An effort to privatize the retail liquor business in Alabama may save the state money, but it comes with costs that deserve close scrutiny in the Legislature.
Sen. Arthur Orr, chairman of the Senate’s General Fund Budget Committee, says the state could save $46 million by eliminating its 169 retail stores and their 600 employees.
The Decatur Republican said state liquor stores are part of an antiquated system left over from the end of Prohibition.
Under his plan, the Alabama Alcohol Beverage Control Board would continue its wholesale operation but distribute liquor only to private retail stores.
It would continue to enforce liquor laws, determine how many retail store locations are in each town and award contracts through a competitive bid process. The state would continue collecting taxes on alcohol, and let the law of supply and demand determine retail prices.
Drawbacks include the fact that 600 people could be added to state unemployment rolls. Although new private retailers would provide employment, those jobs would likely be at lower wages and with no benefits. Another issue could be higher prices for consumers. A similar move in the state of Washington in 2012 resulted in prices jumping by more than $3 per liter. Another consideration is whether crime would increase with private stores operating longer hours than state outlets.
Money, of course, is not the only issue. The state’s involvement in liquor sales originated from a desire to control access to an addictive substance. Privatization, even with strict guidelines on sales, will make it easier for people to purchase alcohol. The longer hours, marketing and location of stores selling liquor probably will result in more consumption, and that carries a social cost.
The financial incentives also could increase underage sales and sales to people who already are intoxicated.
The ultimate answer for Alabama’s budget woes will have to include more revenue from those who have blocked tax reform with lavish campaign contributions. Orr and other legislators are wise, though, to scrutinize the budget for ways to reduce spending.
Not registered? Click here
|High School Sports||@DecaturPreps|