Thursday, January 6, 2011

Privatization of Virginia ABC Stores - Plan B

It's good to have a Plan B in case Plan A fails. But that's only useful if Plan B accomplishes the original goal. The Richmond Times-Dispatch reports on Virginia Governor McDonnell's latest attempt at getting the state out of the liquor sales business. But does it accomplish that goal? From the article:
Bob McDonnell is quietly planning to roll out early next week his second try at dismantling Virginia's 76-year-old liquor cartel. The proposal, prepared as part of a $75,000 study by PFM Group, the national financial-management consultancy hired by the Republican in November, is closely held. But it apparently draws on the approach of another of the 18 states in the liquor business: Ohio.

Booze is sold by privately owned stores, which receive a commission such as the ones Virginia pays retailers for selling lottery tickets, hunting and fishing licenses and collecting the sales tax. Also, Ohio — as Virginia does and possibly would continue —sets prices and serves as wholesaler and distributor, purchasing spirits and supplying stores.
< emphasis added > 

Under this proposal, the Commonwealth of Virginia would no longer act as a retailer, however it would control the selection and prices; just like it does now. I've expressed support for privatization in the past as I believe a private enterprise would increase the selection available to the consumer, and control costs. However, this plan would appear to do neither of those. We'd have private retail stores, however the state would maintain its monopoly on the sale of alcoholic beverages. (Of course, the Governor's goals might not be the same as mine.)

See "Second time the charm for liquor plan?"

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