NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A6989
SPONSOR: Hunter TITLE OF BILL:
An act to amend the alcoholic beverage control law, in relation to
establishing supermarket wine licenses
PURPOSE:
To allow certain off premises sales locations to sell wine in addition
to their existing alcohol sales of beer, cider, and wine products.
SUMMARY OF PROVISIONS:
This bill creates a new definition of supermarket for purposes of estab-
lishing a supermarket wine license. This license would only be available
to full-service grocery stores that are primarily engaged in the sale of
food (at least 65% of sales from food-related products), already have a
license for off premises beer sales, and are more than five thousand
square feet. Applicants would pay a one-time franchise fee of ten thou-
sand dollars per location. There would also be an annual fee for main-
taining such licenses that is based on the licensee's total sales of
wine in the prior year. Sales of New York wines would not be included,
thereby providing an incentive to promote and sell New York wines.
JUSTIFICATION:
New York's restriction on the sale of wine in supermarkets can be traced
back to the era of Prohibition. While many laws have been updated to
reflect modern times, consumers are still stuck making multiple trips to
different stores for groceries and wine. This anachronistic model
provides no consumer protections, but instead protects an entrenched
monopoly that is to the detriment of convenient access for consumers. If
consumers can be trusted to buy beer in supermarkets, they should be
given the option to also purchase wine with their groceries as well.
A January 2023 Siena poll found that 76% of New Yorkers support the sale
of wine in grocery stores and 86% supported modernizing NY laws on wine
sales to create more opportunities for NY wineries and grape producers
to sell their products. New York is the only major wine-producing state
that does not allow wine to be sold in grocery stores- unlike our larg-
est competitors California, Washington, and Oregon- and New York's
wineries will significantly benefit from increased distribution in
supermarkets under this bill.
Currently, more than forty states allow for the sale of wine in super-
markets. In the states where wine is sold in grocery stores, such as
Florida, liquor stores still exist and thrive. Allowing supermarkets to
sell wine is simply about consumer access and ease, while also striking
a balance - not including liquor - which ensures there will always be a
market for traditional liquor stores. These traditional liquor stores
will also likely continue to offer wines beyond what a supermarket can
dedicate floor space to.
The requirement for 65% of sales to be food-related will exclude
national big box retailers and superstores (which may sell some food,
but primarily are general goods retailers with significant buying
power). Additionally, the bill's proposed minimum square foot threshold
of 5,000 square feet would ensure that only full-service grocery stores
are included, and not thousands of smaller convenience stores, gas
station quick marts, drug stores, etc.
This legislation also seeks to incentivize the sale of New York made
wines by providing reductions in the stores' annual fees for New York
wines sold. The focus on New York wines will greatly boost New York
wineries and provide a steady stream of new customers for locally made
products.
LEGISLATIVE HISTORY:
This is a new bill.
FISCAL IMPLICATIONS:
None to the State, but there is expected increased revenue from applica-
tion and license fees.
EFFECTIVE DATE:
Immediately.
