Scrapping minibottles in S.C. was supposed to reduce drunken driving and raise money — it hasn’t
When South Carolina voters got rid of the state’s odd requirement that liquor be served from minibottles, supporters said the change would reduce drunken driving and increase alcohol treatment funding.
Neither of those predictions has come true, a Post and Courier analysis has found.
Instead, the state has been tapping its general revenue fund for more than $1 million yearly since free-pour liquor drinks became legal in 2006, to make up for lost taxes that support a network of alcohol and drug treatment agencies.
And the average number of drunk drivers involved in fatal South Carolina accidents slightly increased in the years after free-pour became legal, instead of declining.
“What I do believe, personally, is that if we still had the minibottle, we would have a lot more accidents related to alcohol, more divorces related to alcohol, and so on,” said former Republican state Rep. Bill Cotty, who led the legislative push to get rid of minibottles.
It took a change in the state Constitution to allow liquor drinks to be “free poured” from full-sized bottles — a change voters approved in a 2004 referendum.
Free pour became legal on New Year’s Day 2006.
The state’s highest-in-the-nation ranking for alcohol-involved wrecks had persuaded Mothers Against Drunk Driving and the South Carolina Council of Alcohol and Drug Abuse Authorities to side with the hospitality industry and press for the end of minibottles.
The argument was that over time, free-poured drinks — allowed in all other states — had gotten weaker, dropping from 1.5 ounces of liquor to 1.25 or less. But minibottle drinks in South Carolina had become stronger, because minis grew to hold 1.7 ounces instead of 1.5 when the bottles were switched to metric measurements.
“Not only are our citizens receiving an abnormally strong drink, many times our out-of-state tourists have no idea that the drinks are stronger than what they are accustomed,” said MADD, in the year of the referendum.
Overall highway fatalities have declined significantly since 2005, in South Carolina and across the nation. But the percentage of fatal wrecks in South Carolina considered alcohol-related has stubbornly remained among the highest in the country, above 50 percent.
And even as fatal wrecks have declined, the number of drunk drivers involved in fatal wrecks has not.
Liquor wholesalers had a near-monopoly on minibottle distribution in South Carolina and fought the 2004 referendum, arguing along with some lawmakers that the state could lose control of the tax revenue reliably produced by a 25-cent-per-minibottle tax.
Former Democratic Sen. Phil Leventis even filibustered the legislation, for a time. He doubted state Budget and Control Board projections that liquor-by-the-drink taxes would raise $170,000 a year more than the 25-cent minibottle tax had.
After learning about The Post and Courier’s analysis, which showed Leventis’ doubts turned out to be well-founded, Leventis declined to say “I told you so.”
“The whole purpose of the minibottles was for taxation and regulation,” he said. “This is probably the best example of why we need to be careful about advocacy groups and their agendas.”
Party like it’s 2004
If it’s hard to imagine what it was like when every liquor drink in South Carolina was poured from a minibottle, like the ones used on airplanes, then drop by Terri’s Sports Bar on James Island. Unlike most bars in the Charleston area, Terri’s still allows indoor smoking and serves liquor from minibottles.
Party like it’s 2004
“I’ve never even used the big bottles,” said long-time bartender Kathy Wiggens, who has worked at Terri’s since it opened 23 years ago.
South Carolina didn’t get rid of minibottles — it just stopped requiring them — and Terri’s is among the establishments that didn’t embrace big bottles. Wiggens said she suspects customers would want her to pour stronger drinks rather than weaker ones, if she was free-pouring.
“People can’t ask for more” with a minibottle, she said, and it’s easier to control inventory.
At other establishments, legal free-pour has meant multi-liquor drinks are no longer a problem.
As comedian Samantha Bee demonstrated in a 2004 segment on the Jon Stewart show, under the old rules a multi- liquor drink required multiple 1.7-ounce minibottles.
Cotty appeared in the Jon Stewart segment, defending his latest effort to change the Constitution.
“I told them to go to Big John’s in Charleston and order a Long Island iced tea,” said Cotty.
So that’s what Bee did at the end of the segment, ordering the four-liquor cocktail at Big John’s Tavern on East Bay Street and wryly proclaiming the pitcher-sized drink “as the forefathers intended, with triple sec, sour mix, and 6.8 ounces of freedom.”
South Carolina’s constitutional minibottle requirement did not actually involve “forefathers” and was just 30 years old. It replaced an even more unusual system of liquor regulation, under which people could carry their own “brown-bag” liquor to an establishment that couldn’t sell liquor but could charge for glasses, ice and mixers.
Today it’s possible to order a Long Island iced tea and have it served in a glass, rather than a pitcher. And South Carolina restaurants commonly offer distinctive multi-liquor cocktails of their own creation, and often call their bartenders “mixologists.”
Drop by any upscale restaurant and you’re likely to find a signature cocktail costing $10 or more on the menu.
Charleston restaurateur Skip Condon’s company owns five restaurants in the Charleston area and two in Virginia, and he said that while free-pour has posed some inventory control challenges it has been a profitable change.
“It’s definitely helped the bottom line, and I do think it’s helped in terms of not over-serving people,” he said. “When a person came in from out of town (before the change) and got a 1.7-ounce drink, yes, that was a problem.”
Restaurants had to retrain bartenders to pour consistent amounts of liquor, and had to find new ways to keep track of liquor inventory, which was easy to track when one minibottle equaled one drink.
“I think it took us a while to get comfortable with controlling the costs,” Condon said.
The 5 percent solution
“For restaurants, it works great, and for people who want minibottles, they can still get minibottles,” said Cotty, who describes himself as a reformed drinker. “It took away a monopoly, it took away an unsafe drink and put us in line with the rest of the world.”
The 5 percent solution
“When it’s just you and the airlines, you know something is wrong,” he said.
The monopoly Cotty referred to was the collection of four wholesalers that controlled all minibottle distribution in South Carolina — a lucrative business in a state selling more than 70 million minis each year.
That system made things simple for the state, which collected the 25-cent tax on each minibottle from those four wholesalers.
Under today’s free-pour system, the thousands of establishments that serve liquor collect a 5 percent tax on liquor drinks and turn the money over to the state monthly.
“Minibottles was the best control on the revenue coming in to South Carolina, because they collected the tax before they even came to me,” said Clyde Burris, a beverage distributor in Charleston. “It made it easy for them to keep track.”
Burris said his business hasn’t suffered from the change.
“I used to sell a majority of those (minibottles) in the state,” he said. “Now I sell the big bottles, and I sell a ton of them.”
Liquor sales in South Carolina have increased, state tax reports suggest, but the portion of liquor taxes that fund alcohol and drug treatment hasn’t increased since 2005 due to the free-pour change.
The minibottle tax was just one of the state’s liquor taxes, but it was the one that mattered for treatment agencies.
“We have seen stagnant revenue since we moved to free-pour,” said Lee Dutton, who handles legislative matters for the South Carolina Department of Alcohol and Other Drug Abuse Services. “Every year since it passed, the state has had to write a check to our providers.”
That’s because the state promised to make up any shortfall if the 5 percent tax on liquor drinks raised less than the 25-cent minibottle tax used to, for the treatment providers.
“We supported it because you went from a 1.7-ounce drink to a lighter drink,” said Dutton. “We’re still supportive of that.”
Cotty said he’s confident that the change saved lives.
“Whether it made or lost money, that’s just the cost of being business friendly, and safer,” he said.
Reach David Slade at 937-5552 .