Archive for Sunday, July 18, 2010

Sound principle

A state law requiring bar owners to charge proportionately more for drinks that contain more alcohol may need review, but the principle involved seems sound.

July 18, 2010


Despite complaints from Kansas bar owners and an enforcement moratorium imposed this week by Gov. Mark Parkinson, it’s hard to argue with the apparent intent of a law that requires bars to charge more for drinks that contain more alcohol.

Last week, the Alcoholic Beverage Control division of the Kansas Department of Revenue, announced it would start enforcing a 1986 law the required bars to proportionately increase the price of a drink when they increase the amount of alcohol in the drink. For some reason, ABC officials has never enforced the law, which, according to how it’s figured, is widely ignored by bars across the state.

What legislators apparently had in mind was to eliminate the financial incentive to buy — and consume — larger drinks. If a 10-ounce beer costs $3 (30 cents per ounce), a 14-ounce beer also should cost 30 cents per ounce or $4.20.

It seems pretty simple, but it gets more complicated when you figure in the other costs of serving a drink in a bar or restaurant. According to a representative of the Kansas Licensed Beverage Association, bars actually are complying with the 1986 law. The costs of serving a drink — labor, etc. — don’t rise just because the amount of alcohol in a drink rises. For instance, bar owners can charge twice as much for the alcohol in the drink, but the overall cost of the drink won’t double because it is offset by lower overhead costs.

So much for what legislators may have thought was a straightforward effort to eliminate the financial incentive to consume alcohol.

After the ABC’s announcement, Parkinson waylaid the enforcement order until the Legislature could clarify the statute. Starting enforcement now, he said, could have an adverse impact on many small business owners. (If businesses already are complying with the law, what’s the problem?)

The delayed enforcement may help businesses, but what about the consumers? A Kansas University official pointed out that charging higher prices for larger drinks is a common sense way to discourage alcohol consumption, especially among young people on limited budgets. One of the advantages routinely cited in connection with raising the tax on cigarettes is the deterrent it provides for young smokers.

It probably doesn’t hurt to revisit this statute and find out exactly what legislators had in mind. The review might even prompt changes in the law to clear up or eliminate the “overhead” rationale that businesses are using to justify not raising drink prices in proportion to the amount of alcohol they contain.

Making customers pay directly for the amount of alcohol they consume may provide only a small incentive to drink less, but it’s a step in the right direction.


jafs 7 years, 11 months ago

Why should the government be involved in what prices bars/restaurants charge?

John Hamm 7 years, 11 months ago

This is a ridiculous statue. Ever hear of economy of scale? For example if you order two mixed drinks they will require: 2 glasses, 2 servings of ice, 2 servings of mixer, 2 servings of liquor and double the labor to mix and serve them. For a "double" you have 1 of everything except the liquor! Now please tell me how in the heck you can deduce that the "double" should cost twice as much as the single. Kansas be elected to the legislature - turn brain off.

Centerville 7 years, 11 months ago

Let's see who comes out on top of this one: a. politicians who like to raise taxes, or b. bar owners and bartenders who know how to both run a business and please a customer.

olddognewtrix 7 years, 11 months ago

Of all the important issues before our state that should be editorialy examined, such as the neanderthal debates going on in statewide political races, the suffering of all level of education due to the parsimony of the Mike ONeal led legislature, it would seem the price of a drink in a bar is of low urgency.Perhaps editorial writers have their bad days too!

gccs14r 7 years, 11 months ago

i'm with everyone except the editorial and the ABC on this one. Double the amount of booze in a drink, double the cost of the booze component. Simple. The tobacco tax argument doesn't apply, and in fact harms the editorial argument, because the State does not mandate that cigarettes (or nicotine) have a consistent unit cost. Want to spend less money smoking? Buy a carton, or roll your own. The same is true for drinking. Want to spend less money drinking? Buy larger drinks, or drink at home. If ABC gets its way, watch 2/3 of the bars in the state go out of business. The 1/3 remaining will be the small town bars that primarily serve PBR and the like. Oh, and watch tax receipts plummet.

Kendall Simmons 7 years, 11 months ago

Let's see. The Governor suspended the upcoming enforcement of the law (a law that hasn't been enforced in its 14 years of existence) until the Legislature clarifies what they meant.

But Dear Editor still felt it logical to write "it's hard to argue with the apparent intent of the law".

This while using one qualifier after another: "what legislators APPARENTLY had in mind" and "so much for what legislators MAY HAVE thought" and "it probably doesn't hurt to revisit this statute and FIND OUT EXACTLY WHAT LEGISLATORS MEANT"

Sounds to me like what Dear Editor really wanted to say was that "it's hard for ME to argue with what I think the legislators meant"... because he "apparently" isn't troubled by the fact that the intent isn't clear.

(By the way, it also seems to me it would still be cheaper to pay for extra alcohol in one drink than it is to buy two drinks, so I have a sneaking suspicion that what Dear Editor thinks was the 1986 legislature's 'alleged' intent to reduce drinking wouldn't be anywhere near as effective as he likes to think they thought.)

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