MINNESOTA RETAILERS PUSH FOR WINE SALES 2004-02-02 (1)

JON SPRINGER

ST. PAUL, Minn. -- Grocery stores in Minnesota are fighting, for a fourth straight year, for the right to sell wine in their stores.

The Minnesota Grocers Association here said last week it would re-submit a proposal to the Minnesota State Legislature to allow wine sales in a food retail environment. The same measure was defeated last spring by an 8-6 vote in the state Commerce and Utilities Committee. Similar efforts in 2001 and 2002 also fell short.

The issue has been a hot one in Minnesota. Opposition to the bill has been led by the Minnesota Licensed Beverage Association, which represents wine and spirits stores, and by some distributors and citizen's groups. The MGA represents grocery stores, convenience stores and food distributors.

"We thought we had it [passed] last year a few days before going into the vote," Nancy Christensen, executive director of the MGA, told SN. "There's a tremendous amount of pressure on legislators from both grocers and consumers. But there was also a lot of pressure on them from liquor stores and distributors."

At stake is the division of around 3.3 million cases of wine sold annually in the state. Based on 2002 figures from Adams Beverage Research, Norwalk, Conn., Minnesota in 2002 accounted for 1.5% of all U.S. wine sales or around $170 million. Around 78% of that occurs in retail stores, according to Adams.

Thirty-three states allow grocery stores to sell wine, including all but North Dakota and Minnesota in the Upper Midwest, Christensen said. The proposal, which limits grocery stores of more than 10,000 square feet strictly to selling wine and requires they operate under the same laws and regulations facing spirits stores, has the support of 59% of the state's citizens, according to a 2002 survey by St. Cloud University. Only 24% oppose the measure, the survey showed.

The MGA has promoted its stance with a campaign and Web site called Wine With Dinner (winewithdinner.net). It argues that consumers deserve the convenience of purchasing wine along with their groceries and outlines a 10-point "Grocer's Code of Conduct" detailing training and compliance checks that Christensen said goes beyond what is required by state law. The MLBA, along with the Minnesota Municipal Beverage Association, counter that with a Web site called Minnesotasmart.com (SMART is an acronym for Supporting Minnesota's Alcohol Retailing Tradition). The group warns the bill could lead to increased access to alcohol by minors and would be "economically devastating" to wine and spirit store operators.

"There's four keys on a cash register -- beer, wine, spirits and miscellaneous -- and they want to take away one," Colin Minehart, a former president of MLBA, told SN. Minehart added that grocery stores in Minnesota are permitted to operate liquor stores if they provide a separate entrance and meet other state regulations. Byerly's, a 12-store gourmet grocery chain based in Minneapolis, operates in this manner. "We support Byerly's," Minehart said. "We don't support those who will put wine along with the pop and candy."

Christensen called Minnesota's liquor retailing laws "archaic and monopolistic," and said the bill's opponents are interested in maintaining the status quo.

"But I think the consumer really wants this [bill], and I think this is the year it finally gets over," she added. "It's a very responsible bill and it should be passed."