Retailers and Grocery Stores and Liquor Stores and Specialty stores and Retail and Real Estate & Retail

Renewed Sunday liquor fight to focus on money

November 30, 2010

A potential legislative battle over allowing carryout alcohol sales in Indiana on Sunday likely will center on economics.

Backers of the proposed legislation, which would allow drug, grocery, convenience and liquor stores to sell alcohol on Sunday, have begun touting a study by the Distilled Spirits Council of the United States, or DISCUS, estimating that as much as $9 million in additional tax revenue would be generated by the allowance of Sunday sales.

The proposed law also would allow cold beer to be sold at drug, grocery and convenience stores every day of the week. Right now, only liquor stores are allowed to sell cold beer in Indiana.

Opponents of the move discredit the financial aspects of the study because an industry group produced it and it dates back to 2006, before the sales tax was increased to 7 percent.

Their arguments against the study could get a boost from a new report by Ball State University economic professors that predicts no significant financial impact from allowing Sunday sales.

Members of the campaign for Sunday sales, who pressed an unsuccessful legislative fight last session, are undeterred. They plan to release an updated DISCUS study when the legislative session begins in January. And they hope the dollar figures will resonate with lawmakers grappling with crafting a difficult budget next year.

“In today’s climate where every little bit helps, there’s $9 million to be found not on taxpayers’ backs,” said Matt Norris, director of Hoosiers for Beverage Choices. “It’s been one of the many arguments we’ve used – it takes on added importance this year, given the state’s budget situation.”

The proponents’ study is based on the estimated increased volume in alcohol sales, according to what has occurred in other states that have allowed Sunday sales.

They say business is lost on Sundays because shoppers in border counties take their business to neighboring states, and some consumers who might impulse-buy alcohol on that day at the grocery store don’t go back to purchase it later in the week.

“All of us are time-starved,” said Grant Monahan, president of the Indiana Retail Council. “(Shoppers) want convenience and the ability to purchase alcoholic beverages when they’re doing the rest of their grocery shopping.”

Opponents are expected to push back with equal tenacity. John Livengood, president of the Indiana Association of Beverage Retailers, said Sunday sales don’t increase overall sales activity, but spread it out over seven days instead of six.

And he worries that allowing Sunday sales would put package liquor stores out of business. Many package stores are family-owned and would likely stay closed on Sundays even if they were allowed to open, he said, thus losing sales to competitors. Those that do open would be hit by the additional expense of doing business an extra day a week. 

“Some of our members would end up closing some of their units in order to survive,” Livengood said. “We don’t think it would be helpful to us, and we don’t think it is good public policy to go down the road of deregulation, which is where this would take it.”

The Ball State study, conducted by Michael Hicks and Nalitra Thaiprasert from the school’s Center for Business and Economic Research, backs up that assertion. They found that allowing Sunday sales could eventually reduce the number of package liquor stores in Indiana as much as 25 percent.

They also didn’t see indications that people cross over to buy booze in states that sell it on Sundays.

“There’s no evidence that there’s an increase in overall sales,” Hicks said. “What this suggests is people are substituting where they buy booze.”

The argument will continue in coming weeks as proponents kick up their campaign to prepare for the legislative session.

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