Mississippi businesses are facing significant disruptions due to ongoing delays in alcohol shipments from the state’s Alcohol Beverage Control (ABC) warehouse, prompting frustration from lawmakers and concerns about economic impact. The House State Affairs Committee held a hearing Tuesday to address the issue, with legislators expressing a sense of urgency to uncover a resolution.
The delays are impacting not only liquor stores and casinos but also the state’s tourism industry, according to committee chair State Rep. Hank Zuber (R). Lawmakers are exploring several potential solutions, including allowing businesses to pick up orders directly or temporarily permitting direct shipments from manufacturers, as reported by the Magnolia Tribune.
During the hearing, Commissioner Chris Graham of the Department of Revenue, who also chairs the National Alcohol Beverage Control Association Board of Directors, attributed the problems to a combination of factors. These include issues with the warehouse’s conveyor belt software and the ongoing construction of a new warehouse, a project approved by the Legislature in 2022. Graham explained that the software provider ceased support, forcing a switch to a slower, manual “pick and pallet” system.
Graham told lawmakers that the ABC has hired 25 additional employees to assist with the backlog and is working six days a week to fill orders, with Sundays dedicated to restocking. He expressed optimism that the backlog would be halved by March and fully cleared by May, but acknowledged, “It will grab time to obtain out of the backlog.”
Tax Revenue and Business Impact
The shipment delays are also impacting state tax revenue. Graham revealed that January alcohol tax collections totaled $5 million, significantly lower than the typical $10 million collected during that month, funds that contribute to the state’s general fund. Larry Gregory, Executive Director of the Mississippi Gaming and Hospitality Association, emphasized the negative effects on casinos, stating, “Believe it or not, some of the people who visit our casinos drink… They are amazed at times in the last few weeks when we say, ‘Hey, we don’t have anything for you.’”
Ann Marie Smith of Raines Cellars voiced concerns about billing discrepancies, claiming her business was billed for a full order despite only receiving a partial shipment. While Graham asserted that the system only bills for shipped items, Smith’s experience raises questions about the accuracy of the current process. A photo from the Magnolia Tribune shows Smith addressing the committee with her concerns.
The construction of a new ABC warehouse, intended to alleviate these issues, is not expected to be completed until sometime in 2027. State Rep. Trey Lamar (R) noted that previous attempts to privatize the state’s alcohol distribution system and establish multiple warehouses failed in the Senate.
Potential Solutions Under Consideration
Lawmakers discussed several potential solutions during the hearing. Rep. Kevin Horan (R) jokingly offered to “make a door” to facilitate a will-call system, but Graham explained that the current warehouse lacks the space or bay doors to accommodate such an option. Another proposal involved temporarily allowing direct shipments from manufacturers, a suggestion Zuber indicated the committee would consider. State Rep. Stacey Wilkes (R) suggested prioritizing smaller orders to help struggling businesses, while Andy Graf, owner of LaVino Wine and Spirits in Tupelo, cautioned that this could exacerbate the problem.
The House is also revisiting legislation related to “qualified resort areas,” as outlined in MS HB1330, which could impact local option alcohol sales. The bill, sponsored by Rep. Hank Zuber (R), revises the definition of these areas, potentially expanding alcohol sales opportunities.
Graham assured the committee that the ABC would implement any solutions the Legislature deems necessary. Bills addressing the alcohol shipment delays are expected to be introduced in the coming days. The situation highlights the challenges of a state-controlled alcohol distribution system and the require for efficient logistics to support Mississippi’s businesses and tourism industry.
As lawmakers begin drafting legislation, the focus will be on finding a balance between addressing the immediate backlog and implementing long-term solutions to prevent future disruptions. The coming weeks will be critical in determining the future of alcohol distribution in Mississippi.
What are your thoughts on the proposed solutions? Share your comments below and let us know how these delays are impacting your business or community.
