Recovering hospitality businesses see support, “nip” bottle proposal could hit retail

By Sara Capozzi

As Rhode Island’s 2022 Legislative session commenced in January, there were several bills before the General Assembly set to impact the industry as of press time. Notably, the potential for reinstitution of “happy hour” in the state after a 30-plus-year absence and a proposal to ban the retail sale of 100-ml or smaller-sized liquor bottles.

Two popular bills, which were also backed by the Rhode Island Hospitality Association, cleared the House and Senate, passing on Feb. 10: the permanent institution of alcohol to-go with food orders and the continuation of outdoor dining without zoning revisions through 2023.

Two Programs Solidified Into Law

A movement to make alcohol to-go permanent in the state was introduced by Gov. Dan McKee in his 2022 budget proposal. Restaurants were given legal permission to sell alcohol to-go, such as craft cocktails or bottles of wine with takeout meals in April 2020, after venues were forced to close indoor dining in early pandemic precautions.

A popular option with takeout, the move to make it permanent is occurring across many U.S. states, not just Rhode Island. The law was first extended until Mar. 1, 2022. Through the latest bill, Senate Bill No. 2153, by Gallo, AN ACT RELATING TO ALCOHOLIC BEVERAGES — MANUFACTURING AND WHOLESALE LICENSES — RETAIL LICENSES, venues are allowed to sell wine, beer and cocktails with takeout orders indefinitely.

Another provision passed to help restaurants retain business during the pandemic was the legislation allowing outdoor dining. Senate Bill No. 2134, AN ACT RELATING TO TOWNS AND CITIES — SMALL BUSINESSES — ZONING ORDINANCES, originally imposed a one-year moratorium on the enforcement of municipal ordinances or zoning requirements that would normally penalize owners of food service establishments and bars for making modifications or alternations to their premises as a result of the pandemic, including outdoor dining. The bill allows restaurants to continue outdoor dining programs without requiring local zoning approval until April 2023.

Time again for happy hour?

“Happy hour” could return in 2022 to the Ocean State. Since 1985, Rhode Island is among one of several states in the country that have prohibited happy hour drink specials out of concern that offering reduced-price alcoholic beverages encourages increased consumption and unsafe situations. However, during the Jan. 25 House Committee on Corporations hearing, both hospitality industry members and state representatives discussed the bill congenially.

“The Happy Hour Bill,” House Bill No. 7060, AN ACT RELATING TO ALCOHOLIC BEVERAGES — RETAIL LICENSES — HAPPY HOUR, allows “happy hour drink specials served in conjunction with meals prepared on the premises sufficient to constitute breakfast, lunch or dinner, excluding snacks.” Proponents said the law would bring another channel of revenue for on-premise venues, a sector most struggling since the pandemic began, as well as job opportunities.

“It’s a really great strategy to help restaurants get out of the funk of the pandemic,” said Rep. Karen Alzate, Pawtucket, one of the bill’s five primary sponsors, during testimony on Jan. 25. “Our restaurant industry took a really big hit … this is a great way to create jobs … this is a great incentive to get people back to work because more guests mean more money.”

Anthony Santurri, Owner of Providence-based Freeplay Bar and Arcade and the Colosseum Night Club, said during his testimony that the return of happy hour would give restaurants a chance to “showcase their venue,” bringing new customers. “We know that we had to survive the [COVID] devastation financially, but we have to replace what was lost also,” Santurri said on Jan. 25. “If we were able to survive it, and many of us could, with the help of the government and without, now we have to replace and rebuild. And we have to make sure that we start with some forward thinking, which requires us to look backward, to an idea that worked.”

And to allay concerns about over-consumption, Santurri reminded that safe alcohol service training is a part of how businesses operate today, no matter what time of day it is. “This will not be and should not be the 1984 happy hour situation. We all know the amount of education that has been done on responsible drinking and driving for patrons … this is not a push to just sell more alcohol. Responsible alcohol service does not have a time stamp.”

The Committee recommended the measure be held for further study, as of press time, meaning the measure is under review.

Brian Ouellette, General Manager, Pat’s Italian Restaurant, said he has seen how beneficial a happy hour can be for businesses while he’s been on vacation in other states, but that if it became legal again in Rhode Island, he doesn’t believe it makes sense for his venue, which has locations in Johnston, Coventry and Cranston. “I think it’s great for business honestly. It definitely brings people in,” he said. “If we were more like a bar or lounge, I think we would do it … but for us … it’s not something we would do here.”

Potential “nips” ban could cost retailers

House Bill No. 7064, AN ACT RELATING TO HEALTH AND SAFETY — PLASTIC BOTTLE AND CONTAINER LABELING ACT, would prohibit the sale of small-format bottles, or “nips,” in the Ocean State. If the bill becomes law, the sale of any sealable container holding 100 ml or smaller of an alcoholic beverage would be prohibited, with 50 ml, known as nips, targeted. Written by Rep. David Bennett (D-Cranston), the bill aims to reduce or eliminate the often-visible small bottle litter, among primary concerns. As of Feb. 10, the bill has yet to be scheduled for a hearing.

Susan Kelliher, Co-owner of Em’s Liquors, said she’s against the bill, since nips are a big part of the store’s revenue. Kelliher estimated that between 30% to 40% of Em’s business is attributed to the sale of nips. “We can’t take something away that’s a big part of our sales,” she said. “People will come in and buy beer and nips before they’ll come in and buy a couple bottles of wine. I have more of that combination … [nips] are a good part [of business].”

Nayan Patel, Owner, Paul’s Fine Wine & Spirits in Cumberland, said he is also against the ban and explained the issue pragmatically. “Attleboro just tried to ban it and they got denied,” he said. “With Rhode Island being surrounded by Massachusetts towns and cities, we’re just going to lose more business [to Massachusetts]. We all agree that it’s an issue with litter, but I think it’s a human issue too. People need to not litter … I think it can be fixed by educating customers, maybe putting up signs in stores, things like that. I don’t think we need to ban things. It’s going to the extreme.”

Patel estimated that losing sales of just one popular nip brand would result in millions of lost dollars in revenue for the state’s liquor stores over the course of one year. “If the whole country banned it, then fine, we’re all on board,” Patel said. “But when you ban it in Cumberland and the customers go to Attleboro, they just bring it over here and they’re going to throw it out over here anyways.”