 Illinois’ liquor laws, more than 80 years on the books, have long been
restrictive for businesses, with the exception of the politically connected. And
new legislation in the Illinois House might continue that trend.
House Bill 3164, introduced by state Rep. Juliana Stratton, D-Chicago, would
make oddly specific carve outs in access to liquor licenses for businesses,
likely to exempt specific Chicago liquor stores, restaurants or bars – but not
others – from the longstanding law.
HB 3164 would amend the Liquor Control Act of 1934 to authorize the issuance and
renewal of a license to sell liquor at premises located within 100 feet of
specific “places of worship and schools in the City of Chicago.” But the
legislation does not simply relax the rules for any business hoping to sell
alcohol within 100 feet of churches or schools. Rather, it provides extremely
specific guidelines, including:
The premises are at least 5,300 square feet and located in a building that was
built prior to 1940 with frontage on South Michigan Avenue.
The shortest distance between the property line of the premises and the exterior
wall of the building in which the church is located is at least 109 feet.
The distance between the building in which the church is located and the
building in which the premises are located is at least 118 feet.
The main entrance to the church faces west and is at least 602 feet from the
main entrance of the premises.
The shortest distance between the property line of the school is at least 177
feet.
The applicant has been in business for more than 10 years.
The legislation also requires the religious leader of the church or principal of
the school to indicate his or her support for the issuance or renewal of the
liquor license, and written approval from the alderman of the ward in which the
premise is located.
The specificity of the guidelines makes it curious which businesses this
legislation was written for, but a glance at past amendments to the law and a
history of Illinois government’s approach to the liquor industry makes it no
surprise.
Before Stratton’s legislation, other changes to this provision of the Liquor
Control Act allowed for alcohol sales within 100 feet of homes for the aged if
the home for the aged was completed in 2015 and is exactly five stories. Another
amendment, for example, allowed for restaurants within 100 feet of a school to
sell alcohol if the restaurant occupied the first floor of a three-story
building at least 90 years old with the rear corner of the building and the rear
lot of the school separated by an alley.
The list goes on and on of narrowly tailored conditions for special interests,
while the law itself remains restrictive and outdated.
The Liquor Control Act, passed shortly after the end of prohibition, established
a three-tier system of alcohol distribution in the state. Under that act, the
Illinois liquor industry was set up into three distinct tiers: producers of
alcohol – such as wineries, distilleries and breweries – retail outlets and
distributors. Licensed distributors buy alcoholic beverages from breweries,
distilleries and wineries and then sell them to retailers such as restaurants,
bars and grocery stores. With certain exceptions for smaller wineries and
breweries, it is illegal to operate under more than one tier.
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 Every state in the country – with the exception of Washington –
operates under this system. But in Illinois especially, the
politically connected benefit the most.
In May 2013, then-Gov. Pat Quinn signed into law House Bill 2606,
which also amended the Liquor Control Act, this time to prohibit
out-of-state brewers from owning any part of a beer distributor in
Illinois. The Associated Beer Distributors of Illinois, or ABDI,
gave thousands in campaign contributions to the sponsors of that
2013 bill, including plenty of cash to main sponsor state Rep. Frank
Mautino, D-Spring Valley, before and during consideration of it.
Lawmakers took that a step further last when they passed legislation
that made bypassing Illinois distributors for out-of-state purchases
a criminal offense. A law that went into effect Jan. 1, 2017, made
purchasing alcohol across state lines for resale in Illinois a Class
4 felony, as opposed to a lesser business offense. ABDI was present
again while this legislation was under consideration in the General
Assembly, making a $1,000 donation to bill sponsor state Sen. James
Clayborne, D-Belleville, totaling more than $60,000 donated to him
over the years, and a $20,000 donation to House Speaker Mike
Madigan.
Beyond amendments to the Liquor Control Act, Illinois state
government has also passed legislation to limit choice in
distributorships in state – favoring big, politically connected
distributors that make up a large share of the market.
In 1982, the House passed the Beer Industry Fair Dealing Act, which
bound beer manufacturers to their distributors unless they can prove
“good cause” – such as breach of contract – to change distributors.
A similar law, the Wine and Spirits Fair Dealing Act, passed in 1999
extended that rule to distillers and wineries. The Wine and Spirits
Fair Dealing Act passed in large part due to the financial backing
of the Wine & Spirits Distributors of Illinois PAC, Judge & Dolph,
LTD, Southern Wine – largely funded by former Chicago Blackhawks
owner Bill Wirtz – which gave thousands of dollars to several
lawmakers, including Madigan and former Minority Leader Lee Daniels.
A U.S. District Court judge struck down the 1999 law for violating
the commerce clause of the Constitution, but the 1982 law still
exists.
Politicians shouldn’t be using existing alcohol laws to eliminate
competition or carve out benefits for special interests. On the
positive side, Senate Bill 1288, introduced by state Sen. Dan
McConchie, R-Hawthorne Woods, would allow craft distillers to sell a
certain amount of their own products directly to retailers, opposed
to having to go through distributors.
But still, Springfield politicians’ history of rigging the state’s
crony liquor laws show there are significant changes needed to the
way Illinois state government approaches alcohol regulation. HB 3164
and all the previous amendments making special rules for special
interests are proof.
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