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Senate Committee rejects ABC store privatization

Brandon Moseley

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The Fiscal Responsibility and Economic Development committee Wednesday voted against giving a favorable report to a bill that would have privatized the state’s liquor stores.

Senate Bill 77 was sponsored by Sen. Arthur Orr, R-Decatur.

A public hearing was held on the eighth floor of the Statehouse on Wednesday, but the bill failed in committee on a 3 to 5 vote.

Mac McArthur, the executive director of the Alabama State Employees Association, said that Washington state has privatized its state liquor stores and has seen revenue come down and the cost to the consumer has gone up in the state.

“There are 6,27 state employees doing a good job who will be out of work,” he said, if Alabama were to close the Alcohol Beverage Control stores. “Their healthcare and retirement will be gone.”

McArthur said that the ABC stores bring in $33 million to education in Alabama and are the fifth largest income source for the state general fund.

The ABC board did not take a stance one way or the other but estimated the state would generate up to $85 million less revenue in a privatization model.

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Joe Godfrey with the Alabama Citizens Action Patrol said, “I would like to shut down all of the liquor stores in Alabama.”

Godfrey said that he is opposed to the state giving up control of the sale of alcoholic beverages. Alabama has the 44th lowest consumption rate in the nation and we are 45th in hard spirits.

“Privatization would lead to an increase because availability goes up after privatization consumption goes up,” he said.

“Privatization will increase alcohol consumption and increase the problems associated with alcohol consumption,” Godfrey said. “Every year $253 billion is spent cleaning up the mess from alcohol consumption. It is a destructive force in our culture.”

“Alabama is not in the alcohol business it is in the control business,” Godfrey said. “Washington reported more hospitalizations, particularly of minors and people under 40,” from alcohol-related issues after they privatized liquor sales.

Godfrey predicted, “We are definitely seeing some bad things happen” if we privatized the ABC stores.

Mark Gaines, a lobbyist representing Conecuh Distillery, said that he favors the ABC stores.

Orr said that Washington state is not a fair comparison because their Costco got behind the privatization campaign and they privatized both the retail and the wholesale alcohol business. That is, “A very different set of circumstances.”

“In the bill there are compensations for displaced employees,” Orr said. “If consumption goes up that means more revenue.”

Former Lt. Gov. Steve Windom, who is now a lobbyist, spoke in favor of Orr’s bill.

“We have another bill that is starting in the House that would privatize both the retail and the wholesale business,” Windom said. “We fully support getting Senator Orr’s bill to the floor.”

The committee’s vote effectively kills SB77 for the 2019 legislative session.

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