Want that margarita to go? Many states are permanently allowing carryout cocktails

The Cellar Peanut Pub in Iowa is known for its Bloody Marys. But, when the state shut down indoor dining in March 2020 to curb the spread of COVID-19, the pub's owner Marty Duffy worried his tomato juice cocktails wouldn't be the only thing in the red.

The bar got a reprieve few days later when emergency rules allowed businesses with liquor licenses to temporarily sell cocktails for carryout or delivery.

So, Duffy started packing up those drinks using a hand operated machine that makes aluminum cans.

"I would can for 14 hours a day just to basically save my business," Duffy says. "I wasn't going to let it fail."

Across the country, looser liquor laws may be one long-term side effect of the COVID-19 outbreak.

At the height of the pandemic, 39 states allowed cocktails-to-go — at least in the short term, according to the National Restaurant Association. Iowa became the first state to make the change permanent with a law passed in summer 2020. Now, at least 17 other states have followed suit with their own laws to permanently allow carryout cocktails.

Allowing carryout cocktails is one of the biggest changes to liquor laws since the end of Prohibition a century ago

The shift may be one of the biggest changes to American liquor laws since states ended Prohibition nearly a century ago by overturning a nationwide ban on making or selling alcohol, says Mike Whatley, a lobbyist for the National Restaurant Association.

"Honestly, without the pandemic, it would have taken five to 10 years or more to have this many states pass laws that change alcohol policy so significantly," Whatley says.

Even though drinks-to-go are popular with customers, the highly regulated liquor industry can be tough to reform, says Jarrett Dieterle, a researcher with the R Street Institute, a think tank that supports free markets.

Most states regulate alcohol using a three-tier system, Dieterle notes. Often, the producers who distill or brew alcohol must go through a middle tier of distributors who then sell to retailers who then sell to customers.

"It creates this patchwork and a lot of kind of vested interests and it's made change just really, really difficult in the industry," Dieterle says. "So things like allowing a brewer to sell or deliver directly to consumer that cuts out, for example, the liquor store. It cuts out, potentially, the wholesaling tier. And so that freaks those entities out because they want to protect economic interests that they have."

In some states, wholesalers and liquor stores are pushing back against more permissive laws because they're concerned about losing business as restaurants get more leeway, Dieterle says.

Relaxed liquor rules "make it harder to police underage drinking"

Robert Mellion lobbies on behalf of liquor stores as executive director of the Massachusetts Package Stores Association. Massachusetts is extending its policies letting restaurants and bars sell alcohol for carryout and delivery until early 2023, but Mellion argues the relaxed rules make it harder to police underage drinking. He says the extension has gone too far.

"During the first year and a half of the pandemic, it was understood we needed to make restaurants whole." Mellion says. "Restaurants are whole now. Now, it's about additional profitability. It's not about making ends meet anymore. And it's additional profitability at the expense of somebody else and that somebody else is being attacked in all different directions — the mom and pop liquor store across this country."

In Michigan, a pandemic relief measure is letting bars and restaurants offer mixed drinks-to-go until the end of 2025. And the state's lawmakers recently voted to permanently enact another COVID-era policy.

Now, local governments can designate outdoor social districts where people can schmooze and booze on public streets, so long as the drinks are purchased from nearby businesses.

Lansing City Councilman Peter Spadafore says the open container zones let people socialize more safely at a distance while the coronavirus was raging.

But, as he sips a vodka with lemon and lime in Michigan's capital city on a chilly April evening, Spadafore argues the benefits of social districts will outlast the pandemic.

"I do think the pandemic really caused us to reevaluate our beliefs and sort of mores around drinking," he says. "You can see people out and about, with a drink in their hand, or just window shopping and really kind of a different set of folks coming to this destination."

If you like being able to carry out a margarita or to stroll downtown with a drink in your hand, you may have the pandemic to thank.

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