A Long and Winding Read
Now that we’ve talked about the simple, quick bills, let’s talk about SB 9. It rewrites our alcohol licensing laws, which (so far) takes 124 pages. It's been in the legislative process in one form or another for nine years. It’s… complicated.
Alaska's current alcohol laws are arcane to the point of being byzantine. Through many decades, exceptions got carved out, tweaks got made, new business models were created or crushed, and there are several Alaska lawyers who make most of their living helping people figure out the rules. The first thing SB 9 does is rationalize the mess so people can understand it. Good.
The substance of the bill needs a little context. Remember that the end of Prohibition didn't end Americans' concerns about the harm alcohol abuse does. So we regulate it to protect lives, health, and safety. Part of that -- pretty much since Prohibition ended -- was preventing any one part of the alcohol business from becoming too colossal. So our rules are built on a three-tiered system: makers, distributors, and retailers all have separate lanes, by law.
Like many other states, Alaska goes further by capping the number of bars, liquor stores, and restaurants that can serve alcohol in a given city by population. Those rules hit in Alaska when there were way, way, way more alcohol businesses than the new per-capita limits. That's how Juneau has 16 liquor store licenses, despite having the population to justify 11. (That cap is one per 3,000 people.) The same dynamic applies - with different numbers - for bars and restaurants, too.
Here's the thing: capping liquor establishments by population doesn't reduce alcohol abuse, or alcohol-fueled crime. I’ve looked at all the research from advocates and there’s nothing showing per capita limits have any impact. There’s definitely evidence smart zoning laws help. But clustering and quantity are different things. We'll come back to that in a bit.
On the good side, SB 9 doesn't just make the law readable. It also makes a lot of excellent policy changes. Enforcement gets easier, which makes it more likely to actually happen. Keeping alcohol away from kids gets easier and more effective, too.
The bill also loosens some of the strictures that have stifled change in the eating and drinking sector. Consider: elsewhere in the country there are brewpubs galore, but Alaska has only two. In most of America you can carry a drink from a hotel bar back to your hotel room, but not here. Elsewhere in the country a winery or brewery can have a tasting room off-site, using industrial land to make products, but selling it in much smaller retail areas (with their higher rents) -- Alaska has said no. In many states you can have a beer when you watch a movie, but not here.
Widening some of the narrow lanes in our current law will let most of those things happen here if a business can make money at it. And I have little doubt that with some breathing room, Alaskans will innovate ideas nobody's come up with yet.
Unfortunately, the bill keeps all the population-based caps in place, and even makes one of them much tighter. As SB 9 reads today, a community could only get one brewery tasting room license per 12,000 people. Juneau has four right now, with our population of about 31,000, so we'd have another category where we're over the new cap.
A beer from a brewery is not four times more dangerous than a beer from a bar. But there's another issue: when a city is over its cap, the cost of buying out somebody else's license gets added to the cost of trying to start a new business. Much of Alaska's resistance to innovation in this arena has, historically, come because the state made bar owners buy tremendously expensive licenses before they could start up. Those folks understandably don't want to see the value of their government-mandated license diminished.
But that's not what government regulation is for. Adding mandatory costs and protecting the people who had to pay them don't protect anyone's life or health. They don't promote public safety. Doing away with problem is a bigger, costlier, more Gordian knot than SB 9 can untangle or cut. But we don't have to make it worse.
SB 9 will be on the Senate floor this coming week. It still has to make it through the House this year. I hope we can clean it up before it hits the governor's desk.
