On April 8th, after listening to spirited testimony, the Oregon Liquor Control Commission (OLCC) approved a floor pricing proposal for distilled spirits which increases the price of the lowest priced spirits sold in Oregon liquor stores.

The wine industry also provided the Commission an overview of its plan to recover from the state mandated lock-down and to return the industry to the growth trajectory it was on in 2019.

Earlier this year, in response to public health concerns around alcohol addiction, the OLCC proposed implementing a “floor” for the lowest priced spirits sold by the OLCC. In the weeks leading up to today’s Commission meeting, the agency received approximately 500 written comments about the proposal. The Commission framed the issue as balancing business interests with public health concerns.

During the mandated lock-down, the OLCC loosened alcohol regulations which have provided Oregonians with easier access to liquor. Liquor stores were deemed essential.

“We increased delivery and availability in the face of COVID,” said OLCC Executive Director Steve Marks. “We became intently aware of the State’s alcohol problem and the impact that alcohol was having on Oregon itself. We principally put this forward as an option because it’s what we could do on the public health front. We control the pricing policy.”

Public health advocates and addiction researchers testified in favor of proposed floor pricing citing research that shows increased prices drive down purchases.

“Increasing the price of alcohol is an effective,evidence based strategy that we can now take to reduce excessive alcohol use,”said Dr. Reginald Richardson,Chair of the Oregon Alcohol Drug and Policy Commission.

Liquor store owners voiced their support by pointing out that low priced distilled spirits are “loss leaders” that are favored by customers who have addiction issues.

However,the hospitality industry and business groups affiliated with alcohol licensees said floor pricing jeopardizes the hospitality industry’s fragile recovery. Opponents testified that they believe it’s the wrong time for increasing bar and restaurant operating costs.

“Now is not the time to make it more difficult for bars and restaurants to do business and serve customers. Let’s build on the good will of the accomplishments of the past year,” said Greg Astley from the Oregon Restaurant and Lodging Association.

A D V E R T I S E M E N T

A D V E R T I S E M E N T

Commissioners raised concerns about other price hike proposals being discussed at the legislature and the impact on Oregon small businesses.

“We’re all concerned citizens on this Commission”, said Commission Chair Paul Rosenbaum. “We are certainly aware of the terrible and difficult circumstances facing restaurant and bar owners in this state. We’re also aware of the drug and alcohol addiction, as well in this state. So there’s competing factors.”

The Commissioners ultimately voted to approve floor pricing, which will take effect July 1, 2021.

Oregon wine industry representatives provided Commissioners with their plan to recover from COVID lock-downs and wildfire impacts, which they estimate reduced wine businesses’ revenues by about 20 percent. In fact, before the pandemic the industry was generating $7.21 billion in economic impact for the state and Oregon wines were continuing their ascent in world-class stature. Fortunately, grape growers were able to partner with Oregon State University to swiftly test whether wine grapes had been impacted by smoke from the wildfires enabling growers to make informed business decisions about their harvest.

To recover from the mandated state lock-down, the industry is launching a marketing campaign called “True Character” to bring consumers back to Oregon wines and tourists back to Oregon wineries. The industry expects wine tourism will initially be limited to short-distance in-state travelers, and expects the overall recovery to be gradual in relation to the post lock-down comeback.


--Bruce Armstrong

Post Date: 2021-04-11 18:03:25

Last Update: 2021-04-11 18:45:14