Alabama Legislature

Bill to Close ABC Stores Gets Committee Approval

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MONTGOMERY — A bill to close the Alabama Alcoholic Beverage Control Board’s about 170 retail stores by 2026 cleared the Senate Tourism Committee on Thursday.

Multiple versions of an ABC store phase-out bill have been filed by Sen. Arthur Orr, R-Decatur, in the past decade.

“I truly believe if we were designing state government today, we would not say, let’s get into the retail sale of alcohol and let’s compete against the private sector,” Orr told the committee. There are more than 500 private retailers in the state.

Orr called Senate Bill 287 a “skinny” version of previous phase-out bills. It does not affect ABC’s other operations, including wholesale distribution of alcohol or law enforcement.

Bill co-sponsor and Tourism Committee Chairman Sen. Del Marsh, R-Anniston, said it’s time to have the ABC store debate on the Senate floor.

“In respect to my colleague who has worked diligently on this issue for several years … it needs to get to that next step,” Marsh said.

Orr said that if the stores were closed, the state would save $8 million to $12 million per year.

Several senators on the committee voted against the bill Thursday, including Sen. Garlan Gudger, R-Cullman, who said as a father of two teen sons, he worries closing the stores would increase access to alcohol for those underage.

“If you privatize, whatever the money says, it’s going to lead to more accessibility,” Gudger said.

Two women – one whose son was killed by a drunken driver, the other whose husband was killed by a drunken driver – each spoke against the bill during a public hearing, citing the need for control of alcohol sales.

Mac McArthur, executive director of the Alabama State Employees Association, also spoke against the bill. He said ABC’s more than 600 retail employees deserve medals and raises for working through the COVID-19 pandemic and Orr’s bill would put them out of a job.

The board is opposed to the bill, Neil Graff, ABC’s chief operating officer, said. He said ABC stores carry more variety than other retailers and that SB287 would increase markups on liquor, a price that will be passed to consumers.

“Your selection will go down, your prices will go up,” Graff said.

Orr’s bill says the ABC can increase the markup on wholesale sale of liquor, not to exceed 20%, to fund remaining operating expenses of the board, provide severance pay or other benefits to displaced workers and “hold current recipients of store profits harmless as retail stores and operations are phased out and subsequently eliminated.”

In fiscal year 2017, ABC revenues generated about $263 million to fund the state’s budgets and a few specific agencies, according to the board’s most recent annual report available online.

Sen. Larry Stutts, R-Tuscumbia, is also a co-sponsor.

“I don’t think the state should be in the retail liquor business, I think that ought to be managed in the private sector,” Stutts said. “The state shouldn’t be competing with the private sector, we’ve got plenty of privately owned liquor stores and we don’t need state retail stores.”

Co-sponsors include Senate leaders President Pro Tem Greg Reed, R-Jasper, and Majority Leader Clay Scofield, R-Guntersville.

“I think Sen. Orr has worked a long time on that particular legislation,” Reed said Thursday. “If we’re able to allow our focus to be wholesale and minimize more of the retail opportunities over a window of a number of years, then that will be a savings to the state and I think that’s what’s driven Sen. Orr’s continued focus on that legislation and I’m supportive.”

Other co-sponsors on the bill are: Sens. Steve Livingston, R-Scottsboro; Sam Givhan, R-Huntsville; Gerald Allen, R-Tuscaloosa; and Tom Butler, R-Madison.