Committee hears bill to remove $250,000 non‑fuel inventory requirement for gas stations selling spirits

The House Regulatory Reform Committee heard testimony on House Bill 4276, introduced by Representative Snyder, which would remove a $250,000 non‑fuel inventory requirement for specially designated distributor (SDD) license holders that operate motor vehicle fuel pumps.

Representative Snyder described the rule as an onerous inventory requirement that singles out motor‑fuel retailers and said the bill would “simply eliminate this inventory requirement.” He and industry witnesses argued the requirement ties up capital unnecessarily and creates an uneven playing field between retailers that operate fuel pumps and those that do not.

Mark Griffin of the Michigan Petroleum Association and the Michigan Association of Convenience Stores told the committee that only about 105 SDD licenses exist statewide and that many fuel retailers do not want to sell alcohol; he said the inventory requirement unfairly burdens motor‑fuel retailers. “Some of my members have put things like rolling papers up in their attic, just so they can meet the inventory requirement,” Griffin said, describing improvised ways some operators meet the rule.

JJ Westgate, who identified himself as a third‑generation co‑owner of Wesco convenience stores, said his company holds SDM and STD licenses across multiple locations and that 26 of their sites are subject to the $250,000 inventory rule. Westgate told the committee his company currently holds about $4.6 million in postage stamps to satisfy inventory checks; he said that inventory is not circulated and ties up capital that would otherwise be reinvested into the business and communities.

Sponsors said the bill does not increase the number of SDD licenses available nor alter other licensing requirements; it removes only the inventory requirement. Representative Snyder said the change also codifies a process for local government involvement in liquor licensing reviews and would not reduce the Liquor Control Commission’s existing enforcement authorities.

Committee members asked whether removing the requirement would change enforcement or licensing oversight. Sponsors said the Michigan Liquor Control Commission would retain enforcement authority; the bill also would codify existing local‑government involvement in licensing reviews. Representative Wozniak asked for clarification about which codes the Michigan Liquor Control Commission could act on; witnesses and sponsors said the bill would codify that liquor‑control‑related violations are subject to suspension by the MLCC.

Multiple stakeholder statements on the record indicated support for the bill: the National Federation of Independent Business (NFIB), Kwik Trip, Midwest Independent Retailers Association and others were listed as supporters who did not wish to speak. The Michigan Liquor Control Commission was listed as neutral and did not testify in this hearing.

No committee vote on HB 4276 occurred at the hearing. Sponsors and industry witnesses presented testimony and answered committee questions; the hearing concluded with committee staff reading in written supporter cards.