(The Center Square) – The saga over legalized alcohol delivery in Louisiana continued Wednesday with a debate about how the delivery companies’ fees should be structured.
Last year, lawmakers legalized alcohol delivery but said the deliveries had to be made by direct employees of the store or restaurant, or by a third-party company with direct, permanent employees. Legislators who supported the restriction said they wanted to ensure the legal responsibility is clear if something goes wrong.
But most third-party food and beverage delivery companies use contract workers, not direct employees. Waitr, the only such company using direct employees in the state when the bill passed last year, later moved to contractors.
Sen. Bret Allain, the Franklin Republican who chairs his chamber’s Revenue and Fiscal Affairs Committee, authored successful legislation this year allowing delivery companies using contract workers to operate legally in Louisiana. But the state Office of Alcohol and Tobacco Control created rules to govern the new law that critics say goes beyond the scope of the law and makes it hard for companies to do business in the state.
The ATC issued a rule that the sticker price of an alcoholic beverage sold through delivery must match the price offered in the store. Ernest Legier, who leads the office, said regulators want to ensure the delivery companies only are receiving a delivery fee and are not engaging in illegal “profit sharing” with retailers on alcohol marked up for delivery.
Anne Junia, an attorney representing delivery company Shipt, said she would not feel comfortable recommending the company do business in Louisiana while the rule is in place. If the retailer changed its prices without immediately updating their information with Shipt, the latter could get in trouble through no fault of its own, she said.
Junia said the rule, which she argues prevents retailers from covering their costs, should be eliminated entirely. Failing that, she suggested the rule be tweaked so the delivery company is only responsible for selling the alcohol at the last price the retailer represented to Shipt or another competing company.
A state House of Representatives committee rejected the rule in an oversight hearing last week, with one member calling the rule akin to price fixing. But Allain, who as author of the legislation suggested he was the best authority on legislative intent, was more sympathetic to Legier’s concerns. He suggested Shipt’s practice of contracting with retailers to be paid a percentage of sales seemed a lot like profit sharing.
“If it walks like a duck and talks like a duck, it’s usually a duck.” Allain said. “It looks like a markup.”
The Senate committee did not take action on the rule Wednesday.