Arkansas’ arcane liquor laws stir opportunity and opposition

by The City Wire staff ( 437 views 

Editor’s note: The following story was written for TBQ magazine, a quarterly publication produced by Little Rock-based journalist Roby Brock. Link here for more information about the magazine and its newest issue.

story by Michael Tilley

Arkansas’ liquor laws are a convoluted concoction of rules creating a checkerboard of 43 dry counties and 32 wet counties. Some of the dry counties are as dry as the bottom of the Arkansas River. Sebastian County, for example, is dry unless you consider that Fort Smith — home to roughly 75% of the county population — is wet.

Or the “dry” Benton County that is home to 123 private club permits. The other four members of the top five most private clubbed dry counties (Faulkner, Craighead, Saline and Pope) have, combined, only 82 private club permits. The wet counties of Pulaski and Washington have 123 private club licenses combined. You can’t pop a champagne cork in Benton County without hitting a private club.

We have rules as to when and how alcohol can be sold from either a convenience store, grocery story or a bonafide liquor store; rules differentiating between sales of wine fermented in Arkansas and wine fermented outside the state. There are rules that say your local Chili’s or Applebee’s is simply a restaurant that can serve beer if built in a wet county, but is a special private club with a (wink, wink) membership policy to go along with food sales if it operates in a dry county.

There are rules on specific times hooch can be sold on the weekends because we’re all mindful of and in agreement with the seminal Harvard study proving that a beer sold at 9:59 a.m. on a Sunday morning leads to immediate and terrific societal destruction, whereas the same beer sold 61 seconds later is nothing more than a standard commercial exchange between consenting adults that results in a positive economic impact for the local economy and tax proceeds for state and local governments.

Not familiar with the Harvard study? Of course you’re not, because no such study exists. Which is something to keep in mind when considering dang near all Arkansas liquor laws and wondering if there is some pragmatic reason for their formulation — No Such Study Exists.

And no definitive study likely will ever exist. The popular social satirist P.J. O’Rourke, commenting on U.S. drug policy, once noted: “Anyway, no drug, not even alcohol, causes the fundamental ills of society. If we're looking for the source of our troubles, we shouldn't test people for drugs, we should test them for stupidity, ignorance, greed and love of power.”

If Christ returned today to pull his famous wedding trick in Craighead County, one of his disciples might encourage the Lord to also pull a private club liquor license out of the backside of his golden toga or there’ll be hell to pay. But Christ would know that, because if anyone fully understands the enigmatic labyrinth of Arkansas’ liquor laws it could only be an all-knowing member of the Holy Trinity.

Or Michael Langley.

Langley is director of the Alcoholic Beverage Control Division. It was a simple questioned posed to him in the interview for this story: “Explain why we shouldn’t believe Arkansas’ liquor laws are nothing more than a tangled web of patchwork rules based more on the fluctuating social mores of when they were founded and amended, rather than any reasoned science, physiology or rational understanding of how humans interact with and around political boundaries and the free market system?”

Langley laughed. Paused. Laughed again, and then said something about offering a 10 cent answer to a $1 question.

“I think disjointed is probably the better term for our liquor laws,” Langley responded, adding that the laws “are all over the place.”

To be fair, Langley’s job is not to defend the state’s liquor laws. His primary job is to ensure that those for and against selling spirits obey the spirit and letter of the law. In admitting without being asked that the body of law is not necessarily intended to be judged as pragmatic, Langley provided honest and sober context. Furthermore, he believes volatile “political atmospheres” through the decades played a big role in changes to the law, especially in a state where religion guided public policy as to what was right and wrong for liquor use.

Langley is also quick to admit that Arkansas' liquor law “has a clear bias” to keep counties dry, citing the rule that to change a county's wet/dry status requires signatures from 38% of the number of people who voted in the county’s recent general election. With churches and adjacent county liquor store owners eager to protect their borders and booze sales, respectively, it’s nigh impossible to hit the 38% mark.

“This is my opinion, but that’s on there to protect the status quo; to protect dry counties and to protect county-line liquor stores,” Langley explained.

Although Marion County voted itself dry in 2006, similar efforts failed in Baxter, Boone, Clark and Sharp counties. Langley said wet proponents in those counties will try again. He said the “talk in coffee shops” in Clark County — home to Henderson State University and Ouachita Baptist University — is that the next vote to go wet might pass.

But a county doesn’t have to vote itself wet to be wet. There is the Betty Pickett law.

Act 1813 of the 2003 regular session of the Arkansas General Assembly was sponsored by Rep. Betty Pickett, D-Conway, and expanded the definition of a private club so a locally owned or nationally-franchised restaurant could sell beer, wine and mixed drinks in a dry county.

Greg Nabholz will go so far as to say the Betty Pickett law could have been one of the many triggers that convinced Hewlett-Packard to locate a 1,200-employee customer and technical service center in Conway. The June 2008 announcement that Palo Alto, Calif.-based HP would build a $43 million facility in Conway was the reward for a more than 7-year effort by Conway business and political leaders to expand the city’s “cool factor,” Nabholz said.

That effort began in 2001 with a failed effort to push legislation allowing cities to vote for a liquor-by-the-drink law. Nabholz, then the president of Citizens for a Progressive Arkansas, said officials in Conway, Jonesboro and other cities believed flexible alcohol rules would better help communities in the global economic development game.

Liquor store owners opposed the 2001 effort because it might allow cities then to push to open up for liquor stores, and the package stores “might lose the government protection of their market areas,” Nabholz noted with a hint of bitterness. They then encountered opposition from restaurants and hotels in adjacent wet counties.

After the Pickett law, downtown Conway began to grow with new restaurants and retail stores. Whether that is a coincidence or a result of the law remains a debate between teetotalers and those who like to swirl a merlot with their moist mignon.

There is no doubting the growth in mixed drink sales in Faulkner County. According to the Arkansas Department of Finance and Administration, the mixed drink tax collected in Faulkner County (10% statewide tax rate) rose from $46,001 in 2002 to $299,719 in 2008. That’s a 551.5% increase in the six-year period for those keeping score at home. Tax collections statewide from the mixed drink tax were $7.26 million in 2008, up 39.5% from 2002 collections.

Downtown improvements between 2003 and early 2008 “set the stage,” Nabholz explained, so that when HP took a tour of Conway, the vibrant downtown was a plus.

“The bottom line is, if you don’t have that cool downtown, you’re out of the game,” Nabholz said. “Having the quality of life amenities, including alcohol and entertainment options in a walkable, livable urban core … those are the things that are going to help the communities in Arkansas be able to compete.”

Langley, a smart attorney, refused to be drawn into the debate.

“If your argument is that we need more amenities for economic development, then the Betty Pickett law is the way to go,” Langley said. “The restaurants and things contributed to the quality of life issues that HP considered. … We can’t completely ignore that effect … because some people have never heard of a dry county until they come to Arkansas.”

Langley added that Faulkner County is “a good compromise between those who seek alcohol sales and those who want to maintain a dry county.”

The other view of the Betty Pickett law is that it is “legal jargon” and “lies from hell” destined to deliver “tremendous negative consequences” to the citizens of Arkansas. That’s the view of Bob Hester, a Craighead County resident who Langley said is one of the more active voices against the expansion of Arkansas liquor laws.

Hester is a self-proclaimed “Christian activist” and has spent more than 20 years fighting the infiltration of pornography and liquor into any corner of the state. They were happy to live with the country clubs and Elk clubs having alcohol, but when the Betty Pickett law was passed, “that was too much,” Hester said.

If you ever have about an hour to kill, ask Hester, who claims to have never sipped the slightest amount of booze, the following three questions.

• What’s your beef with alcohol, anyway?
• Is it really so wrong for an adult to want to have a glass of wine or a Maker’s Mark and water with a steak?
• What about liberalized alcohol laws being good for economic development?

To the first question, Hester noted: “First of all, alcohol is a drug. It’s the number one gateway drug to other drugs and it has tremendous negative consequences. It should be obvious to everyone how devastating alcohol is.”

Opposing alcohol is not just a moral issue, “it’s a practical, safety issue,” Hester advises. “I think they (people who insist on the need to have a drink with a meal) are not being considerate of their neighbor or children for having that and getting in their car and driving. They are very selfish folks, and they need to study up on alcohol,” Hester further advised.

And Hester refuses to acknowledge that any adult is capable of having just one or two drinks, or having a designated driver or seeking a cab.

“If we were talking about having just one beer or one glass of wine with a meal, then we wouldn’t be having this conversation. … But you know they don’t just stop with a few (drinks). It’s like those radio ads say, ‘Buzzed driving is drunk driving.’”

As to the economic development issue …
“That’s the biggest lie that ever came out of hell,” Hester said with an evangelical flourish. For those who claim liquor sales help recruit businesses, Hester notes that a vast majority of wet counties are in the Arkansas Delta.

“So if that’s the case, why aren’t counties in the Delta economic powerhouses?” Hester rhetorically quizzed.

Not waiting for an answer, Hester continued: “Nobody has ever given us one example of a person that said they would not come to a county because there is not enough alcohol. I think they would be very foolish to say that because a lot of alcohol is not a good thing when it comes to worker safety and productivity.”

Hester said several groups, including Citizens for Responsive Government, are gearing up to push back against efforts to expand Arkansas liquor sales. A legislative challenge to the Betty Pickett law and fighting permits that go before the ABC board are two of the “several routes” in the effort, Hester predicted. Would the group work on a statewide referendum to nix the Betty Pickett law?

“A referendum has been mentioned, but I’m not sure how realistic that is. It’s one of those options, I’d say,” Hester said.

There is also the possibility of a legal challenge to the Betty Pickett law. Hester, citing language from the private club law and the 2003 revision by Pickett, made an interesting point in questioning how a for-profit restaurant can claim to be a non-profit enterprise in which the proceeds from liquor sales are to be returned to the operation or the members.

“Do you really think they (nationally franchised restaurants like Ruby Tuesdays) are operating like that, like a non-profit?” Hester said.

Hester and allies might win a legal battle, but numbers from police enforcement fail to prove their claims of an uptick in alcohol-related problems in counties recently approving some form of expanded liquor sales.

Faulkner County had 25 auto fatalities in 2003, with nine of those being alcohol/drug related. In 2007, the county posted 13 fatalities, with just six related to alcohol/drug use. In all of Arkansas, the percent of auto crashes related to alcohol/drug use was 6% in 2000, 6% in 2003 and 5% in 2007. More telling is the reversal in dry county/wet county fatalities. In 2003, 41% of fatalities in dry counties and 43% of fatalities in wet counties were alcohol/drug related. In 2007, 44% of fatalities in dry counties and 41% of fatalities in wet counties were alcohol/drug related.

“All the problems that the people who were against this effort said would happen, has never materialized,” Nabholz said.

Maybe so, but if even a small percentage of the passion of the thousands of Bob Hesters in Arkansas is converted to action, it’s likely that the people who were against the effort will soon materialize into a real problem.

Richard Hodo has seen firsthand this passionate opposition. Hodo, the son of an evangelical minister, was the first restaurant owner in conservative Crawford County to seek and gain a liquor license for a restaurant located in historic downtown Van Buren.

It was Aug. 15, 2007, when Hodo was granted the license by the ABC board, but not before a flurry of personal attacks and hardcore opposition from the First Baptist Church in Van Buren. Church leaders even cajoled prominent Van Buren business leaders into opposing Hodo’s license request.

Hodo doesn’t drink. Alcohol, he admitted, is not his thing. His thing, however, is bringing life back to a downtown he has promoted relentlessly for more than 30 years.

“If anybody knew me, they’d know that I don’t need the money. But I stood out there on Main Street and I could see that the street was dying. So I thought, ‘It’s a shame we don’t have something that will make this a focal point for people to come to,’” Hodo said.

Hodo hired well-known economist Jeff Collins to issue a report on what could help the downtown thrive. Not unlike what Nabholz discovered, having access to alcohol sales was necessary to reinvigorating a “cool” downtown, noted the Collins report.

Hodo knew his decision to push for liquor sales would be controversial. He approached his Assembly of God pastor a few days before the ABC board meeting.

“I told him, reminded him, I guess, that I was raised in the church. My Dad was a minister. But I wanted him (pastor) to know that I did what I felt I should do to help the economy,” Hodo explained.

Hodo was told what Hester thought about the economic argument, and how alcohol is, according to religion, an evil.

There was a pause before Hodo cleared his voice and lowered the volume of his response to a respectful reverence: “My dad, I can still hear him talking from the pulpit, would preach that it’s not what goes in your mouth that defiles you, it’s what comes out. He believed and I believe that it’s not the substance, but it’s the lusting after the substance that is the sin.”

The business — “Sisters” restaurant in downtown Van Buren — is doing well since it began selling alcohol on Aug. 25, 2007. The Aug. 17 date of the license approval was also the same day many years ago that Hodo lost his father. The Sunday champagne brunch draws a crowd, and many of those are Baptists, Hodo noted.

So what would his evangelical minister father think of his son owning a successful restaurant that also sold alcohol?

“He would be happy that business is like it is,” Hodo said. “I think we’d both think that people ought to have the right to make that decision, and that we don’t have the right, because of what we might hear (in a church), that we don’t have the right to take that right away from people.”