Maine's Regulator Testifies Against Direct-to-Consumer Shipment of Spirits Bill

May 01, 2023


Maine’s Director of the Bureau of Alcoholic Beverage and Lottery Operations (BABLO), Gregg Mineo, testified in opposition to LD 1695, which would permit both in- and out-of-state distillers to ship spirits directly to Mainers' doorsteps.  While framed by proponents as a matter of economic support for Maine distilleries, Director Mineo’s testimony raised serious concerns about public health and safety, lack of control over common carriers, and whether it’s even legal – hopefully this  bill will meet the  fate the state’s regulators and staffs are asking for--defeat.   


Director Mineo made legislators aware of the economic harm LD 1695 would have on Maine’s spirits manufacturers. As he accurately noted, this bill does not allow Maine’s distillers to ship products to consumers across the country – as only five states and Washington D.C. allow direct-to-consumer (DTC) spirits shipping, “none of which are especially large markets.” Call us pragmatic , but opening Maine to “a wave of competition” from out-of-state spirits manufacturers undermines in-state businesses and creates an unregulated route to market. Talk about creating exclusivity and killing market competition!  


It’s not just the economic impact that has the Director worried. Mineo condemned LD 1695 for “severely lacking controls over common carriers and leaves the Bureau with insufficient regulatory authority to address violations.” Without “licensing, registration mechanism, or reporting requirements for common carriers engaged in direct-to-consumer shipping of spirits” states can’t adequately address illegal shipments that avoid tax remittance, undercut licensed industry members, and possibly harm public safety by putting alcohol into the hands of minors or selling potentially counterfeit products. This is not just hearsay, these are irrefutable facts.  


Since LD 1695 doesn’t properly establish licensing, registration mechanisms or reporting requirements for common carriers, enforcement of any violations would be difficult. As Director Mineo explained in his testimony, the Bureau will "…not have administrative authority under which to assess fines and other graduated enforcement for violations such as leaving a box clearly marked as containing spirits with a minor." Shipments of alcohol being left at doorsteps actually happen, as seen in Massachusetts, and highlight how American mothers nationwide understand DTC spirits shipping can increase underage access. These same common carrier deficiencies already exist within the state’s DTC wine shipping law and should be remedied rather than “exacerbated by replicating it with the direct-to-consumer shipment of spirits.” 


As if that weren’t enough, Director Mineo highlighted the constitutional violations of the proposed legislation – which is a pretty big issue. LD 1695 would establish different shipping allowances and criteria for producers dependent on whether they are in the state, effectively allowing in-state distilleries to ship unlimited volumes of their own products while out-of-state producers are limited to 200 cases of select products not listed by the Bureau. This creation of a system that favors in-state producers over out-of-state ones is a clear violation of the Dormant Commerce Clause of the U.S. Constitution. You don’t need to be an expert in constitutional law to see that this could cause some serious legal headaches for the state down the line. Need proof? Look at the problems with wine and multiply that by a higher demand for spirits by consumers. It’s a big problem that this bill would only make worse.