Delegate Mark Keam - Virginia's 35th House District

Delegate Keam quoted in Vienna Connection re ABC sales

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Fears, Hopes for Private Liquor Sales

Governor wants to raise transportation cash by selling off state liquor business.

By Julia O'Donoghue

Friday, July 30, 2010

Gov. Bob McDonnell (R) hopes to sell off Virginia's state-run liquor business to generate as much as $500 million for transportation projects.

The Governor has assembled a government reform committee to investigate the issue.

The committee, which has been holding public meetings around the commonwealth this month, is expected to vote on a privatization proposal produced by McDonnell's staff in late August.

Then, McDonnell wants to call the Virginia General Assembly back to Richmond for a special session this fall to consider privatizing liquor sales.

Several legislators said the issue of selling off the commonwealth's liquor business is more complex than it may first appear. Two other governors, Doug Wilder and Mark Warner, also looked at privatizing liquor sales but ultimately did not pursue the issue.

McDonnell has to not only demonstrate that Virginia would receive a large lump sum of money up front but that the new private system would also produce as much annual revenue for the government as the current state-run network. Last year, the Virginia general fund received $230 million from liquor sales.

Many people, particularly county and city officials, also have concerns about the placement of the liquor stores. They want local government to be able to control where the liquor stores go so that certain neighborhoods aren't "overrun."

Some people are also concerned about an increase in liquor consumption and access to alcohol in general.

Previous proposals to privatize state liquor sales would make as many as 800 to 1,000 licenses for selling spirits available in Virginia. Currently, there are fewer than 350 liquor stores across the commonwealth.

Here is what your local elected officials had to say about private liquor sales coming to Virginia:

Del. Mark Keam (D-35)

The freshman delegate said he is open to the idea of private liquor sales, though he would want to see details about the implementation process. Keam also said many questions must be answered. For example, could the new liquor stores sell cigarettes and lottery tickets?

"I am still open to the idea but it is a complex issue. It is not as simple as McDonnell is making it sound," said Keam.

Supervisor Cathy Hudgins (D-Hunter Mill)

If Virginia shifted to private liquor stores, Hudgins would want local governments, like the Fairfax County Board of Supervisors, to have control over where the liquor were placed.

"We don't want to see them pop up on every corner in some neighborhoods. How we control it is going to be a big discussion," she said.

State Sen. Chap Petersen (D-34)

Petersen said he needs to see details about how Virginia would shift to a privately-controlled liquor system before he could be supportive of a plan. Specifically, he would want to know how the commonwealth plans to restrict underage access to liquor, said the senator.

State Sen. Mark Herring (D-33)

Herring has voted against proposals to privatize the state liquor system in the past but, "I am going to keep an open mind and see what he brings forward," said Herring.

Del. Tom Rust (R-86)

On principal, Rust is supportive of the idea of privatizing liquor sales in Virginia. But the delegate would only support a proposal that also found a way to replace the revenue the current state-run system generates for Virginia's general fund each year.

"Conceptually, I don't think Virginia ought to be in the ABC business," said Rust.

Del. Ken Plum (D-36)

The possibility that a new private system could more than double the number of places where liquor is sold in Virginia makes Plum uncomfortable.

"That we could go from 300 liquor stores to as many as 800, I just don't find that very tasteful. As far as I am concerned, we have enough in Virginia as it is," said Plum.

Del. Dave Albo (R-42)

Politically speaking, Albo said the Virginia General Assembly will be reluctant to give away the state liquor system unless McDonnell can find a away to produce $500 million in cash for roads up front and replace the $200 million in recurring revenue the current system generates every year.

"There is absolutely and utterly no reason to do this unless you are going to deliver a boatload of money for roads," said Albo, who sits on the House committee that oversees state-run liquor stores.

Supervisor Jeff McKay (D-Lee)

Even if the sale of the state-run liquor business brought in an extra $500 million, it would not be enough money to significantly address the state's transportation woes, said McKay.

The supervisor also worries that local government would not be given enough control over where liquor stores could locate.

"I don't want to see 10 stores pop up in central Springfield or along Route 1," he said.

Fairfax County Chairman Sharon Bulova (D-At-large)

Bulova is concerned about the commonwealth selling off a government asset that reliably brings in funding for education and social services.

"My biggest concern is that we would be selling off an asset for one-time funding that, right now, is a regular recurring source of revenue," she said.

Supervisor Patrick Herrity (R-Springfield)

Herrity is in favor of moving to a private liquor sales model in Virginia.

"It is not inherently a government function and it is something the private sector can do better," he said.

Supervisor John Cook (R-Braddock)

Cook is supportive of McDonnell's proposal to privatize liquor sales in Virginia.

"If it means more liquor stores, so what? We still have the same laws in enforcement and zoning. I don't see the problems that others are seeing," he said.

Del. Jim LeMunyon (R-67)

LeMunyon said he is generally supportive of moving toward private liquor sales in Virginia but he would want the transition to happen slowly.

For example, the state-run liquor stores could be converted to private liquor stores first.

Then, the Virginia General Assembly could decide whether to allow liquor sales in venues like grocery stores, large-scale retailers like Costco and convenience stores.

"I would want to do this in stages," he said. 

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