State Legislators Ask Leggett to Take Over DLC Reform

State Legislators Ask Leggett to Take Over DLC Reform

Legislators said the county executive should set up a task force to come up with a proposal to fix the department

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Del. Bill Frick speaks with Del. Shane Robinson before the delegation meeting Friday

State delegates representing Montgomery County decided Friday not to take any action to alter the structure of the county’s troubled Department of Liquor Control.

Rather than vote on two pending bills, the county members of the House of Delegates voted Friday to withdraw a bill that would set up a state-mandated task force and instead send a letter to County Executive Ike Leggett asking him to to set up a task force to study how best to alter the department, including possibly fully privatizing it.

The draft version of the letter also asks Leggett and the County Council to “provide the DLC with the necessary management and financial resources” to improve the department to address criticisms “that we believe are valid.”

The move occurred during a delegation meeting in the Lowe House Office Building in Annapolis.

Restaurateurs and small beer and wine shop owners, who depend on the DLC to sell and deliver them alcohol, have criticized the department in dozens of meetings at the county level over the last year for inaccurate deliveries, poor customer service, and a lack of selection, particularly surrounding special-order products. These items are mostly fine wines and beers that are not typically ordered in bulk by the department like stock items such as Bud Light.

The delegation also voted to wait another week before deciding on a bill sponsored by Del. Bill Frick (D-Bethesda) that would call for a referendum to let voters to decide whether the DLC should keep its monopoly on the distribution of all alcohol and retail sale of all liquor.

Frick said he would like to discuss the bill with Leggett and members of the business community before a vote because he may withdraw it if they’re happy with the idea of a county task force.

“I think we need to solve this problem to show our hundreds of thousands of constituents that we’re moving forward,” Frick said.

Frick’s bill would not have abolished the DLC, but allowed private companies to compete against it. However, county leaders said voters likely would support the idea and the new competition would likely put the department out of business.

County leaders have maintained throughout the DLC reform debate that the more than $30 million that the DLC generates in annual profits for the county needs to be protected. Leggett and council members have said losing the ability to use that revenue to help pay for the county’s more than $100 million in bonds could impact the capital budget and delay school construction projects.

The move Friday to pass the buck to Leggett follows a sudden change in the legislation last week that saw it altered from the council-supported bill to allow private distributors to distribute certain special-order products such as craft beer and fine wine into the bill calling for a task force.

Del. Ben Kramer (D-Wheaton) said the revised bill significantly altered the County Council’s intent for the legislation. He said state legislators should leave it to elected county officials to fix the problems at the county-run department.

“No one from Montgomery County government ever asked us to create this task force,” Kramer said. “Let’s leave the responsibility where it belongs and work with the county, not against the county.”

Council member Hans Riemer, who chaired the ad hoc council committee that reviewed the DLC’s operations over the past year, said the council bill represented a hard-fought compromise between restaurants, the labor union that represents more than 350 DLC employees and county leaders who wanted to maintain the revenue stream.

“I’m disappointed that the council compromise didn’t pass, but the county executive caused the demise of the council compromise, so he really does need to own this and figure out how to move forward,” Riemer said, after Friday’s meeting.

Leggett initially supported the council proposal, but then told business leaders he would support a task force to develop options to possibly privatize the system for the 2017 General Assembly session, as long as the department's profits could be maintained or replaced.

The delegation writes in its letter to Leggett that both bills  “are flawed and implementation would not provide relief in the short term.”

The county task force solution appeared to appease members of UFCW Local 1994 MCGEO, the labor union that represents DLC employees as well as 8,000 other county employees. Kramer invited them to stand during his speech and they received a round of applause from the room. More than two dozen members were at the meeting wearing yellow union T-shirts.

“I think the outcome was positive,” Gino Renne, the president of the union, said Friday. “Look, no one denies there needs to be reform at the DLC. We’ve been open about that from day one. The county acknowledges it. We’re asking for time to fix the problems and better serve the customers. We understand that’s our obligation and we’re going to do that.”

Even the business community seems at peace with the issue heading back to county oversight.

“We’re happy that we’re going to have a task force that’s led by County Executive Leggett,” Ginanne Italiano, the president of the Bethesda-Chevy Chase Chamber of Commerce, said. “We trust the fact that they’ll bring in the right stakeholders and he’ll get it done before next year’s session rather than the year later.”

She said the chamber continues to support Frick’s bill, but said it appears unlikely to pass. 

As opposed to the state-mandated task force, which would not have reported its findings until the summer of 2017, the county now has an opportunity to implement a faster moving process that could see a new state bill submitted to the General Assembly’s session next year.

This more closely aligns with what Leggett said earlier this month when he told chamber officials he’d like to develop an expedited task force to develop a bill for the 2017 session. At that time, he said he wanted to find a unified proposal that could be supported by the business community as well as state legislators.

Photo above left: Del. Ben Kramer talks with MCGEO president Gino Renne prior to the delegation meeting. Credit: Andrew Metcalf

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