Retail group wants changes in liquor privatization plan

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The Virginia Retail Federation (VRF) has endorsed privatizing the state’s ABC liquor stores in principle, but it wants modifications in the governor’s plan that it says would help small retailers.

VRF officials say they want to work closely with Gov. Bob McDonnell and General Assembly members to make changes in the plan. The VRF primarily represents small retailers.

McDonnell’s proposal currently calls for 1,000 licenses be auctioned to sell liquor. Under the plan, 600 would go to big-box stores, 150 to freestanding package stores and 250 to drug and convenience stores. To accommodate smaller retailers, McDonnell recently added a “tier four,” which would take up 100 licenses of those reserved for drug and convenience stores. The fourth tier applies to retailers that have fewer than 50 employees and whose stores are less than 3,000 square feet.

“There are currently more than 6,600 businesses in Virginia licensed to sell beer and wine off premises,” says Nancy Thomas, president and CEO of the Retail Merchants Association. “Restricting the sale of distilled spirits to such a small percentage of these businesses creates a serious competitive imbalance.”

The VRF seeks to increase the number of available licenses, especially for small, independent retailers. The group also wants to reduce the starting bid for “tier four” licenses to $25,000, from more than $100,000. In addition, VRF wants the “tier-four” requirement to include retailers with less than 3,000 square feet or less than 50 workers, not both.

“Because there are so many more independent merchants in Virginia than there are national retail chains, we believe the number of tier four licenses must be far greater than those granted to national competitors,” says Susan Milhoan, Retail Alliance president and CEO.

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