Yes, this is except for what’s on front of the box what a wine delivery might look like in Colorado if Proposition 126 passes! {Photo from Meanwell Packaging}

Proposition 126 would allow third-party companies to deliver alcohol directly to customers on behalf of grocery stores, convenience stores, liquor stores, bars, restaurants, and other liquor
licensed businesses. Third-party delivery could begin March 1, 2023 if the initiative passes. It would also permanently allow takeout and delivery of alcohol from bars and restaurants, which is currently scheduled to repeal in 2025. This is a statutory initiative, not Constitutional, and would pass with a simple majority.

Currently, outlets in Colorado can deliver alcohol, but they must use their own employees who are 21 years of age or older and follow other restrictions, depending on their license type. Bars and restaurants have been able to provide takeout alcohol since 2020, which gave bars and restaurants another source of revenue during the COVID economic catastrophe.

Under this initiative, third-party companies delivering alcohol must obtain a delivery permit, follow various safety provisions, and submit proof of liability insurance. All individuals who deliver alcohol through a third-party delivery company are required to be 21 years of age or older, complete a certification program, verify the recipient’s legal age at the time of delivery, and refuse delivery to anyone who fails to provide proof of age or appears intoxicated. The measure also removes retail liquor licensees’ liability for alcohol delivery violations once alcohol is transferred to third-party delivery employees.

Proposition 126 would also remove limits on the amount of revenue that retail alcohol stores and bars and restaurants can earn from alcohol delivery, and would remove a requirement for these outlets to have a physical location in the state. Limits on the amount of alcohol that may be offered for delivery or takeout from bars and restaurants remain in law, which are approximately equivalent to 2 bottles of wine, 12 cans of beer, and 1 liter of spirits per order.

The state Liquor Enforcement Division in the Colorado Department of Revenue would be authorized to enforce violations committed by alcohol delivery licensees.

Who’s Behind It?

The committee backing both Propositions 126 and 125 is called “Wine in Grocery Stores.” The DoorDash delivery corporation had already contributed $3,322,880.24 to this campaign as of the Sept. 19, 2022 campaign finance filing, and Instacart had contributed $3,307,785.07.

Will this campaign spending be worth it? March 2022 information directly from DoorDash said alcohol deliveries were at that time already legal in 22 states plus Washington D.C. and Puerto Rico, and suggested that alcohol deliveries in other states had already increased the dollar amount of orders. Directly from the linked DoorDash report: “We estimate that adding alcohol may increase restaurants’ and grocers’ average customer order values by up to 30% and convenience stores by over 50%.”

I bold-faced two parts of the sentence above because Prop 125 would allow wine sales in grocery and convenience stores, and the committee backing both Props 125 and 126 had received more than $11 million in total contributions as of Sept. 19. If Prop 126 passes but Prop 125 fails, third-party delivery services would still be able to deliver beer from grocery and convenience stores.

I also for the first time in my life visited appsrhino.com, and completely by accident found the following paragraph:

“In 2025, the alcohol delivery app business is expected to be worth more than $42 billion. According to International Wine and Spirit Research, the entire value of the alcohol delivery app businesses in ten worldwide regions, including the United States, will top $40 billion by 2024.”

According to Prop 126 statutory text, it would not require tech services companies to obtain licensing for “providing software or a digital network application that connects consumers and licensed retailers” for deliveries “from the licensed retailer by employees or other delivery service providers of the licensed retailer.”

Read all of this how you will, but it seems obvious that there are economic opportunities associated with alcohol delivery.

Who’s Against It?

The committee Keeping Colorado Local formed to oppose the three alcohol-related initiatives on this year’s ballot, Props 126, 124 and 125. It had raised about $457,000 in contributions as of Sept. 19. However, it’s not easy to look at its contributions and see donations that seem specifically geared toward the delivery issue of Prop 126. Props 124 and 125 seem likely to threaten wine sales for non-corporate small retailers, and Keeping Colorado Local did receive $100,000 from Hazel’s Beverage World in Boulder and $50,000 from Argonaut Wine and Liquor in Denver.

Pro:

  • Home delivery of all kinds of products has become more and more popular, since it’s very convenient for the consumer. More people would be able to get alcohol without starting their cars up.
  • Prop 126 language includes a regulatory structure, including requiring people delivering alcohol to undergo training so they can avoid selling alcohol to people who are underaged or intoxicated.
  • Some retail outlets don’t have the personnel to handle high volumes of home deliveries, while the third-party companies specialize in deliveries.

Con:

  • Opponents say the delivery companies might not be as well-suited to avoid selling to underaged or intoxicated customers as retail outlets would be. This could present public safety issues, and in college towns like Boulder, it’s quite common for people over 21 and under 21 to be present in the same homes or at the same parties.
  • As of Sept. 19, DoorDash and Instacart have both contributed more than $3 million to this campaign. This indicates they believe the initiative would be worth sizeable revenue to them, and since the initiative has no sunset date, it could be a source of revenue for these companies as long as they stay in business.

Richard’s Take

I’ll be voting against Proposition 126 too, though my opposition isn’t as strong as it was for the other two alcohol-related ballot measures from 2022. Like with Props 124 and 125, my opposition is largely based on how it could benefit giant corporations.

First, Doordash and Instacart have already spent far too much money on this ballot measure, and it seems beyond obvious they’d benefit big-time from 126 passing. It’s their right to spend, and my right to criticize the optics of out-of-state large corporations trying to buy new Colorado laws that will be worth a lot of money to them in the long run.

I’ve mentioned in other posts that I’ve seen and heard more than my share of lobbying efforts for new alcohol laws while working at the State Capitol. But while looking at this year’s three alcohol initiatives – Props 124, 125, and 126 – it wasn’t hard to read campaign finance reports and come to the realization that these are big business initiatives pitched under the banners of alcohol and consumer choice. Each of the three initiatives feature contributions of more than a million dollars from out-of-state corporations, and this is only as of Sept. 19.

All in all, this year’s alcohol segment of the election might be really sweet for a handful of big companies, and it’s just not my style to support wealthy corporations getting wealthier.

That said, I’m not completely opposed to third-party delivery services as a concept. Some companies might not want to be in the delivery business, so the third-party corporations offer a legitimate service. Deliveries of all types certainly became more popular or even necessary during the pandemic, and delivery can be a wonderful option for people who need something but can’t drive and don’t have other transportation options.

There are a couple of other dimensions of delivery services for which I have mixed feelings. Delivery services might mean some consumers don’t have to start up a car, but the delivery vehicles generate vehicle miles traveled plus the environmental impacts associated with the actual types of vehicles used. Alcohol delivery might mean people won’t need to drive to get alcohol if they already have a buzz going, potentially reducing driving under the influence, but there’s no telling what the person receiving the alcohol or their houseguests will do after drinking.

Nonetheless, I’ll be voting no on Prop 126, even though potential benefits of third-party delivery are not lost on me.