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Move to scrap Kentucky's limits on liquor licenses stirs opposition

Posted at 2:00 PM, Jan 21, 2018
and last updated 2018-01-21 14:00:36-05

FRANKFORT, Ky. -- Alcohol regulators in Kentucky have filed a proposal that would repeal rules limiting the number of licenses available for retail package liquor stores and by-the-drink liquor sales.

The proposed administrative regulations are stirring opposition, the Lexington Herald-Leader reports. The Kentucky Alcoholic Beverage Control Board filed the proposal last month.

Retired Southern Baptist minister Donald R. Cole of Webster County says he fears “a bar or liquor store on every other corner” if the new regulations take effect.

“The more alcohol sales you have, the more social problems you have,” said Cole, executive director of the Louisville-based Kentucky League on Alcohol and Gambling Problems, formerly known as the Temperance League. “We don’t need these new regulations that are one more step toward the deregulation of the alcohol industry in Kentucky.”

The number of licenses is limited based on a community’s population -- one license per 2,300 people for package stores and one license per 2,500 people for drink sales.

State Rep. C. Wesley Morgan, who operates four Liquor World stores, says he thinks the proposed change “will get a ton of opposition.”

“You either regulate the alcohol industry or not,” said Morgan, a Richmond Republican. “This goes toward deregulation and hurts existing businesses.”

The board, in an impact and analysis statement, said “eliminating quotas may encourage entrepreneurship, foster creativity for new business models and create jobs.”

“The board believes that market forces rather than arbitrary quota limits should determine the number of businesses competing in a community,” the analysis stated.

The board also said elimination of the quota system provides “equitable treatment of all alcoholic beverage licenses.”

The study said the legislature has enacted laws since the 1980s that allow many businesses, such as hotels and restaurants, to obtain non-quota drink licenses and the lack of quotas has not resulted in over-saturation.

ABC spokeswoman Elizabeth Kuhn said in an email that the safeguards built into the current quota licensing system will not go away as a result of the proposed changes. Applicants will still be required to go through a vetting process to receive a license, and the local ABC administrator and the state ABC will still have discretion to issue or deny a license, she said.

Kuhn said the state ABC will hold a public hearing on the proposed changes at 10 a.m. Thursday at its office at 1003 Twilight Trail in Frankfort. Written comments will be accepted through Jan. 31.

The legislature’s Administrative Regulations and Review Subcommittee, which reviews regulations, is tentatively scheduled to consider the ABC regulations at its Feb. 12 meeting.