Kindred Spirits: Wal-Mart, Kroger Align in Booze Bid

Wal-Mart is ginning up a full-bore liquor war and bringing it to the Capitol. Last week it sued the state for the right to sell spirits, and Wednesday it joined Kroger in forming a new nonprofit to promote freedom in the booze marketplace.

One week after Wal-Mart sued the state for the right to sell hard liquor, two Texas lawmakers and a new coalition of businesses are taking the same fight to the Capitol.

Wal-Mart, Kroger and the Texas Association of Business on Wednesday helped birth a new nonprofit group calling itself Texans for Consumer Freedom to push for laws allowing publicly traded corporations like Wal-Mart and Kroger to own and operate liquor stores. Public companies are barred from the Texas booze market by the Texas Alcoholic Beverage Commission — an arbitrary exclusion from the free market, group members say.

“Free markets transcend any individual retailers whether they’re publicly or privately held,” said Travis Thomas, a spokesman who helped form Texans for Consumer Freedom. “It should be open to everybody to compete.”

Bills filed this week by state Sen. Kelly Hancock, R-North Richland Hills, and state Rep. Jason Isaac, R-Dripping Springs, would repeal parts of the alcohol code that exclude publicly traded corporations and limit the number of liquor stores a company can own.

If the bills pass, grocery stores that want to sell hard alcohol would still be required to do so in a separate building with its own entrance. 

“This does not mean that publicly traded companies are going to be selling spirits next to bread and candy,” said Scott Dunaway, another spokesman with Texans for Consumer Freedom. 

Texas law also limits a single owner to five liquor stores. The problem with that rule, Thomas says, is a loophole that allows immediate family members to consolidate permits under one company.

The biggest liquor chains in Texas, Spec’s and Twin Liquors, own 169 and 70 stores, respectively.

“The legislation that was filed yesterday is all about leveling the playing field,” Thomas said. There is a “very protectionist environment” around the Texas liquor market, he said.

Wal-Mart is waging the same battle in court, arguing that the ban on public corporations breaches consumer protection law.

Thomas said Texans for Consumer Freedom wants to change the law “without protracted, expensive litigation.”

Disclosure: The Texas Association of Business and Wal-Mart are corporate sponsors of The Texas Tribune. A complete list of Tribune donors and sponsors can be viewed here.