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STOP SB 620 - Direct to Consumer Shipping of Distilled Spirits & Beer

SB 620 would make direct-to-consumer (DTC) shipping of distilled spirits and beer permanently legal in California. It's bad public policy!

SB 620 poses the following major threats to public health and safety:

• The bill fundamentally undermines the three-tier system, allowing all producers to also be distributors and retailers. The three-tier system was intended to inhibit monopoly among the alcohol industry, as well as empower intentionality in alcohol purchasing and consumption. Direct shipping promotes reflexive—instead of planned—consumption and gives megaproducers such as Diageo or AB InBev another means to leverage their enormous marketing budgets and reduce competition, including local producers.

• With DTC wine laws, we have seen Anheuser-Busch InBev and other megaproducers promote DTC delivery of cheap, mass-market wine products. They will undoubtedly seek to do the same with distilled spirits and beer. These companies have demonstrated track records of aggressive marketing (including marketing to minors), encouraging overconsumption, and predatorily consolidating or supplanting smaller, higher-price-point producers whose output is less harm conducive.

• Efforts to bias the market towards small producers instead of large producers are token at best. The amount for large consumers—9 liters annually—is the equivalent of over 200 standard drinks, or 4 drinks per week. This is already above the mean adult consumption in the United States (3.6 drinks per week). The vast majority of consumers who reach the limit for large producers will have no compunction to seek small producers.

• The 36 liters per year cap for a single small producer is the equivalent of 15 drinks per week, which exceeds the “heavy drinking” threshold for men. (The threshold is lower for women.) Anyone drinking at this level threatens their own health and safety, and those threats impose serious costs on the health care system, emergency services, not to mention damage to interpersonal relationships. Alcohol consumption at that evel should be discouraged through behavioral brakes, not facilitated by dropping the products on their front door.

• DTC makes it nearly impossible to consistently engage in responsible beverage service (RBS) practice. Delivery carriers have no RBS mandate, no ability to consistently identify and refuse service under dangerous circumstances, and both technical and economic pressures that reduce the ability to properly prevent delivery to underage recipients. The online age-gating mandated in the bill is easily circumvented, and common carrier delivery is more difficult to monitor and hold accountable.

• DTC hampers local control of product and packaging. As a case in point, we are seeing the rise of online alcohol purchasing making it extremely difficult to enforce Prop 65 requirements. Not only will California standards be inconsistent with those in other states, shipments into California that violate local laws will be essentially unmonitorable and violations unenforceable. This, essentially, creates a deregulatory race to the bottom.

• SB 620 will either damage the economic well-being of distributors and liquor stores, or it will increase the amount of alcohol consumed in the state. There is no way to avoid both impacts, and both outcomes increase harm from alcohol use. In the first case, California loses jobs, points of regulatory oversight, and brakes against overconsumption; in the second, the burden of morbidity, mortality, violence, and social disruption increases.

This increase in access to consumers, quantities consumed, and freedom from accountability comes at a time when alcohol harm is rapidly increasing in California. Damage from alcohol has been steadily rising for 20 years. Diagnoses of alcohol use disorder increased 50% from 2002 to 2012, and this has resulted in an alarming rise in alcohol-related deaths. Between 1999 and 2017, the raw number of alcohol deaths doubled, accounting for a 50% increase in death rate. This is not the result of long-term alcohol abuse; mortality rates among 25- to 34-year-olds saw annual increases between 4.6% and a staggering 12%. The annual rate of death from cirrhosis of the liver increased 10.5% between 2009 and 2016 in this same age group.

With these numbers in mind, efforts to radically expand alcohol markets have costs that far outweigh any perceived local economic benefit, even assuming that said benefit is not subsumed by multinational mega-producers.

Tell our legislators to vote no on SB 620 to protect public health and not walk away from California’s ability and obligation to oversee its own alcohol trade.

Text PUBLICHEALTH to 313131.

STOP SB 620 - Direct to Consumer Shipping of Distilled Spirits & Beer

SB 620 would make direct-to-consumer (DTC) shipping of distilled spirits and beer permanently legal in California. It's bad public policy!

SB 620 poses the following major threats to public health and safety:

• The bill fundamentally undermines the three-tier system, allowing all producers to also be distributors and retailers. The three-tier system was intended to inhibit monopoly among the alcohol industry, as well as empower intentionality in alcohol purchasing and consumption. Direct shipping promotes reflexive—instead of planned—consumption and gives megaproducers such as Diageo or AB InBev another means to leverage their enormous marketing budgets and reduce competition, including local producers.

• With DTC wine laws, we have seen Anheuser-Busch InBev and other megaproducers promote DTC delivery of cheap, mass-market wine products. They will undoubtedly seek to do the same with distilled spirits and beer. These companies have demonstrated track records of aggressive marketing (including marketing to minors), encouraging overconsumption, and predatorily consolidating or supplanting smaller, higher-price-point producers whose output is less harm conducive.

• Efforts to bias the market towards small producers instead of large producers are token at best. The amount for large consumers—9 liters annually—is the equivalent of over 200 standard drinks, or 4 drinks per week. This is already above the mean adult consumption in the United States (3.6 drinks per week). The vast majority of consumers who reach the limit for large producers will have no compunction to seek small producers.

• The 36 liters per year cap for a single small producer is the equivalent of 15 drinks per week, which exceeds the “heavy drinking” threshold for men. (The threshold is lower for women.) Anyone drinking at this level threatens their own health and safety, and those threats impose serious costs on the health care system, emergency services, not to mention damage to interpersonal relationships. Alcohol consumption at that evel should be discouraged through behavioral brakes, not facilitated by dropping the products on their front door.

• DTC makes it nearly impossible to consistently engage in responsible beverage service (RBS) practice. Delivery carriers have no RBS mandate, no ability to consistently identify and refuse service under dangerous circumstances, and both technical and economic pressures that reduce the ability to properly prevent delivery to underage recipients. The online age-gating mandated in the bill is easily circumvented, and common carrier delivery is more difficult to monitor and hold accountable.

• DTC hampers local control of product and packaging. As a case in point, we are seeing the rise of online alcohol purchasing making it extremely difficult to enforce Prop 65 requirements. Not only will California standards be inconsistent with those in other states, shipments into California that violate local laws will be essentially unmonitorable and violations unenforceable. This, essentially, creates a deregulatory race to the bottom.

• SB 620 will either damage the economic well-being of distributors and liquor stores, or it will increase the amount of alcohol consumed in the state. There is no way to avoid both impacts, and both outcomes increase harm from alcohol use. In the first case, California loses jobs, points of regulatory oversight, and brakes against overconsumption; in the second, the burden of morbidity, mortality, violence, and social disruption increases.

This increase in access to consumers, quantities consumed, and freedom from accountability comes at a time when alcohol harm is rapidly increasing in California. Damage from alcohol has been steadily rising for 20 years. Diagnoses of alcohol use disorder increased 50% from 2002 to 2012, and this has resulted in an alarming rise in alcohol-related deaths. Between 1999 and 2017, the raw number of alcohol deaths doubled, accounting for a 50% increase in death rate. This is not the result of long-term alcohol abuse; mortality rates among 25- to 34-year-olds saw annual increases between 4.6% and a staggering 12%. The annual rate of death from cirrhosis of the liver increased 10.5% between 2009 and 2016 in this same age group.

With these numbers in mind, efforts to radically expand alcohol markets have costs that far outweigh any perceived local economic benefit, even assuming that said benefit is not subsumed by multinational mega-producers.

Tell our legislators to vote no on SB 620 to protect public health and not walk away from California’s ability and obligation to oversee its own alcohol trade.

Text PUBLICHEALTH to 313131.