The Alabama Alcoholic Beverage Control (ABC) Board will meet today to again consider raising the central warehouse bailment fee.
The agenda for today’s meeting lists “Consider increase of the Central Warehouse Bailment Fee” under other business. Such an increase would help cover costs for its new $98 million Montgomery warehouse, the agency says.
The board delayed a vote on the increase at its meeting last month and scheduled it for additional consideration today.
Under the proposal, the per-case bailment fee that liquor suppliers pay while product is stored in ABC’s warehouse would climb from 72 cents to as much as $1.50 per case by 2028 through three incremental increases.
On Wednesday, State Sen. Chris Elliott (R-Josephine) criticized the proposal as “an after-the-fact” move and a “grab of additional revenue” that runs counter to what the board told lawmakers when it sought authorization for the warehouse project.
“The Legislature would have never approved it had they said they were going to need to increase fees,” Elliott told Yellowhammer News.
“They’ve done this kind of surreptitiously … ‘we’re going to change the bailment fee now so we can cover the cost’ … which is going to do nothing but cost consumers.”
The Senator, who has a track record of holding ABC accountable, challenged the board to produce any document or prior testimony showing the fee hikes were disclosed before lawmakers cleared the path for the warehouse.
“It’s a huge increase, and, again, it’s one that the Legislature hasn’t authorized, because they’re doing it through rulemaking, right? It’s a bailment fee, instead of some tax that the legislature is levying,” Elliott said.
“This is not something that the Legislature has approved. Rather, it’s something they’re doing on their own through their rulemaking authority to make up for increased profit for them, for a new building… Show me where either in a published report or a document to the Legislature, that they said they were going to do this prior to asking for approval,” he said.
Elliott also called the tactic obscure. “Most folks wouldn’t be able to tell you what a bailment fee is,” he said, warning that any increase will be passed through to retail prices paid by consumers.
In late August, ABC executives told legislators the warehouse would slightly decrease short-term distributions to the state’s General Fund but increase them over the long run.
After that briefing, the agency said it did not anticipate disbursing profit amounts for the next several years as those dollars were used for the project.
“This is going to be a big issue for my constituents and and the restaurant and hospitality industry in general,” Elliott said.
“I would like for this board and its staff to look really hard at what they said to the Legislature and how it was going to be funded. I would ask them to tread lightly and determine whether or not they were forthcoming with what their plans were on how they were going to fund it.”
Grayson Everett is the editor in chief of Yellowhammer News. You can follow him on X @Grayson270.
