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12.24.2012  
 

What Chain Stores Could Mean for Maryland

Increase in sales could result in $100 million and 500 jobs annually, report says

 
by Hudson Cattell and Linda Jones McKee
 
 
maryland
 
A new report from Sage Policy Group indicates that sales of beer and wine at chain grocery stores in Maryland would have an economic impact approaching $100 million per year.
Baltimore, Md.—With the end of Prohibition in 1933, every state developed its own set of rules and regulations regarding alcohol. Maryland was one of the states that tightly controlled the sale of alcoholic beverages and, with one exception, has not allowed them in chain stores, including grocery stores.

What would happen if that restriction were lifted? An economic impact consulting firm recently tried to answer that question. Marylanders for Better Beer & Wine Laws, a consumer advocacy group located in Baltimore, Md., commissioned Sage Policy Group Inc. to conduct an economic impact report projecting what would happen if chain retailers could sell beer and wine within the state.

Sage’s report, “The Economic and Fiscal Impacts of Better Wine & Beer Policy in Maryland,” was issued earlier this month, and key analytical findings in the report were as follows:

• Wine and beer sales in chain stores would have an economic impact in the state approaching $100 million per year. Upfront licensing fees would generate $72 million for the state of Maryland, and the permanent/annual fiscal impacts would be in excess of $22 million.

• Maryland would see a net increase of 5.5% in annual beer consumption and a 6.5% increase in wine consumption. The net increase in beer sales was estimated at $64.6 million, with wine sales at $16.1 million.

• The number of jobs created directly and indirectly by expanded sales activity would approach 500, the report states. In terms of full-time equivalents, this translates into 435 jobs. Annual employee compensation would be approximately $17 million, of which $14 million would be in wages and salaries. This would translate into nearly $28,000 per job, and more than $32,000 for each FTE.

In 1978, Maryland repealed a provision in the law that permitted one chain store in each county to sell alcoholic beverages, basically forcing Marylanders to purchase wine and beer at liquor stores. For the next three years, grocers fought without success to overturn this change. From 2000 to the present, county and statewide bills to expand alcohol sales to chain stores have died. The latest bill to be introduced involved a five-store chain in Prince George’s County.

The Marylanders for Better Beer & Wine Laws led the fight to legalize wine shipping in Maryland, which became law in 2011. In 2012 the group supported a corkage bill that now allows customers to bring their own wine to restaurants. The full economic impact study is online at mbbwl.com.

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