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D.C. region restaurant association 'buzzing' over ABC privatization

Rosalind Helderman

The chairman of the Restaurant Association of Metropolitan Washington -- who is also a top executive at the well-known Clyde's Restaurant Group -- says his members have a lot of confusion and some concerns about Gov. Bob McDonnell's proposal to privatize state-run liquor stores.

Unlike the Virginia Hospitality and Travel Association, which represents most restaurants around the state, RAMW was not included in a working group that advised staff for McDonnell (R) about privatization in the months before the governor unveiled his proposal Sept. 8, said Clyde's Corporate Operations Manager Claude Andersen, who chairs the association.

Among the group's members across the Washington region are 100 Northern Virginia restaurants, including the prominent 2941 Restaurant in Falls Church, the Great American Restaurants, and 16 Chili's Bars and Grills in Northern Virginia.

Andersen said the group was aware from commercials during last year's gubernatorial campaign that McDonnell supported liquor privatization. But he said they didn't know that the governor was preparing a major push on the topic and have had no contact with his staff on the issue in recent months. Now his members are puzzled by a proposal that includes what the governor's office is calling a 2.5 percent convenience fee for restaurants that choose to buy liquor directly from wholesalers in a newly privatized system. "We've been buzzing about it since that came out," he said.

The governor's staff have said restaurants would be able to avoid the fee by continuing to purchase liquor from retail establishments. Only those that purchase from wholesalers, taking advantage of volume discounts, would pay the fee.

But Andersen said it is likely that only small establishments would logistically be able to buy from private retailers. For those that chose to instead buy directly from wholesalers, he said he is not confident that prices would be significantly cheaper for restaurants, given that McDonnell's plan also includes a $17.50 per gallon tax for wholesalers, and a 1 percent yearly fee on wholesaler receipts.

"We consider that a tax, no matter what they call it," Andersen said. "Everyone's unsure of where this is going, depending on who's talked to whom. But all of us are against this fee. We don't feel that's appropriate."

At the moment, Andersen said his association is continuing to gather information and it has no formal position on the proposal. He said he hopes his group can be more involved with the process going forward.

"An awful lot of the liquor business in Virginia is done in the northern part of the state," he said.

"Had we known what they were going to propose, we might have been down there to say, 'Can we be in the room to discuss that?' But all we knew is what had been said before," he added. "That this would bring better selection and service and $500 million for transportation. ... So why wouldn't we be for it? Now we know why we might not be."

By Rosalind Helderman  | September 20, 2010; 2:58 PM ET
Categories:  Liquor privatization, Robert F. McDonnell, Rosalind Helderman  
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