Privatizion of ABC stores debated
September 10, 2010
In an effort to increase transportation funding, Virginia Gov. Bob McDonnell endorsed the privatization of Virginia’s Alcohol Beverage Control stores Wednesday. If written into legislation, the ABC will maintain its control of all health, safety, law enforcement and marketing regulatory authority over the private enterprises.
Fiscally, the move seeks to provide $500 million in new transportation funding for the commonwealth.
“This is an opportunity to put half a billion dollars into transportation simply by eliminating an outdated government monopoly,” McDonnell said in a press release. “By privatizing ABC, Virginia will join the majority of states in the nation that have long recognized alcohol distribution is not a core function of government.”
If adopted, the state would implement a 25 percent increase in ABC enforcement agents.
With the wholesale side of the business set to be privatized as well, Virginia’s ABC would focus entirely on law enforcement and distilled spirits management.
The move comes with uncertain effects for the College of William and Mary, since privatization of local alcohol retailers could lead to a more competitive selling and advertising environment near campus.
Neither Vice President for Student Affairs Ginger Ambler ’88 Ph.D. ’06 nor Assistant Vice President for Student Affairs Mark Constantine could be reached for comment.
Williamsburg City Councilman Scott Foster ’10 said the impact on the City of Williamsburg is yet to be seen, citing the current proposal as being different from past attempts.
“In the past, there has been a [limited] number of outlets per 10,000 people, which would limit Williamsburg to one, but that is not in [this proposal],” he said. “It becomes a question of private enterprise and who gets the license to operate within the city. I do believe we have the power to zone for the type of business, so that could be concentrated to a specific area.”
Foster indicated that state regulations on advertisements would more than likely stay in effect, stemming a new stream of marketing initiatives within the city.
The proposal grants 1,000 operating licenses state-wide. These licenses are broken into three levels: 600 for large establishments such as grocery stores, 150 for smaller locations such as package stores and wine and beer shops and 250 for convenience stores and retail pharmacies.
The 1,000-license allotment will reduce the total amount of alcohol distributors in the state by over 50 percent. Currently, there are 3.8 locations per 10,000 adults, and the proposal calls for a reduction to 1.8 stores per 10,000 adults.
Two ABC stores service the College community: one in the Williamsburg Shopping Center and one in the Monticello Marketplace.
The recommendation originated in the Simplification and Operations Committee of the Governor’s Commission on Government Reform and Restructuring in Richmond. The Virginia Transportation Infrastructure Bank will handle the money realized from the privatization and grant funds to localities for transportation projects based on congestion relief and economic development.
A vote will be taken on the recommendation the week of Sept. 27, and the full commission will consider the proposal at its Oct. 4 meeting.