SALT LAKE CITY — Concerned that recent court decisions could whittle away Utah's ability to regulate alcohol sales, Attorney General Mark Shurtleff testified before Congress on Wednesday in support of a bill that would allow the state to maintain its unique system.
More than two dozen lawsuits nationwide have challenged the right of states to control alcohol since the U.S. Supreme Court ruled in 2005 that laws in New York and Michigan were unconstitutional. The laws permitted in-state wineries to ship directly to consumers but prohibited out-of-state wineries from doing the same. The Comprehensive Alcohol Regulatory Effectiveness Act or CARE Act, of which Rep. Jason Chaffetz, R-Utah, is a primary sponsor, aims to reaffirm that states have the primary authority over liquor laws.
"The people of Utah feel differently about alcohol than the people in Detroit," Shurtleff told the House Judiciary Committee. "That is the beauty of the American system."
Turns out the words Shurtleff used in his testimony were not exactly his. He acknowledged that it was drafted by Paul Pisano, the general counsel for the National Beer Wholesalers Association, which supports the bill.
Shurtleff said Wednesday evening that a late invitation to speak and having to travel across the country made it difficult for him to organize the speech. He said he's spoken to Pisano about the issue dozens of times and asked him to compile some talking points, much of them based on a March letter 40 attorneys general wrote to Congress asking them to take action on the issue. Shurtleff said he re-read court briefs and the bill while traveling to Washington, D.C.
"I put a lot of work into this testimony," he said. "This isn't one of those advocates writing out there and me just reading it. That would be silly."
Rep. Jason Chaffetz, R-Utah, an original co-sponsor of the bill, said Pisano's involvement was news to him.
"It does beg some questions," he said, adding he intends to alert the leading Democrat and Republican on the committee. "I think the committee leadership will need to look into that."
As for the bill itself, Chaffetz said Utah should have the right to regulate alcohol.
Alcohol regulation became the purview of states after Congress ratified the 21st Amendment, which ended Prohibition in 1933. Utah cast the 36th and deciding vote.
The National Association of American Wineries opposes the bill. Many small, family-owned wineries fear it would limit their ability to distribute products out of state.
Castle Creek Winery in Moab is one of only a couple of wine makers in Utah. Owner Will Fryer wasn't familiar with the legislation but said he does little out-of-state business because the permitting process in each state makes it cumbersome. And in-state shipping isn't an issue because it's not allowed.
"We can't ship in Utah, even though we're in Utah," he said.
Alcohol in the state must be approved by the Utah Department of Alcoholic Beverage Control before being placed on state liquor store shelves.
Fryer said many small, rural wineries now depend largely on wine clubs that make monthly purchases online and have the products shipped to them. The legislation could affect what he said has become their bread and butter, accounting for as much as 40 percent of sales.
Shurtleff said he is a big fan of Internet and electronic commerce, but laws should flow from the Constitution, "not the whims of industry. Just because alcohol can be sold like toothpaste, doesn't mean it should be."
Conflicting court decisions in other states have created confusion about interstate sales, and Shurtleff said that makes it difficult for him to advise the Legislature on what to do.
"There are 2,966 accounts that sell alcohol in Utah, and Utah does a fine job regulating them," he said. "We cannot regulate the 521,000 accounts that sell alcohol across the country."
Shurtleff said CARE would prevent discrimination against out-of-state suppliers, provide clarity for state legislatures and strengthen states' ability to regulate alcohol according to local customs.