Prohibit New Liquor-Licensed Drug Stores
SB25-033 changes Colorado’s liquor-licensed drugstore laws to sharply limit future expansion of these licenses. The bill defines an “independent pharmacy” and then generally prohibits liquor-licensed drugstore licensees from merging, selling, transferring, converting, or changing the location of a liquor-licensed drugstore license after the bill’s effective date. It creates a narrow exception for a liquor-licensed drugstore license issued to an independent pharmacy before January 1, 2025, allowing that license to be moved or transferred only to another independent pharmacy holding such a license or to a person who does not already hold or have an interest in one.
The bill also removes the existing statutory pathway that allowed certain drugstores to combine multiple retail liquor store licenses into a single liquor-licensed drugstore license, and it repeals related provisions governing application procedures, fees, and local review for those merger-and-conversion transactions. It preserves renewal authority for existing licenses, but adds a renewal condition for liquor-licensed drugstore licenses issued on or after January 1, 2017: the licensee must show that at least 20% of gross annual income from the prior 12 months at the premises came from food sales and must keep the premises open to the public. The bill also caps the number of liquor-licensed drugstore licenses that may be held in the affected circumstances at no more than eight.
In practical terms, the bill amends multiple sections of Title 44 governing alcohol beverage licensing, including definitions, transfer of ownership, local decision-making standards, retail liquor store licensing, and state and local fee provisions. It removes the special fee structure for merger-and-conversion applications and eliminates the temporary permit process for those transactions. Local licensing authorities retain their general authority over renewals and transfers, but the bill narrows the circumstances under which liquor-licensed drugstore licenses can be expanded or relocated.
The overall sentiment reflected in the voting history is supportive but not unanimous. The bill advanced through both chambers with clear majorities, including strong final passage votes in the Senate and House, suggesting broad agreement with the policy goal of restricting new liquor-licensed drugstore licenses. At the same time, the presence of several no votes in the Senate and House indicates some opposition or concern, likely tied to the bill’s impact on existing license holders and pharmacy businesses.
The main point of contention appears to be the balance between protecting independent pharmacies and limiting alcohol retail competition. Supporters likely viewed the bill as a way to prevent further expansion of liquor sales through drugstore licenses and to preserve neighborhood retail balance, while opponents may have objected to restricting transfers, conversions, and location changes for existing licensees, especially those that had previously relied on the merger-and-conversion framework. The bill’s narrow grandfathering language and the new renewal conditions suggest an effort to preserve some existing operations while closing the door on future growth.
SB25-033 amends Colorado’s alcohol beverage code in Title 44 by restricting the issuance, transfer, conversion, and relocation of liquor-licensed drugstore licenses, repealing the statutory merger-and-conversion process, and eliminating related state and local fee provisions. It also adds a definition of “independent pharmacy,” imposes a 20% food-sales renewal requirement for certain licenses, and limits the ability of affected licensees to expand beyond a capped number of licenses, with a narrow exception for certain pre-2025 independent pharmacy licenses.
The bill appears to have received generally favorable treatment in committee and on the floor, passing both chambers by comfortable margins, which suggests broad support for its core policy of limiting liquor-licensed drugstore licenses. However, the nontrivial number of negative votes in both the Senate and House indicates that the measure was not unanimous and that some lawmakers had reservations about its effects on existing licensees, pharmacy owners, and alcohol retail market structure.
The central controversy is whether the state should continue allowing liquor-licensed drugstore licenses to be merged, transferred, converted, or relocated, or instead freeze and narrow that market. Supporters likely favored protecting independent pharmacies and limiting further expansion of alcohol sales through drugstores, while opponents likely objected to the bill’s restrictions on business flexibility, its repeal of the merger-and-conversion pathway, and the potential impact on existing license values and operations. The bill’s grandfathering provisions and renewal requirements reflect a compromise between those competing interests.