By The Way

The States Perform

The control state system has sometimes been pictured as a fragile thing, occasionally in this column. In recent years the web of historic logic that ties together the way liquor control laws are administered has often seemed about to tear. Unbearable stress has come from places expected and unexpected:

from states themselves, crushed by fiscal crisis;
from business behemoths such as Costco, lumbering toward vertical integration;
from the world of Internet commerce and its entrepreneurs, who don’t want the rules for bricks and mortar businesses to apply to them; and
from international marketers, challenging controls they believe would limit their freedom to do business in some of the world’s richest markets.

Then, galloping across the page to the rescue, like the U.S. Cavalry in an old Western (and bringing a fresh viewpoint), comes our annual Fiscal Year in Review. In it we detail the industry’s financial progress, with a focus on the 19 control jurisdictions. You’ll find the 2004 report on page 12 of this issue. Suddenly, through this lens — one of facts and not fears — the control state system is not so fragile. The web that was about to tear looks pretty strong and purposeful.


As we report, total gross dollar sales throughout the control states (with the exception of North Carolina, whose audit was not complete at press time) hit $5.698 billion in FY 2004. That represents a gain of about $255 million, 4.7% over FY 2003’s total of $5.443 billion. Revenue contributions to state governments grew by 6.7% and throughout the system about 1.6 million more cases of distilled spirits were sold in FY 2004 than during the previous year.


Editor-in-chief Richard Brandes writes, “Clearly, control state beverage alcohol operations continue to thrive, even where challenges remain.” Editor Brandes sees the generally positive trends as driven by nearly a decade of modernization, with progressive change spanning the whole chain of distribution from retail outlets to state agency headquarters. Clearly control state administrators have been doing a pretty good job.


Sometimes, as in this case, large events such as the movement of international markets can cloud our vision of local realities. Sometimes too much can be made of the headlines of the day.


As this column is being written, it’s still a week before we go to the polls to elect a President and also many others at state and local levels. These thousands of others will be important — much more important than they are seen to be through the dust cloud kicked up by a hard-fought national campaign.


They and the regulators they appoint and the administrators they hire, just like the many readers of StateWays, who hold similar responsible positions, will deal with some of the toughest problems of our day. Let’s toast these old and new public servants and resolve to acknowledge their efforts when we can.


 

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