Maryland: Liquor Department Maintains Services Will Not Change While Future Debated
Source: The Dispacth
by Bryan Russo
While many in the community have likened Worcester County’s Department of Liquor Control to a fast-sinking ship, its director recently made it clear that he is not willing to let that ship go down without a fight.
In a letter obtained by The Dispatch dated Dec. 11, DLC Director Bobby Cowger wrote a plea to Worcester County’s liquor licensees ensuring them, in bold letters, that the county’s services concerning liquor wholesale and retail sales “are not changing.”
“You may have read in the local newspapers that there are politicians who feel very strongly that the County should no longer be involved in trying to maintain a wholesale/retail business in the alcoholic beverage industry, read Cowger’s letter. “As a result, and due in part to the 2014 law change, there are those who feel that because licensees now have the ability to purchase alcoholic beverages from private wholesalers, businesses no longer need the county as an option for purchasing alcohol.”
Cowger, a former Worcester County Commissioner and head of the former Liquor Control Board in the county from 2001-2005, began his second stint as head of Worcester’s liquor operation somewhat reluctantly in 2011 after a comptroller’s investigation revealed a price fixing scandal that eventually saw the previous county LCB abolished and its director let go and board dissolved.
Since then, Cowger has been at the helm of the quasi-governmental agency that has seen its annual contributions to the county and local municipalities dwindle to almost nothing.
Worcester County Commissioner Joe Mitrecic, a vocal opponent of the DLC’s continued existence, was taken aback when made aware of the letter.
“It certainly has a surprising tone coming from someone who works for the county,” said Mitrecic.
Cowger asserts that the tone of the letter was not directed at Mitrecic or any of the other County Commissioners directly.
“When I refer to politicians in that letter, that’s really a broad stroke of the brush,” said Cowger. “I’m speaking more about the Comptroller or Senator Mathias or Mayor Meehan in Ocean City. They all want to see us go very badly.”
Cowger’s approach could be looked at as a last ditch effort to keep support from local licensees who since 2014, have had the option to purchase liquor from the county DLC or directly from the wholesalers.
This law change, according to Cowger, is what has sent the county’s liquor profits in the wrong direction.
“Our budgets weren’t adjusted to take into consideration the impact of the law change,” said Cowger, “so it appears that we are doing much worse than we actually are.”
According to fiscal year 2016 year to date numbers, both the wholesale and the retail side of the DLC’s operation are vastly underperforming and are well in the red. On the wholesale side, the DLC budgeted for more than $283,000 in net income, but have only brought in $56,000 while on the retail side, they budgeted for almost $191,000 in income, but only brought in just under $165,000. That amounts to a $253,367 shortfall for the county’s liquor department thus far in FY16.
Furthermore, Mitrecic claims that Cowger was fully aware of the target numbers set for the DLC.
“I asked him at budget time last May if he believed he could hit those numbers and he responded, ‘absolutely,'” said Mitrecic.
Cowger contends that the letter was more of a clear cut message to the licensees than a jab at politicians.
“It was a way for us to stand up for ourselves and let everyone know that despite what they read in the papers about exit strategies or whatever, nothing has been voted on or enacted yet,” he said.
Despite the numbers, including the six-figure net loss of $492,554 the DLC reported last year, Cowger says the liquor department is on pace to hit $8 million in sales this year.
“I’d put $8 million in sales up against any business in the county,” said Cowger. “There is something happening out there that is hurting us and while I can’t reveal exactly what that is right now, what I will say is that it involves the wholesalers and their efforts to put us out of business.”
Cowger argues that despite the losses, taxpayers have still never had to pay a dollar to support the county’s liquor department. Yet, he does contend that if an exit strategy is implemented, one of the main tripping points will be getting rid of the county’s liquor inventory, which is estimated at over $4 million.
“The thing that’s killing the DLC is the wholesalers,” said Cowger, “and if we go away, then the licensees are going to be back to a monopoly again. We are still the cheapest and best option for them.”