Category Archives: Department of Liquor Control

Comptroller Candidate Tim Adams Opposes MoCo’s Liquor Monopoly

By Adam Pagnucco.

Tim Adams, who is the current Mayor of Bowie and is running for Comptroller of Maryland, said in an interview last week with radio station WNST that he opposes MoCo’s liquor monopoly. In response to a question about increasing liquor taxes (on which he adopted no hard position), Adams said:

I think Montgomery County needs to get out of the liquor business.

Radio Host: Tell folks who may not be from Montgomery County what that issue is and why you feel that way.

Adams: Well, because, what it is, they end up having almost like a board that regulates and establishes the liquor and all the things that goes on with that. And I think there are three things that I will just say, because I know our time is getting short, but you gotta look at it as – you know, we really need to make sure that we… by doing it that way, we lack choice. You know, I think if you bring in competition and allow people to do that, I think it will increase the choice that the citizens of Montgomery have. I think it would improve service. I think that maybe some who feels there’s a lack of service, but again, with that competition you get that. And then most importantly, by continuing to do it this way, you end up with higher prices because you have added bureaucracy on top of it. So I believe that the citizens of Montgomery are ready for them to get out of that business and allow competition to come in and support.

Adams also said he supports allowing grocery stores to sell beer and wine. So far, Delegate Brooke Lierman is the only other declared candidate for comptroller.

Adams’s comments on MoCo’s liquor monopoly appear at 21:28 of the video below.

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The Top Twenty Seventh State Posts of 2020, Part Two

By Adam Pagnucco.

Yesterday, we listed posts 11 through 20 in terms of page views for the year 2020. Here are the top ten.

  1. Volcano in Rockville

In the wake of former Chief Administrative Officer (CAO) Andrew Kleine’s admitted ethics violations, County Executive Marc Elrich wanted him to stay in his job. But the county council was outraged by the scandal and exploded in public fury. The council’s anger wound up forcing Kleine out and opened the door to the ascension of the new CAO, former county budget director and state senator Rich Madaleno.

  1. Repeal the Linda Lamone for Life Law

The problems with the 2020 primary election prompted this historical post summarizing why the state has a law protecting its elections administrator, Linda Lamone, from accountability. Comptroller Peter Franchot and Lieutenant Governor Boyd Rutherford called for Lamone’s resignation but she survived for the thousandth time. Thankfully, the general election was a smoother affair than the primary.

  1. Sitting Judges Get Temporary Restraining Order Against Pierre
  2. Progressive-Backed Judge Candidate Courted, Donated to Republicans
  3. Judge Candidate on Floyd Cops: “Lock Em Up”

It’s fitting that these three posts finished back-to-back-to-back because they all concern the nastiest judicial election in recent MoCo history: the challenge by attorney Marylin Pierre to four sitting judges. This one had a LOT going on: partisanship, charges of racism, charges of lying and even a temporary restraining order. The whole thing cast a foul odor over the ballot box and led me to conclude that judicial elections should mostly be abolished.

  1. Harris Blasts MCEA Over School Reopening

School board elections are mostly sleepy affairs in which candidates agree at least 90% of the time and the only difference between them is which ones are endorsed by the Apple Ballot and the Post. Not this year! MCPS’s boundary study dominated the primary and school reopening took the spotlight in the general, with Lynne Harris (the Post’s candidate) blasting the teachers union for allegedly resisting reopening. Harris told Blair High School’s Silver Chips newspaper that the teachers “were obstructionist, inflammatory, and just said ‘no’ to everything.” That provoked a furious response and the teachers are unlikely to forget it.

  1. What’s More Important? The Liquor Monopoly or a Thousand Bartenders?

Early in the COVID crisis, Governor Larry Hogan gave counties discretion to allow restaurants to offer takeout and delivery of mixed drinks. Many other states and the City of Baltimore allowed it, but MoCo’s liquor monopoly did not. The issue prompted a mass revolt by restaurants and consumers and the county ultimately allowed it.

  1. IG Investigates “Overtime Scam” in the Fire Department

County Inspector General Megan Davey Limarzi blew the lid off county government with her landmark report on an overtime scam in the fire department. The scandal involved more than $900,000 of overtime which exceeded limits set by the fire chief and was scheduled outside of the system usually used by county public safety agencies. Readers were all over this but I have not heard of anyone being disciplined for it. As of this writing, this is the sixth most-read post in the history of Seventh State measured by page views.

  1. Restaurant: My Staff Will Not Wear Face Masks

Last July, The Grille at Flower Hill in Gaithersburg posted this on Facebook: “Let me be very clear…my staff will not wear face masks while working here at the Grille. If that bothers you then please dine elsewhere and please try to find something more important to occupy your time such as volunteer at a nursing home or soup kitchen. Whoever you are that filed the complaint, you need to take a good look in the mirror and try to find some real meaning in your life.” The post provoked a huge firestorm from irate customers resulting in the permanent closure of the restaurant four days later. As of this writing, this is the fifth most-read post in the history of Seventh State measured by page views.

  1. MoCo Democrats Issue Statement on Ballot Questions

This post reprinted the Montgomery County Democratic Party’s statement on the four ballot questions. It was originally published on September 17 and initially attracted little site traffic. But it started to pop in early and mid-October and dominated page views in the latter part of the month. Most of the traffic was generated by Google searches. This provided valuable intel: thousands of people were seeking out what the Democratic Party had to say about a group of arcane and confusing ballot questions. And if they were coming to Seventh State, they were no doubt also visiting other sites with similar information like news outlets and the party’s own site. In the end, it seems likely that the party was the dominant force in driving voter reaction to the ballot questions as its positions carried the election by double digits. It was also a huge boon to us as this post ranks third in page views in the history of Seventh State.

On to 2021!

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Dorfman Out at Liquor Monopoly

By Adam Pagnucco.

According to a mass email sent by Deputy Chief Administrative Officer Fariba Kassiri, Alcohol Beverage Services (ABS) Director Bob Dorfman is leaving his position effective today. The email is reprinted below.

*****

Subject Line: Bob Dorfman/Acting ABS Director

From: Kassiri, Fariba
Sent: Monday, December 14 2020
To: #ABS All
Cc: #MCG.Department and Office Directors; #MCG.SeniorEAAContacts; #MCG.Legislative Branch Directors

ABS Employees,

Effective today, Bob Dorfman will be moving on from his position as Director of Alcohol Beverage Services. On behalf of the County Executive, I want to thank Bob for his 4 years of service to Montgomery County Government and acknowledge his significant accomplishments during that time. ABS would not be the success it is today without his leadership and vision. I thank him for his many contributions and wish him well in his future endeavors.

Kathie Durbin will be Acting ABS Director until a permanent director is appointed.

*****

It’s difficult to describe just how badly the liquor monopoly was doing when Dorfman, a former Mariott executive, was hired to run it four years ago. The monopoly had suffered critical delivery outages in the week between Christmas and New Year’s two years in a row. It was riddled with crime and abuse, with employees skimming booze and selling it for cash, driving drunk in county trucks and running the warehouse with sticky notes. Licensees were so upset at the monopoly’s failures, especially with regards to special orders, that Delegate Bill Frick (D-16) introduced a bill to allow county voters to end it. (I organized a coalition to support Frick’s bill.)

Dorfman’s success was to do what prior leaders had promised to do for years: run the organization like a business. Even some of the monopoly’s harshest critics conceded that, under Dorfman, the department’s delivery accuracy and service improved. Special orders were still an issue but there were no more week-long outages during holiday periods. Dorfman’s performance was good enough that pressure to abolish the monopoly eased off, at least for a little while. One caveat: Dorfman’s pursuit of the bottom line was great for the monopoly but not always for licensees. He instituted a new bottle fee for licensees at county liquor stores and blocked reform passed by the General Assembly to allow private stores to sell spirits.

Dorfman was also an aggressive defender of his organization, going after both Council Member Hans Riemer and Seventh State founder David Lublin in public. When Riemer found out that county liquor stores were losing money and suggested shutting them down, Dorfman called him “ill informed” and said he “obviously doesn’t care much” about county employees. No other department head has said such things about a sitting Council Member in recent memory!

Departing department directors often take extended departures, with their last days scheduled for weeks or months after their announcements. That’s not the case with Dorfman, who is out effective today. That makes me wonder whether he is leaving on good terms with the administration. In any case, his example offers a lesson: if the county wants the liquor monopoly to perform like a business, it has to hire someone to run it who knows how to run a business. Dorfman was that guy. We shall see if County Executive Marc Elrich heeds that lesson when hiring Dorfman’s successor.

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Liquor Monopoly Truck Crashes in Aspen Hill (Updated)

By Adam Pagnucco.

This morning, a delivery truck operated by MoCo’s liquor monopoly crashed in Aspen Hill. The crash occurred on Connecticut Avenue near the intersection with Georgia Avenue, shutting down southbound traffic and sending countless cases of liquor splattering across multiple road lanes.

The first indication of the crash was this set of pictures posted on Facebook by a person who came across the crash scene.

Montgomery County Fire and Rescue Spokesman Pete Piringer tweeted three times about the crash.

Here are close-ups of the four pictures tweeted by Piringer.

NBC Chopper 4 reporter Brad Freitas posted video of the aftermath on Twitter.

From Piringer’s reporting, what is known right now is that there were two occupants of the truck, both of whom were transported away by ambulance, and that the driver was trapped and had to be extricated from the truck. Traffic was completely shut down on southbound Connecticut Avenue and limited to one lane northbound. The mess will take some time to clear.

At this time, the cause of the accident is unknown.

Update: NBC4 has video of how this crash affected seven lanes of traffic.

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Top Seventh State Stories, March 2020

By Adam Pagnucco.

These were the top stories on Seventh State in March ranked by page views.

1. What’s More Important? The Liquor Monopoly or a Thousand Bartenders?
2. Liquor Monopoly Ends Takeout Cocktail Ban
3. Montgomery Leads Maryland in Social Distancing
4. MoCo’s Most Influential, Part Two
5. Is This the Worst Communications Debacle in County History?
6. Is This Moving into the 21st Century?
7. In MoCo, Public Media are Replacing Private Media
8. Everyone Can Vote Absentee
9. MoCo’s Most Influential, Part One
10. The County Budget is in Crisis. What Now?

Of interest is the fact that three of these stories concern the liquor monopoly. The top post – What’s More Important? The Liquor Monopoly or a Thousand Bartenders? – is, as of this writing, one of the top ten most-viewed posts in the history of Seventh State.

Most MoCo politicians don’t like talking about the liquor monopoly. Many of them admit that it is inefficient and archaic in private, but they don’t want to give up its revenues and they worry about offending the union that represents its employees. Our site traffic indicates that Seventh State readers care a lot about this topic and some of our liquor monopoly posts really pop. Politicians who get out front on this will benefit.

More top posts are coming next month!

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Elrich Says Riemer Alcohol Proposal Unsound and Unlawful

County Executive Marc Elrich has written Councilmember Hans Riemer to explain why Riemer’s proposal to allow restaurants to defer payments to ABS, the county alcohol monopoly, would violate the law and is a bad idea:

After reviewing your suggestion, we have determined that your proposal would violate federal law. The TTB, formerly the Department of Alcohol, Tobacco and Firearms, would consider the payment terms as a consignment sale, which is prohibited. Even providing different payment terms to different classes of customers is discriminatory. This is not to say that we can’t look at some reasonable extended terms for all of our licensees that may, in the shot term, be acceptable to the county, and meets all allowable legal criteria. As we consider these terms, we will balance that with the higher risk of potential payment defaults by those businesses that may have to close permanently.

Even if the proposal were legal, it would not be sound business or fiscal practice and could jeopardize county revenues and projects. ABS is run as a business, which means that it needs continued revenues to continue operating. If payments were deferred for 12 months, that could create a cash-flow problem for ABS, which needs to pay for inventory, supplies, wages, and leases on retail stores. Without sufficient revenue, the county would have to supplement ABS, reversing the current situation where ABS generates significant revenue for the county and remains self-funding, allowing it to pay for its own operating expenses. Those revenues are used to bond certain county projects. Deferring payments for many licensees for a year would cause a default on loans and would make it difficult – if not impossible – for ABS to operate in the black and continue to produce the surplus funds that go to the county treasury.

Much of the rest of the letter, printed in full below, explains how the county is otherwise working to aid restaurants and thanking the county council for their efforts during the COVID-19 crisis.

Elrich and Riemer have clashed frequently, so the disagreement here isn’t exactly surprising. It’s well known that Riemer plans to challenge Elrich for county executive and attacks him at every opportunity. Riemer’s proposal make him look like he worked fast to help businesses and forces Elrich to play the bad guy and shoot it down.

At the same time, that his idea is illegal and unworkable reinforces the perception that Riemer simply doesn’t think his ideas through and is looking to score quick political points rather than accomplish anything, even in a time of crisis.

Riemer’s lack of attention to the bond issue is especially strange. Defenders of the liquor monopoly, like both Elrich and Riemer, have repeatedly used the link between the bonds and alcohol revenues as a reason that the county liquor monopoly cannot be abolished.

It’s especially damning since Riemer prides himself on being an expert on the alcohol issue and having chaired the Council’s Ad Hoc Committee on Liquor Control back in 2015. Even the long-term politics are questionable as progressive Elrich has now positioned himself as the fiscally responsible alternative to Riemer–quite a feat.

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Riemer Proposes Liquor Monopoly Payment Holiday

By Adam Pagnucco.

In a letter to County Executive Marc Elrich, Council Member Hans Riemer has proposed that liquor licensees be allowed to defer payments owed to the county’s Alcohol Beverage Services (ABS). Specifically, Riemer wrote, “I am writing to request that ABS allow restaurant licensees to defer payments or make partial payments on all products purchased from ABS for the next 12 months.” Riemer notes the extreme financial losses being experienced by licensees and suggests that the county “explore options that could allow the County to smooth the revenue impact of this proposal over a longer period of time.”

We reprint Riemer’s letter below. We intend to print the executive’s response when we receive it.

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Liquor Monopoly Ends Takeout Cocktail Ban

By Adam Pagnucco.

Council Members Andrew Friedson and Evan Glass have announced that the liquor monopoly has ended its ban on takeout cocktails.

Friedson announced the news on Twitter.

Glass announced it on Facebook.

The official announcement from Alcohol Beverage Services appears below.

And here is a link to the application form for licensees.

Thank you to Council Members Friedson and Glass, Comptroller Peter Franchot and everyone else who worked to turn this around!

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Franchot Blasts Liquor Monopoly

By Adam Pagnucco.

After reading our post on the county liquor monopoly’s takeout cocktail ban, Comptroller Peter Franchot has come out swinging against the monopoly.  The Comptroller wrote on his Facebook page:

As your Comptroller and as a Montgomery County resident, this story makes me viscerally frustrated. There is no constructive purpose served by the continued existence of our government-run alcohol monopoly. It is inefficient, costly and unresponsive to the needs of its customers.

Now, at a time when our restaurants, bars and taverns are looking at possible financial ruin as a result of the COVID-19 pandemic, and are fighting a daily battle simply to survive, we get this tone-deaf ruling from the Department of Liquor Control. By prohibiting the sale of liquor and mixed drinks for carryout and home delivery, the DLC is acting in violation of both Governor Hogan’s Executive Order and a basic standard of common sense.

If there ever was a time for an outdated government agency to flaunt its administrative prerogatives, this certainly isn’t it. Hoping the DLC will reverse this ruling and do everything it possibly can to support our local, community-based businesses. Or, failing that, at least get out of the way while the rest of us help them #KeepTheLightsOn.

Franchot even took out a Facebook ad for this post.  At the moment, his post has 116 reactions, 40 comments and – most critically – 27 shares.  The original blog post has been shared countless more times across Facebook.

With outrage growing against the monopoly, it must lift the ban or face a renewed push to abolish it.

What will it do?

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What’s More Important? The Liquor Monopoly or a Thousand Bartenders?

By Adam Pagnucco.

Battered by shutdowns of dine-in service, restaurants across Maryland and beyond are taking a severe beating.  As a measure of modest compensation, Governor Larry Hogan has allowed restaurants and bars to engage in something unprecedented: takeout and delivery service of alcohol.  That partly applies in MoCo too, but there is a holdup.

The county liquor monopoly.

The monopoly has approved takeout and delivery of beer and wine but not of cocktails and other spirits-related products.  Meanwhile, California, New York, Florida, Colorado, Vermont, Iowa and the District of Columbia allow takeout and/or delivery of cocktails, although they often require them to be offered in sealed containers and only with food.  Governor Hogan’s executive order allows takeout and delivery of spirits too but that is subject to additional restrictions imposed by local jurisdictions.  The City of Baltimore has chosen to allow takeout and delivery of cocktails.  MoCo has not.  Its grant of takeout and delivery authority explicitly says, “This permission does not include liquor.”

Nepenthe Brewing Company in Baltimore advertises takeout cocktails.

The liquor monopoly enjoys a retail monopoly on spirits sales and jealously protects it.  For example, after the General Assembly passed a law three years ago allowing the monopoly to contract with private stores to sell spirits, the monopoly simply refused to enter into any such contracts.  Loosening its retail spirits sales monopoly might damage its profits, which are the only reason it continues to exist.  (Profits are no problem at the moment as the monopoly’s business is booming while folks are stocking up.)

The issue matters because it affects the employment of a key category of personnel in the restaurant industry: bartenders.  Data from the U.S. Bureau of Labor Statistics indicates that MoCo and Frederick establishments together employed 1,410 bartenders in 2017, so at least 1,000 of them work in MoCo owing to the comparative size of the counties.  The two counties employed an additional 2,680 people classified as “dining room and cafeteria attendants and bartender helpers.”  When takeout and delivery is restricted to beer and wine, bartenders are not needed because anyone can handle bottles and cans.  But when spirits beverages are allowed, bartenders are necessary.

Clavel Mezcaleria – Taqueria in Baltimore has an online menu of pre-bottled cocktails.

One restaurant owner who contacted me put MoCo’s cocktail ban in economic terms.  “Maryland allows it.  Montgomery County does not.  Baltimore can sell a margarita to go.  We cannot.  That’s my point. The DLC [liquor monopoly] restricts us again.  If they allowed it I could keep some of my staff employed instead of on the unemployment line.”

So what’s more important?  The continued employment of a thousand MoCo bartenders?  Or the liquor monopoly’s long-time retail spirits monopoly?  County officials, you decide.

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