LCB Profits Plunge Compared To Others

OCEAN CITY — The numbers
continue to tell quite a story concerning the recent performance of the Liquor
Control Board for Worcester County (LCB) as new reports surfaced this week on
money given back to other counties.

Both Somerset and
Wicomico counties released their unofficial numbers this week on the amount of
funds paid back to their respective counties by their liquor control boards for
2010, and local residents, licensees, and politicians were unanimously
awestruck by the figures.

Worcester’s LCB has come
under fire in recent weeks after eyebrows were raised and proverbial liquor
licensee lynch mobs were formed when their 2010 contribution to the county, and
the county’s four municipalities was a mere fraction of last year’s numbers and
hundreds of thousands of dollars less than what came in just five years ago, as
well as accusations of price discrimination and possible collusion.

The reported $110,000
check that the LCB wrote to Worcester County (of which, the county gets roughly
$55,000, and Ocean City approximately $22,000) is significantly less than the
approximated $415,000 given back in 2009 and the $777,000 from 2008.

However, more questions
arose this week when Somerset and Wicomico counties released their numbers and
posted larger dollar amounts than Worcester County’s take, despite gross sales
that even when added together, don’t come close to the more than $14 million
that Worcester County LCB made in 2008, 2009 and reportedly will reach when the
audited 2010 reports are released in upcoming weeks.

“The numbers don’t lie,
and they never have,” said Mayor Rick Meehan. “How can you continue to bring in
more than $14 million from year to year, but see your profits go down by more
than $300,000 every year since 2008? That just doesn’t seem like it’s being run
like a good business operation. No other business that I know of could continue
to operate under those numbers and still justify their existence.”

Somerset County’s LCB
reported $1.8 million in total revenue in 2010, cutting a check to Somerset
County for $79,733, less than the $110,000 to Worcester this year, but if you
factor in the money dispersed to the municipalities in the respective counties,
Somerset County’s take of $71,065 was 23% more than Worcester’s take of $55,000
this year.

For comparison’s sake,
in 2009, Somerset’s total revenue was $1.78 million, with $91,701 going to the
county, but that total was much less than Worcester’s take.

Wicomico County Director
of Finance Patricia Peterson said this week that although the total revenue for
the Wicomico County LCB has yet to be released, officials do know that the
money being paid back to the county will be $424,000.

Last year, Wicomico’s
LCB reported a little more than $7 million in sales or half of Worcester’s
total sales ($14.6 million), and gave its county $476,000, which was still
slightly more than the Worcester LCB gave back that year.

Worcester County LCB
Chairperson Don Hastings was removed as official spokesperson for the monopoly
this week, but his fellow board member and new LCB spokesman Larry Wilkinson
said that the numbers from the other counties are misleading for a simple
reason.

“It’s quite simple
really,” said Wilkinson. “Those other counties don’t have a warehouse or a huge
operation like we have, and they also don’t do deliveries or provide the
services we do for our licensees, nor do they have a sales staff or the amount
of people we have working for them. So, those numbers can be a bit deceiving
and they don’t give you the whole clear picture.”

Wilkinson said that the
LCB continues to stand by its claim the economy played a huge part in the
company’s declining profits, but most notably, he said that lowering prices for
the vast majority of the fiscal year by 4% was extremely detrimental to the
LCB’s bottom line.

“We lowered our prices
to help out the licensees and we’ve been struggling to try and get better
products for them by buying directly from the suppliers, and that has hurt us
as well,” said Wilkinson, “but, we’ve absolutely made some mistakes, and we
believe that we have made the changes to rectify those mistakes.”

Former LCB head and
current Worcester County Commissioner Bobby Cowger said this week that even
though he still thoroughly believes in the idea of an LCB in Worcester County,
he isn’t sure the current people in power are doing the job for the taxpayers
of Worcester County or the licensees.

“If the LCB is run
properly, it helps alleviate the proliferation of alcohol in this county,
especially stopping minors from being able to get it,” said Cowger, “but these
numbers are staggering. There has to be something going on down there because
it should be successful since it’s a monopoly. If it can’t be straightened out
and operate like it used to, then maybe it should be dissolved.”

Cowger said that he
would still, at this point, be hesitant to sign any letter that would pledge
his support on a local campaign to sway state legislators to abolish the LCB,
but he said that just based on the numbers that used to be paid back to the
county when he ran the entity from 1999-2003, it points to glaring problems
that must be addressed.

“When I took over in
1999, the LCB was in shambles and I couldn’t walk into a licensee’s
establishment without worrying that I was going to be thrown out, but by 2003,
we had turned it around and gave almost $900,000 back to the county,” said
Cowger. “At that time though, we were only making a little more than $12
million in total sales, and still giving that much back, so I have to wonder
how can you do 15% more business, but give back 80% less money?”

 

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