By L.A. Williams
Christian Action League
October 1, 2021
Less than two weeks after Zander Guy, chairman of the North Carolina Alcohol Beverage Control Commission, resigned his post amid liquor shortages, lawmakers on the House ABC Committee spent more than two hours Wednesday questioning others involved with the system about why alcohol is not getting from the state warehouses into consumers’ hands efficiently.
The Rev. Mark Creech, executive director of the Christian Action League, said he hopes the inquiries, directed primarily at ABC Deputy Commissioner Terrance Merriweather and Ben Thompson, an attorney representing the company that manages the state’s warehouse and distribution process, were a sincere attempt to help remedy the situation and not a stone-throwing session aimed at undermining the North Carolina’s control-state status.
“You know, I once served a church where a faction of the members would not accept my leadership. They constantly looked for any opportunity to discredit or disparage me. They would pounce on anything that they thought might help them make the case, real or only perceived, against me to get rid of me,” Creech said. “There are some lawmakers, as well as think tanks in Raleigh, who have a lot of sway and are really down on our current ABC system.”
He said many who oppose ABC’s existence are “woefully ignorant about how it actually works.”
“Because of their errant views about freedom, they interpret liberty as license and believe liquor sales should be privatized. They hate our ABC system and they look for any opportunity to discredit or disparage it,” Creech added. “I just hope the situation ABC and LB&B (the contracted firm) are now facing doesn’t result in these people successfully pouncing on them to get rid of ABC. That would be a disastrous outcome that I’m certain some would prefer happen.”
Creech said he had tremendous respect for Zander Guy and was disappointed to hear of his resignation.
Guy was someone who shared the values behind the ABC system – the values of control, public health and safety. He understood, unlike some today, that liquor is not an ordinary commodity. It poses significant risks,” Creech said. “He was, I believe, committed to minimizing alcohol-related harms as much as possible. And that’s what ABC – Alcoholic Beverage Control – is truly supposed to be about.”
At Wednesday’s hearing, led by Rep. Tim Moffitt (R-Henderson), lawmakers learned that the ABC system had been hit by a “perfect storm” of circumstances including supply chain issues, driver shortages and the challenges of implementing a new software system, all as the demand for liquor continued its steep upward trajectory.
Thompson told lawmakers that were performing a required inventory of the state’s $40 million to $60 million worth of alcohol in two warehouses in July put LB&B behind and that the company, which has worked with ABC since 2003 and began a new 10-year contract this year, has struggled, but is catching up.
“There is no question that there were delivery problems in July and August. We own that. We own that it was a difficult time,” he said, but he said the company is righting the ship, now delivering 28 to 32 loads daily and offering Saturday delivery. Thompson said he thought suppliers and distributors had done well dealing with Covid-related problems but that no one has been able to keep up with the increasing volume of alcohol being sold.
Jon Carr, lobbyist for the North Carolina Association of ABC Boards told the committee that liquor sales have gone up more than 26 percent in the past four years, and that increased demand during Covid was not easy for the system to predict or prepare for.
“Whether this demand was forecast or not I don’t know. Covid was clearly not forecast,” Carr said.
In his responses to numerous questions from several committee members, Thompson explained that LB&B manages two ABC warehouses: a 225,000-square-foot state-owned structure built in 1983 in Garner and a 204,000-square-foot facility LB&B leases in Clayton. He said alcohol is trucked from Clayton to Garner multiple times a day so that orders from local ABC Boards can be filled. And he pointed to a lack of space at local ABC stores as part of the issue.
“Some stores have greater storage capacity and can take a different approach as far as inventory management,” Thompson said. “We try to do our best to provide local boards with what they need when they need it.”
To meet certain requirements of their contract, LB&B purchased a new software system from Encompass Technologies and began providing an online ordering app called DSDLink to local boards, but some have resisted change, preferring the old technology to the new system.
Merriweather said the ABC Commission realizes local ABC store managers need more training with the DSDLink to be able to look at real-time inventory. He said the Commission is committed to ensure they get the training they need and that new task focus groups are bringing to light other needs that will be addressed.
“We know looking back that there are things the ABC Commission could have done better. What we are focused on is making sure our customers at the ABC boards and throughout NC are taken care of,” he said.
Moffitt and committee co-chair Jamie Boles (R-Moore) ended the session after about two hours, but did not seem satisfied with the answers they received.
“It concerns me that Moffit expressed dissatisfaction,” said Rev. Creech. “Because I felt the responses to the questioning were honest and reassuring. No one could foresee how a pandemic would affect supply chain issues – a problem that’s global. In fact, I think it’s rather unrealistic that under the circumstances either ABC or LB&B might have done anything significantly different or better. Frankly, on a personal level, I don’t care if no one ever gets another drop of liquor, but the ABC system as opposed to privatization works best to minimize alcohol related harms, and, therefore, ABC needs to be preserved.”
On a motion from Boles, the committee decided to refer the issue to the Joint Legislative Commission on Government Operations.