The director of the county’s alcohol delivery operation says corruption is not widespread in his department, despite two employees caught by a local news station drinking while making beer deliveries.
George Griffin, director of the Department of Liquor Control, addressed the drinking and other allegations of employee theft in the November report from NBC4.
The report also cited anonymous restaurant and alcohol store owners who claimed some DLC employees offer to sell them county alcohol inventory on the side for cheaper rates.
The conversation came before an Ad Hoc Council Committee that’s looking at major reforms for the DLC, including the possibility of deregulation.
Unlike nearly every other “control” jurisdiction, Montgomery County purchases its alcohol inventory from manufacturers, stores it in DLC’s Gaithersburg warehouse and then resells the products via direct delivery to all beer and wine retail stores and restaurants in the county.
“I’m trying to decide what do I think is worse. A management system that doesn’t catch people drinking and driving or stealing from the county,” Councilmember Hans Riemer said at the committee’s hearing Friday. “I thank god that one of those trucks didn’t hit somebody. It’s just extremely upsetting.”
Griffin and Gino Renne, president of the county employees’ union that represents most DLC workers, said they were likewise concerned with the allegations. But they also said reported product shortages — which can be used to mask stealing by employees — happen at a much lower rate than in private alcohol distribution companies.
“We were delivering at a 99.8 percent accuracy rate on the beer side over 12 months,” Griffin said. “We are convinced that is far below the industry average.”
Griffin said the DLC had brought up similar charges against the employees before they were caught on camera.
In that case, the union backed the employees through the county’s Alternative Dispute Resolution process and they were allowed to continue working.
Renne said the union didn’t back the employees after the news report showed them drinking on the job and advised them to resign, which they did.
Renne said the union takes a “zero tolerance” approach when presented with solid evidence of DLC employees stealing.
“I want the public and the county executive and the County Council and everybody else to know that we have a bigger obligation of protecting all the jobs in the DLC, them and their families” Renne said. “We take that extremely seriously.”
Griffin said the DLC is installing a digital scanning system that will allow management to more quickly identify shortages or overages in county alcohol deliveries.
While critical of the DLC for not having the systems in place earlier, Councilmember Marc Elrich said the incident outlined in the news report isn’t a reason for Montgomery County to get out of the liquor business.
“The idea that something’s happening here that would never happen in the private sector, this stuff happens everywhere,” Elrich said. “It’s the nature of retail. Anyone who’s been in retail, or who runs a bar knows how much money does not make it from the customer to the register.”
Griffin said just this week, the DLC filed criminal charges against an employee it found was selling inventory on the side to county licensees. The department has also put in place a new policy in which any shortages must be called into the warehouse immediately.
“If it’s something that raises a red flag, we’ll have them wait there. We’ll be there,” Griffin said. “They actually go out and they inspect the truck and they talk to the licensee.”
DLC management has also switched up teams of drivers and helpers in an attempt to discourage collusion.
The DLC has 255 full-time employees and 155 part-time positions. It also generates about $30 million a year in profits for the county — a big reason why County Executive Isiah Leggett opposes deregulating it.
Renne and the union oppose any deregulation because it could mean the loss of union jobs.
“I hope that we can give these people the piece of mind of not having to look over their shoulders every five to 10 years,” Renne said of the Ad Hoc Committee’s latest review of the control system.
Renne did agree that the committee should push reforms to make the DLC work more like a private business — sentiments that many on the committee share.
The DLC commissioned its own report last year that found its Chevy Chase retail liquor store was hemorrhaging money, the truck fleet that delivers alcohol to local bars and restaurants is outdated and typical government hiring practices make distributing alcohol an inefficient and disjointed process.
The DLC-commissioned report also found a shortage of county liquor retail stores. In Montgomery County, only the DLC is allowed to sell liquor for off-premises consumption.
Leggett’s recommended operating budget for next fiscal year will include funding for three new county liquor retail stores.
The committee agreed to put together a working group that will come back with recommendations for streamlining the DLC process later this year.
