Lawmakers ponder ABC system change

Published 11:20 pm Thursday, June 17, 2010

Staff Writer

The proposed modernization of North Carolina’s alcoholic-beverage control system could be enough to give one a sore head, depending on one’s perspective.
Yet, measures that would affect local ABC boards across the state by closing stores that don’t meet performance standards are more palatable to one key local official than wholesale privatization of the system.
“As far as any of the changes that’s on the table, we’ve been doing as-is, and nothing will affect us as far as Beaufort County is concerned,” said JoKay Smith, supervisor/general manager of the Beaufort County ABC Board.
Bills cycling through the state House and Senate would place more controls on the statewide ABC system, but the proposals would not result in shifting control of the system to private hands as some reform advocates recommended.
The bills would cap salaries for local ABC managers at an amount not to exceed the annual salary of a given county’s clerk of court.
In larger counties, the cap would be $112,607, according to The Associated Press.
For Beaufort County, the cap would be around $82,000, a figure the Daily News derived from the 1-percent filing fee paid by incumbent Clerk of Court Marty Paramore, who is running unopposed for re-election.
“I’m way below that (salary), and I don’t foresee the Beaufort County ABC Board ever reaching that cap,” Smith said.
The bills also would impose additional financial-reporting requirements on ABC boards and provide for local, budget-related public hearings at which anyone could speak.
In addition, the bills would establish new ethics requirements for local ABC boards and take steps to eliminate nepotism in financial arrangements with those boards.
The legislative focus on the ABC system began with questions about mismanagement by a couple of local ABC boards. Inquiries followed a liquor company’s fete for the Mecklenburg County ABC Board and revelations about the large salary of the now-retired head of the New Hanover County ABC Board.
The system is “outdated and needs modernization,” reads a Dec. 10, 2008, report from the Program Evaluation Division of the N.C. General Assembly.
A legislative study panel was formed to look into modernization of the system, and Gov. Beverly Perdue ordered a review of the system.
According to The Associated Press, a modernization bill was given the nod of a House committee, and the item could go before the full House this week.
Calls seeking comment from lawmakers were not immediately returned Wednesday.
One Beaufort County commissioner and state Senate candidate favors privatization and doesn’t see much to like in the House and Senate bills.
“What I’ve read is just more and more regulation,” said Hood Richardson of Washington. “We don’t need to keep building bureaucracies. We need to take the ABC system and privatize. All they’re doing is building a bigger bureaucracy than before.”
The legislation likely would affect local operations by increasing paperwork requirements, said Richardson, a Republican who’s running against incumbent Sen. Marc Basnight, D-Dare.
“I’ve looked at the regulations, and all they’re doing is manufacturing more bureaucracy,” he said.
Though his might be a minority opinion, Richardson said, privatizing the system would plow more profits into the area economy.
He said stiff regulations are needed from an alcohol law-enforcement perspective, but he added, “Any time you’re making bureaucrats, you’re burning up wealth, you’re not creating wealth.”
A majority of Beaufort County’s commissioners oppose privatization.
On June 1, 2009, the county board voted 4-3 for a resolution that supports retaining local control over ABC stores.