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Iowa liquor sales climb; top $242M

DES MOINES — Iowans on average are consuming beer, liquor and wine in mass quantities and at an accelerating rate.

For the fiscal year that ended June 30, the average consumption levels for Iowans age 21 years or older were a record 35.6 gallons of beer, 2.23 gallons of spirits and 1.9 gallons of wine, according to data issued by the state Alcoholic Beverages Division.

Total spirits sales were more than $242 million, a $21 million increase over the previous year. Liquor sales in Iowa were the highest since fiscal year 1988 when the state became the exclusive wholesaler of spirits, he said.

The 6.4 percent increase in hard liquor consumption was aided by a state law change that removed restrictions on gas stations selling spirits and by a spike in consumer demand — especially among women and young people — for flavored drinks such as vodka, whiskey and tequila, ABD officials noted.

“There has been an uptick in consumption,” said division Administrator Stephen Larson. “The sales number reflects that trend and that trend will continue.”

ABD official Tonya Dusold said there has been “an explosion” of new brands and new flavors of spirits that are “selling really well” in Iowa, especially among female consumers.

“We saw almost a 24 percent increase in those in a single year,” Dusold said. “We’ve been seeing flavored vodkas for several years. Now we’re seeing those flavors seep into other categories and we’re seeing more flavored tequilas and flavored whiskeys and things along those lines, and that’s primarily females driving that.”

In addition to revenue from spirits profits, the increased funds generated by state taxes on wine and beer, license fees and civil penalties contributed to a record $115 million in state revenue collected and generated in fiscal 2012.

State officials said the trend of increased sales of alcoholic beverages has continued into the current fiscal year that began on July 1, with gross sales up 13 percent for the first four months.

Also during the past fiscal year, Larson said, his division’s Regulatory Affairs Bureau initiated a comprehensive program to increase compliance with state liquor laws through education, voluntary adherence and punitive regulation.

“During the inaugural year of the compliance program, more than two-thirds of routine checks found licensees to be in compliance,” he said. “However, 54 percent of complaint-initiated investigations found violations.”

The top three offenses were bootlegging, infusing and retailers purchasing product from businesses not licensed for wholesale.