By Tom Brown, VTDigger.org
State Auditor Doug Hoffer is questioning why the state is in the business of selling liquor, a substance that it also regulates.
Hoffer’s office issued a report Monday that examines the impact of privatizing the state’s liquor distribution system. The auditor’s report also suggested ways the Department of Liquor Control could increase its profitability without privatization.
Hoffer questioned why the state still distributes liquor 80 years after the end of Prohibition. “We license and regulate tobacco, but we don’t sell it,” Hoffer said in an interview. “It’s hard to see how selling liquor is a core function of state government.”
Michael Hogan, commissioner of the Department of Liquor Control, said Hoffer’s report was “fair,” but he disagreed with the auditor on the benefits of privatization. “There are some things in the report that we could do, and are doing,” Hogan said. “But time has proven [this system] works. I don’t think it’s a broken system.”
Hoffer’s report acknowledges that privatizing liquor sales would be “revenue-neutral,” meaning it wouldn’t increase or decrease the state’s earnings from the sale of spirits in Vermont.
The state reported about $70 million in liquor sales in 2013, according to the auditor’s report. That resulted in $30 million of revenue for DLC, which sent about $18 million into state coffers after deducting its operating costs.
