For years, when a state, county or city asked the public if they wanted more access to an intoxicating substance, be it alcohol or cannabis, the answer was typically “yes.” Strong beer (over 3.2% alcohol by weight) in grocery and convenience stores? Yes. Wine, too? Yes. All alc bevs in private rather than state-run stores? Absolutely. Sales on Sunday? Hallelujah! Adult use cannabis? Make it a doobie. 

Exceptions emerged from time to time, but generally, the almighty interest of “consumer convenience” tended to prevail in alcohol-focused ballot measures. Behind the scenes, private, commercial interests often drove those initiatives, of course. So too for a handful of high-profile proposals in 2022, as one industry group or another presented their case to the public (read: “consumers”). But this yr, a funny thing happened on the way to convenience. A lot of consumers said “no.”  

CO Proposal to Expand Liquor Licenses Lost 62-38 Colorado voters weighed in on 3 separate alc bev ballot measures this wk. Only 1 remains too close to call, tho “no” votes won in the other 2. Coloradoans handed a clear defeat to retailers aiming to expand the number of liquor licenses that can be owned by a single company. Over 62% of voters said “no” to the proposal, siding with existing small, indie wine & liquor stores, who raised about $670K to beat back this and other proposals, according to Denver Biz Journal. 

Proponents perhaps more accurately described as just one retailer aiming to expand the number of licenses it can own. Total Wine & More spent almost $13 mil to support the measure, according to DBJ. Describing how that measure “failed spectacularly,” the paper highlighted that local liquor stores executed an aggressive grass-roots campaign. By merely talking to their customers, they effectively dismantled the argument that the proposal would somehow help small, local bizzes, a perceived misstep by the measure’s supporters, opponents said.

Delivery Proposal Fails Barely in CO, While Wine in Grocery Still Too Close to Call The second ballot measure voted down in Colorado would have allowed third party deliveries of alcohol and permanently extended cocktails-to-go from on-premise retailers. Tho voters in and around Denver and a couple of other counties in the state supported the measure, it failed with just 47.6% of the vote statewide. 

Grocery chains and 3rd party delivery companies spent almost $13 mil on CO ballot issues this yr, according to the DBJ. They spent heavily to support both the delivery proposal and another that would have allowed grocery and convenience stores to sell wine. And that proposal is still too close to call. “No” votes led early, yet “yes” votes inched ahead and at presstime lead by a margin of less than 0.2 pts. 

Split Tickets & Psychedelics Contrast that tiny margin to the 5 pts or so on the delivery ballot measure and the 25 pts separating votes on the liquor license measure. That variation from proposal to proposal held even in individual county results, whether in the state’s population centers or its rural east and west. So a meaningful group of voters split their tickets, denying one or two measures but not necessarily all three. 

Votes on another Colorado ballot measure ended up closely split, but support and opposition varied widely by geography. With 52% support, the state will decriminalize and regulate certain psychedelics, including psilocybin. But the 4-pt statewide margin stretches to 30 pts or more in either direction, depending on the county. Denver had already joined the state of Oregon in decriminalizing psychedelics, tho no state has set up alcohol or cannabis-like markets for these drugs.

MA Affirms License Status Quo On the other side of the country, another attempt at changing licensing laws also failed. By a 55-45 vote, Massachusetts voters denied a proposal presented by package liquor stores (“packies”). It aimed to gradually double the licenses available to a single retailer from 9 to 18, an option large grocery and convenience chains have sought for years. But it also would have limited the number of those licenses that can be full liquor licenses to 7, down from 9 currently. 

Though the packies presented the proposal as a compromise, it wasn’t exactly favored by retail interests. Total Wine & More opposed it, as did another retailer org, though some of the usual suspects in the fight (including large c-store chain Cumberland Farms) stayed neutral. Opposition in part stemmed from another provision that would have changed the structure of penalties for liquor law violations, basing fines on total revenues, not just alc bev revenues (i.e. including all food and drinks or gas). 

For now, the status quo remains. But legislative proposals or another ballot measure are widely expected in coming years, the Boston Globe wrote last mo. A ballot initiative could lead to a legal challenge, too, the paper pointed out. State law bars “substantially similar” proposals from appearing on the ballot for 6 years, tho there’s some dispute over how close the proposals need to be to meet that standard. So the package stores, which spent some $400K last yr to gather signatures and raised almost as much to support the proposal this yr, may have bought themselves some time, even if their measure didn’t pass. Stay tuned. 

Blue Laws Fade in Red States A few more dry cities and counties in Kentucky and Mississippi went wet this wk, while voters in additional municipalities expanded alc bev sales on Sundays. For instance, Sunday sales passed in a pair of counties in Arkansas with overwhelming support of 70-75% of voters. Similar story played out in some Georgia counties. And over 80% of Atlanta voters agreed that the city should expand the hours of allowable alc bev sales on Sunday. 

These days, voters overwhelmingly support the repeal of such so-called “blue laws,” which remain mostly in states that lean Republican. It reminds INSIGHTS of a comment during the Center for Alcohol Policy meeting in late Aug (see Sep 8 issue). Public health and the religious right once united behind strict alcohol policies. Banning sales on Sunday has overtly religious underpinning. But energy among Republicans seems to have shifted the opposite direction, toward economic development, one attendee commented.

Cannabis Roll Slowed as MD, MO OKs, But AR, Dakotas Just Say “No” And then there’s cannabis, which previously fared very well when put before voters. This yr, not so much, as just 2 of the 5 states where adult use cannabis was on the ballot chose to open up legal markets. Almost 2/3 of voters in deep-blue Maryland gave cannabis the green light. Once a purely a western phenomenon, legal cannabis markets are increasingly appearing along the Atlantic coast. 

Missouri voters also passed adult use cannabis, but by a much slimmer margin of 6 pts. And neighboring Arkansas joined both North and South Dakota in denying to establish a market for the drug. In each state, 53-56% of voters said “no.” These relatively even splits mirror the results of a Gallup poll this summer, which similarly found close to 50/50 splits among American adults when asked if cannabis has a mostly positive or a mostly negative effect on most users and on society (see Sep 20 issue).

Westrock Coffee Co had a couple of juicy scoops to lay on its unsuspecting investors on co's first quarterly earnings call as a public co yesterday afternoon. For starters, it's accelerating already-ambitious capital plan centered on massive new plant going up in Conway, Ark, as major CPG customers lock in most of its Phase 1 capacity a year before it's scheduled to go live. So it's advancing by a year the addition of a more advanced extraction system, multiserve bottling line and bag-in-a-box packaging lines to Phase 1, which has been comprised of standard extraction system and high-speed glass bottle and canning lines. That's all planned to go live by first half of 2024. In addition, Westrock has acquired that pioneer of shelf-stable cold-brewed coffee, Kohana Coffee of Richmond, Calif - a move that brings into the Westrock fold that co's owner/operators, Jonathan Reinemund and his dad, Steve Reinemund, the former PepsiCo ceo. That transaction was for $34.5 mil in cash & stock in which the Reinemunds got paid in $18.5 mil in Westrock shares - keeping them tightly in the fold - and cash part was used to extinguish debt and cover $3.5 mil in transaction fees, per cfo Chris Pledger. So Westrock team that's new to RTD biz now has seasoned bev operator Reinemund Sr to help guide strategy. With Kohana's can line essentially sold out, it will get immediate increment of $3-5 mil in investment to triple its capacity, offering Westrock's top customers access to that format 18 months sooner than it was due to arrive in Conway, which will now drop the can line from its plans, said cofounder/ceo Scott Ford. Even that new increment already is accounted for, he said. Also on the books are $4 mil to fund expansion of single-serve capacity in hq plant in Little Rock, Ark, and extract capacity in Concord NC.