Tuesday, March 10, 2009

Temporary price increase on distilled spirits to offset compensation cuts to liquor agents

At a special March 9 meeting, the OLCC Commissioners adopted a temporary price increase on distilled spirits. From April 1 through June 30, 2009, there will be a 50-cent surcharge per bottle on all distilled spirits products.

The Senate and the House passed a bill to re-balance the current biennium’s budget. Part of that impact would reduce agents’ compensation by $3.8 million.

Initially, the OLCC negotiated a $1.5 million inventory reduction as well as providing additional agency funds to offset the impact to agents. With the negotiations, the impact on liquor agents was reduced to between $500,000 to $1.9 million

Depending on sales, the surcharge is expected to generate at least $1.5 million to further reduce the impact on liquor agents. The agency hopes that this additional revenue will have the minimum impact possible under legislative guidelines of $500,000 on the liquor agents.

“The commission is looking at this temporary increase as a means to assist in filling the state’s budget hole for the 2007-2009 biennium,” said Steve Pharo, OLCC Executive Director. “Through additional funds from the agency, proposed inventory reduction and the proposed price increase, we’ve successfully reduced the impact to liquor agents from the original proposal of $3.8 million. We look to work closely with agents as we resolve this issue.”

The OLCC provided additional funds from the agency’s operating budget, in addition to the cuts required by legislature. Also, the agency and the liquor agents will work together to accomplish a $1.5 million reduction in inventory.

Liquor agents are independent contractors who manage and operate the liquor stores. The stores are required to be open a minimum of eight hours a day Monday through Saturday with six of those hours between noon and 6 p.m. Liquor agents have the discretion to be open Sundays and legal holidays. Hours of operation, vary from store to store.

5 comments:

  1. Can you address the reasoning behind only accepting checks or cash from bars/taverns instead of debit/credit cards? Just curious.

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  2. DUH.... debit and credit cards have fees... they cost about 6%... would you give away 6%????

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  3. According to Oregon Revised Statutes 471.485 and 471.490, retail establishments are prohibited from receiving product without paying for it prior to delivery. This includes prohibiting businesses from using lines of credit for purchases and thus, prohibiting the use of credit cards.

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  4. I am one of many who is sufficiently stocked on alcohol and/or has enough discipline to avoid purchasing distilled spirits until June. I know my one-two bottles/month in purchases aren't a big deal to you since that's only about $1.00/month from me. But please consider that raising the cost of a product discourages people from buying it.

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