McDonnell Unveils Plan for Privatization of ABC Stores

Gov. Bob McDonnell's staff unveiled a plan on Wednesday that would allow for the retail liquor sales at ABC stores in Virginia to be handled through privately owned and licensed stores in Virginia. There are currently 332 liquor stores in the Commonwealth.

Under the plan, the number of stores that sell liquor would increase to 1,000 thanks to licenses that would be auctioned off to the highest bidder. There are 600 licenses available for existing large businesses including grocery stores and outlets such as Wal-Mart. 150 licenses for smaller businesses like wine and beer stores, and 25 licenses for retail pharmacies like Walgreen's and CVS. There would be new shelves in the stores. An additional 668 licenses would be determined by population density.

The licenses could be auctioned off in a year with stores able to add the new shelves in their business by September 2011.

Local representatives like Delegate Vivian Watts (D-39) have spoken out on the issue. In her annual newsletter, Watts said, "selling ABC stores for a possible $500 million one-time windfall will take at least $150 million a year from education, public safety, Medicaid, etc."

Fairfax City is home to two ABC stores, one off Main Street near Old Lee Highway and another on Willard Way near Fair City Mall. A third store is located just outside the city limits before Waples Mill Road.

According to the press release posted on McDonnell's website, there is no tax for the privatization, which would generate $500 million for the transportation budget.

"This is an opportunity to put half a billion dollars into transportation simply by eliminating an outdated government monopoly," said McDonnell in the press release.  "Five hundred million for roads and rail will mean congestion relief for our citizens. By privatizing ABC, Virginia will join the majority of states in the nation that have long recognized alcohol distribution is not a core function of government. Transportation, on the other hand, is a core function and this plan will deliver immediate results for Virginians frustrated by long commutes and stalled construction sites. ABC privatization is one part of the overall solution to our transportation challenges. I look forward to working with Republicans and Democrats to privatize ABC, make government more efficient and improve our transportation system."

The plan was initially proposed on Aug. 25 by McDonnell's Commission on Government Reform and Restructuring.

Presentations from Wednesday's meeting can be viewed at http://www.reform.virginia.gov/ 

The Commission is set to consider the proposal on Oct. 4.