Va.'s Liquor Retail Monopoly May Be Over

The governor of Virginia wants to get the state out of the retail liquor business.

Next week, Gov. Bob McDonnell will roll out his revised plan to transfer the 332 Virginia-owned liquor stores over to private hands.

"Government's supposed to do a lot of things well," McDonnell told Patch in an interview, "but selling Grey Goose and Jack Daniels is not one of them."

Breaking up Virginia's 76-year monopoly on selling liquor has been a long term priority for McDonnell.  During his 2009 election campaign, he made the sale of the state-owned Alcoholic Beverage Control stores one of his central issues. 

He expects the sale of the stores will give the state a one time windfall of $450 million, and then produce recurring revenues from licensing fees.  This money will be used to pay for state transportation funding, costs McDonnell promised not to cover with raised taxes.

The Governor's plans call for tripling the number of retail liquor stores, from the existing 332 up to 1,000.  Wholesale distribution would remain under the state's control.

Members of the Virginia legislature have been critical of the proposed sale.  In the original version of the privatization plan, the Governor predicted $160 million per year in recurring revenues from the sale of wholesale liquor licenses.  A subsequent check of the plan's numbers by Virginia's Joint Legislative Audit and Review Commission found that prediction was based on flawed math, and the real revenues would likely be half that.  The report pointed out numerous holes in the McDonnell's proposal and dialed back anticipated revenue by millions.


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Former Virginia state senator H. Russell Potts also worries that privatization will mean liquor stores closer to residential communities.

"It would be a redux of a situation like in Maryland," he told the Washington Post. "where you can have a liquor store, for God's sake, on every corner.  All you have to do is ride down Route 1 headed toward College Park and you'll see a perfect example of that."

Copyright AP - Associated Press
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