Who knew it would take this long and be this difficult to finally put a once bountiful “cash cow” out to pasture?
This is the image we think of during the arduous effort to get Worcester County out of the booze business despite claims from the County Commissioners that they are, in fact, executing a calculated exit strategy.
While we support having a strategy, we have a real problem with some of the “calculations” that are driving that strategy to put the Department of Liquor Control and whatever is left of the once powerful monopoly out of its proverbial misery.
There has been much debate about the differing language, specifically the bit about placing a 10-mile radius around each of the four existing county-run liquor stores, in the versions of the House and the Senate bills this session. The language would essentially prohibit any private liquor store to open in that radius while the county is trying to sell off the buildings and the millions of dollars of inventory.
The House bill (HB 697), filed by Eastern Shore Delegates Charles Otto and Mary Beth Carozza, has the 10-mile radius in the language of the bill, but the Senate bill, (SB 967) sponsored by Senator Jim Mathias, does not.
The county’s attorney, Maureen Howarth says the 10-mile radius is vital because if the county was unable to sublet or lease its current dispensaries there would be an additional loss of more than $800,000, and that would be tacked on to the projected $1 million associated with getting out of the business altogether.
The county essentially fears that if a private entity opens a liquor store close to the four existing stores, after getting approval from the Board of License Commissioners, it would devalue the existing stores, and that would equate to less money for the county on the way out of the dispensary business.
Mathias said he would not be putting the “10-mile radius” language in his version of the bill because it would “thwart private business or capital investment” and encouraged the County Commissioners to “find compromise.”
The commissioners voiced their support of the house bill and blasted Mathias’ decision to not honor their request for the 10-mile radius.
If you think about the locations of the four remaining county run liquor stores (two in Ocean City and one in Pocomoke and just outside of Berlin) and imagine a big 10-mile circle from each location, one might venture a guess that it doesn’t leave much available space for a private business owner to come in and open a liquor store prior to the county selling off its four stores. Your guess would be correct.
We drew those circles this week, and a 10-mile radius from each of those four stores eliminates every square inch of this county, with the exception of about seven miles from just south of Snow Hill to just south of Newark, and much of that is private farmland, county owned properties, and rural backroads. Ironically, the county shut down the former Snow Hill liquor store because it wasn’t performing well a few years back.
It seems Mathias’ hesitation about the 10-mile radius is correct in this sense, and we feel the language should stay out of both versions of the bill. While we can’t blame the county for trying to get out of the liquor business with as much cash in their pocket as they can, we feel the 10-mile radius language is an abuse of power that aims to stack the deck right before they decide to get up from the table.
The criticism of Mathias’ stance is also misguided and borderline ridiculous if you look back on all the things Mathias has done to help the county’s interests regarding the dispensary.
It was Mathias who pushed for legislation in 2009 that allowed the then Liquor Control Board to increase its buying power of wholesale products from $5 million to $8 million and some believe that this new ability to bulk buy paved the path for the well documented price fixing scandal and Comptroller investigation that inevitably abolished the LCB from existence.
Yet, even during that time, the county didn’t want to lose the revenue so abruptly and asked Mathias to push for a sunset provision in the liquor law, where the monopoly would be broken and a free market system would be instilled in Worcester County for the first time in 80 years, but not for another five years. Mathias kicked that can down the road for them, and helped to establish the Department of Liquor Control, which allowed the county to continue to make money off booze sales for a few more years.
Since the creation of the DLC in 2011, which was created thanks to Mathias’ bill, the county has pocketed over $914,000 of the $1.008 million in dispensary profits, while the municipalities’ cut has dwindled substantially. In the days before the LCB scandal, Ocean City’s cut of liquor profits was upwards of $200,000. Since the DLC was created, that cut plummeted steadily each year from $54,275 in 2012 to zero in 2015.
The county has had more than enough time to figure out an exit strategy as the DLC has been slowly bleeding out, financially speaking, since it was created in 2011. If any part of this exit strategy ends up hurting the taxpayers of Worcester County, the commissioners only have themselves to blame, not Mathias.