Arkansas alcohol distributors have agreed to not purchase Russian alcohol as Gov. Asa Hutchinson examines any state involvement with Russia following its invasion of Ukraine.
During his weekly news briefing Tuesday, Hutchinson updated Arkansans on some of the actions he has taken to ensure the state is doing what it can to honor sanctions against Russia imposed by the international community.
Hutchinson said he has worked with the state's Alcohol Beverage Control division to ensure distributors are no longer acquiring Russian alcoholic beverages.
"Our distributors have reached an agreement that I support that they have agreed not to acquire any additional Russian-based alcohol," Hutchinson said. "So we are joining that ban in essence in that cooperative agreement with our distributors."
Scott Hardin, spokesman for the Department of Finance and Administration, said Alcohol Beverage Control distributed a memo Tuesday to the state's licensed alcohol wholesalers regarding Russian vodka. He said there are approximately 40 licensed wholesalers in the state.
"The memo followed conversations with these companies regarding Russian vodka," he said. "While ABC's director does have the authority to formally revoke the specific Russian brands in the state, that would require all existing stock to be destroyed. Since the Russian brands have already received payments for these products, this action would only hurt Arkansas wholesalers and retailers."
The memo stated that Alcohol Beverage Control had reviewed alcoholic beverage labels registered within the state and discovered brand labels with Russian affiliations, consisting of but not limited to Russian Standard, Beluga, Green Mark Vodka, Russian Value and Stroyski.
"In an effort to support the United States in the position to place sanctions upon Russia, Arkansas is seeking to stay the importation and distribution of Russian affiliated alcoholic beverage products," Doralee Chandler, director of the Department of Finance and Administration, said in the memo to wholesale distributors. "As such, I am confirming the agreement that you will stay the importation of any additional Russian affiliated alcoholic beverages into the State of Arkansas."
Hutchinson said he also is encouraging private businesses to look at their relationships with Russia and consider the sanctions that have been imposed internationally.
"That is where you see the wholesale liquor distributors who have mutually agreed to not make any additional acquisitions of Russian based liquor, and that is a good success story," he said.
The effect the ban will have on the state is unknown. Multiple vendors told the Arkansas Democrat-Gazette on Tuesday they didn't sell Russian alcohol to begin with.
"To my knowledge there are zero Russian alcoholic products sold in the state, so it's pretty meaningless," a representative for De Nux Distributors, LLC said in an email to the Arkansas Democrat-Gazette.
Steve Higginbothom, executive director for Wholesale Beer Distributors of Arkansas, said it won't affect his distribution company because the agreement mostly targets Russian vodka.
"We are a wholesale beer distributor, so it doesn't affect our products at all, but we got the call today and we support it," Higginbothom said. "I think there are only 10 Russian brands labeled in Arkansas."
Robby Vogel, founder of Arkansas Wine & Spirits Wholesale, LLC, which is a sister company of Eagle Distributing of Texarkana and Golden Eagle of Arkansas, said his company also doesn't have any product labeled as Russian.
"We have some product labels that would lead a consumer to believe it was an Eastern block product, but it's just marketing," he said.
Vogel said he believes the ban will have minimal effect on his businesses except that some consumers might not buy products that look Eastern European altogether.
"I am not sure how vodka sales in general will be impacted by it," he said. "I am sure some customers might see vodka and think Russia and not support it, but that is understandable, I guess. Just not all vodkas are Russian."
Vogel said he thinks it's wise of state government to be aware of the geopolitical issues when it comes to the alcohol ban.
"It definitely caught some legs and moved very fast," he said. "We just have to be wise in our decision-making. This is not too harmful for us."
Hutchinson said Arkansas imports to Russia are very small and that the state exports much more than it imports.
"The impact will be largely on the exports that we make, and there is a price to be paid whenever you cut off economic relations with a country or diminish it greatly," he said. "So there will be an impact on Arkansas, partly in agriculture but also aero defense materials, airplanes and other materials that we supply."
Hutchinson said in a news release late Monday that Arkansas imports in from Russia totaled $8.1 million in 2021 and exports totaled $64 million. He said Arkansas imports from Ukraine totaled $2 million that year and exports totaled $455,361.
The Arkansas Economic Development Commission reported there are no Russian-owned or Ukrainian-owned companies in Arkansas.
Hutchinson also announced Monday that he had called for a review of all state departments to see if "any contracts or agreements between Arkansas, the Russian Federation, or other Russian entities exist."
"Although Arkansas's economic ties with Russia are limited, I want to make sure that we as a state are not indirectly supporting Russian aggression through its economy," Hutchinson said in the release. "I am transparent and unequivocal in my condemnation of these actions."
Hutchinson said Tuesday the state had reviewed the Public Employees Retirement System and the Teachers Retirement Fund to see if there had been any investments made in Russian assets and that no direct investments in Russian assets were found in either fund.
Hutchinson also said Tuesday he also has asked the Department of Information Services to send out a warning for state agencies to be on alert for possible cyberattacks.
"They are sending out an alert to state employees, but also our county and city government partners, just urging them to take some preventive measures," the governor said. "Some extra precautions in handling emails and communications so they don't unwittingly step into a cyber attack that has been engaged by Russia."
Hutchinson, chairman of the National Governors Association, also appeared Tuesday morning on MSNBC and spoke about President Joe Biden's State of Union address scheduled for that night.
"[Biden] has got to shift to be able to assure the public that we are doing all that we can as a nation to shore up freedom in that part of Europe, because this world has changed and this is the first time we have heard concern about nuclear weapons in a long, long time," Hutchinson said.
He also said this is a moment for unity for the nation.
"What we need to see is resolve, and this is a time we can come together and support the president," the Republican governor said of Biden, a Democrat. "Republicans, we have differences in policy and would have liked to have seen more aggressive action early on and the sanctions imposed more quickly and more strongly very early on. But, not withstanding that, this is an opportunity to unify the country more, because we are all united behind the incredible bravery we see in Ukraine."
Hutchinson also was asked by MSNBC commentators if he were willing to condemn former President Donald Trump's comments that described Russian President Vladimir Putin as a smart and savvy person, and that Putin's tactics where "genius."
"Putin is evil and he needs to be called such, and anybody who does not call out Putin for the person that he is and the atrocities that he has been conducting, then they are not the leader of the party that I believe in," Hutchinson said, mentioning how President Ronald Reagan had referred to Russia the evil empire. "... Well, let's call it as it is. This is aggression that needs to stop, and I want all of our Republican leaders to be united in that voice."
The Arkansas House passed House Resolution 1035 on Tuesday condemning the invasion of Ukraine.
"I'm sure like me, as you watched on the news that late night, the Russian invasion of the Ukraine, completely unprovoked, you were horrified by what you saw," said sponsor Rep. Aaron Pilkington, R-Knoxville.
Pilkington said the resolution shows that Arkansans stand with Ukraine against Russian aggression, and sends a message to other nations that "if they choose to be aggressive that we stand with those people that they aim to oppress."
HR1035, which passed on a voice vote with no audible opposition, also includes provisions calling for the United States to expel and freeze the assets of Russian oligarchs, place sanctions on Russian oil and other national resources, and take steps to increase the amount of non-Russian oil available to the United States and other countries, including increasing production of domestic oil and reauthorizing the Keystone XL oil pipeline.
"I think as Americans we can all stand together as one group and say what we see going on in the Ukraine needs to be condemned, and that we need to work better to help make America energy independent," Pilkington said.
The Senate also approved a resolution Tuesday condemning Russia's invasion and supporting the people of Ukraine.
Senate Resolution 33 by Sen. Terry Rice, R-Waldron was co-sponsored by 33 of chamber's 34 other senators. Sen. Trent Garner, R-El Dorado, didn't co-sponsor the resolution.
The resolution calls on the United States to expel Russian oligarchs, freeze the assets of Russian oligarchs and political leaders who support the invasion of Ukraine, and take similar actions that would deter the Russian Federation from further unprovoked aggression toward its neighbors, and to penalize the Russia for its unjust invasion of Ukraine.
The resolution also calls on the United States to place sanctions on Russian oil and other natural resources, take other steps to increase the amount of non-Russian oil available to the United States and other countries, and take steps to make the United States an energy independent country.
The Senate's action came after it heard from a Ukrainian woman who resides in Central Arkansas and whose parents and sister are in Ukraine. She described the fighting in Ukraine as the worst war since World War II, saying Russian soldiers are killing civilians and that Ukraine needs help protecting its citizens.
Senate President Pro Tempore Jimmy Hickey, R-Texarkana, directed the Senate to turn off its livestreaming for security purposes before the woman spoke to senators.
Garner called Senate Resolution 33 "a weak and watered-down version" and described Pilkington's House-approved resolution as superior.
He said "the big issue is standing up for the people of Taiwan" against the prospect of China taking similar military action against Taiwan in the future.
Information for this article was contributed by Rachel Herzog and Michael R. Wickline of the Arkansas Democrat-Gazette.