The Virginian-Pilot
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Virginia Gov. Bob McDonnell will travel the state next month to pitch his plans to privatize state liquor sales.
The governor will visit eight Virginia locales during August for a series of town-hall meetings. His second stop will be in Norfolk at Old Dominion University's Webb University Center from 7 to 8:30 p.m. Aug. 9.
McDonnell named a commission earlier this year to consider ways to improve government efficiency. One of the key concepts he asked the panel to consider was ending the state's monopoly on liquor sales.
The governor contends that privatizing operations currently run by the state could generate a one-time windfall of $300 million to $500 million for transportation and provide revenues comparable to what the Virginia Department of Alcoholic Beverage Control now produces.
Administration officials for months have been meeting with industry representatives and other interested groups to help refine privatization proposals.
Under the leading option, wholesale and retail operations would be privatized and store licenses would be auctioned.
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does anyone know what government does?
It is very simple - government provides services, private businesses are to make a profit.
Why is the government selling a product?
"provide revenues comparable to what the Virginia Department of
"provide revenues comparable to what the Virginia Department of Alcoholic Beverage Control now produces."
http://hamptonroads.com/2010/07/changing-virginia-liquor-sales-has-broad-implications#comment-950139
"collect the $220 million in taxes and profits ABC stores contribute annually to the general fund."
"at least $150 million a year in recurring money - an amount that could be generated by a new or reconfigured tax on wholesalers or on retailers."
This is what he calls "comparable"?
That's a bunch of money
220 million in profits??? no wonder Bob wanted to privatize them...now his fat cat GOP pals can run all of them. Perhaps he's coming to Norfolk to meet with Pat Robertson (his pal) to see how much of that action he wants to get in on...this whole thing smells fishy ...as for the town hall....why would a governor go to sell his plan on privatizing alcohol? Why not a town meeting on pencil vendors at the governors mansion? More to come in the news for months to come on this one.
When this goes through....the next big story ...and the only important one....will be who will own those stores and their relation to the administration.....220 mil ????
State benefits
would be eliminated. Folks, I have to say the independent owner would pay the benefits. By the way, I came by an ABC store the other evening and it was 9:15 pm and the store was Closed. There was a shabby guy standing at the door banging on the door to let him in.....
shabby man banging on the door
It was bob that's why he wants to make these changes.
The states that have independent NON government
operated stores are doing just fine. This private sector move is well overdue. I was just in a state who had liquor sales in addition to beer and wine sales. It was very simple with no hassle at the local little store. Sales are included in the grocery stores also. We need to move forward.
if bob thinks it's a good idea
it is! We're lucky to have him leading Virginia out of the depths of dispair. JMHO
Yes, if you think the
Yes, if you think the proposal about sale of the ABC stores (which they don't own) is a bit premature, what about the other proposals by the Commission populated by McDonnell's anti tax supporters. Surprise, they want to reduce taxes on themselves (corporate income tax), and also the BPOL tax, and the machinery and tool tax, which are collected to support local government, not the state. Does anyone else remember the No Car Tax debacle which essentially bankrupted the Commonwealth? Is the collective memory of this administration that short? Or do they plan to cut the local taxes and not reimburse the cities/counties? My theory, that is exactly what they will do, as it is clear that citizens are just too unengaged to get the difference. In fact, cutting taxes is now the popular thing, not the right thing, to do, and with a Governor and a mandate, stand by for more popularity and a bill for the damage that will become due much later.
The idea is genius
This is a scheme right out of the Madoff playbook. You take something that has no REAL value, no buildings, they are mostly rented. The biggest investment the state has apparently is in stock. Which they will sell for a profit in the end anyways.
Then the State sells licenses for whatever the market will bear, why not a cool $1 million each, then increase the tax on the spirits so that it will equal what the state takes in on profit now from the ABC stores. Use the same zoning and other restrictions they use for beer and wine and see how it goes. If the residents want to drink, they will patronize the stores, if not they won't. It's the freemarket at work and the only losers are the state employees staffing the current stores.
ABC
Sen Mark Warner recently got this one right. He said that if we were starting from scratch, probably it would be better to set up a private system for ABC. But we aren't starting from scratch, and the fact is that Va taxpayers get all of the profits ($120mm/yr), so why on earth would you give that up? The only way you'd be able to do that would be to triple (or more) the number of outlets (McD is starting with doubling), which isn't exactly what people think is a good idea.
This has been studied to death over the last 20 years, and McD is the third Gov to look at it. Every one of those studies had Doug Wilder pushing it, because he figures by now everyone's forgotten about his little scandal over it.
Besides, now that McD has said (since his numbers weren't close) that there would be no reduction in prices to consumers, isn't this thing just dead? Come on!
The transportation angle on this thing is really a red herring. The math on that is pretty simple: you've got an ANNUAL deficit of more than $500mm and growing. Pretty soon, there will be zero construction because maintenance will take it all. The only way to fix it is with some kind of ANNUAL substantial revenu