RICHMOND, Va. -- An effort to change a longtime Virginia law governing liquor sales in restaurants was effectively killed Tuesday when the House of Delegates voted to send it back to the committee level.
In Virginia, restaurants that sell liquor are required to make at least 45% of their overall sales from food products.
A bill carried by Sen. Bryce Reeves, R - Orange, would have lowered that ratio to 35%, but done away with the ratio requirement entirely if the restaurant sold at least $10,000 in food per month. That version passed the Senate unanimously.
"What this does is it equals the playing ground and it allows fair access to the market. The other thing it does is it takes away some of the onerous red tape burdens for restaurant owners," Reeves said Tuesday morning. "The General Assembly, legislators thought that if you're going to drink, you should probably have food with it. And that was the intent of the bill. But, over the years, the bill became a barrier to market so to speak. It would control, kind of, entrepreneurs being able to open up a corner restaurant establishment and serve spirits."
As the bill made its way through the House, Reeves did agree to increase the amount required to sell to $35,000.
"I would say you're a restaurant if you're serving that much food. I think most Virginia's common sense would say you're a restaurant versus just a liquor establishment or bar," said Reeves, who added that amount would still cover over 70% of restaurants impacted by this rule.
Among those supporting the proposal is Mac McCormack, who owns Big Whisky Grill, and said the ratio is onerous because of the high-end liquor he carries.
"I was talking about Macallan 25 - they sell this at ABC for about $3,000 a bottle. And so that puts the shop price at around $550. I'm on the hook for $475 for the food currently because I sold one drink. And that's the way it works for every single spirit," said McCormack. "Our average drink is around $27. So, every single drink basically requires an entree sale."
"Hopefully, we get some change, because it doesn't really make sense the way it's written now," he added. "It's really important because potentially really nice restaurants can be put out of business simply because of Draconian laws. I mean, who cares how people spend their money? Like, why am I responsible for how you choose to spend your money?"
Mike Byrne, Director of the Virginia Restaurant Association is among those against proposed changes to ratio and said high-end liquor sales do not account for a large portion.
"$35,000 worth of sales in a month is $1,100 hours a day. Which is, for some -- you can do that in an hour or two per day and the rest of the time, it could be strictly a bar," Byrne said. "Up until now, if you're a restaurant you had to invest in a kitchen, invest in staff, train your staff on not only ABC issues, but how to cook and carry an inventory. And so, we all have a lot invested in that."
"You could have a nightclub license, you can have other options available to you that solved the problem. To get rid of the ratio over $35,000 doesn't solve the problem at all. It just allows basically bars to be anywhere you want them to be."
That concern was raised by Del. David Bulova, D - Fairfax, who made the motion Tuesday to return the bill to the committee. This year's General Assembly session ends Saturday and committees had to finish their work on Monday, effectively killing the bill.
"I understand that there are probably issues with the current policy I think it's not prudent that we move forward with basically reverting and gutting the current policy that has served Virginia well," Bulova said on the floor prior to the vote.
"On behalf of the Virginia Restaurant Association we were pleased with the Virginia House of Delegates who listened and voted to support our industry. The Bill to change and eliminate the food ratio was killed and that is good news for restaurant operators in the Commonwealth Of Virginia," Byrne said in a statement in response to the vote.
Reeves also released a statement after the motion and said in part "[I]t’s unfortunate that a pro business, red-tape slashing bill died by process today rather than risking a vote and its potential passage."
When asked if he intended to bring the bill back next year, a spokesperson for Reeves said the senator had not decided.
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