Bill would privatize state liquor stores
by Tim Lockette
tlockette@annistonstar.com
Jan 21, 2013 | 5599 views |  0 comments | 8 8 recommendations | email to a friend | print
ABC store in downtown Anniston. One state legislator is proposing a bill that would get the state out of the liquor store business. ( Photo by Bill Wilson / The Anniston Star)
ABC store in downtown Anniston. One state legislator is proposing a bill that would get the state out of the liquor store business. ( Photo by Bill Wilson / The Anniston Star)
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MONTGOMERY -- Mike Patel would like to see the government get out of his business -- literally.

Patel owns Liquor King, a liquor store on Alabama 21 in Oxford. Elsewhere in town, the state of Alabama owns a shop that sells the same product for less.

"We pay more for the product than the customer pays down there," Patel said. "It's impossible to compete on the price."

Patel and other private liquor store owners say they support a proposal by Sen. Arthur Orr, R-Decatur, to sell off the 169 liquor stores owned by the state, putting all of the state's retail liquor sales in private hands. Those stores are known as ABC stores, a nod to the Alcoholic Beverage Control Board, which runs them.

Alabama is one of 18 states, known as "control" states, that maintain some form of monopoly on liquor sales. According to the Center For Alcohol Policy, states adopted the control approach after the end of Prohibition as a way to legalize alcohol while maintaining some control over the how it is sold.

Like most control states, Alabama requires retailers to buy liquor -- meaning distilled spirits such as whisky -- wholesale from the state. Alabama also sells that liquor directly to customers through ABC stores, and allows liquor sales by other businesses with liquor licenses.

Orr told the Associated Press last week that he intends to file a bill that, if passed, would get the state out of the retail side of the business. Orr's proposal would sell the state's stores, which have about 600 employees, to private companies. The senator claimed the move would save the state $46 million, the AP reports.

"Should the state be in the liquor business in the 21st Century? Is that truly a mission of state government?" he told the AP.

Under Orr's proposal, the state would still be the sole liquor wholesaler.

There are two ABC stores in Anniston, one in Oxford and one in Jacksonville, according to the ABC's website. Employees at those stores declined comment on Monday, referring questions to ABC headquarters.

Attempts to reach state ABC officials on Monday, a holiday, were not successful. But in an earlier interview ABC administrator Mac Gipson told the AP that the current system is efficient from both a business and enforcement standpoint.

Gipson also told AP that privatization would increase the price customers pay for liquor.

Liquor store owners agree. Jim Adams, owner of The Package Store in Alexandria, said he buys cases of liquor from the ABC wholesaler, but has to pay tax on it before he sells it, unlike the ABC store. As a result, his prices are always higher.

He competes, he said, by staying open later than the ABC store, and by offering convenience.

"Some people don't want to drive all the way to town," he said.

Nick Surani, owner of CC's Tobacco and Package Store in Talladega, said that much of his business came from people who'd rather pay a little more than make drive another seven miles to the ABC store. If privatization equalized the price, he said, it would help him out.

"It could be really good, but it depends on the details of the proposal," he said.

Terry Paschal, owner of the Wine Cellar in Anniston, doesn't believe the bill will pass.

Paschal, a former ABC employee, has a license to sell liquor, but he hardly uses it. His shop sells mostly wine and craft beer, products ABC doesn't deal in, and he stocks a small amount of heavier stuff just in case a customer wants it.

He said he didn't believe the state was losing money on the retail operation.

"They'll never get rid of liquor sales," he said. "It's just about the only thing the state makes money on."

Orr's bill has yet to be filed. It will likely come before lawmakers in the legislative session when begins Feb. 5.

The Associated Press contributed to his report.

Capitol & statewide correspondent: 256-294-4193. On Twitter @TLockette_Star.

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