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Fiercely debated liquor bill heads to governor's desk

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Wine and beer sits on the conveyor belt at a checkout lane next to groceries inside the Homeland grocery store at Classen and NW 18 on the first day of wine and strong beer sales in grocery stores, in Oklahoma City, Monday, Oct. 1, 2018. [Nate Billings/The Oklahoman]
Wine and beer sits on the conveyor belt at a checkout lane next to groceries inside the Homeland grocery store at Classen and NW 18 on the first day of wine and strong beer sales in grocery stores, in Oklahoma City, Monday, Oct. 1, 2018. [Nate Billings/The Oklahoman]

Gov. Kevin Stitt gets to decide a hotly contested liquor bill that advanced to his desk Monday.

Senate Bill 608 would require all wholesalers get the opportunity to distribute the 25 top-selling liquor and wine brands.

Under current law, which drastically changed when voters passed State Question 792 in 2016, manufacturers of alcohol brands have the ability to designate exclusive distributors of their products, whereas before they were forced to make their products available to all distributors.

This change benefited some distributors, but hurt others. Two main liquor distributors that partnered with national brokers have secured nearly 80 percent of the state’s distribution market because of the changes.

Oklahoma City-based distributor Central Liquor Co. partnered with national broker Republic National Distribution Co., and Tulsa-based Jarboe Sales Co. partnered with Southern Glazer’s Wine and Spirits to form RNDC-Oklahoma and Southern Glazer’s Oklahoma, respectively. Both companies have grown under the new laws.

But Tulsa-based Boardwalk Distribution, which did not partner with an out-of-state business and failed to land a distribution agreement with any of the top-100 alcohol brands, has had to lay off employees and estimates it will lose $100 million in sales this year because of the changes.

Boardwalk President Bryan Hendershot is the driving force behind SB 608.

Lobbyists on both sides of the distribution debate have been working lawmakers in recent weeks.

The bill passed the Senate 34-11 Monday. It passed the House last month on a 51-28 vote that was rushed through as lawmakers were still trickling into the chamber after lunch.

Sen. Stephanie Bice, who helped craft the SQ 792 language, argued against the bill Monday, saying that six months into the implementation of the liquor law changes is too soon to overhaul the system again. She urged lawmakers to study the issue further before moving forward.

“As with any significant change in law, it takes time,” she said. “There are disruptions to the system, there are tweaks that have to be made. But to upend a system that’s just been upended six months ago, I think is misguided and not well thought out.”

During the first quarter of the year, Bice accepted a $2,700 campaign contribution from John Jarboe II, of Jarboe Sales, which grew into RNDC-Oklahoma — one of the state’s two largest alcohol distributors.

Bice, R-Oklahoma City, also pointed out that most of the state’s liquor distributors oppose the bill.

The bill’s author, Sen. Kim David, said she was standing up for smaller distributors and rural liquor stores that have faced product availability issues.

When one distributor has sole distribution over a popular brand, retailers can't order that brand from multiple wholesalers, which could lead to delays in delivery and lack of availability for consumers.

“That’s the person I have to stand up and fight for,” said David, R-Porter. “Those are the small retailers and small business owners that right now are going out of business.”

David said she had a petition signed by hundreds of retailers who expressed their support for SB 608.

Multiple senators on Monday theorized that if Stitt signs SB 608 into law, the measure will get tied up in court to determine its constitutionality.

“There’s probably grounds for this to end up in the courts, and it probably eventually should," David said. "If this gets it there, great, because hopefully our retailers can get a bit of relief until there’s a decision made."

Related Photos
<strong>State Sen. Stephanie Bice, R-Edmond [AP photo]</strong>

State Sen. Stephanie Bice, R-Edmond [AP photo]

<figure><img src="//cdn2.newsok.biz/cache/r960-fb301df8ee03cb9586594bbe8b613e03.jpg" alt="Photo - State Sen. Stephanie Bice, R-Edmond [AP photo] " title=" State Sen. Stephanie Bice, R-Edmond [AP photo] "><figcaption> State Sen. Stephanie Bice, R-Edmond [AP photo] </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-07ca4fc53f4618d67fee5cfde077ebed.jpg" alt="Photo - Wine and beer sits on the conveyor belt at a checkout lane next to groceries inside the Homeland grocery store at Classen and NW 18 on the first day of wine and strong beer sales in grocery stores, in Oklahoma City, Monday, Oct. 1, 2018. [Nate Billings/The Oklahoman] " title=" Wine and beer sits on the conveyor belt at a checkout lane next to groceries inside the Homeland grocery store at Classen and NW 18 on the first day of wine and strong beer sales in grocery stores, in Oklahoma City, Monday, Oct. 1, 2018. [Nate Billings/The Oklahoman] "><figcaption> Wine and beer sits on the conveyor belt at a checkout lane next to groceries inside the Homeland grocery store at Classen and NW 18 on the first day of wine and strong beer sales in grocery stores, in Oklahoma City, Monday, Oct. 1, 2018. [Nate Billings/The Oklahoman] </figcaption></figure>
Carmen Forman

Carmen Forman covers the state Capitol and governor's office for The Oklahoman. A Norman native and graduate of the University of Oklahoma, she previously covered state politics in Virginia and Arizona before returning to Oklahoma. Read more ›

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