ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Saturday, December 30, 1995 TAG: 9601020060
SECTION: VIRGINIA PAGE: C-3 EDITION: METRO
DATELINE: RICHMOND
SOURCE: Associated Press
Gov. George Allen's 1996-98 budget contains a provision to declare the Alcohol Beverage Control Department's headquarters and central warehouse surplus property and sell it.
The administration said it does not know how much the 21.79-acre complex in Richmond is worth, though one former ABC official told the Richmond Times-Dispatch it might bring as much as $30 million.
The 229,000-square-foot warehouse supplies the state's approximately 240 liquor stores. The warehouse employs 44 people and cost $1.6 million to run last year, state officials said.
The administration is considering either contracting for warehousing services or having liquor brokers hold the alcohol products in storage until a delivery contractor moves it to ABC stores, said state Secretary of Public Safety Jerry Kilgore.
The ABC administrative operations would be moved to another state building, he said.
Kilgore, however, said the proposal was not a move toward placing liquor sales in private hands. ``I would say it's a step toward more efficiency and to return more profits to the state.''
Some former ABC officials argue that turning the warehousing over to private contractors will increase costs to consumers.
J. David Shobe Jr., a former ABC board member, said the price of liquor has never dropped elsewhere in the country when state operations have been turned over to private contractors.
``If it costs so much for a bottle today, which represents so much tax and so much handling,'' said Jay Cochran, a former ABC board chairman, ``either the income to the state goes down to make up the [private dealer's] profit, or the price is going to go up to the consumer.''
Not everyone agrees.
``Anytime you can create free-market competition, the consumer's better off and the vendors are better off,'' said Kenneth M. Gassman Jr., a retail analyst for Davenport & Co. of Virginia Inc.
Virginia has regulated the manufacture, sale and consumption of beverage alcohol since 1934.
Under the Wilder and Allen administrations, the agency's employment has shrunk by 27 percent. At the same time, its profits have declined by 16 percent.
LENGTH: Medium: 51 linesby CNB