The Shadow
RICHMOND — Virginians will pay at least 24 cents more on average for a bottle of alcohol starting Dec. 8.
The price increase is part of Gov. Terry McAuliffe’s plan to close a $2.4 billion gap in the two-year state budget. Three pricing adjustments were approved by the Virginia Alcoholic Beverage Control Board on Monday.
“The revenue generated from these initiatives will do ABC’s part to help close the state’s budget deficit, but just as importantly, these funds will be used to modernize ABC’s aging infrastructure,” said ABC Chairman Jeffrey Painter.
Painter along with commissioners Judy Napier and Henry Marsh voted to increase the case handling fee from $1 to $2, a process that has not seen a fee increase since 1988 and comes closer to recovering the agency’s actual costs; raise the markup on miniature (50 milliliters) bottles from 49 percent to 69 percent to bring it in line with all other distilled spirits markups; and alter the current roundup from five cents to nine cents, an initiative called “rounding to the nines.” The measure will raise the price of a bottle of liquor that currently sells for $19.90 or $19.95 to $19.99.
The case handling fee and “rounding to the nines” initiative will raise the price of an average $15 bottle of liquor by approximately 24 to 29 cents. The markup increase on “minis” is expected to add approximately 15 cents to the top-selling miniature currently priced at $1.30.
The anticipated revenue generated from the adoption of the measures during the remainder of fiscal year 2015 is $5.4 million. Estimates show the revenue generated during fiscal year 2016 would be $9.5 million.
The adoption of the measures took into account feedback received from stakeholders who sent in comments on the proposed alcohol markup.
Virginia ABC reached out to more than 300 vendors and licensees with a letter outlining various revenue-enhancing scenarios and invited their comments by Oct. 31.
