Montgomery County is getting ready to close the last liquor store it doesn’t operate.
The store at Flower Avenue Shopping Center in Silver Spring, which had been subcontracted to Bill Haberli, will close Jan. 31 when his contract expires.
County officials said a new wine and liquor store managed and operated by county employees will soon open at the vacant space next to the Bank of America branch on Flower Avenue.
Haberli said he still had not heard anything “officially” from the county, but county officials said Haberli was “well aware” of the store’s closing date.
“We gave him as much time as possible,” said George F. Griffin, director of the Montgomery County Department of Liquor Control.
Griffin explained that Haberli’s contract was established in 1994 as part of a county experiment to subcontract the county’s liquor stores. In the program, the county still owned the inventory, paid rent and utilities, and set product prices. Subcontractors had only to hire staff and operate the store.
The Maryland General Assembly passed a bill in 1997 that prohibited the county from subcontracting its liquor stores, but it grandfathered in its existing contracts.
“We could only keep the contracts as long as it was in place ... Once the contract was up it was up,” Griffin said.
County officials said Haberli’s original three-year contract allowed to him to file for up to four renewals. It was renewed in 1997 for four more years and in 2001 for an extra five years. Harbeli then got the contract renewed in 2006, 2009 and 2011. It finally expired on Jan. 31, 2013.
That’s when the county gave him a month-to-month extension for one more year, until the end of this month, which allowed the county to find a new place and train new employees.
“We extended the contract further than we could,” Griffin said.
Haberli made a profit upon a percentage of the gross sales of the store, which in 2013 was equivalent to 8 percent of $2.5 million in gross sales, or about $200,000.
When contacted by The Gazette, Haberli said he still doubted that his contract would end this month because “this has come up in the past, and they have changed their minds before.”
According to a 2013 Montgomery County Liquor Control report, with the repeal of Prohibition in 1933, the method of alcohol beverage regulation fell to citizens, who decided by state and sometimes by jurisdiction. Today, Montgomery County is one of the 17 alcohol-controlled jurisdictions in the U.S., which means the system can keep a standard price and prohibit aggressive sales practices. Stores are operated by county employees.
Besides the Flower Avenue store, the county operates 24 wine and liquor stores.
The liquor control department is the only authorized wholesaler of wine and liquor in the county and the only retailer of distilled spirits under the Article 2B of the Annotated Code of Maryland
“If regular residents want to buy a bottle of Jack Daniel’s ... they can only buy at a county liquor store,” Griffin said.
The liquor control department’s website touts the county’s arrangment, saying that under it private profits are replaced by revenue generated for the community to more effectively support public policy goals.
The 2013 report said that more than $25 million was transferred to the Montgomery County General Fund in 2013 from county alcohol sales.
County officials expect to have the new Silver Spring store operating in two to three months after the current store closes.