A bill introduced by Senator Mark Obenshain (R-Harrisonburg) designed to privatize Virginia's ABC stores was passed by indefinitely by the Senate Finance Committee to provide more time to work with the Governor to refine the proposal.

"I look forward to working with Governor McDonnell to develop legislation that divests the Commonwealth's liquor monopoly in a financially and socially responsible manner," said Obenshain.

"State liquor monopolies are a holdover from the early days after the repeal of Prohibition, a product of unrealized fears," Obenshain added. "We're still living in the shadow of Prohibition seventy-six years after repeal."

Virginia is one of eighteen "control" states, where both retail and wholesale operations fall completely under the purview of the state, a holdover from John D. Rockefeller's campaign for state control of liquor sales in an attempt to prevent "moral decay."

"We can achieve privatization in a socially responsible manner. We have three quarters of a century of evidence to show that control states do not fare any better than their non-control counterparts on underage drinking, driving under the influence, or alcoholism in fact, states with private liquor sales do better in these areas and still the Commonwealth refuses to release its grip on the sale of alcohol," said Obenshain.

"Divesting Virginia's ABC stores is a win-win situation," Obenshain explained. "Privatization offers consumers the benefits of competition: more convenient hours, wider selection, lower prices, and innovation, just to name a few. It does away with the more than $120 million the government spends each year on administrative costs while creating new revenue streams by auctioning off wholesale and retail licenses. And it gets the state out of something in which it never had any business getting involved."

Under Obenshain's proposal, package store licenses, which would authorize the retail sale of alcohol beverages, would be auctioned off one at a time, with no less than one license in every city and county, and the number of licenses tied to the population of the jurisdiction, adjusted every five years. The annual state license charge on package store licenses would be determined by auction, and would be inflation-adjusted.

"This is an idea whose time has come," said Obenshain. "Privatizing the ABC stores and using the revenue to help fund transportation is one of Governor McDonnell's priorities, and I look forward to working with the Governor to make this a reality."

Virginia is not alone in this effort; North Carolina, Washington, and Mississippi are currently weighing proposals to sell their distilled spirits monopolies to raise revenues, and many states divested their own operations in the 1990s. "As Governor McDonnell said in his State of the Commonwealth Address, selling Jack Daniel's is not a core function of government," said Obenshain.