Colorado voters say 'no' to 2 of 3 liquor issues; wine in grocery stores too close to call

In Wednesday's early post-election light, Fort Collins liquor store owner Mat Dinsmore woke up with, well, a bit of a hangover.

Keeping a close eye on Colorado Propositions 124, 125 and 126 ― a trio of hotly debated ballot questions that would change the face of the state's alcohol sales if passed ― Dinsmore said he nervously sipped on some local beers as results trickled in Tuesday night. Those sips would largely turn out to be celebratory, not sorrow-drowning, as Colorado voters handed Dinsmore and other local liquor retailers at least a partial victory.

Proposition 124, which would have increased the number of retail liquor store licenses an individual or entity could hold in the state, and Proposition 126, which would have permanently allowed to-go alcohol and allow third-party delivery services to deliver alcohol, both failed to sway Colorado voters Tuesday.

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Proposition 125, part of the trio of alcohol propositions on this year's ballot, was too close to call as of midday Thursday. more than 2 million ballots counted the proposition was narrowly trailing with 50.1% of voters against it. If passed, Proposition 125 ― which, like Propositions 124 and 126, were opposed by the Colorado Licensed Beverage Association ― would allow grocery stores that currently sell full-strength beer to add wine to their shelves.

While still closely watching the results for Proposition 125, Dinsmore said he was "ecstatic, for lack of a better word," over the defeat of Propositions 124 and 126.

"I'm proud of Coloradans for standing up for small business," said Dinsmore, who owns two Fort Collins liquor stores, including Midtown's mammoth Wilbur's Total Beverage.

Propositions 125 and 126 were largely supported by companies like Instacart, DoorDash, Whole Foods, Kroger, Albertsons and Safeway, which contributed to the propositions' issue committee, Wine in Grocery Stores. All told, Wine in Grocery Stores pumped $13 million into the election, according to Colorado campaign finance disclosures. Wine in Grocery Stores did not immediately return the Coloradoan's request for comment Wednesday morning.

Keep Colorado Local, a coalition of liquor store and small business owners that opposed Propositions 124, 125 and 126, raised roughly $660,000 for their opposition campaign.

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What would Propositions 124 and 126 have done?

Proposition 124 would have increased the number of retail liquor store licenses an individual or entity could own or hold a share in. Under the law, license holders would have been able to have up to eight licenses by the end of 2026, 13 by the end of 2031, 20 by the end of 2036 and an unlimited number of licenses by 2037.

Larger liquor store chains, including Maryland-based Total Wine and More, Colorado-based Applejack Wine & Spirits and the Colorado Chamber of Commerce supported the proposition, arguing that current Colorado liquor laws are outdated in limiting liquor retailers to four licenses. Coloradans for Consumer Choice and Retail Fairness, the proposition's issue committee, raised $12.8 million in its fight to get Proposition 124 passed.

Keep Colorado Local instead argued that current liquor laws ensure a robust independent marketplace and that Proposition 124 would spell the end of that, converting Colorado's liquor landscape to one most benefitting chains with deep pockets.

Proposition 126 would have permanently allowed to-go alcohol from restaurants and bars and would have allowed third-party delivery services to deliver alcohol. With its defeat, alcohol delivery will remain limited to licensed liquor stores and restaurants. To-go alcohol — which has been temporarily allowed since the COVID-19 pandemic shut down in-person dining in its early days — is set to sunset in July 2025.

This ballot question's defeat came as a shock to Colorado restaurants, Colorado Restaurant Association President and CEO Sonia Riggs said in a statement Wednesday.

"We are stunned and disappointed that Colorado voters did not appear to support their local restaurants through Proposition 126. It’s widely known that restaurants have been devastated over the past two years and it’s disheartening to see that voters are not willing to support these businesses in serving their guests in a responsible way, be it at the restaurant or at home through delivery," Riggs said. "Without Proposition 126 in place, alcohol to go is set to expire in summer 2025, and that crucial revenue lifeline — and the convenience it provides for consumers — will be stripped away.”

Northern Colorado restaurant delivery service Nosh NoCo would have also benefited from Proposition 126's passage, but "at the end of the day, we stand in solidarity with small business," Nosh NoCo Director of Operations Nicki Bartolone told the Coloradoan on Wednesday. "The people have spoken."

"Would it have been nice to deliver alcohol for the restaurants to increase their sales? Yes," Bartolone added. "But I also know there's another side to it and there's other small businesses that could have been hurt by it. I think it's landed where it should have."

Dinsmore, who was against Proposition 126, said he feared that third-party delivery services wouldn't follow the strict alcohol delivery regulations Wilbur's Total Beverage and other local liquor retailers operate under. While he and other liquor retailers supported to-go alcohol in restaurants when it was a COVID-19 lifeline, Dinsmore also said he only did so under the understanding that it would be temporary.

What about Proposition 125 and the fate of wine in Colorado grocery stores?

One of the more polarizing propositions for grocery store chains and independent liquor store owners, Proposition 125 would change how Coloradans buy wine. If passed, the proposition would allow grocery stores, convenience stores and retailers that are licensed to sell beer to also sell wine and other vinous liquors — think wine coolers, sake, hard cider and mead.

In Fort Collins, passage of Proposition 125 would mean the 48 grocery and convenience stores currently licensed to sell beer could also sell wine starting March 1, 2023. Under the law, new licenses couldn’t be issued to a grocery or convenience store if it was located within 500 feet of a store with an existing retail liquor license.

Some background:Trio of ballot measures could change Colorado alcohol sales, drawing cheers and fears

The propositions drew cheers from grocery chains and jeers from local liquor stores, which argued through Keeping Colorado Local that the change would be detrimental for their businesses. In all, the committee estimated that nearly 700 liquor stores are adjacent to grocery and convenience stores in Colorado. The Colorado Licensed Beverage Association also estimated that up to half of Colorado liquor stores could shutter if Proposition 125 passes — a claim Wine in Grocery Stores spokesperson Michelle Lyng staunchly denied.

"Colorado’s experience modernizing our liquor laws worked out well for everyone," Lyng said in an email to the Coloradoan last month, referring to grocery stores' 2019 transition to selling full-strength beer. "… There’s room for everyone to thrive."

According to the Colorado Department of Revenue, there were about 1,582 retail liquor licenses issued in the state during the 2018 fiscal year. As of Oct. 4, there were about 1,555, marking a slight decrease in licenses.

In Fort Collins, the number of licensed liquor stores has ticked up slightly since the change, with 37 reported in 2018 and 39 today, according to the city.

This article originally appeared on Fort Collins Coloradoan: Colorado ballot issue to allow wine in grocery stores too close to call