Governor's privatization plan clears first hurdle

By Rachel DePompa - bio | email

RICHMOND, VA (WWBT) - Governor Bob McDonnell's plan to privatize ABC stores cleared its first hurdle today. A sub-committee voted to move the proposal forward, despite changes that continue to shrink projected revenues.

However, it doesn't look like a vote on this plan will happen anytime this year.

On a radio show this morning, the governor backed off an earlier call for a special session of the general assembly this November. He said he wouldn't call for it, unless he knew he had the votes to pass it.

Should Virginia get out of the liquor business? The governor says yes. And so does his handpicked panel to study the plan.

Members voted five to one to move the proposal forward.  The lone vote against, came from democratic senator Mary Margaret Whipple.

"I just can't imagine another enterprise selling a business without a little bit more analysis," Whipple said.

She and other democrats have raised concerns that selling off the state's 332 ABC stores would eventually leave a major hole in the state's revenue stream.

Under the proposal, McDonnell wants to sell the stores and generate a onetime windfall of half a billion dollars for road improvements.

1,000 liquor licenses would be auctioned off to the highest bidder. And he did offer up a few changes to his plan today.

Some proposed taxes for restaurants were scuttled.

"We are already having a tough time, especially in the northern Virginia market competing with our neighbors to the north when it comes not just to distilled spirits prices, but overall food prices and competition generally." said Eric Finkbeiner, senior policy advisor

If approved, the state will now also offer 100 licenses to small retailers and help finance them.

This proposal now heads to the full government reform committee for a vote next week. If it passes there, the plan will then head to the general assembly in January, unless the governor calls for that special session

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