Should Maryland Grocery Stores Sell Beer?

Benjamin Schwalb loves good beer so much he brews his own. He has a leadership post in a local brewing club and, as a connoisseur, seeks craft brews at specialty stores in his Severna Park neighborhood. 

Maryland's long-standing prohibition on beer sales in grocery stores baffles him. 

"Other states sell beer in grocery stores. Why not Maryland?'' he asked. It'd be much easier to scoop up his next favorite brew without making a special trip. "Especially now with the explosion of craft breweries, consumers need more venues.'' 

The idea of grocery store sales is popular with consumers, but Maryland's brewery industry is far less enamored with taking on the political fight. Doing so would require upending Prohibition-era laws that protect liquor stores from chain store competition. 

"The Brewers Association does not have a position on this, actually," said Kevin Atticks, executive director of the organization. He said the big regional brewers and the small, local ones don't agree on whether sales at big chain stores would help or hurt their businesses. 

Maryland is one of a handful of states that restrict most retail beer sales to liquor stores, under laws passed decades ago to segregate the booze-producing businesses from distributors and retailers. 

And though a high-profile panel of beer industry leaders on Wednesday discussed whether to promote sales in grocery stores, few expect beer companies or legislative leaders to push for the change unless consumers start clamoring. 

Comptroller Peter Franchot, who regulates alcohol sales, convened the Reform on Tap Task Force to examine laws governing craft beer after a protracted General Assembly fight over how much brewers could sell without using a middleman. 

But even though he initiated Wednesday's discussion about grocery store sales, Franchot does not support allowing shoppers to pick up a six-pack alongside eggs and milk. 

"The comptroller's position is, and has always been, that grocery stores should sell groceries and retail stores should sell beer, wine and spirits," Franchot spokesman Joseph Shapiro said. "However, he also knows this is an issue of great concern and interest to consumers and small businesses across the state." 

The last big shift in Maryland liquor sales came in 2011, when the legislature legalized direct shipments of wine to consumers after a multiyear fight. 

Fresh off that victory, the advocacy group Marylanders for Better Beer & Wine Laws turned its attention to getting wine and beer sold in grocery stores. 

"That was truly the issue that had the broadest public support, and what everyone asked us about,'' said Adam Borden, president of the organization's board. 

A Gonzales Research poll in 2012 found that 63 percent of Maryland residents wanted the convenience of beer and wine sales in grocery stores. Support swelled to more than 70 percent in the state's rural areas. 

But five years later, Borden's group has all but given up. 

"This is a much bigger lift,'' he said. 

Borden said the last bill to promote liquor sales at grocery stores, in 2013, was the first time a lawmaker had addressed the issue in 32 years. It died in committee without a vote. 

Former Comptroller Bobby Swann said the laws protecting liquor stores from chain grocery store competition were adopted soon after the repeal of Prohibition. 

"Going back to 1935, there has been this strong desire to have the mom-and-pop liquor stores sort of protected,'' said Swann, who joined the comptroller's office in 1960. He said there was little change to the state's three-tier alcoholic beverage distribution system over the next four decades he worked there. 

"The liquor lobby has been pretty strong on maintaining the mom-and-pop liquor store,'' Swann said. 

Del. Dereck Davis chairs the House Economic Matters Committee, which oversees liquor laws. The Prince George's County Democrat said he does not see why it's necessary to change Maryland's current sales structure. 

"We have no shortage of liquor stores in the state of Maryland, and we have no shortage of grocery stores,'' he said. 

Sen. Joan Carter Conway chairs the Senate Education, Health and Environmental Affairs Committee, which also deals with liquor laws. The Baltimore Democrat said she fears that grocery store sales would spell the end for smaller brewers.

"Once you open the door, the door is open. You can't close it,'' she said. "Once you let the big guys in, you can forget about the microbreweries.'' 

Some brewers say they want to protect Maryland's current rules because it allows individual brewers to sell their beer directly to mom-and-pop liquor stores. That levels the playing field among the big and small producers. 

"We all want the same thing,'' said Adam Benesch, co-founder of Union Craft Brewing in Baltimore. "We all want to sell more beer.'' 

Some brewers fear that craft breweries might not flourish in a chain store environment. They might not be able to get small distribution deals with the big chains. Or worse, they say, beer sales at grocery stores could potentially put small liquor stores out of business, ultimately limiting access to craft beer. 

Neal Katcef, a member of the Maryland Beer Wholesalers Association, said he's less worried about his beer distribution business and more concerned about the 3,500 retailers who make up his customer base. 

Katcef, owner of Annapolis-based Katcef Brothers, likened the impact of grocery chain beer sales to small retailers losing business when Walmart came to town. 

"Their livelihoods have been built on a system and a set of laws that have served us well,'' he said. 

Some beer lovers fear that grocery store sales would ultimately limit selection. 

"If you encourage more people to pick up their beer when they pick up their milk, you're going to see more people picking up Sam Adams,'' said Tony Russo, a beer blogger. 

Russo lives on the Eastern Shore, where a handful of grocery and convenience stores can sell beer because their liquor licenses were grandfathered in decades ago. He said selection at the grocers is limited, and craft brewers find better product placement at the stand-alone liquor stores. 

"They have more space to devote to craft beer, and they have more of a commitment to the local industry,'' Russo said. 

While drinkers in Delaware can't buy beer in grocery stores, those in neighboring Pennsylvania, Washington, D.C., and Virginia can - as can imbibers in all but a half-dozen states across the country. 

Atticks, the Brewers Association director, said Maryland consumers "are the wild card here.'' 

He predicted public support for grocery store sales would potentially tip the scales, as it did on the direct wine shipping fight in 2011. 

"That law passed because consumers got engaged,'' he said. "Before that, it was industry fighting among itself. What changed the equation was consumers got involved.''