Posted 11:35 pm Monday, August 30, 2010
Winona Alcohol Windfall Still Up In The Air
By ADAM RUSSELL
Staff Writer
Cases of liquor and wine line the walls and shelves inside the 1,000-square-foot room set aside for wholesale purchasers inside Manish Amim's retail and wholesale beverage store. The smell of freshly nailed pine and plywood is a nagging reminder of new construction.
Staff Writer
Cases of liquor and wine line the walls and shelves inside the 1,000-square-foot room set aside for wholesale purchasers inside Manish Amim's retail and wholesale beverage store. The smell of freshly nailed pine and plywood is a nagging reminder of new construction.
Amim has been selling spirits for more than 15 years and owns an alcohol retail and wholesale business in Winfield, near Mt. Pleasant, an hour-and-a-half to the north. For months, he made the trip almost daily, commuting to get in on the rush for beer, wine and liquor sales in the only “wet” area in Smith County — Winona.
The smells of fresh paint and plaster inside five newly constructed businesses contrast their dusty unfinished parking lots lining Texas Highway 155 just inside the city limits. Dozens of patrons, beer haulers and pedestrian liquor peddlers make the rounds to purchase or present their spirited libations.
The scene is reminiscent of an old west boomtown.
The smells of fresh paint and plaster inside five newly constructed businesses contrast their dusty unfinished parking lots lining Texas Highway 155 just inside the city limits. Dozens of patrons, beer haulers and pedestrian liquor peddlers make the rounds to purchase or present their spirited libations.
The scene is reminiscent of an old west boomtown.
The alcohol boom in Winona is undeniable, but a moratorium of state laws has put the wholesale market, which serves restaurants and bars, and allows store owners such as Amim to increase bulk purchases, reducing costs for his business and retail customers, in limbo.
“I was gambling to come here,” Amim said leaning on crates of wine. “I have more than $300,000 in liquor in this room and nobody to buy it. Basically I lost that gamble.”
“I was gambling to come here,” Amim said leaning on crates of wine. “I have more than $300,000 in liquor in this room and nobody to buy it. Basically I lost that gamble.”
Amim was gambling on getting a slice of the sale of distilled spirits to 50 restaurants and bars in Smith County, which generated almost $40 million in sales from 2000 to 2009, based on taxes received by the state. The state receives 14 percent of all gross receipts for mixed beverages and does not include beer and wine sales.
State law requires mixed-beverage permit holders to purchase all distilled spirits from distributors within the county they are located — in this case, four permitted distributors in Winona. The law does not apply to beer and wine.
However, on Feb. 26, the Texas Alcoholic Beverage Commission suspended state law requiring Smith County beverage retailers to purchase distilled spirits from distributors in the city.
Suspension of state beverage law allows local restaurants to continue purchasing distilled spirits from out-of-county vendors indefinitely.
Distributors insist that their ability to supply restaurants never was properly tested. Restaurateurs are concerned that any disruption to supplies would hurt business. TABC officials say they must consider both sides and make a decision based on what is best for the market.
But according to local alcohol commission assessment documents, distributors were capable of supporting restaurants more than a week before the law's suspension.
In a Feb. 17 letter after assessments of Aces High Package Store and Wildcat One Stop Shop (the first two permitted distributors) in Winona, Longview District Compliance Office auditor Billy Keeling's conclusion and recommendation stated that both were prepared to handle orders from local beverage retailers, including restaurants.
“Upon completion of my assessment of both local distributors, I observed both are ready to provide the necessary service in regards to the sale of distilled spirits to the RM's (mixed beverage restaurant permit holders) in Smith County,” he wrote in the letter. “They have established their inventory systems, and I am confident that with their systems in place, they can accommodate the RMs in Smith County.”
On Feb. 26, commission administrator Alan Steen wrote in a letter that an assessment of the distributors determined they “will be unable to meet the needs of the market, thus, placing a great burden on the businesses currently operating in Smith County potentially creating an undue disruption of the marketplace.”
In April, the commission's Assistant Chief of Field Operations Dexter Jones said the timeline for reassessment would be dependent upon distributors' ability to show they can meet the needs of establishments or the presence of additional distributors. The moratorium took into consideration the distributors' ability to receive and extend credit for beverage purchases, which was not a part of the local assessment, Jones said.
The commission has suspended the law before. In 2005, the city of Anna became the lone wet jurisdiction in Collin County. In February 2006, a single distributor was permitted but deemed unable to service retailers in markets such as Plano. Jones said it took about a year before more distributors established the capacity to serve the market.
There were four distributors in the market by February 2007, according to TABC permit documents.
After the law was suspended in Winona, Texas Restaurants Association President Bob Westbrook, expected other distributors to open soon and suggested restaurants should prepare for the suspension to end.
Two additional Winona distributors have been open since March. Jones said reassessment of the market is expected within three weeks.
Westbrook, who also is a local restaurateur, said the agency asked for input during both assessment processes.
“Their main concern is that (enforcing the law) doesn't put undue pressure on (Winona wholesalers) and our restaurants,” he said Wednesday. “The TABC is working hard for both sides.”
Westbrook said the agency is mindful that established out-of-county wholesalers and restaurants have long-term, sometimes multi-generational relationships. He said severing those ties is inevitable because of the law but that the commission considers how the change will affect the market.
Wholesalers are making bulk purchases now in preparation for the wholesale and retail holiday season, he said.
“It's a tight-rope,” Westbrook said. “Restaurants have these long-time relationships with distributors, so until the TABC says ‘you will change by this date,' they're not going to switch.”
Some restaurants are changing. Amim serves eight accounts but said others are hesitant to abandon their current suppliers while the moratorium continues. In the meantime, Amim has slowed the flow of time and money he invests in Winona.
Restaurateurs such as Gus Ramirez (El Charro) and Rick Eltife (Rick's on the Square) said relationships with current distributors allow them to continue business as they have. A change, they said, would affect their businesses' bottom line. Both expressed concerns about Winona distributors' ability to supply the variety and inventory required to avoid disruption of their business.
“I want to buy from the guy who is the fairest and can supply me. If they could do that, I would buy from (Winona) no problem,” Eltife said. “I don't think they can.”
The law is what brought Amim and the other distributors to Winona. He is concerned the moratorium will continue into 2011. The 82nd Legislative Session begins in January, and he worries legislators will introduce bills that, if passed, would give restaurants and bars the option to purchase distilled spirits from anyone.
Restaurateurs have said the law needs to be changed.
In Titus County Amim's business serves 27 accounts, mostly in Mt. Pleasant. He said monthly wholesale spirits sales total $115,000 to $150,000.
His frustrations with the process in Winona are telling in the tempo and tone of his words.
He understands and respects what is at stake for restaurants and for their current distributors, he said, but he believes those relationships are influencing enforcement of the law to his businesses' detriment.
Amim said he knows, by experience and Smith County restaurants' inventory requirements based on tax records, what it would take to supply the market.
“I am more than capable of handling them,” he said. “I am not going to get all 50 accounts, but there are three other distributors. I am losing hope that we'll even be given a chance to show we can do it.”
State law requires mixed-beverage permit holders to purchase all distilled spirits from distributors within the county they are located — in this case, four permitted distributors in Winona. The law does not apply to beer and wine.
However, on Feb. 26, the Texas Alcoholic Beverage Commission suspended state law requiring Smith County beverage retailers to purchase distilled spirits from distributors in the city.
Suspension of state beverage law allows local restaurants to continue purchasing distilled spirits from out-of-county vendors indefinitely.
Distributors insist that their ability to supply restaurants never was properly tested. Restaurateurs are concerned that any disruption to supplies would hurt business. TABC officials say they must consider both sides and make a decision based on what is best for the market.
But according to local alcohol commission assessment documents, distributors were capable of supporting restaurants more than a week before the law's suspension.
In a Feb. 17 letter after assessments of Aces High Package Store and Wildcat One Stop Shop (the first two permitted distributors) in Winona, Longview District Compliance Office auditor Billy Keeling's conclusion and recommendation stated that both were prepared to handle orders from local beverage retailers, including restaurants.
“Upon completion of my assessment of both local distributors, I observed both are ready to provide the necessary service in regards to the sale of distilled spirits to the RM's (mixed beverage restaurant permit holders) in Smith County,” he wrote in the letter. “They have established their inventory systems, and I am confident that with their systems in place, they can accommodate the RMs in Smith County.”
On Feb. 26, commission administrator Alan Steen wrote in a letter that an assessment of the distributors determined they “will be unable to meet the needs of the market, thus, placing a great burden on the businesses currently operating in Smith County potentially creating an undue disruption of the marketplace.”
In April, the commission's Assistant Chief of Field Operations Dexter Jones said the timeline for reassessment would be dependent upon distributors' ability to show they can meet the needs of establishments or the presence of additional distributors. The moratorium took into consideration the distributors' ability to receive and extend credit for beverage purchases, which was not a part of the local assessment, Jones said.
The commission has suspended the law before. In 2005, the city of Anna became the lone wet jurisdiction in Collin County. In February 2006, a single distributor was permitted but deemed unable to service retailers in markets such as Plano. Jones said it took about a year before more distributors established the capacity to serve the market.
There were four distributors in the market by February 2007, according to TABC permit documents.
After the law was suspended in Winona, Texas Restaurants Association President Bob Westbrook, expected other distributors to open soon and suggested restaurants should prepare for the suspension to end.
Two additional Winona distributors have been open since March. Jones said reassessment of the market is expected within three weeks.
Westbrook, who also is a local restaurateur, said the agency asked for input during both assessment processes.
“Their main concern is that (enforcing the law) doesn't put undue pressure on (Winona wholesalers) and our restaurants,” he said Wednesday. “The TABC is working hard for both sides.”
Westbrook said the agency is mindful that established out-of-county wholesalers and restaurants have long-term, sometimes multi-generational relationships. He said severing those ties is inevitable because of the law but that the commission considers how the change will affect the market.
Wholesalers are making bulk purchases now in preparation for the wholesale and retail holiday season, he said.
“It's a tight-rope,” Westbrook said. “Restaurants have these long-time relationships with distributors, so until the TABC says ‘you will change by this date,' they're not going to switch.”
Some restaurants are changing. Amim serves eight accounts but said others are hesitant to abandon their current suppliers while the moratorium continues. In the meantime, Amim has slowed the flow of time and money he invests in Winona.
Restaurateurs such as Gus Ramirez (El Charro) and Rick Eltife (Rick's on the Square) said relationships with current distributors allow them to continue business as they have. A change, they said, would affect their businesses' bottom line. Both expressed concerns about Winona distributors' ability to supply the variety and inventory required to avoid disruption of their business.
“I want to buy from the guy who is the fairest and can supply me. If they could do that, I would buy from (Winona) no problem,” Eltife said. “I don't think they can.”
The law is what brought Amim and the other distributors to Winona. He is concerned the moratorium will continue into 2011. The 82nd Legislative Session begins in January, and he worries legislators will introduce bills that, if passed, would give restaurants and bars the option to purchase distilled spirits from anyone.
Restaurateurs have said the law needs to be changed.
In Titus County Amim's business serves 27 accounts, mostly in Mt. Pleasant. He said monthly wholesale spirits sales total $115,000 to $150,000.
His frustrations with the process in Winona are telling in the tempo and tone of his words.
He understands and respects what is at stake for restaurants and for their current distributors, he said, but he believes those relationships are influencing enforcement of the law to his businesses' detriment.
Amim said he knows, by experience and Smith County restaurants' inventory requirements based on tax records, what it would take to supply the market.
“I am more than capable of handling them,” he said. “I am not going to get all 50 accounts, but there are three other distributors. I am losing hope that we'll even be given a chance to show we can do it.”
