Utah will get more bar licenses, but the price of liquor is going up

Posted at 4:03 PM, Feb 16, 2024
and last updated 2024-02-16 19:53:58-05

SALT LAKE CITY — The annual liquor bill in the Utah State Legislature has been unveiled.

It seeks to add more bar and restaurant licenses in the state, but will also impose a "sin tax" on beer by the barrel and raise the price of alcohol sold in state liquor stores.

As FOX 13 News first reported last month, Rep. Jefferson Burton, R-Spanish Fork, has proposed to gradually increase bar licenses in the state. House Bill 548 would lower the arbitrary population quota over the next seven years from one bar license per 10,200 people to one license per 3,167 people.

"Ultimately, that may turn into 300 more bars in the next seven years to go with population growth and demographic changes," Rep. Burton told FOX 13 News. "The good news is we take a look at that and if’s not working, we can adjust it again."

Restaurant licenses would also be increased. Under Utah law, restaurants cannot have more than 30% of their total sales be alcohol.

Alcohol policy bills are carefully crafted in the Utah State Legislature with a lot of negotiation between various stakeholders including hospitality and alcohol companies, social conservatives and alcohol abuse prevention groups. So there are always tradeoffs. This year's bill is no exception.

HB 548 proposes to increase the mandatory markup on liquor sales in Utah from "cost plus 88%" to "cost plus 88.5%." The money generated from state liquor sales goes to public safety, school lunches for children in need and the state's general fund. Utah's Department of Alcoholic Beverage Services reported more than a half-billion dollars in sales last year.

"Utah is one of 16 other states that uses the control model. The beauty of that is the cost affiliated or associated with alcohol consumption is paid for by the commodity," Rep. Burton said.

Perhaps the most controversial provision of the bill will be an excise tax on beer by the barrel.

"That’ll be a dollar a barrel total over four years. The idea there, is when we do this, we apply the additional income to prevention programs," said Rep. Burton, adding the DABS would hire more enforcement officers.

The "sin tax" on beer by the barrel is not supported by brewers, who warn the increased cost will ultimately be passed on to beer drinkers.

"For consumers what this means is their beer, whether they’re purchasing it in a grocery store or convenience store or state liquor store, it will cost more," Kate Bradshaw, the executive director of the Utah Beer Wholesalers Association, which represents major beer distributors.

Bradshaw said her organization and others hoped to continue to negotiating the excise tax.

"Anyone that’s concerned about seeing the price of beer increase, and not seeing how it necessarily relates to the overall aims of the bill should absolutely be reaching out to their legislator," she said.

Rep. Burton said he expected negotiations to continue on the bill. The omnibus alcohol bill will also create a new program in the state. Whenever an officer pulls someone over for driving under the influence, they will be asked to inquire where someone had been drinking. The "place of last drink" will then be logged to track if there will be problem areas that state authorities need to address.

"This has been piloted in other states and it does provide a way to encourage our outlets to just be responsible in providing drinks," Rep. Burton said. "If someone is clearly inebriated they shouldn’t continue to give them drinks."