State Lawmakers Move To End Restriction On Sale Of Adult Seltzers

In Texas it’s lawful to shoot wild hogs from a helicopter, but buying High Noon and many other low alcohol seltzers from a grocery store is illegal. Though that could soon change, because Texas is one of many states where prospective legislation is being discussed that would allow the sale of spirits-based ready-to-drink (RTD) cocktails in grocery and convenience stores where White Claw, Truly, and other adult seltzers are already on the shelves.

In many parts of the U.S., state law prohibits spirits-based RTDs like High Noon from being sold in grocery and convenience stores where the sale of similar RTD adult beverages made from fermented sugar or malted barley is permitted. This disparity in regulation of similar and competing products, which lawmakers have ended recently in many places, is something legislators in more state capitals are working to address in 2023.

Lawmakers and governors in several states have enacted legislation in recent years to end disparate access in the RTD beverage market by moving from source-based alcohol regulation to alcohol content-based regulation. Last year Vermont became the latest state to permit the sale of spirits-based RTDs in retail outlets selling beer and wine, as well as the 25th state to provide a reduced tax rate on low alcohol-by-volume (ABV) spirits products. Similar legislation is poised to be approved in more states in the coming months.

Take North Carolina, one of the remaining states where the sale of canned cocktails is restricted based not on alcohol content, but also based on the source. As it now stands, North Carolina residents and visitors can get White Claw or Truly seltzers at the grocery store while stocking up for a party or cookout. But if, instead of Truly or White Claw (5% ABV), someone would rather pick up a pack of High Noon (4.5% ABV) or Caddy Clubhouse canned transfusions (5.9% ABV) made by Raleigh-based Next Century Spirits in partnership with Greg Norman, state law forces people to drive to a government-run liquor store after finishing up at the grocery store.

Representative Jason Saine (R) introduced legislation to remedy this regulatory disparity in 2021. That proposal would’ve allow spirits-based RTD products to be sold in grocery stores and other retail outlets that already sell canned seltzers like Truly and White Claw. That bill did not pass before the end of the previous session and, as such, will need to be reintroduced if it is to receive further consideration.

Next door in Tennessee, which also restricts the sale of spirits-based RTDs but not those made with beer even though they may have a higher alcohol content, state lawmakers recently introduced legislation to expand market access. House Bill 376 and Senate Bill 304, introduced in January by Representative Pat Marsh (R) and Senator Jon Lundberg (R), would allow spirits-based RTDs to be sold in grocery stores and other retailers where the sale of beer and wine is permitted, so long as the ABV does not exceed 10%.

Aside from some states’ disparate regulatory treatment of canned cocktails based on the source of alcohol, spirits-based RTD drinks also face more onerous taxation than White Claw and other competing RTD beverages. This is the case at the federal level, as well as in the majority of states. In some states, lawmakers are seeking to rectify the disparity in market access, in others they’re looking to remedy uneven taxation in the RTD beverage market, and in some cases, the goal is to address both.

High Noon is an official sponsor of the PGA Tour. Yet in North Carolina, home to the PGA’s new headquarters, it’s illegal to purchase High Noon from a grocery or convenience store. If Representative Saine’s proposal from the previous session is reintroduced and enacted in 2023, however, that prohibition will end before the U.S. Open comes to Pinehurst in 2024. Legislation to reform state restrictions on the sale of spirits-based RTD products has been introduced in nearly a dozen states this year and is expected to pass in many of them. With enactment of these reforms, stocking up for beach trips this summer or tailgate parties this fall will require fewer stops in more states.