Montgomery County Getting Out of the Beer Business? - NBC4 Washington
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Montgomery County Getting Out of the Beer Business?

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    Montgomery County gets its first look at how much it could cost to deregulate alcohol sales in the county after a News4 I-Team investigation exposed problems inside the government agency. (Published Tuesday, Feb. 10, 2015)

    Montgomery County’s Office of Legislative Oversight released a report Tuesday giving the first estimate on how much it would cost the county to deregulate or downsize it’s government-controlled alcohol sales.

    Every drop of alcohol in Montgomery County must be purchased from the county’s Department of Liquor Control’s warehouse in Gaithersburg.

    County Councilman Hans Riemer wants to change that.

    "The report shows it doesn't have to be this way in Montgomery County,” he told the News4 I-Team. “There is a way for us to reform how we handle liquor control in the county to protect public health and give people the choices they want."

    Riemer said the report presents five different options for deregulating alcohol sales starting on page 85. The choices range from completely eliminating the agency to moving toward a system more like Virginia's.

    “Virginia is a good model," Riemer said. "In Virginia, the state runs the liquor stores, that's the ABC stores. But the state does not sell beer and wine to restaurants or stores, so there isn't a warehouse with delivery trucks that are owned by the state delivering beer and wine."

    In November, the News4 I-Team caught a delivery crew drinking while delivering beer from a county-owned vehicle. We also interviewed multiple insiders and store owners who alleged some employees were selling cases on the black market using a complicated theft scheme.

    Last month, the county's Inspector General found significant security problems inside the county-owned warehouse, including broken security cameras and unattended doors, which have since been fixed.

    But it led Riemer to tell News4 he no longer has faith in the agency's management team. "No, I do not. Unfortunately, the fact that, for example, they weren't checking the inventory on the trucks when it comes back to the warehouse, that's inexcusable. It's just inexcusable."

    Riemer said even though some of the options could potentially eliminate more than a hundred jobs and lose $20-30 million a year in revenue, the money could be made up by charging private distributors for the privilege of selling the county's alcohol.

    The News4 I-Team reached out to County Executive Ike Leggett for comment. His spokesman pointed us to the Chief Administrative Officer's official response in the report on page 107, stating, "In our opinion, local liquor control has served Montgomery County well. We have lower alcohol consumption and higher revenue for public purposes than other jurisdictions. There are not liquor stores on every corner."

    He then lists multiple problems he has with the report, including his belief that "to 'make up' for the $30 million in revenue lost for the County" would "involve increasing fees and costs to County licensees and/or imposing a County liquor 'piggyback' tax."

    The debate over funding and the future of the entire Department of Liquor Control will now be considered by the Council’s new ad hoc committee on Feb. 27.