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    New Jersey May Allow Liquor Sales at Grocery and C-stores

    Supporters of the legislation cite need to raise tax revenues to close budget gap.

    TRENTON, N.J. -- In an effort to raise new tax dollars to close a worsening budget gap, New Jersey is considering a measure to allow supermarkets and convenience stores to sell beer and wine – something that is already permitted in most other states.

    According to a report by the Associated Press, the measure has been stalled in the state legislature since last year, but supporters are trying to revive it, arguing that selling wine and beer at grocery and convenience stores could make the state money and offer convenience to busy consumers.

    While 45 states allow the sale of alcoholic beverages in supermarkets and convenience stores, New Jersey limits chains to just two total liquor licenses. It also mandates the liquor be sold separately from groceries, usually in an adjoining store.

    The New Jersey Food Council reports there are almost 400 dormant liquor licenses throughout the state and estimates that activating even half of those would generate at least $60 million in new revenue and $50 million per year after that in recurring revenue.

    "Unlike other states that have open and transparent liquor markets, the anticompetitive New Jersey liquor system leaves money on the table as these licenses sit idle and the sales tax revenue that goes with them is unrealized in the state's coffers," said Linda Doherty, president of the New Jersey Food Council.

    According to the AP, major chains , including from Quick Chek, Stop & Shop, SuperValu, Wegmans, Pathmark, Whole Foods Market and Albertsons, which owns Acme, back the measure, saying consumers would be assured more convenience and choice with one-stop shopping and would save money.

    The New Jersey law was adopted in 1962 to prevent price fixing and monopolization, and to address organized crime. Smaller liquor store owners fear the change would drive them out of business because bigger stores can buy in larger quantities and sell the alcohol cheaper.

    To close a growing revenue shortfall as income and sales taxes plummeted this year, Gov. Jon S. Corzine proposed raising the tax on wine and liquor as part of his 2010 budget, amounting to about $1 per bottle on spirits and 75 cents per bottle on wine.

    The New Jersey Wine and Spirits Wholesalers Association, however, charge that Corzine's proposed alcohol tax will actually cost the state $60 million a year in lost sales, thereby nullifying any gain that resulted from allowing grocery stores to sell spirits. It also disputes that consumers in New Jersey need more convenient ways to purchase alcoholic beverages.

    A floor vote has yet to be scheduled and a companion bill hasn't been introduced in the Assembly.

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