating quotas may encourage entrepreneurship, foster creativity for new business models and create jobs.”

“The board believes that market forces rather than arbitrary quota limits should determine the number of businesses competing in a community,” the analysis stated.

The board also said elimination of the quota system provides “equitable treatment of all alcoholic beverage licenses.”

It noted that there are no quotas for licenses on malt beverage package sales and malt beverage drink sales.

In those cases, economic factors have determined the number of businesses that a community can support, officials said.

Higdon said he expects his bill will go to the Senate Licensing, Occupations and Administrative Regulations.

The legislature’s Administrative Regulations and Review Subcommittee, which reviews regulations, is tentatively scheduled to consider the ABC regulations at its Feb. 12 meeting.

This story was originally published January 29, 2018 at 1:04 PM with the headline "Leading GOP lawmaker fighting Bevin Administration’s effort to scrap liquor quotas."