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Public health impact of ABC privatization likely mixed, report author says

Rosalind Helderman

The lead author of a VCU report that reviewed the scientific research into the affects of liquor privatization on public health said Thursday that he sees some encouraging aspects of Gov. Bob McDonnell's proposal to sell the state's liquor monopoly--but also some areas for concern.

J. Randy Koch, the executive director of VCU's Institute for Drug and Alcohol Studies, said he was pleased to see McDonnell propose that the state hire 22 new law enforcement agents to enforce drinking laws during the transition to a private system.

And he said he was encouraged by a column in the Richmond Times Dispatch arguing that liquor prices would rise after privatization--though members of McDonnell's administration have said they believes prices will remain about the same. Higher prices would discourage drinking, he said.

But Koch said he has concerns about McDonnell's proposal to almost triple the number of stores licensed to sell liquor, noting that the VCU study found that increasing the number of alcohol outlets has resulted in increased alcohol consumption and social harms related to drinking elsewhere.

The study, which relied on a review of existing scientific studies on privatization, found that allowing private industry to sell alcohol is not a public health risk per se, but that privatization is often associated with an increased alcohol availability and marketing, Both have been shown to result in increased consumption and social harm, it showed.

It found that alcohol use is highly price sensitive and public health risks can be reduced by using taxation to achieve high prices. And it found that drinking harms can be further mitigated by strict controls on liquor stores hours and advertising.

The researchers also concluded that a study conducted by a George Mason University economist on behalf of the Virginia Public Policy Institute showing there would be no public health risks associated--a study that's been repeatedly cited by McDonnell's office--suffered from "a weak study design" and few conclusions about the effects privatization can be drawn from it.

Koch presented the results of the data review on Wednesday a legislative subcommittee on substance abuse prevention. In an interview, he said his group's goal was to be "as objective and comprehensive as possible" in providing data to legislators.

He said he's concerned that there has been "cherry-picking" in data from both sides of the privatization debate thus far.

"The best policy is informed by the best data," he said. "It doesn't mean that research should always drive policy--we recognize that the potentional public health impact is only one factor that should be considered in this issue. But it's certainly one that deserves more objective attention."

He said the VCU report tried to offer caveats to its own findings and note gaps in the research. For instance, the report found that most research on the issue examined states that privatized wine sales. He said it is unclear if conclusions about spirits privatization be drawn from wine studies.

And he said there has been little research done on the effects of adding distilled spirits to the shelves of stores already selling beer and wine, as has been proposed by McDonnell.

Koch said he saw advantages to that proposal--for instance, it could satisfy concerns about liquor stores sprouting on every corner, with their associated urban blight and crime.

But he said research does show increasing the number of alcohol outlets generally results in increased consumption.

"There is no reason to believe that focusing the increase in off-premise outlets on big box stores would result in less of an increase in total consumption (even though it has other potential benefits)," he wrote in an email.


By Rosalind S. Helderman  | September 23, 2010; 1:10 PM ET
Categories:  Liquor privatization, Robert F. McDonnell, Rosalind Helderman  
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