Constant improvement. That single goal is at the core of the Alabama Alcoholic Beverage Control (ABC) Board’s mission. Despite the Montgomery-based agency’s recent leadership transition, its focus and commitment to outstanding service remains at the forefront.
At the helm of the Alabama ABC’s oversight is administrator Curtis Stewart, who was appointed to the role by Governor Kay Ivey on January 1, 2023. No stranger to state government, Stewart previously worked at the Department of Revenue for 31 years before being asked to consider taking the top job at the Alabama ABC. According to Stewart, it didn’t take long to accept.
“I’d been planning to retire, but this was a great opportunity for someone with my accounting background to be able to come in and take a fresh look at something, learn some new things, and do meaningful work,” Stewart says. “I’d worked with the Alabama ABC a few times over the years, and knew the administrative back end. I get to continue working with numbers and building upon the great foundation the ABC already had in place.”
Stewart is supported by assistant administrator Randy Winkler, who also worked for Alabama’s Department of Revenue for many years and joined the agency in 2023.
A total of 985 employees across the Alabama ABC manage everything from product to warehousing to retail management to education and everything in between. The agency operates a total of 168 stores (159 retail and nine wholesale) and is the only authorized importer and wholesaler of spirits in the state (it does not sell beer or wine).
The Alabama ABC manages all alcohol regulation and licensing across the state, including more than 800 privately owned package good stores that hold liquor licenses; it also issues permits for any retailer that sells tobacco products. The number of package stores with liquor licenses remains constantly in flux, as Alabama has no limit on the number of private licenses available.
Although continued improvement is an ongoing focus across the agency, Stewart says that he sees the Alabama ABC as having three primary focus areas:
- Provide products that responsible consumers want
- Protect Alabama residents
- Produce funding for the state
Providing Product
Retail store operations are a key priority for the agency, especially how they relate to warehouse capacity and product availability. The Alabama ABC has leased its current warehouse space for the past 40 years (per state law, the agency is not permitted to own it). Although the warehouse currently has 190,000 square feet of space, Stewart says that amount is inadequate.
“We are thinking about what might be possible in the future and trying to decide what to do when our warehouse lease is up in two years,” he said.
The reason more space is needed? More space equals room for more products.
Alabama currently has 4,000 different products in its warehouse. Expanding product offerings is a constant desire for the agency, in terms of growing trends, a diverse array of products and expanded flavor offerings across all categories. The ready-to-drink category is by far the highest-growing category across the board in Alabama. Following that, super-premium and ultra-premium tequila continue experiencing high growth, along with bourbon, primarily super-premium and above, which is a consistently high-performing category across the state (sometimes even higher than vodka sales).
Despite its focus on additional product offerings, the Alabama ABC is not currently looking to expand its retail footprint by much. A handful of new stores have opened during the past several years, but the agency is primarily focused on the stores it already has. The Alabama ABC has heavily invested in remodeling many of its stores during the past several years, and the result has been a 6% growth in sales in the first year after stores have been remodeled. Every store is different, and products are generally allocated on a by-store basis. New products are usually released monthly, and special-product release events are incredibly popular, offered at a select number of stores on a quarterly basis.
“We hold a sweepstakes where people can sign up online to win a place in line at our stores and get priority access to products with limited availability,” says Neil Graff, operations director for the Alabama ABC. “More than 18,600 people signed up to participate in 2023. We accommodate 150 people in line for each event and will generally draw 400 to 500 people total into our stores on those days, so it’s been very well-received.”
Each year, the agency holds a large annual release event that typically coincides with the release of Buffalo Trace’s new Pappy Van Winkle products. There is also a special release process for big barrel releases. Additionally, the Alabama ABC will occasionally hold in-store celebrity bottle signings, such as several recent signings featuring former professional basketball player Charles Barkley, who owns Redmont Vodka, a distillery in Alabama. Agency stores also occasionally offer new product tasting events.
The Alabama ABC has also worked to improve its special order process, which Graff admits has been a challenge. A new system that was recently implemented allows suppliers and brokers to ship special order product directly to ABC stores. The state agency is in the initial stages of this initiative. The new process has successfully cut the special order timeline down from an average of two months to approximately five days, making more products easily accessible to consumers.
By law, the Alabama ABC is not allowed to advertise in a way that encourages the sale of alcoholic beverage products. The agency provides product availability and pricing information to the public using its published pricelist, in its stores, on its website and through its smartphone app. All media messaging from the Alabama ABC focuses on promoting temperance; preventing youth access to alcoholic beverages, tobacco products, alternative nicotine products, and electronic nicotine delivery systems; and discouraging abuse of these products.
Protecting Alabama Residents
The Alabama ABC oversees alcohol licensing, tobacco permitting, and education across the state. The agency licenses everyone who sells alcohol and permits those who sell tobacco, tobacco products, alternative nicotine and electronic nicotine delivery systems. The Licensing and Compliance Division also regulates these licensed, permitted businesses through education and inspections. The agency may suspend or revoke licenses or permits that repeatedly commit the same offense or are a danger to the health, safety and welfare of the people of the state of Alabama. The state currently has nearly 17,000 alcohol licensees and more than 8,000 tobacco licensees.
A large portion of the agency’s education outreach target young people, focused on preventing underage drinking. The Alabama ABC also offers trainings for licensees, including the Responsible Vendor Program (RVP), in an effort to help prevent alcohol sales to minors and to intoxicated persons. While not required, businesses who opt to participate in the program must meet certain requirements to maintain certification, including training of all employees within 30 days of hire and semi-annual training for all personnel. RVP-certified businesses that remain in compliance receive the benefit of mitigated fines.
In addition, those businesses are not required to attend a commission hearing on a third offense for sales to minors, as non-certified businesses are: on a third offense for sales to minors, they would be decertified from RVP and required to attend a hearing upon a fourth offense. More than 1,000 licensees have participated in RVP.
In partnership with local law enforcement, the agency also offers the annual Substance Abuse Youth Summit (SAYS) to bring together youth advocates from various agencies and professions to discuss youth support efforts and collaboration opportunities. SAYS has taken place for the past three years thanks to funding provided by a grant from the National Alcoholic Beverage Control Association (NABCA). More than 300 people have attended the event each year.
“The SAYS conference is a great networking opportunity for a wide cross section of professions who serve children,” says Dean Argo, government relations manager for the Alabama ABC. “It was originally intended to get anyone and everyone who works with youth in the same room hearing the same message at the same time.”
Additionally, the Board’s Under Age, Under Arrest program brings agency representatives into schools to talk with students about the dangers of drinking. The program features three main components: education, which focuses on sharing alcohol usage statistics; consequences, which are highlighted to students by representatives from the Alabama Law Enforcement Agency, which partners with the Alabama ABC on the program; and personal experiences, which are often shared by volunteer moms who speak on behalf of Mothers Against Drunk Driving (MADD).
“The program offers three different perspectives on this issue, and over the years it has evolved to focus on better decision-making as students get older and transition to college,” Argo says. “We make ourselves available as much as we can to partner with and support our schools, and we actively promote the program on our website.”
Since its launch in 2013, the program has reached more than 230,000 Alabama students, from middle schoolers to high school students. On average, about 165 schools request the program annually, in addition to running custom programs offered by the Alabama ABC. The program has continued to generate rave reviews and increase overall reach every year. National and statewide underage drinking stats are currently trending down, and the agency credits Under Age, Under Arrest with playing a part in reducing underage drinking.
Producing Funding for the State
In Alabama, spirits are currently taxed at a rate of 56% for state taxes and 6% sales taxes. State taxes generate funding for the state’s general fund, along with the Department of Human Resources, Department of Mental Health, and a variety of other state agencies and local governments.
During the 2023 fiscal year, total agency retail and wholesale Alabama ABC sales amounted to $739,499,983 (a $37,688,383 increase from the previous year). Of that amount, $88,865,540 funneled into the state’s general fund. These figures only encompass taxes derived from sales. They do not include profits, license fees, beer taxes and additional funds collected by the agency. (Note: Sales data detailed in this article is unaudited as of mid-January 2024.)
Stewart stressed that increasing funding is an ongoing priority as agency revenue continues to grow.
“We provide a great deal of funding to the state, and much of it is directed to local law enforcement, mental health and human resources, etc.,” Stewart says. “It’s important to provide funding as we look to contribute to the important work happening across the state.”
Stewart stressed that although the agency is looking at ways to grow revenue, it is also committed to ensuring that consumers have access to the products they want at a reasonable price. Unlike other states, Alabama does not mark up its limited release products, and is mindful of customer needs when thinking about how to expand its overall revenue.
Looking Ahead
The Alabama ABC has no shortage of priorities moving forward. In addition to a continued focus on products, education, compliance and funding, another one of the agency’s priorities is the launch a new online licensing portal. That is expected to go live within the next year.
The portal will largely replace the agency’s current paper system, greatly streamlining the licensing process. Information will be available online, and some required submissions will move to an online system as well. This will reduce the need for applicants to make a special trip to the local Alabama ABC office to receive forms.
In addition to enhancing customer service for licensees, the new portal is expected to significantly improve operational efficiencies at the agency.
In light of recent transformations, the new licensing portal and other upcoming changes will likely prove to be incredibly beneficial for the agency, positioning the Alabama ABC favorably for significant progress in the upcoming months and years. •
Melissa Sherwin is a freelance writer and marketing communications strategist from Chicago, IL. Her work has appeared in Chicago’s Daily Herald newspaper, Time Out Chicago, Suburban Life newspapers, and various magazines. She is also the author of several children’s books. Follow her @MelissaNSherwin.
