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McDonnell's commission backs his ABC privatization plan

Rosalind Helderman

Gov. Bob McDonnell's handpicked Government Reform Commission voted this afternoon in favor of his proposal to privatize the state's liquor system.

The commission voted 22 to 3 after a lengthy debate. Three Democratic legislators -- Del. Bob Brink and Sens. Mary Margaret Whipple and L. Louise Lucas -- voted against the proposal.

To drum up more support, McDonnell made significant changes to the proposal last week, eliminating a 1 percent tax on annual sales by wholesalers and a 2.5 percent fee on restaurants that choose to buy their liquor directly from wholesalers.

The state would lose $47 million a year if the plan is implemented, but the governor's staff assured commission members at the meeting Monday that they would find other ways to make up the losses.

McDonnell is considering calling the General Assembly back to Richmond in November for a special session to debate the liquor proposal and other commission proposals (still being debated this afternoon).

The commission is charged with providing initial recommendations to McDonnell by Oct. 15. A final report must be ready Dec. 15.

Update: The Virginia Chamber of Commerce on Monday issued a statement supporting privatization -- but with the caveat that its endorsement comes on the condition that ending the government monopoly on liquor sales "makes economic sense for the Commonwealth." No word on whether the chamber believes McDonnell's current proposal fits the bill.

The Chamber's full statement:

The mission of the Virginia Chamber is the protection and promotion of Virginia business. Whenever possible, the State government should focus on its core functions and not compete with the private sector. The Virginia Chamber of Commerce supports the idea that the free enterprise system is the most productive supplier of human needs and that increased competition will benefit consumers by bringing more choices. Therefore, the Virginia Chamber of Commerce endorses the privatization of ABC as long as it makes economic sense for the Commonwealth.

By Rosalind Helderman  | October 4, 2010; 2:37 PM ET
Categories:  Anita Kumar, Liquor privatization, Robert F. McDonnell  
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Next: McDonnell talks about the South's future


so the Commission he handpicked supports his plan.
How controversial!
Does his Commission also support cuccinelli in his never ending witchhunt/vendetta against climate change scientist Mann?
Was this a blue ribbon Commission?

Posted by: MarilynManson | October 4, 2010 3:09 PM | Report abuse

It is disappointing, but not surprising, to see that two Democratic legislators from Arlington are trying to block Gov. McDonnell's reform plan.

Private liquor stores would give better service to consumers AND generate new revenues for transportation projects. Moreover, there's no reason for state government to be involved in retail sales. There are many wonderful private stores for wine -- why not allow private stores for spirits as well?

I'm a constituent of Del. Brink and Sen. Whipple, and I strongly object to their vote today. They should both know that many of us in Arlington do not support continuing a state-owned monopoly.

Posted by: jrmil | October 4, 2010 5:11 PM | Report abuse

Increasing Venues for hard Alcohol from 332 to 1000 to fund roads and construction is wrong. Why throw Booze in front of people when they and their children are out shopping for necessities like milk and break. What is the benefit of this???

You raise taxes on Gasoline to fund roads and transportation. Better yet, raise the taxes on Assault weapon sales 1000% and stop the unlicensed, untaxed sales of weapons to in and out of state criminals. Virginia needs roads more than more Booze and Assault weapons.

Virginians do not need a liquor store on every corner; do not need to fill the streets with DUIs and violence and the jails with unfortunate drunks of McDonnell’s lazy and misplaced policies. Private prisons and alcohol abuse will get a boon while worker productivity, real estate values, and society peace will go down as Jack Daniels and Jim Beam in every grocery and convenience store make their skid marks.

California group says Virginia ABC effort driven by alcohol industry

“..efforts to deregulate are being pushed by the alcohol industry, in an effort to boost profits.”

Posted by: Airborne82 | October 4, 2010 5:28 PM | Report abuse

Virginia’s ABC stores are nice, clean and pleasant experiences, without drunks and hangers on hanging outside like so many 7-11s. At grocery stores there’s no temptation for Jack Daniels to go with a families bread and milk, just because it’s there. Bourbon, Scotch, Rum, Tequila, Vodka, etc., are adult vices and should remain separate from general groceries that adults and children need. People have to shop for groceries; they don’t have to shop for hard Booze. Stop trying to put it in front of us everywhere we have to go.

McDonnell is the only governor I know who can take a $250 million/year in revenue stream because of Virginia’s ABC stores bulk purchasing power “in Virginia, where whiskey and every other kind of liquor is sold in state-run stores, more than $13 of the retail price goes to the state.“; and turn it from a $2.5 Billion Plus in 10 years, to a negative within one year while increasing Hard Booze outlets from 332 to 1000.

Va. liquor profits set a high bar for McDonnell privatization plan

“RICHMOND -- For drinkers, a fifth of Jack Daniel's costs about the same wherever they buy it -- about $25 in Virginia and the District, a couple of bucks less in Maryland. But for the governments that regulate that bottle, the difference is as stark as a sip and a chug. In the District and most of Maryland, just a dollar or two from a fifth of Jack Daniel's goes to government. But in Virginia, where whiskey and every other kind of liquor is sold in state-run stores, more than $13 of the retail price goes to the state. “

Posted by: Airborne82 | October 4, 2010 5:44 PM | Report abuse

@jrmil: If you and those you know want private ABC stores in Arlington then you have them with extra police protection because of crime, etc. Don't ask the rest of us VA taxpayers to pay for any problems that come with them. A lot of us who don't live in NOVA like the clean well-run stores - not because we don't like change but because it just isn't good business to have a one time wind fall and then have to
figure out what to do in 5 to 10 years.
If you like private stores just run to the District and stock up!

Posted by: mcdonalsherry | October 5, 2010 5:08 PM | Report abuse

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