Colorado’s independent liquor stores won a resounding victory Thursday as a state House committee unanimously approved a bill that would freeze any increase to the number of grocery stores selling hard booze.

The House Business Affairs and Labor Committee passed Senate Bill 25-33 by a 13-0 bipartisan vote, virtually assuring a smooth path for legislation that would put hard brakes on the quickly expanding sale of spirits outside of local liquor stores.

After already passing the Senate largely un-amended, the bill faces a hearing before the House committee on appropriations and, if successful, the full House. It would head to Gov. Jared Polis’ desk if it passes the House.

Legislators were persuaded by several independent liquor store owners who testified Thursday, laying bare the impact voters had in 2022 when they passed Proposition 125 to allow wine sales in grocery stores. That came just a few years after allowing grocers to sell full-strength beer.

Until then, grocery stores were limited to selling what was known as “near-beer” and “3-2 beer” because it could contain up to only 3.2% alcohol.

But an industry compromise happened around 2016 that laid out a number of concessions, in which groceries could eventually get more and more licenses to sell alcohol without taking the issue to voters.

That changed with Proposition 125 and store owners said the state’s independent liquor industry has reeled ever since.

A Denver Gazette report in December noted that hundreds of independents were closing since that vote as a result of the competition with grocery stores, which took a menacing turn with that industry’s use of LLDS licenses — a quirky deal initially designed for pharmacies but now relied on by grocers and big-box stores with in-store druggists. About 30 of the licenses exist today and would remain unaffected by the legislation. It would only prevent new licenses from being issued.

“We could lose another 400-600 stores within the next year, 45% of the independent market,” Josh Robinson of Argonaut Liquors testified. “And that would force consumers to the same stale selection.”

Several owners of craft brews and small distilleries in Colorado told legislators how independent liquor stores are their lifeline to solvency, and if lost would essentially collapse their business model.

“Economically we’re really experiencing challenging times,” said winemaker Patric Matysiewski of Sauvage Spectrum Winery in Palisade. “Local retailers have played a big part in our success, putting our wine on their shelves despite the risk.”

Said Carey Shanks of Marble Distilling in Marble: “Allowing big-box retailers to sell spirits might sound like consumer choice, but it’s actually going to crush local liquor stores.”

Proponents of keeping things as-is said taking away the broader consumer choice of buying alcohol along with their groceries would put Colorado in a minority nationwide.

“We understand the harsh economic reality that liquor stores are facing,” said Ainsley Giglierano of the Distilled Spirits Council of the United States. “Spirits as a whole are facing equally difficult times and now is not the time to further restrict our access.”

She pointed to looming trade wars with Canada, its largest recipient of exports, as a contributing factor to keep in mind, developments that have surfaced since the bill was introduced Jan. 8.

“The spirits industry is stuck in the middle,” she said.

Jeff Keener, the president and CEO of the South Metro Denver Chamber of Commerce, was succinct: “This threatens convenience for all Colorado consumers.”

Legislators who ordinarily endorse free markets and fewer restrictions on business said they were in a bit of a bind but said supporting a bill that could ensure the success of small enterprise garnered their support.

“The value of the stores have been totally devalued,” said Rep. Naquetta Ricks, D-Arapahoe County, one of the bill’s co-sponsors. “This is Goliath versus these small businesses and we’re asking for a lifeline to them.”

A hearing date before the House Appropriations Committee has not been set.