RALEIGH — The North Carolina Bar Owners Association (NCBOA) is advocating for reforms to state alcohol laws governing club and private bar membership that they say are antiquated and that violate privacy rights of consumers.
NCBOA is a 501(c)6 nonprofit organization founded by bar owners from across the state that is “working towards a common goal of reforming North Carolina’s outdated ABC system and updating prohibition era alcohol laws to better serve the consumer today.”
A press release by NCBOA called the membership requirement for clubs and bars “burdensome” and “rooted in racist beginnings designed to legally discriminate against people of color.”
In North Carolina, state statutes say that establishments bringing in 30% or less in food or nonalcoholic sales are considered private clubs or bars. As such, private clubs or bars required to charge a $1 annual membership fee to customers. In addition, members have to sign in before being served a drink and membership rosters that include a person’s full name and address can be accessed by law enforcement without a warrant.
Jay Ruth, Vice President of NCBOA, tells North State Journal that his group want to see an end to those practices which he described as being put into place at the end of the Prohibition era “to keep certain groups out.”
“That needs to change,” said Ruth. He added that private bars and clubs are the only establishments in the state where one has to provide personal information in this manner.
North Carolina is one of only around 17 states where liquor is still controlled by the state.
NCBOA is also seeking greater flexibility in sale and advertising of alcoholic beverages. Ruth says they want the option of being able to put signs advertising their specials outside bars and clubs.
“If you see a restaurant, a bar, any mixed beverage permit holder that has a sign out front that let’s say says “Jack Daniels” or “beer here,” that is technically illegal,” Ruth said. “We want to see that change where you could put an Absolut Vodka neon in your window, or a regular banner or even a sign out front that says, ‘come in and have a drink with us’.”
Advertising “Happy Hour” drink deals are also an issue. State law says bars can’t change drink prices unless it applies to the entire calendar day. Around 42 states allow happy hours.
Relief for membership requirements as well as signage and advertising issues may be on the horizon with a pair of bills recently filed at the General Assembly.
House Bill 1108, Allow ABC Permits for Bars, would repeal the outdated, unnecessary requirement for bars to maintain a membership registry.
House Bill 1135, ABC Laws/Local Sales Option, would allow local governments to establish a “happy hour” ordinance, allowing establishments to obtain a permit for $100 from the ABC allowing for discounted adult drinks during specified hours. Happy hour permits appear to be tied to a city or county government choosing to adopt such an ordinance, however.
The lead sponsor on both bills is state Rep. Tim Moffitt (R-Henderson), chair of the House standing Alcohol Beverage Control committee.
State Rep. Jon Hardister (R-Guilford), a vice chair on the committee, said in an interview with North State Journal that the membership requirement was “unnecessary paperwork” for a business and patrons to have to keep up with.
“There’s really no benefit to it,” said Hardister, adding there is no logic to a membership requirement and there is “definitely a privacy issue.”
“It’s almost 100 years later,” Hardister said of the membership laws. “This is a matter of modernizing laws, repealing a requirement that is outdated and doesn’t make any sense.”
“We applaud legislators for taking initiative on the happy hour bill,” Zack Matheny, President of the North Carolina Downtown Development Association said in a statement. “This gives business owners another tool through the survival of the pandemic.
North State Journal ask Ruth how bars and clubs were now doing after being the only set of businesses forced to remain closed the longest due to Gov. Roy Cooper’s pandemic response orders.
Ruth said the state Alcohol Beverage Control Commission (ABC) has been slow to update the permit lists but that “probably 200 or so private bars statewide went under during the pandemic.”
“There have been some rebounds in the bars across the state,” said Ruth. “We’re estimating at this point there’s probably around 900 private bars left across the state.”
The ABC’s most recent annual report says ABC stores around the state posted liquor and wine sales totaling $1,367,857,493 in the fiscal year ending June 30, 2020. Distributions from total revenue that year in the amount of $529,307,824 went into the state’s General Fund and the cities and counties where alcohol sales are permitted.
Heading into the summer tourism months, alcohol sales have increased over last year.
“Total sales across all ABC boards in April 2022 were $150,911,294 (a 6.1% increase over April 2021) and total sales during 2022 are up 9.75% over 2021 thus far,” according to a May press release by the ABC.
North Carolina’s overall tourism revenue had been steadily growing for the better part of the last decade prior to the pandemic.
In 2018, the state logged a record visitor of $25.3 billion, but when the pandemic hit in 2020, tourism spending statewide came in at $19.96 billion; a 32% increase over 2019.
2021 saw an uptick, rising to $28.9 billion.